At first, it seemed as if mining obtain Bitcoins through the process of solving extremely difficult cryptographic problems would be an endless endeavor – but alas, this was not to be so! The era of easy money may have come and gone for Bitcoin miners; now they’ve mined about all the BTC that will ever exist. Despite what some people believe on how scarcity drives up price and there are still enough coins left in circulation to keep prices stable or even see them increase again at a slower rate than before due to less competition with other miners – there just isn’t enough incentive anymore for most people who want bitcoins.
The Bitcoin Halving Explained
With a hard cap of 21 million Bitcoins, Bitcoin was designed to mimic other expensive goods that have a theoretically finite supply, like gold.
As Axios notes, nearly a decade after Bitcoin was mined for the first time, the mainstream crypto is near its next milestone: 19 million mined coins.
Leaving the obvious question: what will happen when the world runs out of that final supply? Unfortunately, the answer to that question turns out to be less than straightforward.
21 Millions Coins in Total
Every four years, Bitcoin’s blockchain’s number of coins minted per block is halved, which significantly slows down the mining process.
Miners will no longer receive rewards after the very last Bitcoin is mined. The 21 millionth Bitcoin will not be mined for over 100 years at the current rate.
One complexifier is that we’re not even sure there are 19 million Bitcoins in circulation.
Chainalysis, for instance, revealed in 2020 that more than 3.7 million coins had not been touched in at least five years. Around three million, according to other firms, will never be recovered.
The 19 million mark does not seem to mean much to anyone. However, that means that the majority of available Bitcoins have already been created – a staggering figure.
Proof-Of-Work Mining On Bitcoin Doesn’t Have Much Of An Effect
Currently, a single Bitcoin is worth over $45,000, so the news has not had much of an effect.
What about Bitcoin’s value in the future?
As proof-of-work mining consumes considerable energy and is environmentally damaging, miners may lose incentive to continue if the token’s value falls enough. The future value of the currency will depend greatly on the supply of coins as they become more scarce.
Miners worldwide also made record revenues in 2021 from mining Bitcoin. This indicates that governments and banking institutions are increasingly accepting Bitcoin as a legitimate currency.
Governments around the globe have banned proof-of-work mining, including those in China, which once had the largest Bitcoin mines, because of its massive carbon footprint and shady connections.
What does the future of Bitcoin look like? That’s the million dollar question on the minds of crypto investors – and the answer is hazy as ever.
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Author
Chris Munch is a professional cryptocurrency and blockchain writer with a background in software businesses, and has been involved in marketing within the cryptocurrency space. With a passion for innovation, Chris brings a unique and insightful perspective to the world of crypto and blockchain. Chris has a deep understanding of the economic, psychological, marketing and financial forces that drive the crypto market, and has made a number of accurate calls of major shifts in market trends. He is constantly researching and studying the latest trends and technologies, ensuring that he is always up-to-date on the latest developments in the industry. Chris’ writing is characterized by his ability to explain complex concepts in a clear and concise manner, making it accessible to a wide audience of readers.
