Bitcoin block reward will decrease from 6.25 to 3.125 coins in approximately
Estimated date of reward drop: May 01, 2024
Bitcoin uses peer-to-peer technology to operate with no central authority or banks; managing transactions and the issuing of bitcoins is carried out collectively by the network.
What is Bitcoin Halving?
Bitcoin has a total supply of 21 million. The underlying code ensures that only 21 million bitcoins will ever exist. Bitcoin’s finite supply is a strong economic statement and supports its value system.
Bitcoin is distributed through mining. The 21 million bitcoins in existence are scheduled to be mined through the year 2140. That is, the last bitcoin is expected to be mined in the year 2140. At the current rate of emission, the unmined bitcoin will be exhausted before this speculated time. Almost 90% of bitcoin’s total supply has been mined. About 900 bitcoins are mined per day, currently.
To sustain the emission and increase scarcity, the number of bitcoin emitted per block is regularly reduced. This process of reducing the bitcoin emission per block is known as Bitcoin Halving.
After a predetermined block height (a number that is used to indicate a particular block), the amount of bitcoin emitted per block is reduced to half of the previous number. For bitcoin new halving occurs after an interval of 210,000 blocks or 4 years.
The most recent (2020) halving reduced bitcoin emission from 12.5 bitcoin per block to 6.25 bitcoin per block. This means that instead of 12.5 bitcoins, miners will now be rewarded with 6.25 bitcoins per block mined.