How the Bitcoin halving works and its impact on price

February 20, 2024
6 min read

After the approval of Bitcoin spot ETFs in the United States, the next milestone for Bitcoin is already upon us. In the spring of 2024, the entire community is looking forward to an event called the Bitcoin halving. This is a periodic event that significantly impacts the supply of Bitcoin and thus indirectly affects the value of the currency. We discuss the Bitcoin halving, the historical impact, and what we can expect from the upcoming halving(s).

The Bitcoin halving in a nutshell

When the Bitcoin network was launched in 2009, the reward for adding (mining) a new block was 50 BTC. So with today's prices, a miner would receive more than $2 million in Bitcoin for each block. Obviously, since a new block is mined about every 10 minutes, that would not be a sustainable model.

Therefore, every 210,000 blocks, which is roughly every four years, this reward is halved. This event is known as the Bitcoin halving.

The longer explanation

The Bitcoin blockchain consists of blocks linked together like a chain. It is a digital ledger that can be viewed by anyone. Each block contains multiple transactions or mutations. Miners, which are very advanced computers, solve complex mathematical puzzles to verify the transactions in the next block, adding a new block to the blockchain.

As a reward for their work, miners receive a block reward. This consists of transaction fees sent along by users, and newly created or mined bitcoins. Thus, miners ensure the creation of new bitcoins. As mentioned earlier, the reward per new block was originally as much as 50 BTC.

What's special about Bitcoin is that they have a mining schedule where this reward is halved every 210,000 blocks. This mechanism is built into Bitcoin's original code and therefore cannot be modified. So this event happens automatically, and there is no one pushing a button to halve the reward whenever it suits them.

In 2020, during the most recent halving, the reward was reduced to 6.25 BTC. So after the next halving, it will be 3.125 BTC. This halving process will eventually continue until the maximum supply is reached, expected around the year 2140. After this point, no new BTC will be created through mining. Miners will then only receive transaction fees as compensation.

Bitcoin halving has a direct impact on the profitability of mining. As the reward per block halves, it becomes increasingly difficult to mine profitably, especially for miners with older hardware or higher operating costs such as energy prices. This can lead to a decrease in the number of active miners and a slowdown in the rate at which new bitcoins are mined.

Inflation & the Bitcoin halving

Precious metals such as silver and gold have value largely because they are scarce. There is a limited supply of them. By gradually reducing the supply of new bitcoins, scarcity is also created for Bitcoin. This creates deflationary pressure on the price. The idea is that as Bitcoin becomes scarcer, its value could increase over time, provided demand continues to grow.

An important aspect of Bitcoin is the maximum supply. Unlike fiat currencies such as dollars and euros, which central banks can print unlimited amounts of, there is a set maximum of 21 million bitcoins. The exact amount is actually 20,999,9999,9999,9769 BTC, but colloquially we talk about 21 million. During the first halving in 2012, half of Bitcoin's total supply was already in circulation. With the halving, inflation continues to decline. For example, after the first halving, inflation dropped from 50 to 12 percent. Meanwhile, inflation is less than two percent. The maximum supply further contributes to the deflationary nature of Bitcoin and its value as a scarce asset.

The historical impact of the halving on the price

Of course, past results are no guarantee for the future, but historical data show that previous halvings have led to significant price increases for Bitcoin. So far, the year following a halving each time had a considerably firmer rise than the year leading up to it. Consequently, the halving ushered in new bull runs.

graph halving
Graph showing the development of the Bitcoin price, with previous halvings highlighted

Future Bitcoin halvings

The tricky part is that finding a new block usually takes about ten minutes. But this can be a little faster sometimes and a little slower other times. As a result, we cannot say for sure exactly when a halving will occur.

What we do know is that it is about every four years, and we are very close to the next halving. There are several websites with countdown timers based on their estimates and models. Currently, the expectation for the next halving is mid-April 2024. The next Bitcoin halving is scheduled at block 840,000. On you can see which block was last mined. After this halving, the reward for miners will be reduced to 3.25 BTC.

As mentioned, there is a halving about every four years, so the halving after 2024 will probably take place in the spring of 2028. This will be followed by another halving about four years later, around 2032. This pattern will continue until the maximum of 21 million bitcoins is reached, expected in 2140. This is the most important data for the next few halvings:

HalvingBlock numberBlock reward (rounded)New BTC per day*
January2009050 BTC7200
November 2012210,00025 BTC3600
July 2016420,00012.5 BTC1800
May 2020630,0006.25 BTC900
April 2024840,0003.13 BTC450.7
Approx. 20281,050,0001.56 BTC224.6
Approx. 20321,260,0000.78 BTC112.3
Approx. 20361,470,0000.39 BTC56.2
Approx. 20401,680,0000.20 BTC28.8
Approx. 20441,890,0000.10 BTC14.4
Approx. 20482,100,0000.05 BTC7.2

*This is only an indication. Assuming one block is mined every ten minutes, that would be 144 blocks per day. However, the exact time per block varies greatly, so on some days there will be more or less new BTC added.

What can investors expect from the upcoming halving?

The upcoming halving in 2024 is likely to have a similar impact as previous halvings, though possibly at a different scale. With reduced pay per block, miners will face reduced profitability. As long as prices continue to rise and miners find ways to operate more efficiently, the halving will not be a problem for most miners and mining companies.

Bitcoin's scarcity will increase after the halving, which, with equal demand, will usually cause prices to rise. Keep in mind that things also depend on broader economic developments such as geopolitical conflicts, purchasing power, employment, and general economic policies.


The Bitcoin halving is a crucial part of the Bitcoin protocol. With the next halving on the horizon, we can expect Bitcoin to be in the spotlight again. Combined with the approval of Bitcoin spot ETFs earlier this year, many investors expect the halving to usher in another bull run.

Investors worldwide are already taking into account a possible effect the next halving could have. We too continue to closely monitor developments and adjust our crypto asset management strategy accordingly.

The information provided in our articles is intended solely for general informational purposes and does not constitute (financial) advice.

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