Bitcoin’s next halving event is less than a week away and the industry is abuzz with excitement. Market participants are all focused on the price of Bitcoin: Will there be a bull run pre- or post-halving? Is the halving already priced in or will it be a catalyst for the next great Bitcoin bull run?

So, what is the Bitcoin halving and why is it important? Why are people speculating it will have an impact on the price movement of Bitcoin? In order to answer these questions, we must step back and understand the history of Bitcoin.

History of Bitcoin

Bitcoin was created in 2008 by the anonymous Satoshi Nakamoto to enable a decentralized and open source P2P e-cash system. Over the last decade, the blockchain industry has grown into a billion-dollar industry and catalyzed technical innovations in a number of different fields.

One of the distinguishing characteristics of Bitcoin compared to fiat currencies is limited supply. Bitcoin has an upper cap on its supply and only 21 million Bitcoins will ever exist. The scarcity of Bitcoin is hard coded in the network and the issuance of new Bitcoins is done through a process called “mining.” Miners contribute to the Bitcoin network by validating transactions and adding blocks to the Bitcoin blockchain approximately every 10 minutes. As a reward, miners receive newly minted Bitcoins. To ensure a total Bitcoin supply of only 21 million, the Bitcoin blockchain network periodically reduces the number of Bitcoins miners earn, an event known as “halving.”

What is Halving?

Every 210,000 blocks, the number of Bitcoin miners earn decreases by 50%. In 2009, miners received 50 Bitcoins per successful valid block. There have been two prior Bitcoin halvings. In 2012, the block reward decreased to 25 Bitcoins and in 2016, it decreased again to 12.5 Bitcoins. The highly anticipated halving next week will decrease the reward to 6.25 Bitcoins. Currently, approximately 18 million Bitcoins have been mined, leaving under three million more to be introduced into circulation.

What was the impact of prior Halvings?

Let’s look at the Bitcoin price chart and the trend post-halving:

First Halving (November 28, 2012 at block 210,000)

The first halving reduced the mining reward from 50 Bitcoins to 25 Bitcoins. On the halving date, the price of Bitcoin was $12.25. Bitcoin price increased over 8,000% within the following year.

Second Halving (July 9, 2016 at block 420,000)

The second halving reduced the mining reward from 25 Bitcoins to 12.5 Bitcoins. On the halving date, the price of Bitcoin was $664. After an immediate drop of approximately 10%, the price rebounded quickly and increased over 280% within the following year. This ultimately led to an all the time high Bitcoin price in December 2017.

Two competing thoughts on the impact of the Halving on Bitcoin price

There is no general consensus on whether the halving event is priced into the current Bitcoin price. Proponents usually cite the efficient markets hypothesis — that halving is public information the market has already digested and the halving is thus priced into the markets. Others point to previous halving trends and to fundamental supply and demand analysis to argue that the upcoming halving will initiate a bull market.


It is gratifying to see Bitcoin thriving and generating global interest 12 years after its release. Where Bitcoin price will go after the third halving is anyone’s guess but it is important to remember that the concept of halving is crucial to how Bitcoin operates. No matter what happens, the Bittrex Global Team is committed to providing the most secure and reliable trading environment in the midst of this historical event. Happy Trading!

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