Crypto for Dummies: Halving

Hey there guys! This is a very heterogeneous sub since there’s people from all around the world and all different kind of backgrounds. Some are very knowledgeable when it comes to IT, crypto and finance and some are able to pull it off just by experience, patience and the basics of it all. Nonetheless, there are lots of new concepts and it can be very challenging to know them all and keep up with all the new ones that are appearing every day. So I thought about trying to make posts that help digest some of this info.

???? ) What is Halving?

Halving in the crypto world means reducing the rate at which new coins are made on a blockchain network. It happens automatically after a certain number of blocks are created. This helps control how many coins exist and keeps them valuable.

???? ) Bitcoin Halving: A Big Change

Bitcoin, the first cryptocurrency, has a significant halving event called the "Bitcoin Halving" or "Halvening." It happens around every four years or after every 210,000 blocks. When a halving occurs, the reward given to Bitcoin miners for doing their job gets cut in half.

The first Bitcoin Halving was in 2012. Miners used to get 50 BTC for each block they mined, but it got reduced to 25 BTC. Then, in 2016, it went down to 12.5 BTC per block. The most recent halving was in 2020, and now miners earn 6.25 BTC per block.

⚡️) Other Coins with Halving

Bitcoin's halving idea inspired other cryptocurrencies to do something similar. They also have events to control the number of coins and keep them scarce. Here are a few well-known coins that have halving events:

1. Litecoin (LTC): Often called "silver to Bitcoin's gold," Litecoin has halving about every four years. At the beginning, miners got 50 LTC per block. After halvings, the reward is now 12.5 LTC per block. (New halving coming very soon!)

2. Bitcoin Cash (BCH): Bitcoin Cash is a popular Bitcoin spin-off. It also follows the halving schedule. It started with 12.5 BCH per block and went down to 6.25 BCH after two halvings.

3. Zcash (ZEC): Zcash focuses on privacy. It has a different halving schedule. Instead of halving every four years, it reduces the mining reward by half every 840,000 blocks. Right now, miners earn 2.5 ZEC per block.

Remember, these are just a few examples, and other cryptocurrencies might have their own way of halving.

????) Differences in Halving Approaches

Although halving works similarly for different cryptocurrencies, there can be differences in the specific rules. Some things that can vary are how often halvings happen, how much the reward is reduced, and how many coins will exist.

Feel free to ask any questions or share any info that I’ve left out. I hope at least you’ve learned something new today!