How Bitcoin Halving Works
Each Bitcoin block is mined every 10 minutes on average, which is approximately 144 blocks per day. The Bitcoin production decreases by half every 210,000 blocks or approximately every four years. The last halving event took place in May 2020 and Bitcoin miners currently receive block reward of 6.25 bitcoins per block. Subsequently, roughly 900 bitcoins are mined every day until the next Bitcoin halving event in 2024. This is how new bitcoins are created.
Bitcoin Halving and Price Increase
Bitcoin’s inflation rate is decreasing based on the mathematical algorithm, unlike the inflation rate of fiat currencies. We expect that the lack of new supply will cause the future increased demand for Bitcoin. Besides that, Bitcoin halving has been historically an extremely positive event for Bitcoin price action. Based on the Kraken cryptocurrency exchange data, halvening kicked off Bitcoin bull runs with price appreciation of 9,000% and 3,000% in 2012 and 2016, respectively.
Next Bitcoin Halving Event in 2024
Next Bitcoin halving event is expected in 2024, when Bitcoin block reward will be reduced to 3.125 bitcoins per block from the current amount of 6.25 bitcoins per block. This means the daily Bitcoin supply will be reduced to approximately 450 bitcoins per day from the current supply of approximately 900 bitcoins per day. We assume that Bitcoin price will continue increasing in the foreseeable future, due to the algorithmically predetermined decrease of its supply and presumably steady if not increasing demand for Bitcoin from both institutional and retail investors.
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