Bitcoin Halving: What It Is and What It Means for Users in Switzerland
The Bitcoin halving is one of the most important mechanisms built into the Bitcoin protocol. Approximately every four years, the amount of new bitcoin awarded to miners is cut in half. This slows the growth of the cryptocurrency's supply and can affect the entire digital asset market.
For people buying Bitcoin in Switzerland, the halving is particularly relevant because of its potential impact on the BTC price, mining profitability and investor behavior. However, it does not automatically cause the price to rise. Bitcoin's price also depends on demand, economic conditions, regulation, central bank policy and sentiment across financial markets.
What is the Bitcoin halving?
The Bitcoin halving is an automatic 50% reduction in the block reward paid to miners for adding a new block to the blockchain.
Miners use specialized equipment and electricity to validate transactions and secure the network. In return for performing this work correctly, they receive:
- new BTC issued as the block reward
- transaction fees from transactions included in the block
After a halving, the first part of this compensation is cut in half. The mechanism is not controlled by a company, bank or government institution. It is built directly into the Bitcoin protocol.
Why is the block reward reduced?
Bitcoin was designed as an asset with a limited supply. No more than approximately 21 million BTC can ever exist. Unlike traditional currencies, the supply of bitcoin cannot be increased at will by a central bank.
The halving slows the issuance of new coins and gradually reduces Bitcoin's inflation rate. As a result, fewer new BTC enter circulation over time.
This mechanism is often compared with gold mining. As more of the available supply is extracted, obtaining each additional unit becomes more difficult and expensive.
The final fractions of bitcoin are expected to be mined around 2140. In the future, miners' revenue will rely increasingly on transaction fees.
How often does the halving occur?
The halving is not scheduled for a specific calendar date. It occurs every time 210,000 blocks have been mined.
A new block is produced roughly every 10 minutes on average, so halvings occur approximately once every four years. The exact date can shift depending on the rate at which the network produces blocks.
When the relevant block height is reached, the reward is reduced automatically. No vote or update to user accounts is required.
Bitcoin Halvings So Far
Since the Bitcoin network was launched, the block reward has already been reduced several times.
|
Halving Date
|
Block Number
|
Reward Before the Halving
|
Reward After the Halving
|
|---|---|---|---|
|
November 28, 2012
|
210 000
|
50 BTC
|
25 BTC
|
|
July 9, 2016
|
420 000
|
25 BTC
|
12,5 BTC
|
|
May 11, 2020
|
630 000
|
12,5 BTC
|
6,25 BTC
|
|
April 19, 2024
|
840 000
|
6,25 BTC
|
3,125 BTC
|
Earlier halvings had a larger percentage impact on the amount of new bitcoin entering the market. Today, most of Bitcoin's maximum supply has already been mined, so the effect of future reductions may gradually change.
How does the halving affect miners?
Miners experience the effects of a halving directly. Once the reward is reduced, they receive less BTC for roughly the same amount of computing work.
If Bitcoin's price remains unchanged, mining revenue may fall. Less efficient mining operations may scale back, switch off older machines or move to locations with cheaper electricity.
Miners typically try to improve profitability by:
- replacing equipment with more energy-efficient models
- negotiating lower electricity prices
- using renewable energy sources
- joining larger mining pools
- increasing the share of revenue generated by transaction fees
Bitcoin automatically adjusts mining difficulty. If some miners leave the network, the difficulty can adapt to the network's current hash rate.
Does the halving cause the Bitcoin price to rise?
A lower block reward reduces the number of new BTC entering the market each day. If demand remains stable or rises, the reduced supply may support a higher price.
However, this is not guaranteed.
In previous cycles, the strongest price increases often occurred only several months or even more than a year after the halving. The market responded not only to slower supply growth, but also to improving sentiment, new investors entering the market and broader interest in cryptocurrencies.
