How the Bitcoin Halving Works

What actually gets cut in half

On the Bitcoin network, the miner who gathers transactions into a new block receives a reward. That reward has two parts: the bitcoin newly created in that block, and the fees paid by the transactions inside it. The halving cuts only the first part, the new issuance. Transaction fees have nothing to do with the halving; they depend on how busy the network is at the time.

• Block reward = new issuance + transaction fees
• The halving cuts the new issuance
• Fees vary with network congestion

Why every four years

Halvings are set by block number, not by date. Every time another 210,000 blocks are added, new issuance halves. The network adjusts mining difficulty every 2,016 blocks so that a block takes about 10 minutes on average. Multiply 210,000 blocks by 10 minutes and you get roughly four years, hence the four-year cycle. Because actual block times drift, the exact date only becomes clear as the halving approaches.

Halvings so far

Bitcoin launched in 2009 issuing 50 coins per block. The first halving in 2012 cut that to 25, the second in 2016 to 12.5 and the third in 2020 to 6.25. The fourth came in April 2024 at block 840,000, bringing it to 3.125. The next halving is scheduled for block 1,050,000.

• 2009 launch: 50 per block
• 2012: 25
• 2016: 12.5
• 2020: 6.25
• 2024: 3.125

The 21 million cap

When a reward keeps halving at fixed intervals, the total issued approaches a limit and stops growing. The first 210,000 blocks at 50 each produce 10.5 million coins, and each later stretch adds half as much as the one before, so the total converges on 21 million. Bitcoin can only be divided down to one hundred-millionth of a coin, so after enough halvings the reward drops below that unit and new issuance stops. That is expected around the year 2140, and most of the supply has already been issued.

What happens to miners

Right after a halving, the issuance part of miners' income drops by half overnight. Miners with high power and equipment costs may find it no longer pays and switch machines off, which lowers the network's total computing power, its hash rate. Blocks then come a little slower for a while, until the next difficulty adjustment lowers the difficulty and brings the interval back to about 10 minutes. As issuance keeps shrinking, whether fees can cover enough mining income to secure the network is still an open debate.

How this article treats price

Halvings are almost always discussed alongside price predictions, but this article makes none. The schedule has been public from the start, and four past cases are too few to count as statistics. Interest rates, regulation and the mix of market participants were different around each halving. Why stories that line up past price moves with halvings sound more convincing than they should is covered separately in the article on what cycle narratives actually do.

Common misconceptions

Some of what gets said about halvings rests on a misunderstanding of the mechanics. A halving does not reduce the supply of bitcoin; it slows the rate at which new supply is added. Not every cryptocurrency has halvings, as issuance rules differ by coin. Halvings are tied to block numbers rather than fixed dates, and a halving does not mean the end of mining.

• Supply shrinks → the growth rate of supply slows
• Every coin has one → issuance rules differ by coin
• It falls on a fixed date → it is set by block number
• Mining ends → it continues on fees and remaining issuance

Checking it yourself

Anyone can work out how long remains until the next halving. Look up the current block height on a block explorer, subtract it from 1,050,000 and multiply by 10 minutes for a rough estimate. The more blocks remain, the further the real date may drift from that figure. This article explains the structure of the issuance rule only and is neither a price forecast nor investment advice.