What Is Bitcoin Halving?
A bitcoin halving is an event where the reward for mining new blocks is halved, meaning miners receive 50% fewer bitcoins for verifying transactions.
After the network mines 210,000 blocks—roughly every four years—the block reward given to Bitcoin miners for processing transactions is cut in half. This event is called halving because it cuts the rate at which new bitcoins are released into circulation in half.
This rewards system will continue until about 2140, when the limit of 21 million Bitcoin is reached.
In 2009, the reward for each block in the chain mined was 50 bitcoins. As of April 2023, about 19.3 million bitcoins were in circulation, leaving just around 1.68 million left to be released via mining rewards.
The next bitcoin (BTC) halving is likely to occur in April 2024 and could have a dramatic impact on the cryptocurrency’s price.
Bitcoin halvings are important events for traders because they reduce the number of new bitcoins being generated by the network. This limits the supply of new coins, so prices could rise if demand remains strong.
When Did the Bitcoin Halvings Happen?
There have been three halvings as of April 2023:
Nov. 28, 2012, to 25 bitcoins
July 9, 2016, to 12.5 bitcoins
May 11, 2020, to 6.25 bitcoins
Why Are the Halvings Occurring Less Than Every 4 Years?
The Bitcoin mining algorithm is set with a target of finding new blocks once every 10 minutes. Some blocks take more than 10 minutes; some take less. This can decrease or increase the amount of time it takes to reach the next halving goal. For example, if blocks consecutively average 9.66 minutes to mine, it would take about 1,409 days to mine the 210,000 blocks required (four years is 1461 days, including one day for a leap year).
What Happens When There Are No More Bitcoins Left?
It is often thought that in 2140, the last bitcoin will be mined. However, if the reward is halved every 210,000 blocks, there will always be a mining reward—assuming the blockchain still exists at that time. The reward will just get smaller and smaller every time there is a halving if the practice continues.
