Bitcoin halving is a scheduled event on the Bitcoin network where the block reward for Bitcoin miners is halved after every 210,000 blocks. This means that the number of Bitcoins miners receive for each newly generated block will be reduced by half. The purpose of Bitcoin halving is to control the supply of Bitcoin and ensure that Bitcoin does not increase indefinitely, thereby achieving a deflation-like effect.

Basic principles of Bitcoin halving

1. **Fixed supply**: The total supply of Bitcoin is limited to 21 million. In the blockchain network, the block reward is halved every 210,000 blocks (approximately every four years).

2. **Block reward halving**: Initially, miners can get a reward of 50 Bitcoins for each block generated. After the first halving, the reward becomes 25 Bitcoins; after the second halving, it becomes 12.5 Bitcoins; and so on. Currently (as of 2024), the reward per block is 6.25 Bitcoins.

3. **Inflation control**: Through this mechanism, the issuance of Bitcoin slows down over time, unlike fiat currencies, which can usually be increased by central banks based on economic conditions.

### Previous halving events

- **First halving**: On November 28, 2012, the block height was 210,000, and the reward was reduced from 50 BTC to 25 BTC.

- **Second halving**: On July 9, 2016, the block height was 420,000, and the reward was reduced from 25 BTC to 12.5 BTC.

- **Third halving**: On May 11, 2020, the block height was 630,000, and the reward was reduced from 12.5 BTC to 6.25 BTC.

Impact

1. **Price impact**: Historically, the price of Bitcoin has usually experienced significant fluctuations before and after each halving event, usually upwards. Because halving means a decrease in the supply of new Bitcoins, the dynamic changes in supply and demand often drive prices up.

2. **Miner impact**: Due to the reduction in rewards, miners' income will be directly affected. If the price of Bitcoin does not rise to offset the impact of the reduction in rewards, some less efficient miners may exit the market.

3. **Market expectations**: Halving events tend to trigger a lot of market discussion and speculation, and investors may buy or sell based on expectations of future price increases.

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