Last Updated on December 30, 2022
Halving in cryptocurrency is a reduction in rewards allocated to miners, validators, or anyone who benefits from the issuance of new tokens or coins.
Used to tame supply and improving an asset’s value against a stable or changing demand. With fewer new tokens or coins coming into circulation at a time, halving is believed to create scarcity.
- The “triple halving” of Ethereum refers to the reduction in ETH issuance by over 80%, which is similar to halving the Bitcoin system three times.
- This reduction in supply was instituted alongside the switch to the Proof-of-Stake consensus algorithm through the Ethereum Merge and came into full function as The Merge was completed.
- Ethereum’s “triple halving” slows Ether’s supply rate via reduction in issuance, staking and coin burning. This keeps already-circulating coins in check and makes Ether deflationary, improving Ether’s value through systematic scarcity.
From the genesis block in January 2009 to about four years later, the Bitcoin blockchain rewards each miner with 50 bitcoins for successfully validating a block. In November 2012 at the block height of 210,000, this was reduced to 25 bitcoin per block.
Bitcoin’s creator included pieces of code in the Bitcoin codebase that splits miners’ rewards after a certain number of blocks are added to the chain. The halving interval coincides with four years, but this is prone to deviations. The block height is a more accurate measure.