All You Need to Know About Bitcoin Cash's First Block Reward Halving

Siamak Masnavi

Bitcoin's third block reward halving is still 35 days away, but around 11:00 Eastern Time (or 15:00 UTC) on Wednesday (April 8), Bitcoin Cash will have its first block reward halving.

According to data from CryptoCompare, in the past 7-day period, the price of Bitcoin Cash (BCH) has gone from $218.48 to $273.44, i.e. up an impressive 25.15% against USD, as you can see from the BCH-USD price chart shown below:

BCH-USD 2 Week Chart on 8 Apr 2020.png

As for the past 24-hour period, BCH-USD is up almost 6%.

In fact, currently, the top two gainers amongst the 50 most valuable cryptoassets (by market cap) are the two forks of Bitcoin that have their block reward halving this week, i.e. Bitcoin Cash and Bitcoin SV (which is up almost 13% today).

Per data from Bitcoin Cash block explorer Blockchair, at the time of writing (08:18 UTC on April 8), a major milestone for Bitcoin Cash, i.e. its first block reward halving is happening in approximately 6 hours and 28 minutes, which is when block #630,000 will get mined.

So far, 629,960 BCH blocks have been mined, and there have been 287,234,155 transactions.

Bitcoin Cash "block reward halving", or just "halving" for short, is the event that results in the halving of BCH rewards given to BCH miners when they manage to verify a BCH block and add it to the BCH blockchain (a new block is produced roughly every 10 minutes). 

When the upcoming BCH halving occurs, the BCH block reward will go from 12.5 BCH to 6.25 BCH.

Approximately, every four years, i.e. after every 210,000 blocks have been mned, the block reward halves, and this process continues, until the block reward reaches zero (which will happen by year 2140).

Currently, the number of BCH coins in circulation is 18,374,490, and of course, as with Bitcoin, the maxium supply is capped at 21 million.

Currently, the BCH hash rate is 3.80 Eh/s, and Coin Dance says the top four (known) mining pools are AntPool, BTC.TOP, ViaBTC, and BTC.com:

top BCH mining pools on 8 Apr 2020.png

Bitcoin's third block reward halving is occurring in 35 days, i.e. on May 12. The reason that BTC and BCH have different halving dates has to do with the difficulty adjustment algorithm.

Here is some background:

"Both Bitcoin, as well as Bitcoin Cash, use a proof-of-work algorithm to timestamp every new block. The proof of work algorithm used is the same in both cases. It can be described as a partial inversion of a hash function. Additionally, both Bitcoin and Bitcoin Cash target a new block to be generated every ten minutes on average. The time needed to calculate a new block is influenced by a parameter called the mining difficulty. If the total amount of mining power increases, an increase of the mining difficulty can keep the block time roughly constant. Vice versa, if the mining power decreases, a decrease of the mining difficulty can keep the block time roughly constant.

"To keep the block generation time equal to ten minutes on average, both Bitcoin and Bitcoin Cash use an algorithm adjusting the mining difficulty parameter. This algorithm is called the difficulty adjustment algorithm (DAA). Originally, both Bitcoin and Bitcoin Cash used the same difficulty adjustment algorithm, adjusting the mining difficulty parameter every 2016 blocks. Since 1 August 2017, Bitcoin Cash also used an addition to the DAA, called an Emergency Difficulty Adjustment (EDA) algorithm. EDA was used alongside the original DAA and it was designed to decrease the mining difficulty of Bitcoin Cash by 20%, if the time difference between 6 successive blocks was greater than 12 hours.

"EDA adjustments caused instabilities in mining difficulty of the Bitcoin Cash system, resulting in Bitcoin Cash being thousands of blocks ahead of Bitcoin. To address the problem with stability, a change of the Bitcoin Cash DAA was implemented and the EDA canceled. The change took effect on 13 November 2017. After the change, the Bitcoin Cash DAA adjusts the mining difficulty after each block. To calculate the difficulty for a new block, the Bitcoin Cash DAA uses a moving window of last 144 blocks."

Ethereum Was Behind 85% of Dapps' $12 Billion Volume in Q2 2020

The total transaction volumes of decentralized applications (dapps) in the cryptocurrency space hit $12 billion in the second quarter of this year, rising by $4.5 billion compared to the first quarter. Etheruem dapps accounted for 85% of the volume.

According to DappRadar’s Industry Review report, there are more than 70,000 active wallets across 13 different blockchains interacting with the cryptocurrency space. The top blockchains were EOS, TRON, and Ethereum, with the latter representing $10.2 billion of the $12 billion volume seen in Q2.

Ethereum’s large transaction volume was partly fuelled by Compound and the launch of the COMP token, which led to a “yield farming” trend, in which users were interacting with the protocol as much as possible to receive COMP tokens. Compound saw $1.2 billion move through it.

The yield farming trend saw Ethereum gas prices and transaction fees increase, which according to the report did not stop Ethereum dapps from thriving in general. It did, however, contribute to an 80% drop quarter-on-quarter for ETH gaming dapps, as high gas prices are “killing” their activities on the cryptocurrency’s network.

Despite Ethereum’s growth, EOS and TRON (TRX) dapps have also seen their activity increase in the second quarter of the year. According to the report in only three months, TRON’s transaction volumes on decentralized applications surged by over 17,200%.

The rise was largely attributed to Oikos.cash, a TRON-based version of the Compound lending protocol.  While TRON’s DeFi growth has been notably, DappRadar pointed out that most dapps on its blockchain are still in the “gambling” and “high risk” categories.

The EOS blockchain has still been enduring the effects of the EIDOS token airdrop, which put the network into “congestion mode.” The airdrop clogged the network and as a result, from 2019 to 2020 wallet activity on decentralized applications dropped 53%.

So far this year, $1.9 billion have been transacted on decentralized applications using the EOS blockchain, thanks to two dapps: Crypto Dynasty and Upland. DappRadar’s report also shows that two other blockchains are growing thanks to gambling dapps: WAX and ThunderCore.

Featured image via Pixabay.