What You Need To Know Ahead of The Bitcoin Halving

investopedia.com:

The bitcoin halving—in which the amount of newly issued bitcoin created roughly every ten minutes is cut in half—is expected to take place on Friday or Saturday. In the past, this event has been followed by a significant rise in the price of bitcoin, but analysts are divided over whether that will occur this time around.

Bitcoin (BTC) already hit all-time highs above $73,000 last month, the first time record highs have been hit ahead of a halving event, though the price has retreated in recent weeks. On Thursday morning, bitcoin was trading around $63,500, after dropping below $60,000 on Wednesday.

After the halving, the incentive for bitcoin miners and the pace of issuance of new bitcoins will come down by half. This is one of the rules of the network that was «set in stone» by Bitcoin creator Satoshi Nakamoto.

Simply put, bitcoin mining is the process by which all transactions on the Bitcoin blockchain are verified and new bitcoins are minted. Miners first to successfully validate a block containing transaction information are rewarded for their effort.

This reward is made up of both a block subsidy and transaction fees. The block subsidy is newly created bitcoin that is entering existence for the first time and has historically made up the majority of the value of the block reward.

While the block reward was originally 50 bitcoin when the network launched in January 2009, it has since halved after every 210,000 blocks, or roughly every four years, on a predetermined schedule. After the upcoming halving, block reward will drop to 3.125 bitcoin from the current 6.25 bitcoin.

While new blocks are intended to be found roughly every ten minutes, block times can vary over the short term based on the amount of computing