Rocket launch. Image by Steve Jurvetson via License: Creative Commons

The question that interests many people most about the halving is the price. What will happen to the Bitcoin price if the creation of new Bitcoins halves? We can’t look into the future – but we have plenty of material to recognize patterns in the past.

Clear. You cannot read the future from the past. If that were the case, we would all lead a rich and secure, but also somewhat boring life.

Nevertheless, it is worth looking at the past. If you find stable patterns in it, there is some chance that they will continue in the future, if only because people believe in them. Therefore, in this part of our focus on halving, we will look at how the Bitcoin price has reacted to past halvings.

Halving halves the output of new Bitcoins. In the case of raw materials, you would probably call it a production quota, similar to OPEC’s reduction in oil production in the 1970s. In protest against the Yom Kippur War, OPEC countries cut oil production by around five percent. The result was the oil price shock, in which the price of oil rose from around three to twelve dollars per barrel.

If a five percent cut in oil quadruples the price, what does a fifty percent cut do in Bitcoin?

The three previous and one future halving

A lot, as we will see. Below we will analyze the Bitcoin prices surrounding the previous halvings. These took place on the following dates:

  • Block 210.000: 28. November 2012
  • Block 420,000: 9 July 2016
  • Block 630.000: 11. Mai 2020
  • Block 840,000: expected April 19, 2024

Some people will notice that the halving doesn’t take place exactly every four years, as originally planned, but always a little earlier. This is because the hashrate increases, but the mining difficulty only adjusts every 1016 blocks, which should be about two weeks. Until then, the miners are producing Bitcoins a little faster than planned, which will accumulate until the next halving.

After this note we get started. We examine the previous halvings with many charts.

A pattern couldn’t be much clearer

Our first chart is the first reward era. A reward era means a period of time in which a certain amount of Bitcoins is created per block.

The first reward era lasted from January 9, 2009 – when Bitcoin went live – until November 28, 2012, when the reward per block fell from 50 to 25 Bitcoins. This phase is almost prehistoric because real price discovery only became possible from the beginning of 2011 with the founding of Mt. Gox.

All charts from

Nevertheless, the first reward era has everything that belongs to a Bitcoin era: It has its bubble – that was in June 2011, the price had increased about thirty-fold – and its bear market – the price lost around 80 percent from the top of the bubble out of. At the end of the reward era, however, the price had stabilized at a strong $10, significantly higher than at the beginning.

The course doesn’t look much different in the second reward era. It ended on July 9, 2016. The price formed a small bubble at around $260, which was soon followed by the second, real bubble, which raised the price from around $100 to more than $1,000. Bitcoin then entered the bear market, during which it lost around 80 percent from the peak. At the end of the reward era, Bitcoin had stabilized at around $500 – increasing fifty-fold since the beginning of the era.

You won’t believe what we’re seeing in the third reward era, which began with the halving on July 9, 2016:

Exactly! The price forms a bubble – the value increases sevenfold within a few months – followed by a bear market in which the price collapses by around 70 percent. At the end of the third reward era, Bitcoin stabilized at a good $8,000 – meaning its value had increased almost twenty-fold since the beginning of the era.

Finally, we’ll look at the fourth reward era, which began on May 11, 2020 and will end on April 19.

She stands out a little. But only a little. It also has its bubble – it forms a nice double peak at around 65,000 dollars, which means that the price has increased at least 6 times – then falls massively by more than two thirds, stabilizes – and jumps even before the era closes Ending, to a new all-time high!

The fourth reward era largely corresponds to the pattern of the previous ones, with the one nice exception that it is the only one to top its own all-time high.

From the halvings to new all-time highs

Before we get to evaluating the findings that are already clearly emerging, let’s look at a few more charts in which the halvings do not form the beginning and end, but rather the middle marked in orange.

All charts from

This chart shows the price six months before and six months after the first halving. The months around the halving are relatively boring, little happens during them. The price fluctuates around ten dollars. Even in this early phase of Bitcoin, the market apparently priced in the halving.

However, after about three months, the price begins to rise increasingly aggressively, reaching a peak of $260 not quite half a year after the halving. The bubble then collapses, but the price quickly recovers.

However, if we zoom out a little further and look at the twelve months before and after the halving, the $260 peak fades. After a few months of stagnation, the price shot up in November 2013. It peaked at $1,250 relatively exactly 12 months after the first halving.

The six months before and after the second halving look somewhat different. This time the halving itself stands out a little more clearly. The price jumped a bit beforehand, largely ignored the halving, but continued its bear market afterwards. However, after six months, it has recovered with a stable upward trend.

This trend will continue vigorously in the following months. A year after the second halving, in July 2017, the price has long since reached a new all-time high – but is still a long way from the all-time high of this market phase. It will take another six months for the bull market of this reward era to reach its peak.

The third halving in May 2020 is also a non-event. The price has recovered after the “Corona shock”, is enjoying a slight upswing, and cuts through the halving as if it were nothing. A few months later, however, it began a powerful increase that took it close to the previous all-time high of $16,000 six months after the halving.

As you know, that was just the beginning. A year after the third halving, in May 2021, Bitcoin has long since reached a new all-time high of a good $65,000.

Looks good – but you will be disappointed

So what do we know so far? There are some fixed patterns that have worked in previous halvings and reward eras:

  • The halving itself is a non-event. It has long been priced in, sometimes so much so that the price falls rather than rises. If you’re waiting for something great to happen on April 19th, you’ll probably be disappointed.
  • In the long term, however, the price rose powerfully in each reward era. As a “hard factor,” the throttled creation of new Bitcoins drives the price up just as persistently as an interest rate cut drives up stock prices. Six months after the halving at the latest, Bitcoin is back in the bull market, and 10-15 months later it breaks a new all-time high. An exception is the fourth and now ending reward era, which topped its own all-time high shortly before its end.
  • The price does not just rise linearly, but rather exponentially: it multiplies – but not with the same intensity. Instead, the effect appears to cool down over time. We will look at this in more detail shortly.

I roughly show the differences in the scales in a table. It shows the price in dollars on the day of the halving, the maximum price of the subsequent reward era and the number of days from the halving up to this one.

Halving date Price Halving Price top Days from halving to peak
28.11.2012 12 1200 368
9.7.2016 663 18.000 522
11.4.2020 8740 65.000 320 / 549
9.04.2024 70.700 ??? ???

From the first halving to the local peak, the price increased a hundredfold. From the second halving to the local peak by 27 times, from the third halving to the next peak by seven times. The exponential increase is leveling off. If the logic here continues, Bitcoin would only rise about twice in the following cycle, i.e. to around $150,000. I know you expect more.

So let’s look at the peaks: At $1,200, the peak of the second reward era exceeded that of the first by 34 times. The $18,000 peak of the third era was 15 times higher, and that of the fourth era was only 3.6 times higher despite the impressive $65,000. That’s why many consider the fourth era to be a bit disappointing. However, if it forms a pattern that continues, a top of $150,000 would still be quite optimistic.

Of course, patterns don’t have to repeat themselves. There is no guarantee, and no one who means well to you would promise you that things will turn out the way they have. Things can get better or worse. But if Bitcoin does not abandon its previous patterns, there is a good chance that the price will rise significantly again this time – but not nearly as significantly as many hope.


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