Important points
Bitcoin halving helps control the supply. The latest halving reduced the reward for mining one bitcoin block to 3,125 BTC. The network will continue to function even after the last bitcoin halving.
Bitcoin halving is the process that reduces the rewards for mining bitcoin by half.
A Bitcoin halving event occurs every time an additional 210,000 blocks are added to the blockchain.
The most recent halving event took place on April 19, 2024. The event cut the reward from 6.25 BTC per block to 3.125 BTC per block.
Bitcoin halving helps manage the cryptocurrency’s supply and maintain its scarcity. Historically, bitcoin halving has led to an increase in its value.
Here’s what you need to know about bitcoin halving and its impact on the cryptocurrency market.
What is bitcoin halving? And how does it work?
Bitcoin halving revolves around miners, who lend their computing power to maintain and secure the bitcoin network. In return, they earn rewards in the form of new bitcoin.
“Every four years, or, more precisely, every 210,000 blocks, something unique happens in the world of bitcoin. This is called the bitcoin halving event,” said Konstantin Boyko-Romanovsky, CEO of Allnodes.
This reward is halved every four years, hence the term halving. This is akin to a predictable, scheduled pay cut for these miners.
Halving doesn’t just adjust miners’ rewards. It also reduces the rate at which new coins are created, reducing the new supply and affecting the market value.
Basics of bitcoin mining
Miners are the engine that makes the bitcoin machine run smoothly. These computer miners validate bitcoin transactions and add new blocks to the blockchain.
To help the ecosystem remain secure and operational, these miners must solve complex puzzles to validate new blocks. The first miner to succeed is rewarded with new bitcoin.
Bitcoin halving dates
Bitcoin halving doesn’t sneak up on you like a surprise birthday party. It follows a predictable cycle.
So let’s look at the historical halving events to understand bitcoin’s journey so far.
Previous bitcoin halving events
Halving occurs every 210,000 blocks. So it’s about every four years.
When was the last bitcoin halving?
The last bitcoin halving occurred on April 19, 2024. The halving occurred at block 840,000 in the bitcoin blockchain. This cut the reward for mining a single block from 6.25 BTC to 3.125 BTC.
The most recent halving occurred under unique circumstances compared to previous halvings.
New bitcoin spot exchange-traded funds launched in early 2024 fueled institutional demand. This is because bitcoin production has been delayed. Bitcoin prices have hit new highs in the current cycle ahead of the halving event. And this is something that has never happened before.
When will bitcoin halve again?
Bitcoin halvings occur every time an additional 210,000 blocks are added to the bitcoin blockchain. The next halving will occur when the blockchain reaches block 1,050,000. The rate of creation of bitcoin blocks varies but averages about one block every 10 minutes.
As a result, bitcoin halvings occur approximately once every four years. The next bitcoin halving is likely to happen in early 2028. But it is difficult to predict an exact date. The upcoming fifth bitcoin halving will cut the reward to just 1.5625 BTC.
Future bitcoin halving events
Bitcoin halvings will continue until the reward’s value reaches zero. And it is estimated to take place in 2140.
Why does bitcoin halving matter?
Bitcoin halving plays an essential role in controlling the cryptocurrency’s supply. If the supply of bitcoin decreases as a result of the halving and the demand remains constant or grows, this could, in theory, push the digital asset’s price higher.
“Theoretically, if there is less BTC available for miners to sell and steady demand from buyers, the price of each unit should continue to rise over time,” said Kadan Stadelmann, Chief Technology Officer at Komodo.
Bitcoin is also often considered “digital gold”. Therefore, every halving event becomes a focal point for market analysts and bitcoin enthusiasts.
Is bitcoin halving bullish?
Bitcoin halving is considered bullish because each event reduces the rate at which future bitcoins are created. This then increases the scarcity and value of existing bitcoins.
But a positive effect is not guaranteed. For example, while bitcoin’s price rose on November 28, 2012 and July 9, 2016, it fell on May 11, 2020. However, it rose shortly after the May 2020 halving. So it can be argued that halvings have historically been bullish indicators for bitcoin.
What happens if there are no bitcoins left?
Bitcoin’s supply is limited to 21 million. The final halving will be in 2140. From then on, no new BTC will be minted.
After the last bitcoin is mined, miners will no longer receive bitcoin rewards for adding blocks to the blockchain. But that doesn’t mean miners will become obsolete. They will continue to verify transactions to maintain bitcoin’s network.
Frequently Asked Questions (Frequently Asked Questions)
How often is bitcoin halved?
Bitcoin experiences a halving roughly every four years, or, more precisely, every 210,000 blocks.
What happens when bitcoin is halved?
When bitcoin is halved, the reward for mining new blocks on the blockchain is reduced by 50%.
The halving event is significant because it reduces the rate at which new bitcoins are created, contributing to their scarcity.
Does bitcoin halving increase the price?
Although not guaranteed, bitcoin halving events have historically been associated with an increase in the price of bitcoin.
Disclaimer for Uncirculars, with a Touch of Personality:
While we love diving into the exciting world of crypto here at Uncirculars, remember that this post, and all our content, is purely for your information and exploration. Think of it as your crypto compass, pointing you in the right direction to do your own research and make informed decisions.
No legal, tax, investment, or financial advice should be inferred from these pixels. We’re not fortune tellers or stockbrokers, just passionate crypto enthusiasts sharing our knowledge.
And just like that rollercoaster ride in your favorite DeFi protocol, past performance isn’t a guarantee of future thrills. The value of crypto assets can be as unpredictable as a moon landing, so buckle up and do your due diligence before taking the plunge.
Ultimately, any crypto adventure you embark on is yours alone. We’re just happy to be your crypto companion, cheering you on from the sidelines (and maybe sharing some snacks along the way). So research, explore, and remember, with a little knowledge and a lot of curiosity, you can navigate the crypto cosmos like a pro!
UnCirculars – Cutting through the noise, delivering unbiased crypto news
