The halvening has passed as expected – slashing the value of newly mined units of the virtual currency Bitcoin by 50%.
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The halvening was an automatic slowdown in the generation of new Bitcoin written into the master code.
The authors have included halvenings at prespecified times to preserve the value of Bitcoin – and to spike interest from investors.
The online currency also has a 21-million-unit limit, which at the current rate of mining, will not be reached for hundreds of years.
This is not the first Bitcoin halvening. The first was in 2012, when the number of coins mined from solving complicated maths equations fell from 50 to 25.
Blighted by unsavoury links to crime
This time round, the halvening leaves successful miners with 12.5 Bitcoin for solving the cryptographic puzzle.
The next event is expected around 2020 if the currency continues to be mined at the same rate – and if the controversial currency sticks around.
The short history of Bitcoin has been blighted with unsavoury links to theft, fraud and organised crime.
Bitcoin is worth US$645, making each newly mined batch of coins worth around US$8,062.
The havening is called into play every time miners successfully add 210,000 Bitcoin to a secure database called the blockchain. The blockchain verifies the Bitcoin as genuine and adds them to the miner’s electronic account.
A new block of Bitcoin is estimated to be mined every 10 minutes somewhere around the world.
Exchange rate blip
The Bitcoin\US dollar exchange rate blipped by around 5% as the halvening passed.
Bitcoin experts expect amateur and small mining enterprises to drop out of the market as the reward for spending time and money resolving the puzzle to is cut.
Bitcoin was first unveiled in 2008. The online app is called a ‘currency’, but no government or central bank considers Bitcoin as such.
Worldwide, around 100,000 merchants and service providers will accept Bitcoin in payment, but the concept has struggled to catch on outside a small group of enthusiastic technology geeks.
The real success has been the secure database at the root of Bitcoin – the blockchain. Banks, governments and other organisations are exploring ways of integrating the blockchain into online financial applications.
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