## Halving: what is it and why does it matter for bitcoin?

Halving is a mechanism built into the Bitcoin protocol that reduces the reward given to miners for confirming transactions approximately every four years, specifically every 210,000 blocks. This phenomenon is a key element in controlling inflation in the network, ensuring that the number of bitcoins in circulation never exceeds 21 million.

## Bitcoin Tokenomics and the Role of Halving

Halving what does it mean in practice? It is primarily a tool for regulating the pace of new coin issuance. The reduction of the block reward by half causes the supply of bitcoins to increase at a predictable and decreasing rate. This deflationary structure makes bitcoin a scarce digital good, and its maximum amount of 21 million is a rigid limit that approaches slowly and systematically.

## The History of Halvings: From the Beginning to Today

The first halving took place in 2012 and reduced the reward from 50 to 25 bitcoins per block. Subsequent halving events in 2016 (12.5 BTC) and 2020 (6.25 BTC) continued this trend. April 2024 brought another reduction to 3.125 bitcoins per block as the network reached 840,000 blocks.

## When will the issuance of bitcoins end?

According to current calculations, the last halving will occur after 32 events of this type. At that point, mining rewards will reach zero, and the last bitcoin will be mined around the year 2140. By that time, exactly 21 million BTC will have been mined, and no more bitcoins will ever be created.

## The Impact of Halving on Held Bitcoins

What change does halving bring to your wallet? Directly - nothing. The number of coins you own remains the same. However, this phenomenon can indirectly affect the valuation of Bitcoin, as the decreasing supply of new coins is usually associated with an increase in demand, especially during periods of heightened media attention.

## Why do miners pay attention to halvings?

For miners, halving means a potential decrease in the profitability of operations, as the reward for each confirmed block decreases. This prompts some network participants to optimize costs or withdraw from activities, leading to a natural adjustment of the network's computing power.

Understanding the halving mechanism is crucial for anyone looking to deepen their knowledge of Bitcoin's economics and the long-term structure of this cryptocurrency.