The next Litecoin halving scheduled at just over two months from now. The event, no prices for guessing, will have noticeable consequences on the Litecoin ecosystem, and also on the crypto space. What will be those? Let’s try to find out.
What is crypto halving?
To understand its impact, let’s first understand what crypto halving is.
Every cryptocurrency needs a robust set of miners, and they need a lucrative incentive to perform their tasks. Therefore, they are rewarded with a certain amount of cryptocurrency. This reward is then halved over a period of time or after reaching a certain period of time.
Possible effects of Litecoin halving
Litecoin doesn’t have a whitepaper; however, is the network’s block rewards for mining are halved every 840,000 blocks. The current block record for Litecoin miners is 25 LTC, which will be reduced to 12.5 LTC on or around August 6, 2019. The first and the only halving of Litecoin till date took place on August 26th, 2015, when the block rewards were reduced to 25 LTC from 50 LTC.
The biggest impact on the Litecoin chain would be on the mining profitability. Simply put, Litecoin halving will reduce the profits miners receive for LTC mining by 50%.
And if historical data holds true, halving will cause a price rally for Litecoin. After its first halving in 2015, LTC grew by 100%, from a $1.5 pre-halving price to a $3 post-halving price. Similar consequences can be expected this time around too. We can expect the prices to shoot up post-halving, before stabilizing at a new high.
Another major impact, which might seem a more logical one ta face, is that the number of miners mining LTC will go down. However, this might just not be the case. As after the first halving, the miner count remained almost stable, without any considerable variation.