The Litecoin halving event took place on August 2nd, 2023 around 15.45 UTC. It proceeds steadily without any technical problems. This is a pre-decided reduction in the block reward to maintain the supply of LTC to 84 Million coins. Charlie Lee, the founder of Litecoin proposed that halving ensures a more gradual issuance of new coins and incentivizes miners to play a pivotal role in network security.
Halving in crypto refers to an event where miners’ block reward for validating transactions on the blockchain is reduced in half. The method starts with miners receiving 50% lesser coins for every block they mine. This process is determined to create scarcity which will increase its value with time. The decrease in block reward makes it harder for miners to mine the new coin which leads to less coin supply in the market.
The block reward was 50 LTC at the time of the Litecoin launch. After the first halving, it was reduced to 25 LTC and then to 12.5 LTC after the second halving. The halving event is done every four years when 840,000 blocks have been mined. The block reward is reduced to 6.25 LTC after the recent halving.
Litecoin Halving Dates and Details
The first Genesis block was mined on October 7, 2011. At that time, the block reward was 50 LTC. Four years later, on August 25, 2015, with 840,000 block height, the block reward was reduced to half, i.e. 25 LTC. Again, after four years on August 5, 2019, with 1,680,000 block height, the block reward was reduced to 12.5 LTC. The recent halving was on August 2, 2023, with 2,520,000 block height; the block reward was reduced to 6.25 LTC.
Halving affects the Litecoin price. Its price immediately went down to 8% within 12 hours. Its price fell from $94 to $86.1. This broke a 50-day record (falling price). This falling price is the same as before when the previous halving of 2015 and 2019.
Investors should be aware of the basic effects of halving the coin. It affects the price of coins. The halving event is designed to create scarcity and slow down the issuance of new LTC. This will also generate volatility in the market as scarcity leads to price fluctuations. In the case of Litecoin, halving results in an 8% lower price.
Summary
Litecoin halving occurs every four years. In halving, the block reward is reduced to half. It leads to scarcity and thus, leads to variations in price in the market. The Litecoin halving results in a lower price which results in a bearish market.
