At exactly 10.26 pm (EAT) on May 11, 2020, a historic moment in the cryptocurrency field took effect in what experts say is the evolving future of financial systems. It was the third time the most dominant digital currency in the world – Bitcoin – that birthed blockchain technology in 2009, halved.

The prospects of cryptocurrency traders amassing riches in the next few years has drawn global attention after the event, which has seen the amount of supply entering the Bitcoin blockchain system suddenly shrinking.

Bitcoin’s halving has spurred an interesting anticipation about the future of digital money and how the market will respond in both the short and long-term.  

But what does all that actually mean?

Mr Benjamin Arunda, a blockchain expert and author of ‘Understanding the Blockchain’ says that halving simply means that the supply of Bitcoins will be cut into half.

 “The first Bitcoin block was mined in 2009. At that time miners were being rewarded with 50 Bitcoins every time they added a new Bitcoin into the network. Since then, after every four years this reward is reduced by half. The first halving happened in 2012, then 2016 and now,” he told Afcacia.

In 2012, the reward reduced from 50 to 25 Bitcoins, then to 12.5 in 2016. This has been the current state till today when it will halve to 6.25 Bitcoins. 

Expounding on why this has been the trend, Mr Arunda attributes that to the plan by Satoshi Nakamoto – the person or group of persons who designed the Bitcoin blockchain – to have, contrary to fiat currency, a limited supply of 21 million Bitcoins.

“Normal currencies have unlimited supply of banknotes affected by the law of supply and demand. Bitcoin is different because it has a constant, fixed supply. For all coins to be mined, Satoshi Nakamoto designed an algorithm to ensure the supply halves every four years till it reaches zero,” he notes.

Halving happens when 210,000 blocks have been mined, and that takes four years, and cracking the Bitcoin hash-code becomes more difficult as the mining progresses.

“After every 10 minutes, a new block is released and that creates certainty of exactly when all blocks will be mined and pave way for halving. Miners know the year, but the month and date can only be approximated few days to halving,” he explains.

With an anticipation in reduction in supply every time Bitcoin halving is about to happen, the demand for the digital coin soars, and that raises its price.

He says it is the same concept used in gold trade where its scarcity pushes its price high, predicting that all Bitcoins could be exhausted in the online mines by the year 2140.

There are currently 18,370,212 Bitcoins in supply. At the time this story was written, the price of one Bitcoin was Sh800,000, up from Sh381,000 in March, the lowest it has plunged in 2020.

The hike in price has also been recorded by altcoins (alternative cryptocurrencies) such as Ethereum, Ripple, Tether and Litecoin.

“All other cryptos follow how Bitcoin, the market leader, behaves because it carries the overall reputation of crypto trade due to its 68 percent market dominance. But other cryptocurrencies don’t undergo halving because they use different consensus protocols,” says the expert.

Altcoins do not use Bitcoin’s proof-of-work concept on which the halving aspect is anchored. All of them have been pre-mined and therefore no coins are introduced into their networks.

So what will happen when block rewards get very small or the mines get depleted?

“In a few decades when the reward gets too small, the transaction fee will become the main compensation for nodes. I’m sure that in 20 years there will either be very large transaction volume or no volume,” Nakamoto wrote back in 2009.

That means the cost of transactions may go up over time to keep the network secure, because Bitcoin cannot process huge quantities of transactions on the blockchain network.

Mr David Gitonga, founder of local crypto news site BitcoinKE says an upsurge in the thirst for Bitcoin knowledge has been witnessed in the past few weeks.

“The real effect of halving will be felt by miners who will have to come to terms with their mining rewards being reduced by half. Price volatility will be experienced by crypto traders,” he says, advising them to hold their coins till the past-halving period. 

Mining requires sophisticated computer software and electric power, and that has been left to institutional mining groups in developed economies, as the high cost of power in Kenya discourages the activity. 

Experts say the more the computing power miners direct towards mining Bitcoins, the harder it becomes for cyber hackers to attack the network since a cyber criminal must have the same processing power or more, called the hashrate, to launch the attack. 

But it is through the mining process that Bitcoin transactions are validated, the same way M-Pesa deposits, withdrawals and transfers are authenticated. 

Mr Arunda, who has also been a crypto trader for several years says there has been a trend every second year after halving where the price of Bitcoin skyrockets. 

The price shot to a high of Sh120,000 in 2013 from a low of Sh1,275 during halving day in November 2012. During the July 9, 2016 halving, the price was Sh70,000 before shooting to an all-time high price of over Sh2.1 million on May 9, 2017.

 “We expect the same this time round. It has increased in the weeks heading to halving but it will plunge sometimes in June, and start to climb to the highest ever price in history in 2021,” Mr Arunda forecasts. 

