- Litecoin has successfully completed its third halving event at the block height of 2,520,000.
- This move has reduced the block reward from 12.5 LTC to 6.25 LTC as the Litecoin supply remains limited.
- In the long run, the scarcity of Litecoin, will protect it from inflation and preserve its market capitalization.
Litecoin has successfully completed the third halving event, which means block rewards move from 12.5 LTC to 6.25 LTC, this halving event took place at a block height of 2,520,000.
The 12-year-old blockchain has successfully completed the third halving. The fourth halving is expected to take place 4 years from now or around July 30, 2027, at a block height of 3,360,000.
The first halving took place in 2015 after the block height was 840,000, followed by the second Litecoin halving event which occurred in 2019 when the total block height was 1,680,000.
What is Halving?
Bitcoin has characteristics embedded in its code, which is programmed to allot a total maximum supply of 21 million BTC. Important characteristics of Bitcoin include; fixed supply and decreasing rewards. After every four years, the rate of Bitcoins issued into circulation is decreased, a process known as Bitcoin Halving.
History of halving in in Bitcoin
There have been three Bitcoin halving that have occurred to date. The first one took place in November 2012, when the block reward was decreased from 50 bitcoins per block to 25 bitcoins per block. The second halving dates back to July 2016, when the reward per block was reduced again from 25 bitcoin per week to 12.5 bitcoin per week. The third halving took place in May 2020 2020, the block rewards decreased from 12.5 bitcoins per block to 6.25 bitcoins per block.
Halving rewards promote healthy and sustainable growth on the network. Halving ensures that Bitcoin supply remains limited but finite, which is likely to maintain its value over time.
The next Bitcoin’s halving is expected in April 2024, which is expected to raise the value of BTC tremendously. Halving Bitcoin decreases the supply of new coins entering the market, this decreases inflation as well.
LiteCoin Halving
Litecoin launched in October 2011 with 50 LTC as initial block rewards. According to CoinMarketCap, Litecoin miners have mined 87% of the network’s 84 million total coins.
Reduction in the supply of Litecoin is expected to trigger a rally in Litecoin price, but because traders are aware of this trend, they try to get exposure to LTC before halving, causing a premature rally and price drop on the day of the event. For instance, Litecoin’s price fell by 3.86% to US $89.16 in the 24 hours leading to its third halving event.
In the long run, the reduction of LTC means miners will get 50% fewer rewards for every block they mine, this will create scarcity in the litecoin, reducing the circulation of the asset. This will reduce inflation and grow market capitalization over time.
Like Bitcoin, block-halving events on Litecoin happen every four years. Litecoin had a market capitalization of US $ 6.54 billion as of 11.15 pm on Wednesday in Hong Kong, making it the 11th largest cryptocurrency.
