Author: Christophe Biocca 2014-10-28 21:57:01
Published on: 2014-10-28T21:57:01+00:00
In an email exchange on the Bitcoin-development mailing list, a user named Neil suggested that a halving in Bitcoin's block reward is almost economically equivalent to a halving in price. The predictability of the halving can cause miners to alter their buying behavior significantly by reducing the hashpower on the day. Miners can plan to purchase less hardware as they approach the revenue drop and expect it to pay for itself before the halving. If margins are already low as the halving approaches, rational miners would cease purchasing any new hardware that wouldn't be profitable past that point. There would be an increased focus on cost-effective hash power and older units would not be replaced as they break. Either a significant supply of cost-effective hardware shows up or difficulty would stall long before the halving happens.
Updated on: 2023-06-09T03:44:25.330917+00:00