How Does the ‘Halving’ Event Affect the Economics of Mining?

The Bitcoin halving is a pre-programmed event that occurs approximately every four years, which cuts the block subsidy reward for miners by 50%. This instantly reduces the primary source of miner revenue, often forcing less efficient miners offline.

The halving is a deflationary mechanism that tightens supply, and historically, it has been followed by significant price increases, which compensate miners by increasing the fiat value of the remaining block subsidy and transaction fees.