How the schedule works
The schedule so far
The reward started at 50 coins per block in 2009.
It fell to 25 in 2012, to 12,5 in 2016, to 6,25 in 2020, and to 3,125 in April 2024. The next reduction is due around 2028, and the sequence continues until the reward becomes too small to divide, at roughly the year 2140.
Adding up that shrinking series gives a total just under 21 million, which is where the cap comes from. The entry on how many bitcoins exist covers the arithmetic.
What it does to miners
This is the immediate and certain effect: mining revenue from new coins halves overnight.
Operations running on thin margins become unprofitable at the old electricity price, and some shut down. Hash rate drops, then recovers as difficulty adjusts and remaining miners take a larger share. Each halving has produced a consolidation toward operators with cheaper power and newer hardware.
The recovery pattern is consistent across all four halvings so far, which makes it the part of this subject with actual evidence behind it.
What it does and does not mean
What it does not prove about price
Worth being careful here, because the claims outrun the evidence.
The argument goes that reduced new supply against steady demand pushes price up, and price did rise substantially after each of the four halvings. That is four data points, on an asset whose price rose over most of the same period regardless, during years that also included institutional adoption, ETF approvals and multiple macroeconomic cycles.
Four observations cannot separate the halving’s contribution from everything else happening. Anyone presenting the pattern as a rule is asserting more than the data supports, in either direction. The honest position is that the supply effect is real, its magnitude is unknown, and it is already public information that markets have had years to price.
The long-term question
More interesting than the price argument, and less discussed.
Miners are paid from two sources: newly created coins and transaction fees. The new-coin subsidy halves every four years toward zero, so eventually fees have to carry the network’s security entirely.
Nobody knows what fee level that requires or whether transaction demand will supply it. This is a genuine open question about Bitcoin’s long-term design, and it sits well beyond any current business planning horizon.
Relevance to a merchant
Almost none operationally, which is worth stating so nobody plans around it.
A business converting on receipt holds Bitcoin for minutes, and a four-year supply schedule has no bearing on that. Network fees are set by current block demand rather than by the reward level, so halving does not change what a transfer costs today.
The only practical consequence is attention: halvings generate news cycles, and news cycles generate transaction volume and fee spikes. If your checkout offers Bitcoin, expect busier periods around them, and the setup guide covers network choices that avoid the issue.