What happens during Bitcoin halving?

Bitcoin halving is a scheduled event that happens approximately every four years. During halving, the reward that miners receive for validating Bitcoin transactions is cut in half. This process slows down the rate at which new bitcoins enter circulation, reducing supply growth. Since Bitcoin has a fixed maximum supply of 21 million coins, halving events are designed to control inflation and mimic scarcity similar to precious metals like gold. Historically, halving events have led to increased prices due to the reduced supply and continued or growing demand. However, price reactions can vary depending on market conditions, investor sentiment, and external economic factors. Miners may face reduced profitability, which can lead to changes in mining activity or network security adjustments.