The 2024 halving differed from earlier events. Bitcoin reached new all-time highs before the block reward was reduced. Factors included growing institutional interest and the expansion of regulated BTC investment products.
Historical market behavior does not mean that every future halving will follow the same pattern.
What the Halving Means for Investors in Switzerland
People buying Bitcoin in Switzerland should consider not only its price in US dollars but also its value in Swiss francs.
The BTC/CHF exchange rate depends on two factors:
- changes in Bitcoin's own market value
- the Swiss franc's exchange rate against the US dollar and other major currencies
Bitcoin may rise sharply in USD terms while producing a different result for an investor measuring returns in CHF because the Swiss franc has strengthened or weakened.
Halvings also tend to increase media interest in Bitcoin. The market may become more volatile during these periods. Sharp rallies can be followed by deep corrections, so purchase decisions should not be based solely on the expectation of a quick profit.
When will the next Bitcoin halving take place?
The fifth halving will occur at block 1,050,000. It is expected to take place in 2028, probably around spring. The exact date will depend on the actual pace of block production.
After the next halving, the block reward will fall:
- z 3,125 BTC
- to 1.5625 BTC per block
The reduction will once again slow the issuance of new bitcoin. Its market impact may differ from previous cycles, however, because Bitcoin is now a more widely recognized and mature asset.
Should you buy Bitcoin before the halving?
There is no single best time to buy BTC. Buying solely because a halving is approaching can lead to emotionally driven decisions.
Before buying, consider:
- how much you can afford to allocate to a high-risk asset
- how long you plan to hold Bitcoin
- where and how your private keys will be secured
- whether you are prepared for substantial price swings
- the fees and exchange rate applied to the transaction
Some people prefer buying smaller amounts of BTC regularly instead of making a single purchase. This can reduce the risk of entering the market near a short-term peak.
Where to Buy Bitcoin in Switzerland
Bitcoin can be purchased through cryptocurrency exchanges, financial apps, brokers and physical Bitcoin ATMs.
A Bitcoin ATM lets you buy BTC with cash and send it directly to a wallet address. At selected machines, you can also sell cryptocurrency and withdraw cash in Swiss francs or euros.
Before starting a transaction, prepare your own cryptocurrency wallet and make sure the correct network is selected. Additional identity verification may be required for higher amounts, in line with applicable security procedures.
Summary
Bitcoin halving is a fixed part of Bitcoin's monetary policy. Every 210,000 blocks, the block reward paid to miners is cut in half, steadily reducing the rate at which new BTC are issued.
The event primarily affects supply, mining profitability and market expectations. Previous halvings have preceded periods of price growth, but they do not guarantee a profit.
Investors in Switzerland should also consider the BTC/CHF exchange rate, transaction costs and the market's high volatility. The halving is best understood as an important part of Bitcoin's economics, not a simple buy signal.
The Bitcoin halving is an automatic 50% reduction in the reward miners receive for mining a new block. It slows the rate at which new BTC enter circulation.
A halving occurs every 210,000 mined blocks, or approximately once every four years on average. The exact date depends on the actual pace of block production.
The next halving will occur at block 1,050,000, most likely in 2028. The block reward will then fall from 3.125 BTC to 1.5625 BTC.
A halving reduces the supply of new bitcoin and, if demand remains strong, may support price growth. It does not guarantee a profit, however, because the BTC price also depends on economic conditions and investor sentiment.
After a halving, miners receive 50% less BTC for each block they mine. This can reduce mining profitability and push operators toward more energy-efficient equipment or cheaper energy sources.
Bitcoin's maximum supply is approximately 21 million BTC. Halvings cause new coins to enter circulation at an increasingly slower rate.
Buying before the halving does not guarantee that your investment will rise in value. The decision should depend on your strategy, risk tolerance and intended holding period.
Bitcoin can be purchased through exchanges, brokers, financial apps and physical Bitcoin ATMs. These machines allow you to buy BTC with cash and send it directly to your own wallet.
