Bitcoin continued its gradual recovery in 2016, with the price steadily increasing throughout the year, breaking past $700 by mid-year and approaching $1,000 by December. 

A major event was the second Bitcoin halving, which occurred in July, reducing the block reward from 25 BTC to 12.5 BTC. This event was anticipated by the community and likely contributed to the positive price momentum by further constraining the new supply of bitcoins. 

The year also saw a growing awareness of other cryptocurrencies and blockchain platforms, notably Ethereum, and the rise of Initial Coin Offerings (ICOs), although Bitcoin remained the dominant cryptocurrency. 

The debate around Bitcoin’s scalability and transaction capacity continued to be a significant topic within the community.

Bitcoin Milestones in 2016

• May: The DAO, a decentralized autonomous organization built on Ethereum, raised a record amount, highlighting the growing interest in blockchain applications beyond Bitcoin (though its later collapse impacted the broader crypto sentiment).
• July 9: The second Bitcoin halving occurred, reducing mining rewards to 12.5 BTC per block.
• August: Major cryptocurrency exchange Bitfinex was hacked, resulting in the theft of a significant amount of Bitcoin and a temporary price drop.
• Throughout the year: Bitcoin’s price showed a strong upward trend, nearly doubling from the start of the year. The discussion around scaling solutions like Segregated Witness (SegWit) intensified.