Split The Bitcoin
My loved ones are following me everywhere today. I will discuss the issue of division that the Bitcoin pioneers are interested in, if not all of them:
- What is the split?
- What is economic inflation?
- What is the purpose of this division?
- What impact on the currency of Bitcoin?
- Analysis
- Summary
- Cloud mining companies
- Tips
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- What is division?
As everyone knows, the bonus for the current block is 25 Bitcoin for every 10 minutes, ie within 10 minutes one block is discovered, you go to the first metal or a mining pool to solve the block.
The division occurs every four years. The intention is to reduce the equivalent of the block code solution by half every 4 years. In the first four years, it is equal to 50 bytes. Now it is 25 Bitcoin. After the split of July 2016 it will be only 12.5 Bitcoin and the division will continue every 4 years. The last Satoshi is produced in 2140 years.
- What is economic inflation?
In a nutshell it is
- Excessive rise in the general price level.
- Inflation of monetary income or component of cash income such as wages or profits.
- High costs.
- Over-creating cash balances (eg Bitcoin mining).
And the occurrence of one of them means an economic problem and may collapse and in our case means the collapse of Bitcoin.
- What is the purpose of this division?
After we know what inflation is, then the purpose of this division is to protect the currency from inflation in any way, whether by excessive price or cost, and we have here the costs of the mining machinery.
It is known that Bitcoin has been determined that Bitcoin's production ceiling or mining is 21 million Bitcoin ie that after we reach 21 million Bitcoin there will be something called Bitcoin Mining.
The question here is why will Bitcoin's production stop at $ 21 million? The answer: as stated by the developers of the programming algorithms of this currency, which control the stock, such as gold, which is a limited stock and this makes it valuable and valuable.
This is linked to supply, demand and inflation.
- What impact on the currency of Bitcoin?
Before the first split, the price of Bitcoin did not exceed $ 13 and after the first split, almost four years ago in late 2012 and after the entry of 2013 was the price of Bitcoin above $ 100, even the largest value since the beginning of Bitcoin and $ 1250 and then in 2014 Its price was between $ 300 and $ 600, but in 2015 there was a drop in price, which did not exceed $ 250.
This year 2016 saw a rise of up to $ 700 and more due to the accession of many investors to the currency.
Looking at the past and also taking into account the following:
- Bitquin production will be halved (12.5 Bitcoin per block).
- The mass will remain as it is conglomerate every 10 minutes approx.
- High demand for currency.
- Analysis
The theoretically expected impact on the currency is:
- Decrease in profits of minerals.
- High difficulty mining.
-Supplies (buying and selling Bitcoin)
- Summary
The price of Bitquin will rise after the split, but after speculations that will occur during the split and after and these speculations certainly have a strong impact on the rise in the price of Bitcoin.
It may decline after selling and buying but then Bitcoin will increase (the effect of the split).
- Cloud mining companies
The impact of splitting on cloud mining companies that own mining farms such as Genesis mining and cexio ... will have to cut profits or buy powerful Bitcoin mining devices.
As for the companies that claim to be Bitcoin mining and we do not know if they really own the equipment, they will also cut profits or move to mining currencies other than Bitcoin or directly as a CLDmine
- Tips
- Anyone who wants to invest does not invest large amounts of money before splitting and not trading in the currency Bitcoin unless you have full knowledge of trading and especially since now until the split time.
-last word
In the end, this is just an analysis and a personal opinion. This is not necessarily 100% true and the coming days will determine this.
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