Everyone familiar with Bitcoin knows Bitcoin is created by a process known as bitcoin mining. Miners solve the difficult cryptographic puzzles to create a new block in the blockchain. This involves the usage of high computational power which needs a large amount of electricity.

For every new block added to the blockchain, one will be awarded a block reward. This is the only way bitcoin is created.

As per bitcoin’s code, for every 210,000 blocks, the block reward to miners will get halved until they reach zero in two decades. This will limit the total number of Bitcoins that ever exist to 21 million.

This is known as Bitcoin Halving. Third bitcoin halving happened on May 11th, 2020 since its creation which is in 2009. This third halving reduced the block reward for miners from 12.5 BTC to 6.25 BTC.

The first halving happened in 2012, second in 2016. This halving code is written into the cryptocurrency by its creator Satoshi Nakamoto. The 630,000th block which was mined halved the bitcoin reward.

What is the impact of this Halving?

The miner's revenue will be reduced and also the number of bitcoins mined. This might lead to a bullish market and leads to an increase in price. This is, in fact, true according to previous halvings. 

The next halving will occur sometime in spring of 2024, when the block reward will be reduced to 3.125