🚀🚀🚀What Is the Bitcoin Halving? How Bitcoin's Supply Is Limited🚀🚀🚀

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What is the Bitcoin halving?

Embedded in the Bitcoin code is a hard cap of 21 million coins. New Bitcoin is released through mining as block rewards. Miners do the work of maintaining and securing the Bitcoin ledger and are rewarded with newly minted Bitcoin.

However, approximately every four years, the reward for mining is halved, and each halving reduces the rate at which new Bitcoin enters the supply—a process that likely will last until 2140.

Did you know?

The first million Bitcoin were mined by Satoshi Nakamoto in 2009. Since then, over 93% of the total supply has been mined and only about 1.44 million more Bitcoin will ever be created.

A brief history

2009: Bitcoin mining rewards start at 50 BTC per block.

2012: The first Bitcoin halving reduces mining rewards to 25 BTC.

2016: In the second halving, mining rewards go down to 12.5 BTC.

2020: In the third halving, mining rewards drop to 6.25 BTC.

2024: In the fourth halving, expected to occur around April 2024, mining rewards drop to 3.125 BTC.

Bitcoin’s supply limit

To understand the Bitcoin halving, we must first understand the theory behind its supply.

The inventor of Bitcoin, Satoshi Nakamoto, believed that scarcity could create value where there was none before. After all, there’s only one Mona Lisa, only so many Picassos, a limited supply of gold on Earth.

Bitcoin was revolutionary in that it could, for the first time, make a digital product scarce—there will only ever be 21 million Bitcoin.

The idea of limiting Bitcoin’s supply stands in marked opposition to how fiat currencies such as the U.S. dollar work. Fiat currencies initially were created with firm rules—to create one dollar, the U.S. government needed to have in reserve a certain amount of gold. This was known as the gold standard.