Halving

In simple terms

A halving is a pre-programmed moment when the reward for mining a Bitcoin block drops by half. It happens roughly every four years and is the reason Bitcoin's supply grows more and more slowly.

Definition

A scheduled event that cuts the new supply paid to Bitcoin miners in half.

In depth

Bitcoin's subsidy halves every 210,000 blocks, which at a ten-minute target is approximately four years. The schedule is fixed in consensus rules and enforced by every node, so it requires no coordination and cannot be rescheduled without a network-wide rule change. The geometric series converges to a maximum supply just under 21 million. As the subsidy trends toward zero, miner revenue is designed to shift to transaction fees, and whether fees alone can sustain sufficient hash rate is a genuine open question rather than a settled one.

How does Halving work?

Every node counts blocks. At each 210,000-block boundary the valid subsidy halves, and a block claiming more is rejected by the whole network. Miners keep the subsidy plus the fees from the transactions they include. After a halving, revenue per block falls immediately while costs do not, so less efficient miners shut down, difficulty adjusts downward at the next retarget, and the remaining miners find blocks at the target rate again.

An example

The subsidy went from an illustrative 6.25 BTC per block to 3.125 in 2024. A miner producing one block a day saw daily issuance revenue halve overnight, with transaction fees unchanged. The next difficulty adjustment then rebalanced block times after the least efficient capacity left the network.

Figures are illustrative only.

What beginners get wrong

• Treating a halving as a price event. It is a supply-schedule event that everyone has known about for years, and it is already public information.
• Assuming it applies to all cryptocurrencies. Halvings are specific to networks that adopt this schedule, and most do not.
• Expecting the date to be fixed. It is block-height based, so it arrives when the blocks arrive.

Related terms

• Bitcoin
• Mining
• Max Supply
• Emission Schedule
• Hash Rate
• Deflationary Token

Part of

What is tokenomics, and why does token supply matter? — the subject page for tokenomics and supply, with all 14 of its definitions in one place.