Chief executive of Nairobi and Moscow based crypto exchange platform Totalcoin Mr Joshua Mutisya advises crypto enthusiasts to buy now, revealing that 10 Bitcoins are exchanged every day in Kenya on the platform, among 170 traders. 

“Right now, we are seeing more people buying altcoins. One trader on our platform buys 21 Bitcoins every day. You may go offline for 30 minutes and when you come back you find five deals awaiting your approval,” he says.

With a rising demand in the use of digital currencies, Bitcoin, according to him, will become the new gold and this will make it a credible store of value.

The return on investment for Bitcoin from 2010 to 2020 stands at 9 million percent, surpassing all assets in global trade. He however, warns newbies who want to jump into the bandwagon without proper research and market study.

“The price sometimes price plummets, so you need a proper understanding first.”

Brian Adams, founder of Nairobi-based blockchain and crypto awareness startup Cryptocurrency Academy, says that scamming traps have spiked during the halving period.

“If you don’t research well or connect to experts in the field, then your vulnerability increases and you will only have false expectations. The lack of awareness could lead you to lose millions worth of investment,” he warns.

According to online Bitcoin marketplace Paxful, which has enabled M-Pesa to Bitcoin and vice versa money conversions, the total number of Bitcoin wallets in Africa stood at 1.35 million as at March 2020 with tremendous growth in trade volumes coming from Kenya, Nigeria, South Africa and Ghana.

Ahead of Monday’s halving, Africa’s Bitcoin trading volumes broke 2017’s record with Nigeria trading Sh763 million in volume, Kenya Sh169 million while Ghana was thrilled with 84 million.

If widely adopted across the globe, Bitcoin could eventually reduce the influence of central banks and governments over financial policies because no central entity can control Bitcoin’s supply outside the set schedule.


author

67 Comments

  • DavidLal, July 7, 2021 @ 6:55 pm

  • DavidLal, July 8, 2021 @ 9:02 am

    https://ivermectinstr.com/# stromectol tablet 3 mg

  • BrendanLat, July 11, 2021 @ 1:07 am

    ed problems treatment: mens ed – buy ed pills

  • PeterLiero, July 17, 2021 @ 1:09 am

    100mg viagra blue pill viagra – viagra from canada

  • PeterLiero, July 18, 2021 @ 1:13 pm

    buy real viagra online blue pill viagra – buy real viagra online

  • WayneSoowl, July 19, 2021 @ 10:23 pm

    how to buy cialis online from canada buy cialis online viagra – buy cialis 36 hour

  • Mariojendy, July 26, 2021 @ 7:37 pm

    ivermectin cost canada ivermectin – ivermectin price usa

  • WilliamRab, July 27, 2021 @ 7:22 pm

    dating sites
    [url=”http://onlinedatingtwo.com/?”]gay dating sites[/url]

  • Mariojendy, July 28, 2021 @ 10:14 am

    ciprofloxacin over the counter cipro – antibiotics cipro

  • WilliamCof, July 29, 2021 @ 11:17 am

    canadian pharmacy viagra & cialis generic cialis prices – cialis super active 20mg

  • WilliamCof, July 31, 2021 @ 2:44 am

    viagra cialis sample pack cialis 5mg tablets CialisCND20Mg – cialis switzerland

  • RonaldMog, August 2, 2021 @ 12:57 am

    for sale viagra australia viagra25mg – viagra professional vs viagra

  • bear gay dating website, August 2, 2021 @ 11:19 pm

    Maintain the amazing work !! Lovin’ it! https://gaydatingzz.com/

  • RonaldMog, August 3, 2021 @ 2:56 pm

    brandnameviagra sign up viagra – best place to buy online viagra paypal

  • RonaldMog, August 7, 2021 @ 10:18 pm

    viagra united states viagra online sales in australia – viagrafreesamples

  • what to eat keto diet, August 8, 2021 @ 7:58 am

    keto beef and broccoli https://ketodietplanus.com/

  • RonaldMog, August 9, 2021 @ 1:32 pm

    buy generic viagra canada generic viagra discover card – how much does viagra cost at walgreens

  • gay sugar baby dating sites, August 9, 2021 @ 10:23 pm

    christian gay dating sites https://gaychatus.com/

  • chicago gay dating, August 10, 2021 @ 2:44 pm

    best european gay dating sit https://gaychatgay.com/

  • gay dating sites for twinks, August 10, 2021 @ 10:15 pm

    speed dating for gay men https://freegaychatnew.com/

  • KevinCon, August 11, 2021 @ 3:14 am

    gay dating south florida
    gay dating sites south africa
    [url=”http://gaychatgay.com?”]gay vegan dating[/url]

  • Floydhib, August 13, 2021 @ 2:34 am

    doxycycline 100 mg buy doxycycline – 200 mg doxycycline

  • KevinCon, August 14, 2021 @ 2:12 am

    middle school dating is gay
    bear gay dating website
    [url=”http://gaychatus.com?”]best friend is gay dating[/url]

