Report
April 17, 2024
Bitcoin is set to undergo a reward halving, a 50% reduction in the block subsidy, on April 19th, just the fourth such event since it launched over 15 years ago.
Halvings are foundational to Bitcoin’s economic promise of fixed supply as halvings are how the supply of bitcoins is capped at (nearly) 21 million.
The impact of the new supply reduction represents only 0.6% of daily trading volumes and today is less economically impactful to price than it once was.
The halving is more economically impactful on miners, who are seeing a 50% drop in their main source of income.
Following halvings we have historically seen downward difficulty adjustments of 5.4% - 14.7% as uneconomical hash rate is taken offline. However, given where prices and rig breakevens are, it seems unlikely much hash rate, if any, will be taken offline.
