Halving

A halving is the point at which the amount of new cryptocurrency issued is cut in half. Bitcoin's code halves the mining reward roughly every four years.

The design limits the total supply while releasing it gradually. Issuance keeps slowing until it stops altogether at 21 million coins.

Each halving generates expectations that reduced supply will raise the price. Prices did rise substantially after several past halvings, which is why the expectation recurs.

Establishing causation is difficult, though. Market conditions, interest rates and liquidity differed at each halving, and with only a handful of instances there is not enough data for a statistical conclusion.

For miners it is an event that halves revenue. Unless prices rise correspondingly, miners who can no longer cover costs drop out and the network's composition shifts. It also matters that halvings are known well in advance. Information everyone already has tends to be priced in beforehand.