What is Bitcoin halving?

Bitcoin halving is an event that reduces the rate at which new bitcoin enters circulation, limiting supply growth and reinforcing Bitcoin’s scarcity.

How does a Bitcoin halving work?

New bitcoin is mined approximately every 10 minutes as miners compete to add blocks to the bitcoin blockchain.

When a miner gets the opportunity to add a block, they earn the transaction fees from all the transactions in the block and a block reward as a result. When a miner earns a block reward, it brings new bitcoin into circulation - this is the only way Bitcoin’s available supply can grow.

With Bitcoin’s supply capped at 21,000,000 bitcoin, halvings occur every 210,000 blocks to prevent inflation.

This means the block reward is halved approximately every 4 years.

Why does Bitcoin halving exist?

Bitcoin halving is a core part of the protocol, and is especially important to Bitcoiners for several reasons:

• Each halving cuts the block subsidy, so new bitcoin enter circulation at half the rate each halving. Anyone can verify the exact point where supply growth slows.
• A declining issuance rate limits long-term inflation.
• Early high rewards create a large, independent miner base. As adoption grows, rising fee revenue lets the block reward shrink without hurting network security.

When was the most recent Bitcoin halving?

The most recent Bitcoin halving happened on April 20th, 2024. It reduced the block reward from 6.25 BTC to 3.125 BTC.

When is the next Bitcoin halving?

The next Bitcoin halving will happen when Bitcoin reaches a block height of 1,050,000, meaning that the Bitcoin blockchain becomes 1,050,000 blocks long, expected in April 2028.

The exact date will become clearer as it approaches due to the slight fluctuations in Bitcoin’s block time.

The block reward will reduce from 3.125 BTC to 1.5625 BTC.

When is the final Bitcoin halving?

Eventually, the reward will decrease to zero, and all 21 million bitcoin will be mined once the block height reaches 6,930,000 - estimated to be sometime in the year 2140, assuming the 10 minute Bitcoin block time is consistent.

At this point, miners will only be paid the transaction fees from blocks they mine.

With blocks being mined approximately every 10 minutes, 210,000 blocks last approximately 4 years.

How will miners get paid after all Bitcoin is mined?

Once the final block reward has been paid out, the miners will continue to mine blocks as usual, without the block reward.

They will remain incentivized by the transaction fees which are included in each block, which by this point will be magnitudes higher than the block reward.

As the block reward keeps getting smaller with each halving, there will come a time when the fees in each block are usually higher than the reward itself. Based on the halving schedule, if fees remain consistent, this could happen in the coming 20-30 years.

Fees have occasionally been higher than the reward during busy times in the past, and one day this will likely become the normal state of the network.

Bitcoin halving timeline

Below is a chart showing the block rewards from the beginning to now, and until 2032 well as the final year of the process where the block reward is one satoshi, and then the when the block reward disappears in 2140, leaving miners with only the transaction fees in each block.