Authors: SanTiLi, Naxida, Legolas
Abstract: Summary:
This article will focus on the four halving events of Bitcoin from 2012 to 2024, systematically sorting out Bitcoin's halving mechanism, inflation rate change trends, and exploring their impact on price trends in conjunction with market performance before and after each halving. Through historical data analysis and macro comparison, this article points out that Bitcoin has currently entered a phase where its inflation rate is lower than that of gold, its scarcity has become increasingly prominent, and it is gradually possessing long-term value logic to contend with traditional assets. Meanwhile, from the cyclical rhythm of the four halvings, while the increase has been moderate since the 2024 halving, it is still in the accumulation phase, and the true window may gradually open between 2025 and 2026. The article concludes by discussing Bitcoin's core value foundation, including scarcity, decentralization mechanism, and deflationary model, pointing out that its logic as "digital gold" is maturing.
1. Bitcoin halving cycle basic rewards and inflation rates:
Bitcoin was designed by Satoshi Nakamoto in 2009, with a total issuance fixed at 21 million coins. In the early days, miners could earn 50 BTC as a reward for successfully mining a block. This reward is halved approximately every 210,000 blocks (about four years), gradually reducing the new issuance.
The Bitcoin halving cycle officially began in 2012, halving every four years, with the 2024 halving resulting in each block reward being 3.125 BTC, and the annual inflation amount being: 52560 x 3.125 = 164,250 coins, accounting for approximately 0.782% of the total supply. An inflation rate around 0.78% is already lower than the annual inflation rates of most developed countries, while the inflation rate of gold mining's total output growth is around 1.5%-2%. Currently, BTC has entered a phase where its inflation rate is lower than that of gold.
Fig.1 Bitcoin halving cycle rewards and inflation chart.
As shown in the chart: When each block has a reward of 50, the annual increase is approximately: 52560 x 50 = 2.628 million coins, accounting for about 12.5% of the total 21 million. As of 2025, when each block has a reward of 6.25, the annual increase is: 52560 x 6.25 = 328,500, accounting for about 1.564% of the total 21 million.
As of May 7, 2025, around 2 PM, approximately 19,861,268 BTC have been mined, accounting for about 94.58%, with a total market value of about $2 trillion (approximately $2034,300,009,004). Compared to the last halving cycle in 2020, when about 18,385,031 BTC were mined, accounting for about 87.5%, with a total market value of approximately $161.8 billion, the total market value has increased by about 1236% after about five years.
The inflation rate for the next four years is only 0.782%.
Fig.2 Comparison chart of inflation rates of major countries globally from 2019 to 2025.
China's inflation rate in 2019 was about 2.9%, while the US inflation rate was 2.3%. At that time, due to COVID-19 subsidies in 2020, we predicted that substantial dollar issuance would likely cause a significant increase in inflation rates from 2020 to 2022. The US inflation rate indeed reached a high of 8%, subsequently declining year by year due to the Federal Reserve's interest rate hikes. By 2024, it has dropped to around 2.2%, while China's annual inflation is approximately 0.2%, which is relatively good for major countries in controlling inflation (2019–2024: Data from various national statistical agencies. 2025: Data from the International Monetary Fund (IMF) reports and actual updated forecasts). Most developed countries show statistics around 2.5%, but the actual experience of shopping and currency depreciation should be significantly greater than the statistical data.
At this time, this halving of Bitcoin will again halve BTC's inflation rate, entering a new historical low inflation level of 0.782%. The reduction in the inflation rate is not a bad thing for any asset in principle, as it further increases scarcity. However, this does not necessarily mean that the asset's value will rise 100% in a short time, but it is a relatively important anti-devaluation factor.
2. Comparative analysis of market performance after Bitcoin's four halvings:
Since Bitcoin's inception, each halving of block rewards has had a profound impact on BTC's market price. From 2012 to 2024, four halving events have shown some relatively consistent cyclical characteristics. This article provides a detailed comparison of market price trends before and after each halving, extracting some valuable patterns for readers. History does not repeat itself exactly, but before reaching a peak or approaching destruction, there are always similar patterns.
Fig.3 Value change data chart of Bitcoin's four halving cycles.
As shown in Fig.3, the trend data for Bitcoin's four halvings over the first six months and the year following the halving, as well as the peak situations during the corresponding cycles, is summarized. From the figure, it can be seen that after each halving, Bitcoin's price has experienced significant increases. Calculating from the closing price on the halving day as a benchmark, the price increase after the 2012 halving exceeded 8000% within a year, approximately 286% after the 2016 halving, and around 475% after the 2020 halving, while the increase after the 2024 halving in the first year is only about 31% (with a maximum of 68.75% at $109,588 so far).
