Bitcoin Offshoot Undergoes ‘Halving’ in Prelude to Larger Blockchain’s Change

Olga Kharif, Bloomberg News

The Bitcoin logo on a cryptocurrency ATM, operated by Coinhero, in Hong Kong, China, on Thursday, Feb. 29, 2024. At the heart of the rally that is pushing Bitcoin toward a record high is a simple tenet of economics: supply and demand. Photographer: Paul Yeung/Bloomberg , Bloomberg

(Bloomberg) -- In a precursor to Bitcoin’s “halving” later this month, an offshoot cryptocurrency called Bitcoin Cash is reducing its supply of newly minted token by 50% Wednesday.

Bitcoin Cash split from Bitcoin in 2017, and jump started the so-called forking craze, in which dozens of software-development teams sought to create money out of thin air by tweaking the original computer code and releasing coins with “Bitcoin” in their names. Bitcoin Cash’s supporters include Roger Ver, who was known as Bitcoin Jesus in the early days of crypto for supporting Bitcoin before shifting his allegiance to Bitcoin Cash.

Bitcoin Cash rallied as much as 11.4% to $632 on Thursday, bouncing from a selloff in the prior session. The token is still well below its all-time high of about $4,355 set in 2017, based on CoinMarketCap data.

Bitcoin is due to undergo its own slashing of newly minted coins, which go to computers called miners that support its network, in about 16 days. Historically, Bitcoin halvings — supposedly because they’ve limited coin supply — have fueled market market booms.

--With assistance from Sidhartha Shukla.

(Updates with market data in the third paragraph.)