Halving

A halving is a built-in event that cuts the block reward paid to miners in half. Bitcoin is the best-known example: its reward started at 50 BTC per block in 2009 and halves every 210,000 blocks, which works out to roughly every four years. Litecoin and several other proof-of-work coins use a similar schedule.

The mechanism is coded into the protocol, so no company or vote decides it. When the block height hits the threshold, nodes simply accept half the previous subsidy as valid. This steadily slows the rate of new supply and is what caps Bitcoin's total supply at just under 21 million coins. Miners still collect transaction fees on top of the subsidy, and fees are meant to make up a larger share of their income over time.

For holders, a halving reduces how many new coins enter the market, which is why it is often linked to price expectations. Past Bitcoin halvings were followed by large rallies, but there were also big drops, and the halving date is known years in advance, so markets can price it in. It also squeezes miner revenue, which can push less efficient miners to sell coins or shut down.

Be skeptical of small tokens that advertise a halving as a selling point. Many simply halve staking or farming rewards on a schedule set by an admin, which is not the same as a fixed protocol rule. Check whether the schedule is enforced by code no one can change, what the real circulating and maximum supply are, and how much is held by insiders who can still sell regardless of emissions.