What Is the Bitcoin Halving
Why the bitcoin block reward is cut in half every 210,000 blocks, how it caps supply at 21 million BTC, and what it means for miners.
The bitcoin halving is a scheduled event built into the Bitcoin protocol. At regular intervals, the number of new bitcoins created with each block is cut in half. It is one of the best-known features of Bitcoin because it makes the issuance of new coins predictable for decades ahead.
Where new bitcoins come from
Bitcoin has no central issuer. New coins enter circulation through mining. Miners collect pending transactions into blocks and compete to add the next block to the chain. The network aims for one new block roughly every 10 minutes. The miner who adds a valid block receives a reward made of two parts:
- the block subsidy, which is newly created bitcoin
- the transaction fees paid by users whose transactions are included in that block
The halving affects only the first part, the block subsidy. Fees are set by users and are not changed by the halving.
How the halving works
The rule is simple: every 210,000 blocks, the block subsidy is divided by two. With a target of about 10 minutes per block, 210,000 blocks take roughly four years. The halving is tied to block height, not to a calendar date, so the exact day can only be estimated in advance. If blocks arrive a little faster or slower than 10 minutes on average, the date shifts.
No vote or announcement is needed. Every node on the network follows the same rule and simply rejects blocks that try to claim more than the allowed subsidy.
History of halvings
When Bitcoin launched in 2009, the block subsidy was 50 BTC. Since then it has been halved four times:
- 2012: from 50 to 25 BTC
- 2016: from 25 to 12.5 BTC
- 2020: from 12.5 to 6.25 BTC
- April 2024, at block 840,000: from 6.25 to 3.125 BTC
The next halving will happen at block 1,050,000 and is expected around 2028, depending on how fast blocks are produced until then.
Why the supply is capped at 21 million
Because the subsidy keeps halving, the total amount of new bitcoin forms a shrinking series. Add up all the subsidies across every halving period and the total approaches 21 million BTC, but never goes beyond it. Most of these coins have already been mined. Each new period adds half as many coins as the previous one, so the remaining amount trickles out more and more slowly.
Eventually the subsidy becomes smaller than the smallest unit of bitcoin, the satoshi, which is one hundred-millionth of a bitcoin. At that point, which is expected far in the future, the subsidy effectively reaches zero and no new coins are created.
What the halving means for miners
For miners, a halving cuts the subsidy part of their income in half overnight, while their costs for equipment and electricity stay the same. Miners with less efficient hardware or more expensive power may find mining no longer covers their costs, and some may switch off machines. The network handles this through difficulty adjustment: about every 2,016 blocks, Bitcoin recalculates how hard it is to find a block so that the average time stays near 10 minutes, regardless of how many miners are active.
Fees after the subsidy fades
Over time, as the subsidy shrinks, transaction fees are expected to make up a larger share of miner income. Whether fees alone will be enough to keep miners motivated and the network secure in the very long run is an open question that the Bitcoin community continues to discuss.
The halving and the market
The halving is often discussed in connection with bitcoin's price. The argument usually goes that fewer new coins entering the market changes the balance of supply and demand. Others point out that the halving schedule is known years in advance, so markets may already take it into account, and that price depends on many factors at once. There is no consensus, and past behavior around halvings does not guarantee anything about the future. What can be said with certainty is that the halving reduces the rate at which new bitcoins are issued.
Key points
- The halving cuts the block subsidy in half every 210,000 blocks, roughly every four years.
- The subsidy started at 50 BTC and has been 3.125 BTC since April 2024.
- The schedule is enforced by the code that every node runs, not by any company.
- It is the reason the total supply of bitcoin is limited to 21 million.
- Its effect on price is debated and cannot be predicted.