What Is the Bitcoin Halving? Supply, Miners and Risk

01What exactly gets cut in half?

Each new bitcoin block contains a reward for the miner who found it. That reward has two parts: the block subsidy, newly created bitcoin, and the transaction fees paid by users whose transactions are in the block. The halving affects only the subsidy. Fees are set by demand for block space and are not halved.

The rule is short enough to read directly in Bitcoin Core's source code. The function that sets the subsidy starts at 50 BTC and shifts it right by one bit, which halves it, for every 210,000 blocks that have passed. The code comment states that this will happen approximately every four years. After 64 halvings the subsidy is forced to zero.

The Bitcoin whitepaper describes the idea behind it: once a predetermined number of coins have entered circulation, the incentive for miners can move entirely to transaction fees.

02When have halvings happened, and when is the next one?

Halvings are set by block height, not by calendar date. That is why the date of the next one is always an estimate that drifts as blocks arrive faster or slower than the ten-minute target.

• Block 210,000 (2012): subsidy 50 → 25 BTC.
• Block 420,000 (2016): 25 → 12.5 BTC.
• Block 630,000 (2020): 12.5 → 6.25 BTC.
• Block 840,000 (2024): 6.25 → 3.125 BTC.
• Block 1,050,000 (expected around 2028): 3.125 → 1.5625 BTC.

Bitcoin targets one block every ten minutes. Every 2,016 blocks, about two weeks, the network adjusts mining difficulty so that blocks keep arriving close to that pace. The developer documentation describes the target as 1,209,600 seconds for each 2,016 blocks. That adjustment is what keeps 210,000 blocks close to four years: 210,000 × 10 minutes is about 1,458 days.

03How much new bitcoin is issued after a halving?

With about 144 blocks a day (24 hours × 6 blocks an hour), the subsidy sets the daily flow of new coins. These figures follow directly from the rule above; they are averages, because real block times vary.

• At 3.125 BTC per block: about 450 BTC a day, or roughly 164,000 BTC a year.
• At 1.5625 BTC per block after the next halving: about 225 BTC a day, or roughly 82,000 BTC a year.
• Coins created by block 840,000: 210,000 × (50 + 25 + 12.5 + 6.25) = 19,687,500 BTC. By block 1,050,000 another 656,250 BTC will have been added, bringing the total to 20,343,750 BTC.

Measured against those totals, new issuance runs at roughly 0.8% a year until the next halving and roughly 0.4% after it. The total can never exceed 21 million: the sum of all future subsidies stops just below that number.

04When does the block subsidy reach zero?

The subsidy is counted in satoshis, the smallest unit of bitcoin (one hundred-millionth of a coin). Each halving drops it by one binary place, so after enough halvings it falls below one satoshi and rounds down to nothing. Starting from 50 BTC, that happens at the 33rd halving, at block 6,930,000.

At ten minutes a block, 6,930,000 blocks take about 132 years from bitcoin's launch in 2009, which puts the last subsidy around the year 2140. From then on, miners would be paid by transaction fees alone, the transition the whitepaper describes. The code also forces the subsidy to zero after 64 halvings, a safeguard that will never be reached in practice.

05What does a halving change for miners?

For a miner, a halving cuts subsidy income per block in half overnight, while electricity and hardware costs stay the same. Miners with higher costs can become unprofitable, switch off machines or move to cheaper power. Fees become a larger share of revenue, especially when blocks are full.

If enough machines switch off, blocks come more slowly for a while, and the next difficulty adjustment lowers difficulty to bring block times back towards ten minutes. Most small miners also join mining pools to smooth out their income; our explainer on how bitcoin mining pools work covers what pools do and what happens when one closes.

06Does the halving move the bitcoin price?

The halving is often described as a bullish event because new supply falls. It is worth being precise about what is known. The change in issuance is certain and public years in advance. What price does around it is not.

• Four events are a tiny sample. Any pattern drawn from four halvings is closer to a story than a statistic, and each one happened in a different macro and market setting.
• It is already public. The block height of every future halving is known. Markets have years to absorb that information.
• Flows matter more than issuance day to day. About 450 BTC a day of new supply is small compared with what can trade or move through exchange-traded funds on a busy day.

Tradevo does not forecast prices. The useful question for a trader is not what the halving will do, but how the plan handles the volatility that tends to come with heavily covered events.

07How should a trader plan around a halving?

Treat the halving like any scheduled event that draws attention: the date is known, the reaction is not. A few rules keep it inside a normal trade plan:

• Size from the stop, not from the story. If wider swings are expected, a wider stop means a smaller position at the same risk; the 1% rule guide shows the arithmetic.
• Use a volatility measure such as ATR to set the stop distance, so the stop fits the market rather than a round number. See ATR stop placement.
• Be careful with leverage around crowded events. If you hold a perpetual future, funding is a cost that can rise when sentiment is one-sided; see funding rates in your trade plan.
• Log the trade and the reason for it. A trade journal shows later whether event trades actually helped your results.

08What are the common halving myths?

• "The halving halves the supply." It halves the rate of new issuance. The existing supply does not shrink.
• "Miners' income halves." Only the subsidy halves. Fees and the bitcoin price also decide miner revenue.
• "The date is fixed." The block height is fixed. The date is an estimate.
• "Past cycles repeat." Four observations cannot establish a reliable cycle.

09Sources and further reading

• Bitcoin Core source code: GetBlockSubsidy in validation.cpp
• Bitcoin developer guide: block chain, proof of work and difficulty
• Satoshi Nakamoto: Bitcoin, A Peer-to-Peer Electronic Cash System (whitepaper)
• CFTC: Customer Advisory, Understand the Risks of Virtual Currency Trading