  • Ronaldgop, August 15, 2021 @ 11:42 am

    stromectol order online stromectol tablets – ivermectin gel

  • Stevenhal, August 15, 2021 @ 9:54 pm

    canadian viagra online
    viagra pill viagra substitute cheap celias cialis 5mg best price [url=http://www.darkml.net/bbs/home.php?mod=space&uid=224261]what does viagra do[/url] viagra uk price of cialis in canada india pharmacy low cost cialis [url=https://wifidb.science/wiki/Intend_To_Really_Feel_Better_Follow_These_Crucial_Nutrition_Tips]viagra online sales[/url]
    canada drugs buy viagra without prescription viagra pharmacy online cialis from canada? [url=https://bbs.now.qq.com/home.php?mod=space&uid=1429188]generic viagra cheap[/url]

  • Rogerseday, August 16, 2021 @ 4:47 pm

    how much does cialis cost
    onlinepharmaciescanada.com canadian drugs without a prescription canada pharmacy for cialis online pharmacy viagra [url=http://vinculacion.udla.edu.ec/forums/forum/ideas-y-vinculacion/]cheap viagra[/url] viagra plus cialis canada buy heroin online cheap cialis in canada [url=http://orjinalkutu.com/user/yachtwolf53/]cialis canada pharmacy[/url]
    india pharmacy viagra discount viagra online buy viagra online without script order viagra without prescription [url=https://git.sicom.gov.co/flutecrook18]canadian pills[/url]

  • KevinCon, August 16, 2021 @ 11:56 pm

    g2g dating gay
    gay disabled dating sites
    [url=”http://gaychatus.com?”]gay dating dad bod[/url]

  • WilliambaH, August 18, 2021 @ 9:49 pm

    best ed pills non prescription cause of ed – best erection pills

  • Lloydrirty, August 20, 2021 @ 10:12 pm

    northwestpharmacy.com
    viagra canada online cialis without prescription buy viagra without a prescription online pharmacy viagra [url=https://www.misterpoll.com/users/fueldrink351]where to buy viagra online[/url] cialis viagra ed medications canadian drugs without prescription northwestpharmacy.com canada [url=https://checkpointforarts.com/members/clefgarden01/activity/591060/]viagra dose[/url]
    viagra wiki viagra online uk viagra drug canadian pharcharmy [url=https://m1bar.com/user/sampanbeat25/]viagra pill[/url]

  • Thomasonemi, August 21, 2021 @ 10:08 am

    buy cheap lipitor lipitor generic – lipitor drug prices

  • Joshualap, August 22, 2021 @ 1:23 am

    over the counter viagra
    ed medications by pills from canada generic pharmacy india canada drugs cialis [url=http://sc.sie.gov.hk/TuniS/www.pearltrees.com/birchpolo69]best canadian pharcharmy online[/url] viagra in canada canadian pharmacy store price of viagra viagra [url=https://india77.com/user/profile/1065779]viagra canadian pharmacy[/url]
    tadalafil generic best prices getcanadiandrugs .com cialis mexico pharmacy best canadian pharmacies shipping to usa [url=https://marvelcomics.faith/wiki/Exactly_how_To_Order_And_Usage_Your_Generic_Cialis_Online_Without_Prescription]about canadian drug companies[/url]

  • Thomasonemi, August 23, 2021 @ 7:50 am

    stromectol tablets for humans ivermectin pills canada – stromectol pills

  • Barrycliex, August 24, 2021 @ 2:19 am

    drug store
    canada meds buy viagra without prescription canada discount viagra online viagra best price [url=http://qx.dz169.com/home.php?mod=space&uid=337278]canadian pharmacies without prescription[/url] buy cialis canada how to use viagra viagra usa viagra pfizer [url=https://getpocket.com/@peppercherry54]viagra pill[/url]
    order cialis cialis-canada buy viagra online without script generic viagra online [url=http://ts.stonybg.com/member.php?action=profile&uid=158283]buy drugs[/url]

  • GerardoSoash, August 24, 2021 @ 8:25 pm

    price of clomid clomid – where to buy clomid

  • GerardoSoash, August 26, 2021 @ 7:01 pm

    best treatment for ed prescription drugs without doctor approval – best drug for ed

  • GerardoSoash, August 28, 2021 @ 5:09 pm

    purchase cialis online cialis grapefruit interaction – cialis..com

  • MauriceItelf, August 30, 2021 @ 10:21 pm

    propecia 5mg sale buy propecia – finasteride without doctor

  • MauriceItelf, September 1, 2021 @ 9:55 pm

    buy propecia without a prescription buy propecia – propecia 5mga

  • Patrickeneme, September 2, 2021 @ 2:27 am

    dating gay bigger men
    gay dating sites site
    [url=”http://freegaychatnew.com?”]filipino gay dating site[/url]

