Time and time again, bitcoin and/or cryptocurrency analysts refer to block reward halvings when analyzing crypto prices… why are they so important?
This quick video explanation will help you understand just that, an explanation which contains anything from the definition of block reward halvings to the implications when it comes to mining and ultimately price action?
As you will find out by watching this block reward halving explanation, while halvings are without a doubt quite important, they are by no means a miracle solution which guarantees prices will only go up. If the market decides it no longer cares about one cryptocurrency or another, it can have a halving per month and it still wouldn’t be enough.
However, a block reward halving event does make the stock to flow ratio of bitcoin and other cryptocurrencies more attractive. In light of the fact that miners will be able to obtain two times less coins, the implications from a supply and demand perspective should be fairly easy to understand.
As a conclusion, block reward halvings are important variables in the let’s say blockchain equation. They most definitely affect the price (would be hard not to) but this doesn’t mean you should treat them as gateways to guaranteed profits, there is no such thing 🙂
