New bitcoins are issued by the Bitcoin network every 10 minutes. For the first four years of Bitcoin’speculation bitcoin existence, the amount of new bitcoins issued every 10 minutes was 50.
Every four years, this number is cut in half. The day the reward halves is called a “halving”. In 2012, the amount of new bitcoins issued every 10 minutes dropped from 50 bitcoins to 25. In 2016, it dropped from 25 to 12.
Now, in the 2020 halving, it will drop from 12. What is the Significance of the Reward Halving? The halving decreases the amount of new bitcoins generated per block. This means the supply of new bitcoins is lower.
In normal markets, lower supply with steady demand usually leads to higher prices. Since the halving reduces the supply of new bitcoins, and demand usually remains steady, the halving has usually preceded some of Bitcoin’s largest runs. Note how the price has jumped significantly after each halving. Bitcoin Halving Chart In the image below, you can see Bitcoin’s inflation rate during each period. Each halving lowers Bitcoin’s inflation rate.
The orange line is Bitcoin’s inflation rate during a given period, while the blue line is the total number of bitcoins issued. Bitcoin Halving Schedule The Bitcoin halving is scheduled in block height, not date. The reward halves every 210,000 blocks. The 2020 halving will happen on block 630,000. The 2024 halving will happen at block 840,000. What Happens to Miners During Halvings?
Many always speculate that miners will shut down after the halving. The reality is most miners are very smart and price in the halving, so they don’t end up shutting down any miners. When is the Next Bitcoin Halving, after the 2020 Halving? The 2024 halving will likely occur between March 2024 and June 2024. Bitcoin Halving History This section will take a look at the previous two halvings.
2012 Halving The 2012 block halving was the first halving. 2016 Halving The 2016 was the second one ever. Current Bitcoin Block Reward The current Bitcoin block reward is 12. When block 630,000 is hit in 2020, the reward will drop to 6.