Bitcoin’s Halving Impact On Its Price WIll Have More Impact Than Litecoin’s Halvings
A crypto analyst on Twitter, @100trillionUSD recently pointed out that the influence of Bitcoin’s halving’s effect on its price will be much more than that of Litecoin.
Some people think that because litecoin didn't jump on ltc halving, btc halving will also be irrelevant for #bitcoin. That logic is flawed. LTC price doesn't have a significant relationship with stock to flow, so halvings are indeed irrelevant. BTC price-s2f relation is strong 🚀 https://t.co/5Wx7vHLvUd
— PlanB (@100trillionUSD) August 31, 2019
In Bitcoin, a miner mines a successful block every 10 minutes and receives 12.5 BTC as a block reward. After the next halving of Bitcoin, this block reward will get reduced to 6.25 BTC, and this halving in Bitcoin happens after every 210,000 blocks have been mined. The next halving of Litecoin, this block reward will get halved to 12.5 LTC, and this halving happens after every 840,000 blocks of Litecoin have been mined.
LTC’s spot price increased nearly 550% from December to June, but has fallen 50% from the June high, and remains down 81% from the record high set in December 2017. Investors were hopeful that the halving would push up demand and increase price performance. The event reduced the amount of LTC available for each mined block of transactions from 25 LTC to 12.5 LTC. It is still too early to tell how well the price will hold over the coming weeks.
“Bitcoin only needed 4 years of data to pick up and model the stock to flow signal. That 2012 model is still working fine (out of sample) until this very moment, and probably for some years to come.”
As block rewards continue to diminish, Bitcoin’s fixed supply should accrue value as the cost of producing one BTC increases with each halving, likely one of the driving factors behind Bitcoin’s cycles. As future block rewards continually diminish to zero, future miners will have to rely on other incentives within the system to secure the network.