The Bitcoin network completes the fourth-ever ‘halving’ of rewards to miners (2024)

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The Bitcoin network completes the fourth-ever ‘halving’ of rewards to miners? ›

The Bitcoin network on Friday evening completed its fourth "halving," reducing the rewards earned by miners to 3.125 bitcoins from 6.25. The price of bitcoin has been volatile ahead of the event, and fell about 4% this week to trade around $64,100, according to Coin Metrics.

Bitcoin halving is when the reward for bitcoin mining is cut in half. Halving takes place every four years. The next halving is expected to occur sometime in 2028. The halving policy was written into bitcoin's mining algorithm to counteract inflation by maintaining scarcity.

The much-anticipated bitcoin halving event has come and gone, quietly marking a historic moment in the world of digital assets. On April 19, 2024, the block reward for bitcoin miners was reduced by half, from 6.25 BTC per mined block to 3.125 BTC per mined block.

This reward is reduced by half every four years, hence the term halving. It's akin to a predictable, scheduled pay cut for these miners. Halving not only adjusts miners' rewards. It also reduces the rate at which new coins are created, decreasing the new supply and influencing the market value.

Over time, the reward for mining Bitcoin is reduced. This reward process continues until 21 million bitcoins are circulating. Once that number is reached, the Bitcoin reward is expected to cease, and Bitcoin miners will be rewarded through fees paid for the work done.

A Bitcoin halving event occurs when the reward for mining Bitcoin transactions is cut in half. Halvings reduce the rate at which new coins are created and thus lower the available amount of new supply. Bitcoin last halved on April 19, 2024, resulting in a block reward of 3.125 BTC.

“Miners need their revenues to be more than their costs, like any business,” Malekan says. “What is likely to happen after the halving is that some miners will no longer be profitable, and they will stop mining.”

The second halving took place on July 9, 2016. The most recent Bitcoin halving happened on May 11, 2020. While the 4-year rule isn't set in stone, these dates show us that it does take roughly that period of time to reach each following BTC halving. That's why the next one is projected to happen in 2024.

1st Bitcoin halving date — November 28, 2012 — Reward down: 50 BTC to 25 BTC. 2nd Bitcoin halving date — July 9, 2016 — Reward down: 25 BTC to 12.5 BTC. 3rd Bitcoin halving date — May 11, 2020 — Reward down: 12.5 BTC to 6.25 BTC. 4th Bitcoin halving date — April 19, 2024 — Reward down: 6.25 BTC to 3.125 BTC.

Fees currently constitute 35% of total miner revenue, while the latter now hovers around $50 million, a 35% decline from pre-halving record-high levels of roughly $78 million. According to YCharts data, Bitcoin transaction fees have fallen from $80 million on April 20 to $6 million.

Is Bitcoin halving good or bad for miners? ›

The halving happening in April will cut rewards for miners, and could drive the price of Bitcoin higher because of the lower supply of new coins. The most efficient miners will be the ones best equipped to handle the halving, industry players say.

A halving may highlight the falling rate of issuance of Bitcoin, drawing more money to the sector as traders anticipate a change in sentiment in the market and expect a run-up in the crypto's price. But the key driver is more money moving to the sector, not a fundamental change to the value of Bitcoin itself.

Halving reduces the supply of new bitcoins, which should in theory increase the price. It is an economic axiom that if demand for an asset remains stable while its supply decreases, its price should go up.

Who owns the most Bitcoin in the world? The top Bitcoin holder is still believed to be Satoshi Nakamoto, the anonymous creator of Bitcoin, who reportedly holds around 1.1 million BTC across many wallets. Despite this large holding, the top 10 holders collectively only possess about 5.5% of the total Bitcoin supply.

CryptoTab is a free Bitcoin mining software that allows you to mine cryptocurrency while browsing the web. You can download and install the CryptoTab browser on your Windows, Mac, Android, or iOS device and start mining with one click. You can also increase your earnings by inviting your friends to join the browser.

Obtaining 1 BTC per day without any cost or risk is not possible. While there are various ways to obtain Bitcoin, such as through mining or trading, all of these methods come with some level of cost or risk.

In comparison, the first Bitcoin mining difficulty adjustment after the halvings in November 2020, July 2016 and May 2020 came in at -2%, 0% and -6%, respectively. The second adjustments post-halving were even more pronounced at -12%, -5% and -9%, respectively.

Bitcoin pays out a mining reward each time a new “block” is entered into the permanent record of transactions. The reward shrinks every few years, but for now, it is 6.25 BTC, which in December 2022 was worth roughly $105,000 as Bitcoin hovered below $17,000.

The rewards for mining bitcoin are cut in half every four years.2 When first mined in 2009, one block would earn you 50 BTC. In 2012, this was halved to 25 BTC. By 2016, this was halved again to 12.5 BTC. On May 11, 2020, the reward was halved again to 6.25 BTC.