The basic economic principles of demand and supply also apply to cryptocurrency. With Bitcoin, though, there is a catch: it has a fixed supply. This supply is currently capped at 21 million Bitcoins, of which 19 million have already been mined. With a fixed supply, demand for bitcoins is the reason for the fluctuations in their value. However, there is another factor that adds to periodic fluctuations in value. This is known as Bitcoin halving. What Is Bitcoin Halving and Why Does It Take Place? Bitcoin halving is the process through which the Bitcoin protocol halves the block reward for
