**UPDATE April 19th, 2024 at 8:09pm - Halving event is officially complete.  See y'all in 2028**




It's that time again.  

Approximately every 4 years the "Block Reward Rate", or what is effectively an issuance rate for Bitcoin, gets cut in half on a date known as the "The Halving".  The original issuance rate of new Bitcoin at launch on January 3rd, 2009 was 50 BTC per block with new blocks being mined approximately every 10 minutes.  Bitcoin is programmed in such a way that this block reward rate is reduced every 210,000 blocks which at 10 minutes per blocks comes out to right about a 4 year interval.

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On November 28th, 2012 the rate dropped from 50 BTC to 25 BTC
On July 9th, 2016, the rate dropped from 25 BTC to 12.5 BTC
On May 11th, 2020, the rate dropped from 12.5 BTC to 6.25 BTC

On April 20th, 2024 or thereabouts, we will reach the 840,000th block and Bitcoin's block reward rate will drop from 6.25 BTC to 3.125 BTC.

Why does this matter?

It matters because it reduces the supply of new Bitcoins being generated per day by miners which are typically introduced to the market and sold to pay the expenses of the miners and generate a profit.  At the current block reward rate of 6.25 BTC per block and 144 blocks per day, there is about $63,000,000 worth of new Bitcoin supply generated per day diluting the value of Bitcoin.  On April 20th, 2024 this amount gets cut in half and if all other things remain equal there will only be $31,500,000 worth of new Bitcoin supply being generated per day which the market has to absorb.

In laymen's terms, the halving event creates an instant reduction in supply and presuming the dollar demand remains relatively constant the only way for the market to get back into balance is for the price to go up.  Historically speaking, the halving event has been an launching off point for Bitcoin bull markets.

Why should you care?  

Maybe you shouldn't.  Few people really do.  Halving events are usually very quiet events that only crypto bros talk about with the usual hype and FOMO from your relatives, neighbors, and the guy behind the counter at Starbucks coming several months later after the fact.  That said, I brought it up here in 2016 and 2020, so I'll bring it up again in 2024.  Do what you want with it.

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A couple caveats:

1)  The logarithmic scale of the chart tells a couple truths and a couple lies depending on the how savvy the viewer is.  

First, it may give the impression of less volatility than there actually is.  All of those little red candles which look like nothing, even during bull markets, can represent corrections of 25% or higher.  There is nothing that says that Bitcoin can't go from $70k to $40k well before it goes to $100k.  Corrections of that size happen literally all the time, several times per year, even during the best years.

Second, there's a pretty obvious declining rate of return phenomenon over time.  You will not 100X from here like we saw back in 2013.  We likely won't even 8x like we saw back in 2021.  If Bitcoin merely doubled or tripled in the next 12 months, it should be considered a win.  People will make arguments about a "super cycle" and you might see Cathie Wood on TV talking about a million dollar Bitcoin.  It's not going to happen in 2024/2025.  Bitcoin isn't a lottery ticket anymore.  At best, it's a digital asset that could continue to outperform traditional assets for another decade or so before hitting maturity.

2)  Macro risks and black swans events don't give a shit about Bitcoin.

Even though halving events have preceded a major bull market every single time, there is no rule that says that some event external to Bitcoin such as a significant recession or a political action couldn't put a halt to the party at any time.  Bitcoin going up in value is not a matter of destiny but rather a phenomenon that is both observable and has a basis in the design of the protocol that increasingly drives scarcity over time.  It's not like tulips where you can always grow more tulips or Beanie Babies where they can always make more Beanie Babies but it isn't exactly physically tangible either and the degree to which that matters remains to be seen.

3)  Bitcoin and cryptocurrency in general is still highly experimental

In the same way that nobody really knew the future implications and applications of the internet in the early 1990s, nobody really knows the same regarding cryptocurrency and how it fits in 20 years from now if it fits in at all.  Anybody putting money into this stuff is betting on a VERY uncertain future.

I don't intend this thread to replace the main Bitcoin thread.  This is a halving news and analysis thread and I expect it to die off some time after the halving.  If you've got some interesting perspective that you want to share, want to speculate on it, or have some questions about it, this would be a good place to do it.  If you want to come here to say that Bitcoin is equivalent to dutch tulips, that's sort of off topic, but be my guest.

Doesn't Bitcoin generally become worth more after the halving event?

Absolutely

On 4/20 at 4:20?

Yes, that is one of the key thrusts of my post.

