Bitcoin Halving

Bitcoin Halving is an event that occurs approximately every four years, reducing the reward that miners receive for adding new blocks to the Bitcoin Blockchain by half. This mechanism is built into the Bitcoin protocol to control the supply of Bitcoin and to coMBAt inflation.

For example, when Bitcoin was first launched in 2009, miners received a reward of 50 BTC for each block mined. The first halving took place in November 2012, reducing the reward to 25 BTC. The second halving occurred in July 2016, further reducing the reward to 12.5 BTC. The most recent halving happened in May 2020, cutting the reward to 6.25 BTC.

As a result of these halvings, the total supply of Bitcoin is capped at 21 million coins, creating scarcity that can influence the market price. Past halvings have often been followed by significant increases in Bitcoin’s price, although such trends are not guaranteed.