The Bitcoin halving date is usually a quadrennial event on the Bitcoin blockchain where the reward assigned to miners for successfully verifying and adding new blocks to the blockchain is substantially reduced. The term Bitcoin halving refers to the phenomenon where the reward for mining Bitcoin is cut in half.
The importance of the halving event lies in its role in reducing the rate of creation of new Bitcoins as the cryptocurrency approaches its fixed supply limit. In 2009, each block mined on the chain generated a reward of 50 BTC. As of October 2023, there are approximately 19.5 million BTC in circulation, leaving only around 1.5 million bitcoins to be released through mining rewards.
What is Bitcoin Halving?
After the Bitcoin network successfully processes 210,000 blocks approximately every four years, there is a reduction in the block rewards given to Bitcoin miners for their transaction processing efforts. This phenomenon is commonly known as the “bitcoin halving,” as it precisely halves the rate at which new BTC enter circulation.
This reward mechanism will last until approximately the year 2140, at which time the default limit of 21 million coins will be reached. Beyond this point, miners will be compensated through transaction processing fees paid by network users. This fee will eventually serve as motivation for miners to participate and sustain the network.
Previous Bitcoin Halving Events
There have been a total of three Bitcoin halving events so far. The first halving event occurred on November 28, 2012, in which the reward value for each block mined was 25 bitcoins. Subsequently, the second halving event occurred on July 9, 2016, halving the reward value again, reaching 12.5 bitcoins.
Lastly, the most recent halving event occurred on May 11, 2020, where the reward was reduced to 6.25 Bitcoins for each successfully mined block. With the next halving on the horizon, scheduled for mid-2024, the block reward will be 3,125 BTC.
Why does the halving happen every 4 years?
The Bitcoin mining algorithm is designed to seek the discovery of new blocks approximately every 10 minutes. However, the actual time needed to find the blocks can vary, sometimes exceeding 10 minutes and sometimes less. This variation in block mining times may shorten or extend the duration needed to reach the next halving milestone. For example, if blocks consistently take an average of 9.66 minutes to mine, it would take approximately 1,409 days to mine the 210,000 blocks needed (assuming four years of 1,461 days, including one day for a leap year).
When will the next Bitcoin halving date be?
The next Bitcoin halving is expected to take place around April 2024, coinciding with the mining of block 740,000. During this event, the block reward will be reduced from 6.25 bitcoins to 3,125 bitcoins. The exact date of the halving remains uncertain due to variable block generation time, with the network aiming for an average of one block every ten minutes.
BTC Price Prediction After BTC Halving
Bitcoin price is projected to reach an all-time high (ATH) after the upcoming Bitcoin halving event. Market experts, traditional financial companies, and CoinGape Media analysts predicted that the price of Bitcoin would surpass $120,000. The current ATH price is $68,789. Some experts, such as the CEO of investment management company ARK Invest, Cathie Wood, believe that the price of BTC will reach $1 million by 2030.