About 688% gain from the previous halving in the 2020 halving event to the peak in 2021.

It's not an overnight thing though and it could easily dump...several times...between now and then.  If I was betting on 12 months from now though, I'd expect it to be substantially higher than today.

LOL.

There is a possibility it happens on 4/19 though.  Time between blocks isn't exactly 10 minutes every time.  There's a degree of randomness to it by the very nature of how blocks are mined but it's generally about 10 minutes on average over the long haul.

I did quite well post 2020 halving. Restructured my portfolio for 2024.

I'm buckled up and strapped in for the post 2024 action!

My body is ready.

Artificially restricting supply of artificial money. Neat.

Can someone explain this to the Fed?

I will never forget GD making fun of bitcoin in 2022 when it dropped to $19k and saying that it was worthless and done for good

What is money?

What are the properties of money?

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Bought 550 bucks worth.  Post holder...

Hope to acquire some more during the halving "sell the news" dip, if there is one.

BTC is the best wealth preservation asset to come about in my lifetime and I plan to pass it on to my heirs in hopes of them having fuck you wealth to be able to follow their dreams  and not get locked into some thankless job.

This news is already baked into the price bud.

What did you learn during that event?

"It's going up forever, Laura".

PS: I can thank ARFCOM for turning me on to Bitcoin 11 years ago.

Is it still a pain in the ass to buy bitcoin?

Very easy.

I used to recommend Coinbase, but now I just tell people to start with an app like Strike. Once you accumulate a bit , then get a hard wallet.

ETA: There are countless other options for onramps and storage, but for beginners. who just want to dip their toes in, this recommendation is very straight forward

Nope, very easy on Coinbase

For speculative and investment purposes, I can't argue against the ETF route.  

But coinbase is pretty easy if you need an onramp to self custody.

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11/26/2023 - price approx $37.5K

IMHO, Coinbase puts too much emphasis on the SH*TCOIN casino. Plus they're in bed with Larry Fink.

Apps like Strike or Swan are bitcoin-only which, as everybody eventually realizes, is the only thing that counts.

All money is artificial. All supplies of money are artificially restricted.

We can sidestep the idea of money in favor of labor equivalence.  For those two ugly fish, I will trade you an original sonnet about your daughter and three vile limericks for your next affinity-group meeting.  Four limericks, tops.

As opposed to what? The government printing more USD on demand and devaluing the existing money supply in the process?

I’ll take BTC.

Should people be trying to get 0.10 Bitcoins like all the vids I've been seeing?

Still got some ways to go.

Would the ETFs be an okay okay?? Or do I want to actual currency

I cashed out except for 1 BTC. In the very near future the government will pull a china / saudi arabia and make it illegal to own with the swipe of a pen. China is the model the US govt is aiming for. Woke China, so its coming. Once the current banking system is truly threatened they will go to extreme lengths to prop it up.


They'll let you 'invest' in it via ETFs, but won't allow you to hold it yourself citing illegal uses and crime etc etc as their justification.


And most people, the laymen who missed the boat on BTC , are miserable envious poors who will celebrate other people losing their asses on it, like they already do every time it crashes.

I'm going to hodl.  

I've got 4-5 percent in my portfolio.  Going to wait until 2034 when BTC hits $1 million, and then sell.  

appropriate since half the money you invested in it will be gone at some point.

Submitted for your enjoyment: https://www.history.com/news/tulip-mania-financial-crash-holland

I don't think it's really a binary should/shouldn't thing.

Is there a reasonable expectation that Bitcoin will substantially outperform the S&P 500 over the next 1, 5, and 10 years?  I say yes.

Will you be OK if you pass on it and just stick with stocks and bonds?  Also yes.

I will however say that the near term potential of Bitcoin is and will continue to be greatly exaggerated through the end of this particular cycle as it has been in every previous cycle.  You have to keep in mind that if the peak next year ends up being $150,000, it will require people to believe it was going to go much higher than that.  Nobody is buying Bitcoin at $150,000 if the expectation is that $150,000 is the peak.  Whoever was buying Bitcoin at $69,000 back in November 2021 obviously thought there was enough gas left in the tank in that rally to make $69,000 a good price.  They were wrong, but someone always has to be wrong by the end of any particular bull market for anything by definition.  Someone bought

Basically what I'm saying is to take those videos with a grain of salt.  If the consensus appears to be $X then make sure you are selling well before that.

