Article by Frank America | Edited by trewkat and Hiro Kennelly | Cover Art by Tonytad

Approximately every four years the amount of bitcoin released to the world is cut in half — which is known as the halving. The time between halving events is approximate because of the slight variation in hash rates, which affect the time it takes to complete each new block on chain. The specific amount of blocks that must be mined to reach the next halving is hard-coded to be 210,000 blocks. At an average of ten minutes per block, halvings occur every four years.

Since bitcoin mining began in 2009, there have been three halvings. Until the first halving in November 2012, 50 bitcoins were released every 10 minutes. Next spring, at block 840,000, the bitcoin reward that goes to miners will decrease to 3.125 BTC per block. Keep in mind that’s 3.125 bitcoins every 10 minutes or 450 bitcoins a day.

Image source: Bitcoin halving dates history & future dates — CryptoAnswers

Just as Ethereans get extra excited when network usage is high and the blockchain enters a period of “Ultra Sound Money”, which means ETH becomes deflationary or burns more than it prints, so too, the Bitcoin halving cycles are celebrated by Bitcoiners as this finite and limited supply of bitcoin whose distribution is ever approaching zero¹. When no further bitcoins are distributed, 21 million bitcoins will have been mined, and not a satoshi more.

¹ This is reminiscent of Zeno’s paradox of taking half the distance to a certain location and thus never arriving.

Psychologically, scarcity often breeds demand. This is also true with bitcoin. Every time there has been a halving the price of one bitcoin has increased considerably. For example, the price of bitcoin at the first halving on November 28, 2012 was $12.46. One year later the price of one bitcoin was $1,042.01, which is an 8,262.84% increase.

Source: CoinMarketCap.com

The next halving took place on July 9, 2016 when one bitcoin was priced at $650.96. One year later on that same date it was worth $2,518.44. This is a 286.88% increase in value. The third halving took place on May 11, 2020 when bitcoin was $8,601.80. One year later bitcoin’s value was $56,704.57. This is a 559.22% increase in value. Based on these figures, a conservative projection for bitcoin’s price a year following the next halving would be +250%.

Take a moment to view the chart below which shows the price of bitcoin one year prior to each halving and one year following each halving. The beige is the year before it splits in two, and the purple is the year after. The year following a halving — so far and without fail — has seen a spike in the value of each bitcoin.

Image credit: CoinDesk

As of today, the bitcoin halving countdown clock indicates there are approximately 254 more days until the next halving so we’re within the beige zone of the 2024 event. The projected date is currently around April 20, 2024. The above chart shows that the % increase of bitcoin the year preceding the halvings has lessened each time (385%, 142%, and 17%). Conservatively, let’s assume BTC price doesn’t increase more than 5% in this time preceding the fourth halving. That would put bitcoin roughly at $31,150 on April 20, 2024.

Our projected increase of 250% — which is less than any of the historic increases measured one year after a halving (8,262.84% in 2013, 286.88% in 2017, 559.22% in 2021) — would put bitcoin’s price on April 20, 2025 at $109,025. If bitcoin remains on par with the previous cycle’s differential between the second to third halving and hits a 500% increase, that would put BTC at $186,900 in Q2 of 2025.

Crystal ball aside, factually we’ve never had a halving that didn’t follow with a run-up in the price of bitcoin. However, it is a logical fallacy to believe that past results presume future outcomes. Whether one can accurately predict the price of bitcoin beyond the next halving remains to be seen, but there is no doubt consensus around its proof of brilliance.

Author Bio

Frank America is an author, musician, and comedian. He is Editor-in-Chief of The Rug News, and a Content Manager/Staff Writer at Bankless Publishing.

Editor Bios

trewkat is a writer, editor, and designer at BanklessDAO. She’s interested in learning about crypto and NFTs, with a particular focus on how best to communicate this knowledge to others.

Hiro Kennelly is a writer, editor, and coordinator at BanklessDAO, an Associate at Bankless Consulting, and is still a DAOpunk.

Designer Bio

Tonytad is a graphic designer who has worked locally and internationally with organisations and firms on over 200 projects, which includes branding, logos, flyers, cards, and covers.

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