Crypto Terms: Letter H

What is Halving?

Halving MEANING:
Halving - a blockchain event where rewards received for transaction validation or block subsidies decrease by half.
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Let's find out Halving meaning, definition in crypto, what is Halving, and all other detailed facts.

Halving (or halvening) of rewards obtained for transaction validation or block subsidies is a blockchain occurrence in which the incentives are reduced by half. It reduces the rate at which supply enters circulation, this way increasing scarcity by bringing fewer and fewer coins or tokens into existence. These events are pre-programmed into the code and announced publicly.

Bitcoin (BTC) rewards, for example, are set to decline every four years on average. Since 2020, block rewards have decreased to 6.25 BTCs per block (900 BTCs daily), down from 12.5 BTCs (1800 BTCs). The rewards will continue to decline in this manner every four years until the last Bitcoin is mined in around 2140.

Because the circulating time can be calculated at any point in time, halvings have the extra benefit of making the emission schedule more predictable. This can help determine the value of a token with precision. Staking or mining decline over time is a common feature of practically every non-pre-mined cryptocurrency.

Following the mining reductions in 2016 and 2012, Bitcoin's halving in 2020 was the third. Due to rising scarcity and a tightening of supply from miners, each halving was followed by a significant price increase. The next Bitcoin halvening will take place in March 2024, and mining incentives will be reduced to just 3.125 BTC per block.