Unless there are tax reasons to buy the ETF (like ease of having it in a Roth), you should possess your own BTC. An ETF injects another layer of trust which is not necessary. You have to trust Coinbase, Larry Fink, and probably our own government.

by that time you wont have to sell, it will be the global currency and fiat will likely be dead.  hodler forever!

Yeah, I remember similar remarks when I posted about halving events back in 2020 below $10,000 and in 2016 below $1,000.  

That’s the beauty.  Numbers Go Up technology.

That’s the secret sauce my man.

Read this

Hey, if you're happy I'm happy. Hopefully we all have our own well researched and well diversified investment portfolios.

China banned BTC but many of the people still hold it. China banned mining which was then taken up by other countries, and the current hashrate is higher than ever. So, China is now indirectly supporting (by allowing) a BTC ETF in Hong Kong.

Game theory in action. "You can't ban bitcoin, you can only ban yourself from bitcoin".

What's your purpose for owning BTC?

If your only purpose is to speculate on the price going up then I can't make any argument against the ETFs.  If I was starting from scratch today, that's where I'd be.  As it stands right now, I can't make that move because of the massive capital gains tax liability that I would incurr.  If I do some selling later in this cycle and decide to buy the next bear market, then I probably would switch to the ETFs for that purpose.

If you actually want to use it or you are interested in putting some value beyond the reach of any other third party then obviously self custody is the way to go.

Bitcoin is slavery and they keep the books.

That is such a tired and disproven analogy. When someone uses it, it tells me that they have not studied BTC at all.

Well that’s….different

Yep.  South Sea company is more appropriate.

Submitted for your enjoyment and yes I was in this thread 11 years ago:

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Tulip mania didn't last 11 years nor did it survive multiple crashes let alone one crash.  That analogy is old, tired, and long since invalidated.  Bitcoin can fail for lots of reasons but not for the same reasons that the tulip market crashed.

ETA:  Tulips was doomed from the beginning because you can always grow more bulbs.  The price going up just increases the incentive for farmland to be dedicated to growing tulips.  Not only can you not increase the rate of Bitcoin production but the very subject of this thread is discussing the fact that the rate of Bitcoin production keeps dropping every four years.  

If there was a fixed number of Tulip bulbs that could ever exist, they WOULD be valuable and people would probably still be speculating on them increasing in value in 2024.

@albertacoyitecaller

I learned a 5 digit investment netted about 6 digit in profits, excluding my initial funds. Paid off debt. Bought a 2013 ZL1. Paid capital gains tax AND re-rolled remaining profits back into my crypto portfolio.

I learned to sit, wait and accumulate near the low point of the cycle. My current portfolio has surpassed my previous ATH and the real fun hasn't even kicked off yet.

I will do the same thing this time around to better my position for 2028. My end game is to target 2032 (post halving) to retire.

What I try to put into perspective for people was that March 12, 2020 changed my life. ETH was about $100-125 and I purchased 15 of them. Cashed out on the backside of it's ATH near $4400/ea. A 40x +/- return for literally doing nothing but holding it for just over a year! That was just one crypto in my portfolio I sold, along with others back then.

Today ETH is sitting around $3,500. Still an impressive 30-35x from 4 years ago.

My traditional portfolios (stocks, bonds, money markets) are an island onto themselves.  My 401k and Roth IRA get maxed to the absolute statutory limit every single year and then I go well beyond that into non-tax advantaged brokerage accounts.

My Bitcoin portfolio doesn't even enter the conversation when it comes to retirement planning as hard as it may be to ignore it at this point being up about 35,000% since I bought it.  

People that aren't hitting their retirement goals with traditional investments shouldn't even contemplate speculating on Bitcoin.  They can't afford the risk.

I disagree with the last sentence. Everyone should have at least SOME exposure to BTC. I mean your own experience demonstrates this.

My only caveat would be that you have to have at least a 5 year time frame, and be able to weather the volatility. If those things are true, and you just HODL, bitcoin will outperform all assets.

I have my own well diversified and successful investments that have and continue to do well for me.

I have researched crypto fairly well and what I don't like is the volatility and "pyramid scheme" type model that it is.

So don't insinuate that I'm stupid for not buying into something you really like and I don't like.  

IMO a reasonable savings is more like 1btc.

It's fine to say you don't like the volatility or how it's valued but throwing out the Tulips analogy is low effort.

If you aren't stupid, which I'm sure you are not, you can find a better criticism of Bitcoin.  Hell, I'm waist deep in Bitcoin and I can find a better criticism.  I even listed some in my first post.