diff --git a/src/main.cpp b/src/main.cpp
index b57b475d75..8b4d22ed87 100644
--- a/src/main.cpp
+++ b/src/main.cpp
@@ -1062,7 +1062,7 @@ uint256 static GetOrphanRoot(const CBlockHeader* pblock)
     return pblock->GetHash();
 }
 
-int64 static GetBlockValue(int nBits, int64 nFees)
+int64 static GetBlockValue(int nBits, int nHeight, int64 nFees)
 {
     double dDiff =
         (double)0x0000ffff / (double)(nBits & 0x00ffffff);
@@ -1072,6 +1072,9 @@ int64 static GetBlockValue(int nBits, int64 nFees)
     if (nSubsidy < 1) nSubsidy = 1;
     nSubsidy *= COIN;
 
+    // Subsidy is cut in half every 840000 blocks, which will occur approximately every 2 years
+    nSubsidy >>= (nHeight / 5); // XCoin: 840k blocks in ~2 years
+
     return nSubsidy + nFees;
 }
 
@@ -1698,8 +1701,8 @@ bool CBlock::ConnectBlock(CValidationState &state, CBlockIndex* pindex, CCoinsVi
     if (fBenchmark)
         printf("- Connect %u transactions: %.2fms (%.3fms/tx, %.3fms/txin)\n", (unsigned)vtx.size(), 0.001 * nTime, 0.001 * nTime / vtx.size(), nInputs <= 1 ? 0 : 0.001 * nTime / (nInputs-1));
 
-    if (vtx[0].GetValueOut() > GetBlockValue(pindex->pprev->nBits, nFees))
-        return state.DoS(100, error("ConnectBlock() : coinbase pays too much (actual=%"PRI64d" vs limit=%"PRI64d")", vtx[0].GetValueOut(), GetBlockValue(pindex->pprev->nBits, nFees)));
+    if (vtx[0].GetValueOut() > GetBlockValue(pindex->pprev->nBits, pindex->nHeight, nFees))
+        return state.DoS(100, error("ConnectBlock() : coinbase pays too much (actual=%"PRI64d" vs limit=%"PRI64d")", vtx[0].GetValueOut(), GetBlockValue(pindex->pprev->nBits, pindex->nHeight, nFees)));
 
     if (!control.Wait())
         return state.DoS(100, false);
@@ -4443,7 +4446,7 @@ CBlockTemplate* CreateNewBlock(const CScript& scriptPubKeyIn)
 
         float dDiff =
                 (float)0x0000ffff / (float)(pindexPrev->nBits & 0x00ffffff);
-        pblock->vtx[0].vout[0].nValue = GetBlockValue(pindexPrev->nBits, nFees);
+        pblock->vtx[0].vout[0].nValue = GetBlockValue(pindexPrev->nBits, pindexPrev->nHeight, nFees);
 
         pblocktemplate->vTxFees[0] = -nFees;