LTC Halving Countdown: All you need to know about Litecoin Halving

LTC Halving Countdown: All you need to know about Litecoin Halving

Cryptocurrency
October 6, 2021 by Editor's Desk
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Litecoin is a popular cryptocurrency coin first created in 2011 as a ‘lite’ version of Bitcoin. Litecoin performs many of the same functions that Bitcoin does and retains many of its core features, but also improves some aspects of the coin that the developers thought could be better. Litecoin was seen as a Bitcoin rival
LTC Halving Countdown All you need to know about Litecoin Halving

Litecoin is a popular cryptocurrency coin first created in 2011 as a ‘lite’ version of Bitcoin. Litecoin performs many of the same functions that Bitcoin does and retains many of its core features, but also improves some aspects of the coin that the developers thought could be better. Litecoin was seen as a Bitcoin rival when it came out, but as the cryptocurrency market became more and more saturated, the coin faded into the background. Today, it is the sixteenth-largest coin in terms of market cap. 

Litecoin, much like Bitcoin, also goes through a halving cycle where the block reward falls by 50% roughly every four years. Litecoin has halved twice before, once in 2015 and then again in 2019.

The primary purpose of halving Litecoin is to control the supply of the coin in the markets. Unlike fiat currencies that can be injected or removed from the markets by governments as they deem necessary, these cryptocurrencies grow at a constant rate that halves every four years. Thanks to the halvings, the maximum amount of Litecoins that ever get into circulation equals 84,000,000. In this way, Litecoins are removed from the glaring specter of inflation, which is not true for fiat currencies. While the reward for miners verifying transactions keeps going down, the intrinsic value of every LTC increases after each halving, keeping miners incentivized.

Read on to find out everything you need to know about Litecoin halving, why it occurs, what its effects are, and when it’ll happen again.

Litecoin Halving Dates History

New Litecoins, just like Bitcoins, are created when miners add new transactions to its blockchain and earn network rewards in return. The amount the miner receives for adding transactions to the block is fixed, and the transaction fees are included in the block.

 

However, after every 840,000 blocks are mined, the block reward for miners is halved by the network automatically. Considering that it takes around 2.5 minutes to mine one block, this halving occurs roughly every four years. When the currency first launched and began to be mined, it rewarded 50 LTC for every block mined. Since then, the network has halved twice already – once in 2015 and again in 2019. Consequently, the block reward has gone down from 50 LTC to 12.5 LTC as of October 2021.

Before Halving

When the currency was first launched, it rewarded 50 LTC for every block of transactions verified. That means that the miner was awarded a total amount of 50 LTC for every block they mined.

Litecoin Halving 2015: First Halving

The first 840,000 blocks of Litecoin were mined on 25th August 2015. This meant that the rewards given to miners for mining every block were to be halved. Now, miners were getting awarded 25 LTC for every block mined instead of the previous 50 LTC. Before the price of Litecoin halved on 25th August 2015, the price was on an upward path. After the sharp fall in price after the event, Litecoin gained some of its value back by the activation of the SegWit protocol. In December of 2017, Litecoin reached its all-time-high price of $357.

Litecoin Halving 2019: Second Halving

The last halving of Litecoin occurred on 5th August 2019. Right before the halving date rolled around, the bullish trend of the coin turned remarkably bearish at $146 on 22nd June 2019. While many people thought that the prices would increase after the halving of the coin, that didn’t happen. The coin continued to lose value in the crypto markets even after the event.

Next Litecoin Halving: Litecoin Halving Countdown

Litecoin halvings occur once every four years approximately. Considering the average time taken to mine one block is 2.5 minutes, the average halving lands around four years apart. Since the last halving took place on 5th July 2019, it is estimated that the next Litecoin halving is estimated to fall on 6th August 2023.

Effect of Litecoin Halving on its price

The main reason why Litecoin is programmed to cut down its rewards by 50% every four years is to keep inflation at bay. However, reduced rewards quite naturally disincentivize miners to continue mining these currencies. However, because every halving is supposed to come with a decrease in supply (and hence an increase in demand), the regular growth of prices keeps miners interested.

 

Many people wonder whether LTC prices will increase after the 2023 mining. The answer is that nobody knows for sure. The price effects on the currency after its eventual halving is a very debatable issue because:

 

  • Prices of the coin are affected by the halving, but these effects can be made out only in the long run. Predictions of price changes in the short run are highly unreliable and cannot be backed by solid calculations
  • Halvings are events that have fixed dates and times. This means that miners and traders of Litecoin already know when it’s going to happen. This creates an imbalance in the price of the currency way before the date is anywhere near, which makes it harder to predict how the graphs are going to move in the future
  • Halving doesn’t really have an impact on the price point of Litecoin, per se. The price of the coin in the crypto market is determined by the supply and demand fluctuations, and in turn, are affected by hundreds of untangling factors. By the time the coin halves in 2023, 87.5% of all Litecoins will already have been mined. Experts believe that a slight drop in the supply of new Litecoins would not noticeably affect the price.

 

The only thing that can be known for sure is that the effect of halving on Litecoin’s prices will be challenging to accurately predict in the short run.

Since Litecoin’s Unique Selling Point (USP) over Bitcoin was some minor improvements here and there to the oldest and largest cryptocurrency coin of all time, the market advantage of LTC fell over time. Over the last two halvings, the prices of LTC have shown consistent ups and downs, but have mostly fallen. With the third halving still some years away, the future of Litecoin concerning the entire crypto market still remains to be seen.