As we await the next Litecoin halving which has been scheduled to begin in over two months from this date, it is normal to want to know what the halving is about and what impact it will have in the crypto space. Off course the upcoming even will definitely have noticeable consequences on the price of Litecoin itself. But in what way will it impact the crypto ecosystem? Will it be beneficial or have resulted in disadvantages? What effect will it have on Litecoin price prediction? Let’s find out below:
What’s Cryptocurrency Halving?
To understand what the impact of Litecoin halving will have on the crypto space, let us first understand what the term crypto halving means. So what is crypto halving?
Every crypto needs a robust group of miners. Cryptos typically need a lucrative incentive if they are to perform their tasks very well. Therefore, they are to be rewarded with a certain sum of crypto. Their reward is then halved through a certain period of time or after it has reached a certain period which is a crypto halving. Now that we have understood what halving means what are the effects of Litecoin halving?
What are the Effects of the Litecoin Halving?
Litecoin does not have a whitepaper. But, the network’s block reward for mining activity is usually halved after every 840,000 blocks. Hence, the current block record on Litecoin for its miners is about 25 LTC. This will be reduced to about 12.5 LTC on August 6, this year. The first and only that there was a halving of Litecoin to this day, was on August 26, 2015. At the time, the network’s block rewards for mining activity were reduced from 50 LTC to 25 LTC.
One effect that the halving will have on the network (which may well be the biggest impact) would be on mining profitability. The Litecoin halving is going to reduce the profits that miners will receive for their LTC mining activity by 50% at least.
In the event that historical data holds true, which is always the case, the Litecoin halving will definitely cause the price of Litecoin to rally. After the network’s first halving in the year 2015, the price of Litecoin grew by about 100%. It increased from a $1.5 price (before halving) to a $3 price (after halving). Hence, it is safe to expect similar consequences of the long anticipated halving this time around too.
We can expect the price of Litecoin to shoot up just after the halving before it stabilizes at a new high position.
What More Can We Expect From the Litecoin Halving?
Another major impact that the Litecoin halving will have on the crypto space and LTC ecosystem, (which may seem a more logical outcome) is that the total number of miners who have been mining LTC will drop. However, this may not just be the case. Because, after the first Litecoin halving in 2015, the network’s miner count remained stable to an extent. At least without any considerable variation. Whatever the case may be we are barely two months away from the scheme. We have to wait to see what happens in the end.