1. There have generally been significant price increases in the six months before the halving.
Looking back at the four halving events, Bitcoin usually gradually enters an upward channel six months before the halving. For example:
In 2012, the price increase reached 141.03% compared to six months prior.
After the 2024 halving, the price increase reached 118.88% compared to six months prior.
This stage often corresponds to the market's gradual pricing of "halving expectations," possessing strong preparatory signal value.
2. The core explosion period after the halving is between 6-12 months, but it is not necessarily the highest point.
Historical experience from three rounds shows that the core upward phase occurs 6-12 months after the halving.
2012: The price increase reached 8181.51% one year later.
2016: The price increase was 286.29% one year later.
2020: The price increase was 475.64% one year later.
2024: Currently not yet a year, temporarily at 31.18%, with a maximum of 68.75% ($100.9k).
Especially in 2012 and 2020, it exhibited a typical structure of "consolidation within six months, followed by an explosion." A year later, it enters the maximum explosion period, reaching a historical high. Currently, with the 2024 halving just over a year ago, if history repeats, the true explosion window may open between 2025 and the first quarter of 2026.
3. The price trend in the first year after the halving has preliminary reference significance for judging the market.
After the 2024 halving, Bitcoin increased by 10.02% within a month, but then saw fluctuations and corrections over the next two months, remaining in an accumulation phase overall. As of October 2024 (i.e., six months after the halving), the price has only slightly increased by 6.30% relative to the halving day, far from entering the main upward phase. However, this is not uncommon in history, as both 2016 and 2020 did not see a formal market start until six months after the halving.
4. The peak of each bull market mainly appears within 6-12 months after the halving.
According to data from the previous three rounds, the maximum price relative to the closing price on the halving day during the halving cycle occurs in the middle period before the next halving.
2012: The highest increase was 9237.15%.
2016: The increase was 2825.84%.
2020: The increase was 700.28%.
In the current round after the 2024 halving, a peak of $109,588 has already appeared, which is an increase of 68.75% compared to the halving day, though it has not yet entered an exponential explosion phase. This pattern only applies to the current round because after this round, if BTC can reach a valuation of up to 300,000 to 500,000 or even 1 million, its valuation would be extremely substantial. For the next halving, unless it refers to the depreciation of reference assets or further expands application exploration, such as interstellar exploration, it is unlikely to see several times the growth again.
Chart summary:
Bitcoin's historical halving cycles exhibit a highly consistent three-phase rhythm:
Accumulated rise (six months before the halving) → Stable fluctuation (six months after the halving) → Main upward surge (6-18 months after the halving). Currently, with the 2024 halving approaching one year, it means the market may still be accumulating energy for the later explosion. Similar to the eve of 2017, coincidentally, it was also during Trump's initial term. At the same time, the Stock-to-Flow chart indirectly supports our perspective of still being in a period of thick accumulation and thin eruption: however, historical data and patterns only have reference value, and should not be blindly followed; sufficient self-judgment and DYOR must be applied.
Fig.4 Bitcoin price Stock-to-Flow chart.
Three, BTC's long-term value scientific attributes:
The value of an asset comes from consensus and its intrinsic value, while long-term consensus must come from its inherent advancement, scientific attributes, and irreplaceable pioneering nature. Bitcoin (BTC) is not just a cryptocurrency, but an innovative achievement at the intersection of multiple disciplines such as technology, economics, mathematics, and cryptography. Its long-term value is not merely maintained by market speculation, but is built on a comprehensive, rigorous, verifiable, and anti-manipulation system design.
1. Scarcity:
As mentioned earlier, the total supply of Bitcoin is fixed at 21 million coins, written into the protocol by Satoshi Nakamoto in the underlying code, and gradually released through the block reward halving mechanism. Halving occurs approximately every four years, with the final issuance expected around the year 2140. Compared to the unlimited issuance mechanism of fiat currencies, Bitcoin has a natural deflationary characteristic that supports its long-term appreciation logic from a supply and demand perspective.
Scarcity design is the core pillar of Bitcoin's anti-inflation, laying the foundation for it to become "digital gold."
2. #Decentralization: The consensus mechanism ensures network neutrality.
The Bitcoin network relies on the decentralized PoW (Proof of Work) consensus mechanism provided by computational power, allowing any node to verify transactions and participate in maintaining the ledger. This structure effectively avoids issues such as centralized single points of failure, power abuse, and system control found in traditional financial networks. The massive global decentralization also minimizes the risk of a 51% attack.
