Halving Bitcoin: How the reward reduction works

ser_ngmi · 2025-12-21T11:23:29+00:00

Halving in the cryptocurrency world is a crucial event for Bitcoin, occurring every 210,000 blocks and reducing miners' rewards. This process controls Bitcoin's supply, ensuring scarcity. After 32 halvings, the maximum supply of 21 million BTC will be reached, ending the mining era. Investors monitor these events for their impact on market prices.

ser_ngmi

2025-12-21 11:23:29

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The History of Halving and Its Mechanism

In the world of cryptocurrencies, halving is a critical moment in the development of Bitcoin. The event occurs every 210,000 blocks (approximately every four years) and results in a reduction of the rewards that network participants receive for validating transactions. This pre-programmed process is a fundamental part of the design of Bitcoin.

The first halving occurred in 2012, when the reward was reduced to 25 BTC. Subsequent iterations in 2016 and 2020 consecutively decreased this figure to 12.5 and 6.25 BTC, respectively. The next reduction is scheduled for April 2024 at a height of 840,000 blocks, which will lead to a reward of 3.125 BTC.

What is the purpose of halving?

The main goal of the mechanism is to control the issuance of Bitcoin and ensure its scarcity. The total supply remains capped at 21 million coins. Without halving, the cryptocurrency would be issued without limitations, which would devalue the asset. The regulated reduction in the issuance rate provides a predictable schedule for reaching the maximum supply.

As of today, over 90% of all Bitcoin has been mined. According to experts' estimates, the mining of the last BTC will be completed around the year 2140. This long time horizon makes Bitcoin unique as a monetary instrument.

Impact on Owners and Portfolios

Many people ask: what will happen to the already mined coins? The answer is simple – your current Bitcoin balance will remain unchanged after the halving. The event itself does not directly affect the number of already mined tokens. However, the indirect impact can be significant – halvings often affect market price and trading dynamics.

This explains why investors, traders, and analysts closely monitor such events. Historically, halvings have correlated with significant movements in the price of Bitcoin, although the causal relationship remains debatable.

The Future of Halving

The process will not last forever. After 32 halvings, the mechanism will stop, and new Bitcoin will no longer be produced. By that time, the entire supply of 21 million BTC will be exhausted, marking the end of the mining era.

You can track the countdown to the next halving using specialized tools that monitor the blockchain height in real time.

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