How the Bitcoin halving works
The halving is an event coded into Bitcoin that cuts the block reward paid to miners by 50 percent. It happens every 210,000 blocks, roughly every four years, and steadily slows the rate at which new BTC enters circulation until the supply caps at 21 million. It is the mechanism that makes Bitcoin disinflationary by design, with a known issuance schedule no one can alter.
Worked example
The reward fell from 50 BTC per block at launch to 25, then 12.5, then 6.25, then 3.125 at the 2024 halving. Each cut halves the new supply hitting the market from mining. If demand holds steady while new supply drops, basic supply and demand points toward upward price pressure, which is the core of the halving narrative, though it is a tendency, never a guarantee.
What it means for miners and price
Each halving squeezes miner revenue per block, forcing less efficient miners offline until difficulty adjusts. Historically, major bull cycles have followed halvings with a lag, but the sample is tiny (only a handful have ever occurred) and past patterns are not a forecast. Treat the halving as one structural input, not a trade signal on its own.
Why it matters
The halving is the clearest example of tokenomics driving an asset: a transparent, pre-set supply schedule you can model years ahead. When you take spot or CFD exposure to BTC on Volity, the issuance schedule is part of the long-term backdrop. Related: proof of work.
Read the full breakdown in our crypto trading guide.
