Halving refers to a process that reduces the issuance rate of new proof of work (PoW) cryptocurrency. More specifically, halving is the periodic reduction of the block subsidy provided to miners. Halving ensures that a crypto asset will follow a steady issuance rate until it eventually reaches its maximum supply.

What Is Bitcoin Halving?

Bitcoin halving refers to a pre-programmed event in the Bitcoin protocol that occurs approximately every four years or after 210,000 blocks have been mined. During a halving event, miners’ rewards for mining new blocks is reduced by half. This means that fewer new bitcoins are introduced into circulation, decreasing the rate of inflation.
The halving is an important part of the Bitcoin protocol, and since the code is open-source, anyone is able to see it. For instance, the Bitcoin Core implementation is available to view on GitHub.

Why Does Bitcoin Halving Occur?

Halving is an important aspect of Bitcoin’s tokenomics, which is designed to control the supply of bitcoins over time, with the goal of creating a scarce and valuable digital asset. The total supply of bitcoins is capped at 21 million, and the halving process ensures that this limit is approached at a predictable rate over time.

Bitcoin’s halving promotes stability over time by helping to ensure a more stable and predictable market. If the supply of new bitcoins were to continue at a high rate indefinitely, it could lead to hyperinflation and even greater volatility in the market.

The slow release of new bitcoins through halving also promotes a more equitable distribution of the currency. By limiting the supply of new coins, Bitcoin’s halving ensures that early adopters do not have an unfair advantage over new entrants.

When Is the Next Bitcoin Halving Date?

Bitcoin’s next halving is expected to take place in 2024, approximately four years after the last halving, which took place in May 2020. Therefore, the exact Bitcoin halving dates are not known in advance. To date, more than 90% of all bitcoins have been mined, and it is estimated that the last bitcoin will have been mined by the year 2140.

Bitcoin Halving Countdown Timer by Binance Academy

Bitcoin’s block reward (or subsidy) was initially set at 50 BTC when its genesis block was mined. It was then reduced to 25 BTC in 2012, 12.5 BTC in 2016, and to 6.25 BTC in 2020. The next halving in 2024 would reduce the block reward to 3.125 BTC. Once 32 halvings have occurred, the process stops and no more bitcoins are created. At that point, the maximum supply of 21 million BTC will be reached.