⏱ 5 min read [ INTERMEDIATE ]
The Bitcoin halving is one of the most anticipated events in all of finance. It happens every four years and has historically preceded some of Bitcoin’s biggest price movements. Here is exactly what it is and why it matters.
When Bitcoin was created, the system was designed to produce new coins at a controlled rate. Roughly every 10 minutes, a new ‘block’ is added to the blockchain, and the miner who added it receives a reward in Bitcoin.
The halving is a programmed event that cuts this reward in half every 210,000 blocks — approximately every four years. It is written into the code and cannot be changed by anyone.
Basic economics: when supply decreases and demand stays the same or grows, prices tend to rise. After each halving, the daily creation of new Bitcoin drops by 50%. If buyers continue at the same pace, there is simply less Bitcoin available — and prices tend to adjust upward.
| After each of the first three halvings, Bitcoin reached a new all-time high within 12 to 18 months. Past performance does not guarantee future results, but the pattern is hard to ignore. |
The halving continues until all 21 million Bitcoin have been mined. This is estimated to happen around the year 2140. After that, miners will only earn from transaction fees. The scarcity is permanent and built into the code.
| Key takeaway: The halving cuts Bitcoin’s new supply by 50% every four years. Historically, it has preceded major bull runs. The next one occurred in April 2024. |
