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Why Bitcoin Will Reduce Production (Why Bitcoin Continues to Decline)

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Why does Bitcoin reduce production? According to CCN news, why does Bitcoin redu

Why Bitcoin Will Reduce Production (Why Bitcoin Continues to Decline)

Why does Bitcoin reduce production? According to CCN news, why does Bitcoin reduce production? According to Coinmarketcap data, every four years since July 1, 2015, there will be a new block reward halving in Bitcoin production adjustment. After two Bitcoin price crashes occurred in the first quarter of 2018, the price of Bitcoin also decreased significantly, reaching a low of around $28,000, but then returned to around $40,000.

The first Bitcoin halving occurred in 2016, which happened in early 2009. At that time, the mining difficulty of Bitcoin reached its peak, but due to changes in market supply and demand, the price of Bitcoin quickly fell, and eventually, the second production halving occurred at the end of 2017 (the third halving since 2012). In May 2020, when Bitcoin production reached its highest historical level, the entire network stopped running. This means that the network cost of Bitcoin has been reduced by more than half. Therefore, if the cost is not considered, it may cause more transaction fees and lower gas fees.

At the end of March 2019, Bitcoin ushered in its fourth quarter, the halving, because the increase in the computing power of the entire Bitcoin network doubled the supply of Bitcoin. Therefore, in order to maintain the status quo of Bitcoin, a major adjustment will be made every year. So what is Bitcoin? Why does Bitcoin gradually unlock liquidity within a year to generate new coins?

Why Bitcoin Continues to Decline

Bitcoin’s recent trend has been declining continuously, and the price continues to fall. Why does the price of Bitcoin continue to decline? The main reason is that the market’s demand for BTC is increasing, and the trading volume is gradually increasing. According to CoinMarketCap data, in the past 24 hours, the global average price of BTC was $4960, the global average price of ETH was $2897, the global average price of XRP was $0.186, and the global average price of BCH was $14.95. These two factors have led to bearish sentiment in the market.

As the exchange rate between BTC/USDT in cryptocurrency exchanges began to decline, there are now more than 1000 addresses holding at least one BTC in long positions, and these investors are actively buying other assets. However, despite the large amount of selling pressure, many people still hope to sell their positions in the coming days. This is true even for the largest cryptocurrency investment fund, Grayscale Investments. In addition, since the end of July 2020, institutions have been transferring funds to the cryptocurrency field, and this is one of the turning points when large cryptocurrency companies entered the market.

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