What is the block reward split?
The block reward split in any blockchain is generally a process that aims to reduce the rate of issuance of coins.
The new one is halved periodically according to rules set by the network.
What does this graph show?
Bitcoin miners currently generate revenue from two sources:
1. Transfer fees
2. Mining Rewards
This chart shows the rewards received each time a miner successfully validates a block.
The mining reward (or block) is reduced by half at each halving event.
- Bisection events are indicated by dotted vertical lines on the graph.
Why does the split occur in digital currencies?
Blockchain-based currencies are designed to be deflationary currencies in order to resist inflation.
And the purchasing power decreases over time.
Specifically, every 210,000 blocks mined by Bitcoin miners, the rate of issuance of Bitcoin coins is reduced to
Half and this happens approximately every four years.
In other words, we can say that over time and with the increase in demand versus supply in the market on the one hand.
On the other hand, the issuance of cryptocurrencies decreases by half every 4 years, so digital currencies will increase in
Value over time, and this is what actually happened during the past divisions in some currencies, especially the currency.
Bitcoin.
The process of halving the Bitcoin issue is one of the essential things in controlling its price in the market, according to what we mentioned previously in supply and demand.
The process of division is one of the basics of the financial system of cryptocurrencies based on the proof-of-work system, which
It decreases at a steady pace over time, which is completely opposite to the paper financial system, which basically has an immaterial supply.
Limited as money can be printed at any time in any quantity as happened in the Corona pandemic.
To further clarify, let's look at what happened in previous splits and their impact on prices.
First division
28/11/2012
At block 210,000, the price of a Bitcoin was only $2, until it rose to its highest value during the first cycle.
The market reached approximately $1162.65 and prices continued to decline during the first session until it reached its lowest level at $151.5.
Before the start of the second session
Second division
9/7/2016
At block 420,000, the price of a Bitcoin was about $644, after a decline that lasted about a week, then took off.
Prices surpassed the previous peak, achieving a new record of $20,113.2, the highest point during the second session.
In late December 2017.
Third division
11/5/2020
At block 630,000, the price of a Bitcoin was approximately $8,628, and the rise continued until Bitcoin touched the price of
$69,000 and the third round is still ongoing
Fourth division
This year's event
April 19, 2024,
The prize was divided into 3.125 Bitcoins per block as a prize for discovering the block.
And the coughing started from that date until now, and Bitcoin is recording new historical numbers, as it reached nearly one hundred thousand US dollars.
😍Until I meet you in another article, stay safe😀
