Today's a momentous occasion for Bitcoin enthusiasts around the globe: later today, the block reward subsidy as programmed in the Bitcoin software will drop by 50%. This is a deflationary event programmed to occur every 210,000 blocks, or approximately every four years.
Some Bitcoin users believe a much higher price will be the result of the block halving in the days ahead, as after the halving kicks in miners will only earn 12.5 Bitcoins per solved block, instead of the 25 Bitcoins they currently earn on the network.
Others, however, are warning of a possible economic catastrophe when the block reward subsidy drops. One influential miner believes it could cause unprofitable miners to shut off, resulting in an inability to process transactions on the network in a timely fashion until the difficulty readjustment factors in such a drastic drop-off in miner participation.
Of course, no need for speculation now. I'll likely be livetweeting stats in the minutes and hours after the block halving kicks in, so feel free to join me over on Twitter. If the price jumps up after the halving, there will likely be many champagne bottles (and Red Bull cans) opened up around the world. If the price stagnates, or if the network stalls out due to the above mentioned miner drop-off scenario, we could obviously see a lot of crypto tears instead.
Time will tell! I discuss more details on today's block halving here, and some thoughts on the rapid rise of the #2 most valuable cryptocurrency after Bitcoin, Ethereum:
Full disclosure: At time of publication, I do hold some bitcoins in my portfolio for the long term. Not intended as financial advice or a recommendation to buy or sell bitcoins.