Quote from: Montane on Today at 08:39:21 AM

So does mining account for a significant portion of the coins being sold? Is that why miners' decreased participation reduces supply?

Yeah I understand the psychological effect of the halving.

Also who halves bitcoin? Like how does it halve?

Miners are always competing to find the next block, which means computing a lot of hashes until they find a hash that when converted to an integer is smaller than a target integer that is coming from the "difficulty". This difficulty and the way it is computed is part of the consensus rules of bitcoin and anyone can compute it based on previous blocks and they all come to the same value.

Each time a miner finds a new block they can claim the reward for that block which has a fixed max value. It started from 50 and each 210000 blocks it is cut in half (again with the same consensus rules enforced by all bitcoin full nodes) automatically. We have had 3 halvings so far 50 > 25 > 12.5 > 6.25.

If miners leave or stop mining it takes longer to find blocks but when the "difficulty" adjustment period is reached (2016 blocks) it will readjust (the same consensus rules apply here too) and the subsequent blocks would be mined at normal speed.
Similarly when new miners come online it becomes easier to find blocks so the difficulty goes up hence making the time between blocks "normal" which means we want 2016 blocks to be mined in 2 weeks.