The Bitcoin halving is a built-in rule that cuts the number of new bitcoins paid to miners in half every 210,000 blocks, which works out to roughly every four years. It is how Bitcoin enforces its fixed supply of just under 21 million coins. It matters because it slows the creation of new bitcoin, squeezes miners' income, and shifts more of the network's security budget onto transaction fees over time.
Where new bitcoin comes from
New bitcoin is created through mining. Miners compete to add the next block of transactions to the blockchain by doing proof-of-work, a process of repeatedly hashing data until one of them finds a result below a target value. The winner earns the block reward, which has two parts:
- Block subsidy: brand-new bitcoin created out of nothing by the block's first transaction, called the coinbase transaction.
- Transaction fees: the fees paid by users whose transactions are included in that block.
The halving only affects the subsidy. Fees are set by users competing for block space and are not touched by the halving.
The rule in the code
Bitcoin's software calculates the subsidy from the block height, which is the block's position in the chain. In simplified form:
halvings = block_height / 210000 (integer division)
subsidy = 5,000,000,000 >> halvings (in satoshis)
A satoshi is the smallest unit of bitcoin, one hundred-millionth of a coin, so 5,000,000,000 satoshis is 50 BTC. The >> operator shifts the number's binary digits one place to the right for each halving, which divides it by two and drops any remainder. Every node on the network runs this same rule. A miner that tries to pay itself more than the allowed amount produces an invalid block, and other nodes reject it.
The halving history
| Halving | Block height | Date | Subsidy per block |
|---|---|---|---|
| Launch | 0 | January 2009 | 50 BTC |
| First | 210,000 | November 2012 | 25 BTC |
| Second | 420,000 | July 2016 | 12.5 BTC |
| Third | 630,000 | May 2020 | 6.25 BTC |
| Fourth | 840,000 | April 2024 | 3.125 BTC |
| Fifth | 1,050,000 | Expected around 2028 | 1.5625 BTC |
The dates are not fixed in advance. The protocol targets one block every 10 minutes, and 210,000 blocks at that pace take about four years. Real block times vary, so each halving arrives on whatever day the network reaches the target height.
Why the supply stops just under 21 million
Each four-year era creates half as many coins as the one before. The first era created 10.5 million bitcoin, the second 5.25 million, the third 2.625 million, and so on. This is a geometric series that approaches 21 million but never reaches it.
Because the subsidy is counted in whole satoshis and the right shift drops fractions, the numbers round down along the way. After 33 halvings the subsidy shifts all the way to zero. That is expected around the year 2140. The final total will be slightly below 21 million, about 20,999,999.98 BTC. After that, miners will earn only transaction fees.
More than 90% of all bitcoin that will ever exist had already been mined by the time of the 2024 halving. Each future halving adds less and less to the total.
Why the halving matters
It slows the flow of new supply
After the 2024 halving, the network produces about 144 blocks a day at 3.125 BTC each, or roughly 450 new bitcoin daily. Before it, the figure was about 900. The annual rate of new issuance fell below 1% of the existing supply. Unlike most currencies, that growth rate is set by code and known years ahead. No central bank or committee can change it.
This predictability is a big part of Bitcoin's appeal to many holders. It is often compared to gold, whose supply also grows slowly, which is why bitcoin is sometimes called "digital gold."
It cuts miners' revenue overnight
Mining is a business. Miners spend money on specialized hardware called ASICs and, above all, on electricity. When the subsidy halves, their bitcoin income per block drops sharply on a single day, while their costs do not.
What typically follows:
- Miners with older, less efficient machines or expensive power may become unprofitable and switch off.
- If enough of them stop, blocks come more slowly for a while.
- Bitcoin's difficulty adjustment, which recalculates every 2,016 blocks (about two weeks), makes mining easier to bring block times back toward 10 minutes.
- The remaining miners each earn a larger share of the reduced rewards.
Miners measure this with hashprice, the expected revenue per unit of computing power per day. A halving roughly halves the subsidy part of hashprice at once. Whether miners stay profitable afterward depends on the bitcoin price, fees, their power costs and the efficiency of their machines.
It raises the long-term question of security
Miners secure Bitcoin. The more computing power they dedicate, the more expensive it is for anyone to attack the network, for example by rewriting recent blocks. That computing power is paid for by the block reward, which is sometimes called the security budget.
As the subsidy keeps halving, fees must make up a growing share of miners' income to keep security high. Whether fees alone will be enough over the coming decades is one of the most debated long-term questions about Bitcoin. Some argue that rising demand for block space and a higher bitcoin price will cover it. Others worry the budget could shrink over time. There is no settled answer.
It draws attention to the market
Halvings are among the most watched events in crypto. Past halvings have been followed, sometimes months later, by large price increases. But there have only been four halvings, many other factors were at play each time, and the date of each halving is known years in advance. That makes it hard to say how much of any price move was caused by the halving itself. Past patterns are not a reliable guide to future prices.
What the halving does not change
- It does not change the 10-minute block target or the maximum block size.
- It does not affect transaction fees directly, though miners may care more about fees afterward.
- It does not affect coins that already exist. Balances stay the same.
- It does not require a software upgrade or a vote. The schedule has been in the code since Bitcoin launched.
Key takeaways
- Every 210,000 blocks, about every four years, the new-bitcoin subsidy paid to miners is cut in half.
- The fourth halving, in April 2024, reduced the subsidy from 6.25 BTC to 3.125 BTC per block.
- The schedule caps total supply just under 21 million, with the last new coins expected around 2140.
- Halvings cut miner revenue sharply, and the difficulty adjustment rebalances the network afterward.
- Over time, transaction fees must pay for a larger share of Bitcoin's security.
- Past halvings have coincided with price moves, but they are no guarantee of future ones.
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