What is Bitcoin Halving? Bitcoin Price History with BTC Halving 2024
Bitcoin halving refers to the process of cutting down or halving the rewards given to the miners for validating or processing transactions. This is a pre-set feature in Bitcoin and it occurs every 4 years.
While the total number of Bitcoins that will be mined is fixed, i.e. 21 million, the reward given to the miners for mining the Bitcoin is not fixed.
It reduces every four years to cut down the circulation of Bitcoin in the market. The idea of Bitcoin halving has been implied since the beginning of the creation of Bitcoin. And it all goes down to Bitcoin mining and the miners.
Bitcoin Halving Countdown: As of November 19, BTC halving is 145 days away from Bitcoin 4th Halving.
Bitcoin Halving 2024 tentative date: 12th April 2024
What we are going to learn?
Understanding Bitcoin Halving in Detail
Bitcoin is created through mining. Bitcoin Miners are people who use their computers and hardware to participate in the Bitcoin Blockchain network by recording or verifying transactions.
Due to the Proof of Work system, the miners have to prove their efforts in verifying and recording transactions in order to receive rewards. These miners have to solve complex mathematical problems in order to complete their creation of blocks, and chain of blocks.
Only after the block is filled with confirmed transactions, that the miners rewarded.
But after every 2,10,000 Bitcoin blocks mined, or mostly after every 4 years, the reward given to the Bitcoin miners for creating and processing blocks is halved. This incentive affects the circulation of Bitcoins in the market.
There will only be 21 million Bitcoins that will be circulated in the market and as of July 12, 2021, there are about 18.75 million Bitcoins already in circulation which leaves behind only 2.25 million Bitcoins to be mined.
Bitcoin Halving Dates
|First halving||28th Nov, 2012||25|
|Second halving||9 July, 2016||12.5|
|Third halving||May 11, 2020||6.25|
|Forth Halving||Estimated April – 6th May 2024||3.125|
When did the first Bitcoin halving take place? 28th Nov, 2012.
When is the next Bitcoin halving? Estimated Bitcoin Halving ETA is April 12, 2024
Impacts of Bitcoin Halving
Bitcoin Halving has a great impact on the market, as well as other currencies. Let’s have a look at it :
- The reward is halved: The incentive that the Bitcoin miners are paid for their services by creating blocks and maintaining them is halved every 4 years.
- The supply of Bitcoin is reduced: Halving the Bitcoin rewards also leads to creating fewer Bitcoins and thus, reduced availability of the coins.
- The demand is increased: As economical as it can get, when the supply of Bitcoin in the market reduces, the demand automatically increases.
- The price of Bitcoin goes higher: After every halving, when the supply of Bitcoin is low, the price goes higher.
- The value of Bitcoin increases: Even though the miners get fewer readers rewards and the supply is less, people start valuing Bitcoin more due to its unavailability.
Bitcoin Halving Price History
As mentioned earlier, this feature is pre-set and has been applicable since the beginning of the creation of Bitcoin blocks.
- In 2009, the Bitcoin miners were awarded 50 Bitcoins for mining the chain.
- After the first halving, which occurred on November 28, 2012, when 2,10,000 Bitcoin blocks were already created, the rewards went down by 50%. This means the miners were rewarded only 25 BTC. This led to a price increase of Bitcoin from $12 to $1207 by the end of the year.
- The second halving occurred on July 09, 2016, when 4,20,000 blocks were created. The rewards were further halved from 25 BTC to 12.5 BTC. The prices soared from $647 to $19345 in a year.
- The most recent Bitcoin halving occurred on May 11, 2020, when 6,30,000 blocks were already created. The rewards halved from 12.5 BTC to 6.25 BTC. But the Bitcoin prices went from $8821 to $63,558 in a year.
- The next Bitcoin halving is expected to occur between April and May 2024 which will lead to the miners reward halving from 6.25 BTC to 3.125 BTC.
Bitcoin halving not only affects Bitcoin users but also affect the prices of other cryptocurrency like Ethereum and other altcoins. With a rise in the demand for Bitcoin, the entire crypto market seems to go up. It plays a very important role in the Bull run cycle.
Bitcoin First Halving: 2012
The first Bitcoin halving event occurred on November 28, 2012, and was a landmark moment in the cryptocurrency’s history. SlushPool mined the halving block using a Radeon HD 5800 miner. The event cut the reward for mining new blocks from 50 BTC to 25 BTC, reducing the rate at which new bitcoins were generated. This scarcity likely played a part in the price of Bitcoin rising from $12.35 on the day of the halving to $127.00 150 days later, marking an increase of more than 900%.
Bitcoin Second Halving: 2016
The second halving took place on July 9th, 2016, and it continued the protocol’s predetermined schedule of reducing the mining reward by half every 210,000 blocks. The reward for each block went from 25 BTC to 12.5 BTC. This decrease in supply may have contributed to the gradual rise in Bitcoin’s price over the following months. The price on the halving day was $650.63, and 150 days later, it had increased to $758.81, a more moderate increase compared to the first halving but still significant.
Bitcoin Third Halving: 2020
The third Bitcoin halving happened on May 11, 2020, further diminishing the reward for mining a block from 12.5 BTC to 6.25 BTC. The reduced supply continued the theme of scarcity in Bitcoin’s economics, fostering greater demand in theory. On the day of the halving, Bitcoin was priced at $8821.42, and it experienced a measured increase over the next 150 days to $10,943.00. The 2020 halving carried on the trend of increasing prices post-halving, although at a rate less dramatic than the first halving, reflecting the maturing market and broader understanding of Bitcoin’s economic model.
When will the last Bitcoin be mined?
All 21 million Bitcoins are expected to be mined by approximately the year 2140. The mining process involves halving the block reward approximately every four years, reducing the rate of new Bitcoin issuance. This gradual reduction will eventually lead to the exhaustion of the total supply by the projected date.
What will happen in 2024 when Bitcoin halving takes place?
In the 2024 Bitcoin halving, the block reward for miners will be reduced from 6.25 Bitcoins to 3.125 Bitcoins per block. This reduction will slow down the rate at which new Bitcoins are created and introduced into the market. It is anticipated that this event may have an impact on Bitcoin’s price and market dynamics, potentially leading to increased price volatility and market speculation.
How many Bitcoins are created every day in 2023?
Approximately 900 Bitcoins are generated through mining on a daily basis.
Will Bitcoin rise after 2024 Bitcoin Halving?
Based on the scarcity of Bitcoin and the Stock-to-Flow (S2F) model developed by PlanB, Bitcoin’s price is projected to increase significantly after the next halving in 2024.
Historical data shows that previous halving has resulted in substantial price spikes, such as the rise from $11 to over $1,000 within a year after the 2012 halving. PlanB forecasts a potential price surpassing $100,000, possibly even reaching $200,000, driven by wider adoption and the influence of the S2F model.
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