This marks another milestone
On April 27, 2018, the 17th million Bitcoin had been mined. This marks another milestone for the first and most successful cryptocurrency to date. If you’re not new in the world of crypto, then you probably know that Bitcoin’s supply is limited to 21 million coins.
This is the first time the million-bitcoin marker had been crossed since mid-2016. It shows that the digital asset lives true to what the white paper says, creating a digital scarcity through shared software instead of a centralized institution governing the process.
Bitcoin is designed in a way that only a set number of coins are introduced to the economy at intervals. The miners are the people who invest in and operate the hardware required to perform hash calculations. They get rewarded for tracking Bitcoin’s transaction set and adding new entries to the public ledger.
Many people celebrate this amazing achievement by continuously supporting the different projects and actively trading digital assets using crypto software like Bitcoin Code. Others, however, couldn’t help but fear what lies ahead for Bitcoin. After all, there are only 4 million Bitcoins left to be mined. That may not sound like a lot, but the last Bitcoin won’t be mined in this century, assuming no changes would be made in the underlying code.
Satoshi Nakamoto, the founder of Bitcoin, mined the first ever Bitcoin block on January 3, 2009. He received 50 Bitcoins at the time. This reward remained unchanged for the following 209,999 blocks. It was only after this that the first “halvening” happened, which reduced the rewards in half.
This didn’t happen by accident. It’s a hard-coded schedule that the rewards will be cut in half every 210,000 blocks. The most recent halvening was in July 2016, which cut the reward to 12.5 Bitcoins. If you crunch some numbers, it’s easy to see that the 4 million Bitcoins left would require much more time than the 9 years it took to mine the first 17 million. Also, the rate of monetary inflation slows down as the halvenings occur.
If the bitcoin protocol doesn’t change, then the last Bitcoin wouldn’t be mined until 2140. It should give investors some much-needed peace of mind knowing that the protocol is designed to run for an extended period.
But what if things change suddenly and 21 million Bitcoin areas already in the market? This point doesn’t mark the end for Bitcoin. Miners wouldn’t be rewarded with new coins since it has already reached its limit, but they could still be compensated through fees, just like they do today. Many critics, however, say that this scenario probably wouldn’t work out as the cost of mining might exceed the potential gains.
Right now, though, there’s nothing to worry about the fact that 80% of all Bitcoins have already been mined. If anything, it only shows how far Bitcoin has come in the ten years it has existed. It still is, by far, the most used and trusted cryptocurrency. If the scaling issues are addressed, and mass adoption continues to increase, investors can rest easy even if there are only 4 million Bitcoins left to mine.