The Fourth Halving: Bitcoin Enters Uncharted Territory
Bitcoin's fourth halving reduced the block reward to 3.125 BTC. For the first time, a halving occurs with spot ETFs creating structural demand. The supply-demand dynamics are unlike anything in Bitcoin's history.
The Fourth Halving: Bitcoin Enters Uncharted Territory
At block 840,000, Bitcoin's block reward dropped from 6.25 BTC to 3.125 BTC — the fourth halving in the network's fifteen-year history. The event was expected, scheduled, and thoroughly analysed. What makes this halving different from the previous three is the demand side of the equation.
Previous halvings occurred when Bitcoin's buyer base was primarily retail and crypto-native. This halving occurs with 11 spot Bitcoin ETFs that have collectively accumulated over $50 billion in assets in just three months. BlackRock's IBIT alone holds more Bitcoin than MicroStrategy. The ETFs are purchasing Bitcoin at a rate that far exceeds new supply — even before the halving reduced that supply by half.
The Math
The numbers are stark. Pre-halving, miners produced approximately 900 BTC per day. Post-halving, they produce approximately 450 BTC per day. At $65,000 per Bitcoin, that is roughly $29 million in new daily supply. The spot Bitcoin ETFs have been averaging net inflows of $150-200 million per day. The ETFs alone are absorbing 5-7x the daily new supply.
This structural imbalance — persistent institutional demand exceeding new supply by a wide margin — is unprecedented in Bitcoin's history. Previous halvings created supply shocks that took months to manifest in price. This halving is occurring into a demand environment that was already absorbing supply faster than it was being produced.
The Miner Economics
The halving immediately cuts miner revenue by 50% — from approximately $58 million per day to $29 million per day (at current prices). Miners with higher electricity costs or less efficient hardware will be forced offline. The hash rate will decline temporarily before the difficulty adjustment restores equilibrium.
But the miner landscape has changed since the last halving. The industry has professionalised — publicly traded mining companies with access to capital markets, long-term power purchase agreements, and diversified revenue streams (including transaction fees and ordinals/inscriptions). The least efficient miners will exit, but the industry as a whole is better capitalised and more resilient than in previous cycles.
My View
The fourth halving is the most bullish setup in Bitcoin's history — not because of the halving itself, but because of the demand environment into which it occurs. Spot ETFs have created a structural demand channel that did not exist in any previous cycle. The combination of reduced supply and persistent institutional demand creates conditions for price appreciation that are fundamentally different from previous post-halving periods.
The risk, as always, is that macro conditions — a recession, a liquidity crisis, or a geopolitical shock — overwhelm the crypto-specific dynamics. Bitcoin remains a risk asset that correlates with broader markets during stress events. But absent a macro shock, the supply-demand dynamics favour significant appreciation over the next 12-18 months.
Every halving reduces supply. This is the first halving where demand — structural, institutional, ETF-driven demand — was already exceeding supply before the reduction. The math is simple. The implications are not.