3. The deflationary model against fiat currency depreciation.
As shown in Fig.2, Bitcoin's built-in deflationary issuance model forms a strong contrast with the inflation structure of fiat currencies around the world. Especially against the backdrop of massive quantitative easing and currency oversaturation by central banks since 2020, Bitcoin has gradually proven to be a hedging tool against fiat currency depreciation and asset bubble risks. BTC is gradually becoming a safe haven for global capital in an era of increasing distrust in fiat currency.
4. Technological attributes: Advanced cryptography + peer-to-peer network design.
Bitcoin comprehensively applies several cutting-edge technologies:
● Elliptic Curve Cryptography (ECDSA): Ensures account security and private key signing.
● SHA-256 hash algorithm: ensures data immutability.
● Merkle Tree Structure: Efficient verification of transactions within blocks.
● P2P peer-to-peer network: Achieving global value transfer without intermediaries.
The combination of these core technologies makes Bitcoin a highly robust, forgery-proof value transfer network, while also possessing unlimited extensibility, laying a solid foundation for subsequent layer-two expansion (such as the Lightning Network, ecological applications). BTC is not only an asset but also a masterpiece of cryptographic technology. Future quantum resistance updates are also worth looking forward to.
5. Challenger of the global financial order: alternative consensus assets for the trend change of the US dollar.
The current world is experiencing a wave of de-dollarization: settlements between countries are beginning to shift towards local currencies, gold, and decentralized assets. Bitcoin, with its non-sovereign objectivity, globalization, scarcity, and other characteristics, has become an important channel for asset transfer and value storage in emerging markets and turbulent countries. It has constructed a new model of financial order that coexists but is independent of the US dollar and gold – a "neutral system of consensus currency." When the "credit of certain countries" is difficult to trust, relying on objective algorithmic credit will become an international moat, of course, it also requires further intervention from regulatory agencies in various countries to prevent frequent illegal activities.
6. Potential financial infrastructure for interstellar civilization (currently not applied, belongs to personal exploration view).
Bitcoin is currently the only value protocol that does not rely on any country, bank, or internet entity. Its ledger can exist at any node across planets, requiring only electricity and computational power to maintain the network. This structure is naturally suitable for future space exploration scenarios, such as Mars or lunar exploration, facilitating quick and direct use and application. However, since human exploration of outer space is still in its infancy, with no significant breakthroughs in stable landings and arrivals, this point is limited to personal fancy. Yet, looking ahead to a 30-50 year cycle, preliminary planetary applications do not seem entirely impossible. Bitcoin (or similar credit points) could serve as the underlying token of human digital civilization.
Therefore, the overall scientific attributes of BTC are:
Supply ceiling (scarcity) + consensus strength (decentralization);
Real-world background: Continuous weakening of fiat currency credit and expansion of debt bubbles.
In the face of uncertainty in the future, Bitcoin's 'anchoring attribute' is becoming increasingly prominent.
Four, $BTC Major long-term trend value summary.
This article draws the following conclusions through analysis of BTC halving cycle performance and research on its long-term scientific attributes:
The four halving cycles of Bitcoin show a highly consistent market rhythm: expectations drive up prices before the halving, followed by short-term consolidation after the halving, and then a main upward wave. From the perspective of inflation rates, after the 2024 halving, Bitcoin's annual inflation rate drops to 0.78%, falling below that of gold for the first time, further solidifying its status as a scarce asset. Against the backdrop of ongoing high inflation, credit expansion, and increasingly large debt deficits in the global fiat currency system, Bitcoin's deflationary model and decentralized characteristics are attracting more and more attention and allocation from traditional capital.
Despite short-term market fluctuations and the potential for unexpected black swan events, the logic of Bitcoin's long-term value is becoming increasingly clear: it is not only a cryptocurrency but also a new type of asset based on cryptography and consensus. In future cycles, its long-term value potential, ability to hedge against inflation, and the irreplaceable nature of its technical foundation, along with the further expansion of ecological development, will continue to empower it, constructing the core value barrier that "digital gold" should possess.
Viewpoint reminder: Some people categorize speculation or conceptual fraud in the market as such, which is also an unobjective research attitude (or it can be said that projects relying solely on speculation are difficult to last, like many memes).
Risk warning: This article's discussion of halving cycles and long-term value is for educational and research purposes only, and not investment advice. Readers should conduct thorough research, form their judgment logic, and not blindly follow or trust anyone; DYOR.
