What is the Bitcoin halving? A major transformation in the mining system after 12 years

What is the Bitcoin halving? It is a mechanism where the block rewards for miners are halved approximately every four years. Since the first halving in 2012, 12 years have passed, and this system continues to have a dramatic impact on the mining industry. Bitcoin, which experienced its fourth halving in April 2024, faces dual pressures of rising mining difficulty and decreasing rewards, but miners are innovating and tackling these challenges with ingenuity.

Supply Limitations and Scarcity Created by the Halving Mechanism

The Bitcoin halving mechanism reduces the initial block reward of 50 BTC to 25 BTC, and after two more halvings, it has gradually decreased to the current 3.125 BTC. This design strictly limits the maximum supply of Bitcoin to 21 million coins, which is the fundamental principle ensuring the asset’s scarcity.

As of January 2026, approximately 19.98 million Bitcoins are in circulation, with about 1.2 million remaining to be mined. However, the process of mining these remaining coins becomes increasingly difficult for miners. Due to the gradual reduction in rewards and rising difficulty, it now takes significantly more time and energy to mine the same amount of Bitcoin.

Rapid Increase in Mining Difficulty and Challenges in Mining Efficiency

Changes in mining difficulty are the most emblematic indicators of the impact of Bitcoin halving. In early November 2024, mining difficulty first surpassed 100 trillion, then further increased to 102.3 trillion. This dramatic rise indicates that more miners are participating in the network, intensifying the competition to mine blocks. The next difficulty adjustment is scheduled for early December, and this upward trend may continue.

As difficulty increases, the operational costs for miners are rising rapidly. The electricity consumption required for mining increases, while block rewards are relatively decreasing, leading to a decline in overall industry profitability.

Strategic Shifts and Adaptations in the Post-Halving Mining Industry

Despite Bitcoin’s price rising in 2024, miners are not only benefiting from the price increase but are also implementing various strategies to address structural challenges. Industry data shows many companies are focusing on cost reduction and adopting artificial intelligence to maximize mining efficiency.

Major mining companies like Marathon Digital have strategically sold some of their mined Bitcoin in 2024 to cash out, while actively purchasing new Bitcoin. In August, they issued $250 million in convertible bonds to fund business expansion and technological investments. Meanwhile, companies like TeraWulf are reevaluating their management strategies due to declining profit margins and are exploring potential mergers.

Regions such as El Salvador are investing in developing alternative mining methods utilizing geothermal and volcanic energy, accelerating the construction of sustainable mining environments across the industry.

Latest Mining Status and Future Bitcoin Supply Forecast

As of January 2026, the current price of Bitcoin is approximately $88,360 (88.36K USD), down 13.53% over the past year. Since the halving in April 2024, Bitcoin has been moving within a complex market dynamic.

Mining the remaining 1.2 million Bitcoins will take considerable time due to continued difficulty increases and gradual reward reductions. The design of the halving mechanism suggests that the next halving is expected around 2028, at which point the block reward will decrease further to 1.5625 BTC.

The miner community continues to face industry challenges, maintaining the security and functionality of the Bitcoin network through ongoing technological innovation and cost optimization. The 12-year history of Bitcoin halvings is not just a story of reward mechanism changes but also a record of the evolution and adaptation of the entire mining industry.