As Bitcoin Payouts Halve, Uncertainty Looms – Fortune

The hosts who maintain the servers of the Bitcoin network (so-called “miners”) are expecting some bad news early next month. Around July 10th, their pay will suddenly be cut in half, with the reward for a unit of computing work dropping from 25 bitcoins (currently around $14,250) to 12.5 coins. Bitcoin watchers are debating what exactly the consequences of that drop will be for the decentralized payments network, and some think there’s trouble ahead.

There’s no penny-pinching boss cutting fat at Bitcoin, Inc. (Actually, there’s no such thing as Bitcoin, Inc.) The regular halving of miner payouts has been baked into the open-source digital currency since it debuted in January of 2009, occurring roughly every four years. The cuts are intended to slowly throttle the growth of the Bitcoin supply, an anti-inflationary control that helped drive early faith in the technology.

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The first halving came in late 2012, when most miners were still small-scale hobbyists. Now, though, miners are more likely to run huge server farms with thousands of cutting-edge processors and full-time staff. They’re the essential workhorses of the Bitcoin network, processing and recording tens of millions of dollars in payments daily.


Read more ... source: TheBitcoinNews

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