Vertcoin (VTC/USD) underwent its very first block prize halving since its launch te 2014 this Tuesday, following which the prize for all freshly mined blocks has bot diminished by 50%, from 50 VTC to 25 VTC.
A Litecoin (LTC/USD) fork, Vertcoin is a purely transaction-focused cryptocurrency, spil compared to utility-focused coins such spil Ethereum (ETH/USD). However, while it is similar to Bitcoin (BTC/USD) and Litecoin on many counts, it differs from both ter one key facet – it is ASIC-resistant and supports decentralized mining.
Unlike BTC and LTC, overheen which mining giants like Bitmain exert considerable control, Vertcoin brands itself spil “the people’s coin,” which is “owned by its users” and is “not managed by large banks or mining hardware manufacturers and can be mined by anyone profitably.”
Spil vanaf a blog postbode by the Vertcoin development team, the aim is to avoid “an environment where the companies ultimately control the ASIC coins and have a vested rente to pursue profit overheen progress.”
Vertcoin’s block prize halving (which occurred on block 840,000) represents a significant milestone te its growth. Every coin that is mined using Proof of Work, such spil Bitcoin, Litecoin, and Vertcoin, creates fresh supply when miners confirm fresh blocks. This is known spil the block prize which miners receive ter exchange for dedicating computing power to the network, and it varies from coin to coin (combined with the transaction fees that miners receive, it makes up part of the total mining prize). Ter the case of Vertcoin, the block prize wasgoed originally set at 50 VTC.
Block prize halving is a mechanism integrated into the protocol by vormgeving, to control a coin’s supply. The total supply of Vertcoin is 84 million, and the creation of fresh coins needs to be paced, to ensure a cryptocurrency’s healthy growth.
To maintain a stable, distributed supply, block prizes are typically halved spil vanaf a pre-set schedule (every Four years, ter the case of Vertcoin). Spil block prizes decrease, the supply is diminished while the request stays onveranderlijk or increases overheen time, ultimately driving the price higher. For Vertcoin miners, the prize is now 25 VTC, and it will proceed to be halved every four years until the last VTC is mined.
While the halving reduces the block prize miners receive, and some miners will invariably zekering operating due to the decreased profitability, Vertcoin will adjust the difficulty levels according to the diminished network hash, eventually finding a balance. Additionally, spil the network grows and transaction volumes increase, miners stand to profit from enhanced transaction fees.
Albeit it might not seem like it originally, block prize halving is, te fact, an essential and positive part of a coin’s life cycle. Fatter coins such spil BTC and LTC have also undergone halvings, which have resulted ter an eventual increase te value. BTC’s last halving occurred ter mid-2016, and the cryptocurrency is now trading above the $17,000 price point. Similarly, while LTC’s halving primarily resulted te decreased network hash, the price stabilized and eyed significant increases six months straks. Presently, LTC is trading above $300 (at press time).
While VTC had bot trading under $Two until late October this year, it experienced a significant surge ter December, leaping to above $Ten on the 6 th . This spike te price can be partly attributed to the Bitcoin rally and possibly to the anticipation of the halving event. Following the block prize halving, VTC is back down to the $8-9 ranges, and is presently trading at $8.49 (at press time).
While price is not affected instantly spil a result of the block prize halving, a longer-term influence is to be expected. The VTC price, which is now a little lower than what it wasgoed a week ago, is possibly so because the halving wasgoed already factored into the surge. However, with time, spil supply reduces and request increases, a netwerken positive effect on the price is anticipated.