At the weekend, the reward for Bitcoin mining was slashed in half, no less – but don't worry, this wasn't triggered by some sort of catastrophe in the world of the virtual currency, but rather a built-in feature.
Known as the 'halvening', the cryptocurrency has a mechanism whereby every 210,000 blocks completed (which under optimal conditions should take around four years), the number of Bitcoins available across the globe is cut in half.
So instead of 25 Bitcoins being available every 10 minutes to miners worldwide, there are now 12.5.
This is designed to keep inflation of the virtual currency under control, and obviously enough, it makes things harder for miners to make money from the system going forward. Smaller Bitcoin mining operations may well be forced to close their doors as a result, leaving less competition for the bigger players.
Amateur Bitcoin enthusiasts are obviously going to struggle more after the move, too (incidentally, if you want to find out more about how Bitcoin mining works, we've got a full how-to guide available).
Following the halvening, the value of the Bitcoin in dollars fell somewhat, but there was no huge drop in the currency.
Impending collapse?
However, earlier this year we heard from one Bitcoin expert, Mike Hearn, that the cryptocurrency was a failure and the whole system was close to a 'technical collapse', thanks to bitter infighting among the community.
Hearn's big problem with the cryptocurrency is that it's effectively controlled by a handful of people – a virtual financial elite, if you will – and he argues that when it comes to this issue, there is no solution whatsoever in sight.
The next halvening will roll around in 2020, if Bitcoin is still going as a viable concern, that is.
Via: Betanews
- Check out our article on understanding Bitcoin and cryptocurrency