  • SEO, September 2, 2021 @ 3:48 pm

    Wow, fantastic weblog structure! How lengthy have you been blogging for? you make running a blog glance easy. The full glance of your website is great, let alone the content material!

    https://www.blogexpander.com/turning-useful-tips-into-tangible-article-promotion-ideas/

  • MauriceItelf, September 4, 2021 @ 4:02 am

    zithromax online pharmacy canada zithromax 500 price – buy generic zithromax no prescription

  • Patrickeneme, September 5, 2021 @ 5:32 am

    gay online dating
    rich gay dating site
    [url=”http://freegaychatnew.com?”]young gay man dating older man[/url]

  • https://ivermectinmeds.com/, September 5, 2021 @ 10:55 pm

  • furosemide for sale, September 6, 2021 @ 8:40 pm

    furosemide price furosemide no prescription phode Oxire

  • MichaelEnrox, September 7, 2021 @ 2:28 am

    gay dating online
    top 10 gay guys dating sides
    [url=”gay-singles-dating.com?”]gay dating in wales[/url]

  • gay s, September 8, 2021 @ 3:29 pm

    sweet pea gay dating https://gayonlinedating.net/

  • buy lasix online no prescription, September 8, 2021 @ 5:08 pm

    lasix over the counter cvs lasix 500 mg price phode Oxire

  • chinese gay dating site, September 8, 2021 @ 11:44 pm

    mateen gay dating https://gayedating.com/

  • lasix online, September 9, 2021 @ 4:59 am

    lasix 40 lasix 500 mg tablet price phode Oxire

  • cost of lasix, September 9, 2021 @ 8:08 pm

    lasix 40 mg tablet furosemide 20 mg price phode Oxire

  • Henrysnalf, September 10, 2021 @ 8:28 am

    best gay dating sites 2021
    gay dating group
    [url=”http://gay-singles-dating.com?”]whats it like dating a gay guy?[/url]

  • online gay dating ad, September 11, 2021 @ 10:02 am

  • christianmingle gay dating, September 11, 2021 @ 3:05 pm

    gay sites for dating https://dating-gaym.com/

  • furosemide 40 mg tablet price, September 11, 2021 @ 10:57 pm

    order lasix furosemide 10 mg phode Oxire

  • Petertit, September 12, 2021 @ 4:40 am

    viagra wikipedia
    buy viagra online canadian prescription low price cialis price of cialis [url=http://forum.naronanews.com/member.php?action=profile&uid=99757]canada for viagra[/url] cheap viagra online canadian pharmacy cialis buy drugs us pharmacy cialis [url=https://chanceedward08.doodlekit.com/blog/entry/16347074/putting-a-stop-to-the-panic-handling-and-also-treating-anxiety-attack]buy real viagra[/url]
    viagra overdose viagra india ordering medications from canada buy drugs online [url=http://mail.livejuronal.com/user/hosebox79/]low cost cialis[/url]

  • Henrysnalf, September 14, 2021 @ 11:12 pm

    closeted gay men dating
    planetromeo gay dating site
    [url=”http://gaydatingcanada.com/?”]gay chubby dating tumblr[/url]

  • buy ivermectin uk, September 15, 2021 @ 1:23 am

    ivermectin 3 ivermectin online

  • Vendoren Shops, September 15, 2021 @ 1:39 pm

    435529 845428This write-up gives the light in which we can observe the reality. This is quite nice 1 and gives in-depth info. Thanks for this nice article. 125042

  • stromectol ivermectin buy, September 17, 2021 @ 5:33 am

    ivermectin oral ivermectin 12

  • Jerrytob, September 18, 2021 @ 8:50 am

    fast ed meds online ed vacuum pump – generic ed drugs

  • stromectol 6 mg tablet, September 19, 2021 @ 3:26 am

    stromectol ivermectin for humans buy stromectol pills

  • buy clomid at walmart, September 23, 2021 @ 3:43 am

    clomid ebay phode Oxire

  • Peterdax, September 23, 2021 @ 1:46 pm

    sildenafil canadian online pharmacy sildenafil citrate india – sildenafil discount prices

  • clomid generic brand, September 24, 2021 @ 6:00 pm

    buy clomid amazon phode Oxire

  • Peterdax, September 25, 2021 @ 8:53 pm

    plaquenil skin rash how much is plaquenil pill – buy plaquenil online

  • https://ivermectinstromectolhp.com/, September 25, 2021 @ 9:48 pm

    ivermectin without prescription ivermectin horse paste

  • https://ivermectinstromectolhp.com/, September 26, 2021 @ 1:42 pm

    stromectol to buy stromectol cost

Leave a Reply

Your email address will not be published.