Since its inception in 2009, Bitcoin has captured the imagination of millions around the world. You may know about its decentralized nature, its massive price fluctuations, or the widely discussed “Bitcoin halving.” But how does halving affect the supply of new coins coming into the circulation?
Let’s dive into this long form blog to explain a little bit about what is bitcoin halving, how its historical context has played out, show you a halving chart, and find out how the whole process affects your Bitcoin’s price and its network.
What is Bitcoin halving?
Before we get into block rewards and the specific dates, it’s helpful to quickly remind ourselves of Bitcoin’s overall design. Bitcoin operates on a blockchain, on which “miners” add new blocks of transactions. Miners solve cryptographic puzzles with computational power and, should they succeed, they are awarded freshly minted Bitcoin (as well as any transaction fees in that block).
But as Satoshi Nakamoto (Bitcoin’s maker) programmed the system the payout for where the mining blocks is planted not be forever held constant. Instead, it halves the block reward roughly once every four years. That event is called a bitcoin halving.
This native mechanism keeps the amount of Bitcoin limited. The total cryptocurrencies ever existent can only be 21 million BTC. By periodically halting the emission of new BTC, the protocol can slowly distribute coins over longer periods time and limit inflation.
Why Bitcoin Halving Matters
- Supply Dynamics: Each halving reduces the number of new bitcoins entering circulation, potentially influencing price dynamics if demand remains the same or increases.
- Mining Economics: When the reward is cut in half, miners earn fewer new bitcoins for their efforts. This shift can impact their profitability.
- Investor Psychology: Historically, halvings have coincided with heightened market attention and speculation around Bitcoin’s value.
How Often Do Bitcoin Halving Occur?
Bitcoin halvings happen approximately every 210,000 blocks added to the blockchain. A new block is mined approximately every 10 minutes. Doing the math, 210,000 blocks take roughly four years to mine.
That timeframe isn’t fixed to precise calendar dates, as the average block time can vary, but the four-year interval is a good rule of thumb. For example, if blocks are being found faster than 10 minutes on average, the halving will happen slightly earlier than expected. If blocks are discovered slower than expected, the date gets pushed further back.
Bitcoin Halving 2020 Recap
The 2020 Bitcoin Halvingoccurred on May 11, 2020. This was the third halving event since Bitcoin’s birth, reducing the block reward from 12.5 BTC to 6.25 BTC per block. After the event, there was a increase of interest, with many wondering how the price would react.
- Block Reward: Dropped from 12.5 BTC to 6.25 BTC.
- Market Reaction: Shortly after, Bitcoin’s price fluctuated. Over the next several months, it experienced upward momentum, culminating in the well-known bull run that peaked in late 2021.
- Mining Adjustments: Some smaller mining operations faced challenges as rewards diminished, but the bigger players persevered, aided by rising BTC prices.
A Glimpse at Bitcoin Halving 2024
The last bitcoin halving, which is Bitcoin Halving 2024 took place on April 17, 2024. The miners’ rewards was be cut from 6.25 BTC to 3.125 BTC per block. Let’s do a brief overview of what that implies. The price was $64,125.69 on April 18, the next day after the halving.
- Block Reward: Dropped from 6.25 BTC to 3.125 BTC
- Market Reaction: Bitcoin’s price was risen to another height. After Donald trump’s victory in November, 2024 US Election, the price jumped to all time high, $108,268 in December.
When Is the Next Bitcoin Halving?
It might feel a little early to talk about 2028 since bitcoin halving 2024 just happened yet. But it’s a popular question: “When is the next halving?” We can estimate it happening about four years after 2024, so somewhere between early 2028 and mid-2028.
As always, the exact date is subject to how quickly blocks are mined. If the network hash rate — that is, the total computing power directed toward mining — goes up, blocks may be discovered more quickly, bringing forward the date of the 2028 halving. On the other hand, if the hash rate drops, then the network could slow down, pushing the event back to a later date in that year.
Technical Breakdown: Block Rewards & Difficulty
To understand why halving happens, it is useful to take a look at two of the main components of Bitcoin’s design: block rewards and mining difficulty.
- Block Rewards: As you may remember, miners that successfully solve the puzzle to create a new block receive a specific amount of BTC. This reward was 50 BTC per block in 2009 and has since been halved at regular bitcoin halving intervals
- Mining difficulty: The Bitcoin network retunes difficulty every 2,016 blocks (ie, approximately every 2 weeks). This mechanism tries to maintain the average block time at around 10 minutes. More miners come in with more hash, blocks are found more quickly, make the difficulty go up.
These two things create a feedback loop. The block reward eventually tapers off to nearly nothing, and difficulty wait limits the apparent speed of blocks being created.
Potential Impact on Price and Mining
People often say that a bitcoin halving triggers a bullish wave. While that’s been true in past cycles, the market is more complex nowadays. Here are some possible outcomes:
- Price Pressure Upwards: Once the new supply of BTC issued is cut in half, the market has less and less coins available to sell to potential buyers. If demand does not change or increases, the price may be pushed up.
- Short-Term Volatility: Halving events are hot stuff, leading to speculative buy-sell activity. This can cause price fluctuations leading up to the date of the event.
- Mining Landscape: Miners become less profitable when price doesn’t increase enough to make up the reduced reward. Less profitable mining rigs will go off-line over the next few weeks, temporarily compressing hash rate.
- Market Maturity: As Bitcoin’s market matures, subsequent halving events may not create the same level of frenzy. Institutional investors and a wider audience may respond differently than when they did in the early days.
Handy Bitcoin Halving Chart (With Past & Future Dates)
If you’re a visual learner, a halving chart can help.
| Event | Approx. Year | Block Reward | Date Range |
| Genesis (no halving yet) | 2009 | 50 BTC | Jan 3, 2009 |
| 1st Halving | 2012 | 25 BTC | Nov 28, 2012 |
| 2nd Halving | 2016 | 12.5 BTC | Jul 9, 2016 |
| 3rd Halving | 2020 | 6.25 BTC | May 11, 2020 |
| 4th Halving | 2024 | 3.125 BTC | April 17, 2024 |
| 5th Halving | 2028 | 1.5625 BTC | 2028 (est.) |
After 2028, halvings will continue roughly every four years until the reward is nearly zero, which is projected to happen around 2140.
Final Thoughts
Bitcoin halving is a fundamental characteristic of the cryptocurrency’s economic structure. This would bring the total number of such halvings to three, and brings the network even closer to its maximum supply of 21 million coins. These halvings function as natural countdowns, attracting the attention of miners, investors, and the general public.
Halvings have historically been causes for much excitement and speculation. It is a fairly significant change after all, the reduction of the supply of new coin. Many remember that the bitcoin halving 2024 contributed to the price rise after. But that does not ensure the same result for future events. The markets change, global macroeconomics change, Bitcoin itself is more mainstream than ever.
At the end of the day, halving is just one of the things that makes Bitcoin unique. It is a constant reminder that scarcity is the central to the design. Each halving event is a nod to the idea that digital money can be finite in supply—and that idea alone is revolutionary enough for folks to be interested for years to come.
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