Since this episode was recorded awhile ago it's only right to give your a full perspective of the halving
Bitcoin halving is a pre-programmed event that occurs approximately every four years, or every 210,000 blocks on the Bitcoin blockchain. During a halving event, the reward that miners receive for validating transactions and securing the network is cut in half. This process plays a critical role in Bitcoin’s monetary policy, effectively controlling the rate at which new bitcoins are created and introduced into circulation.
Why Does Halving Matter?
The halving mechanism was designed by Bitcoin’s pseudonymous creator, Satoshi Nakamoto, to simulate scarcity—similar to precious metals like gold. When Bitcoin was launched in 2009, miners received 50 BTC for each block mined. After the first halving in 2012, that reward dropped to 25 BTC. It was reduced to 12.5 BTC in 2016, 6.25 BTC in 2020, and most recently to 3.125 BTC in the halving that occurred in April 2024.
By halving the block reward every 210,000 blocks, Bitcoin ensures that its total supply will never exceed 21 million coins. This predictable supply schedule contrasts sharply with fiat currencies, which can be printed in unlimited quantities by central banks, often leading to inflation.
Historical Impact of Halvings
Historically, each halving has been followed by a significant bull run in the price of Bitcoin, although these price surges typically happen months after the event. The 2012 halving preceded Bitcoin’s rise to over $1,000 by late 2013. The 2016 halving set the stage for the massive 2017 bull run, where Bitcoin reached nearly $20,000. After the 2020 halving, Bitcoin soared past $60,000 in 2021, fueled by growing institutional interest and mainstream adoption.
This pattern occurs because each halving reduces the rate of new Bitcoin entering the market, decreasing supply while demand often remains the same—or even increases—due to growing awareness and adoption.
The Future of Bitcoin Halving
Looking ahead, the next halving is expected around 2028, when the block reward will drop to 1.5625 BTC. As the rewards get smaller, the incentive for miners relies more heavily on transaction fees rather than block rewards. This transition is a key aspect of Bitcoin’s long-term sustainability. If Bitcoin continues to gain mainstream adoption, transaction volume—and therefore fee income—could compensate for the reduced block rewards.
However, there are potential concerns. Lower mining rewards could lead to a decline in miner participation, especially if Bitcoin’s price doesn’t rise significantly. This could impact network security. On the other hand, as Bitcoin becomes more valuable and widely used, the reduced issuance could make it even more appealing as a scarce, deflationary asset.
Bitcoin’s final halving will occur sometime around the year 2140, when the 21 millionth coin is expected to be mined. At that point, no new bitcoins will be created, and miners will be sustained entirely by transaction fees.
Conclusion
Bitcoin halving is more than just a technical event—it’s a cornerstone of Bitcoin’s economic model. With each halving, Bitcoin becomes more scarce, potentially increasing its value and appeal as a hedge against inflation. As Bitcoin matures, halving events will continue to shape the conversation around supply, value, and the future of decentralized finance.