Last Updated on May 16, 2023
Bitcoin halving refers to an inbuilt 50% reduction in the mining block reward that occurs every 210,000 blocks – usually every four years.
This upcoming halving will be the fourth in Bitcoin’s history, cutting the block reward from 6.25 BTC to 3.125 BTC. There are 33 halvings programmed into the protocol, with the last set to occur in 2140 when the block reward zeros.
With a fixed maximum supply of 21 million coins, halvings slow down the number of coins coming into circulation – thus hardwiring a scarcity mechanism into the protocol. In theory, this process impacts supply-demand dynamics, acting as a tailwind to price.