A brief discussion on Bitcoin halving in 2024

The halving is what makes Bitcoin truly unique in the world of financial assets. No other commodity has a completely calculable production schedule like it, allowing the public to prepare in advance for the halving event.

The 2020 halving left an indelible mark on the Bitcoin mining industry, and the 2024 halving will undoubtedly bring major changes. In order to avoid its possible impact as much as possible, we have made a report (downloadable here: https://hashrateindex.com/blog/content/files/2024/03/2024-Bitcoin-Halving-Report-Final.pdf) by analyzing the impact of halving on the core indicators of Bitcoin mining (including computing power, difficulty and computing power price) and the business aspects of Bitcoin mining (mining machine prices, hosting rates and other considerations).

Based on the analysis, the following key points are provided here:

1. The fourth Bitcoin halving will occur on April 19, 2024 at approximately 13:30 UTC.

2. If the current coin price continues to maintain or increase moderately, it is expected that about 3%-7% of Bitcoin computing power will be offline after the halving, and miners will see these approximate percentage reductions in subsequent difficulty adjustments.

3. If the price of the currency drops from the current level to about $48,000, it is expected that about 16% of the Bitcoin computing power will be offline, and the computing power will be between 639EH/s-674 EH/s by the end of the year.

As noted in this report, the 2024 halving is believed to be very different from previous halvings. The current bull run in Bitcoin, coupled with a surge in transaction fees driven by inscription and ordinal activity, provides an opportunity for many miners to remain motivated after the block reward drops to 3.125 BTC. If the price of Bitcoin remains or rises, a small portion of the hashrate could go offline. If current trends continue, expect to see slow growth in hashrate over the next year, as compressed profit margins - caused by a slow but steady increase in difficulty - will determine how much hashrate can continue to stay online and profitable.

Finally, while the halving may not have as big an impact on miners as previously thought, profit margins after the event will still be very limited. Therefore, miners should try to improve their mining efficiency as much as possible, whether through firmware updates or mining equipment updates, or hedging mining income, electricity price risks, and Bitcoin volatility.