There were 19,510,987 bitcoins in existence as of Feb 15, 2023. At that time, there were 1,489,013 bitcoins left to be mined before hitting the limit of 21 million.
One of the significant features of Bitcoin (BTCUSD) is its finite supply. Bitcoin's enigmatic creator, Satoshi Nakamoto, designed the cryptocurrency with a supply cap to limit the circulation. This design increases its scarcity over time, which can potentially drive up demand and price.
Approximately every 10 minutes, new bitcoins are added to the Bitcoin supply, corresponding to the average time it takes to create a new Bitcoin block. By design, the number of bitcoins minted per block reduces by 50% after every 210,000 blocks, which is around once every four years.
KEY TAKEAWAYS
- Bitcoin's maximum supply is capped at 21 million.
- Due to rounding operations in the Bitcoin codebase, the actual number of Bitcoins issued may not reach exactly 21 million.
- Once the Bitcoin supply limit is reached, no additional Bitcoins will be generated.
- When this cap is hit, Bitcoin miners are likely to earn income exclusively from transaction fees.
Will the Number of Bitcoins Ever Reach 21 Million?
The 21 million bitcoin limit likely won't be reached due to the Bitcoin network's use of bit-shift operators. These arithmetic operators round decimal values down to the smallest whole integer.
This rounding happens when halving the block reward amount paid to miners. The new reward is calculated in satoshis, where 1 satoshi = 0.00000001 bitcoins. Since a satoshi is the smallest Bitcoin unit, it can't be split. If a satoshi reward needs halving, the network's programming rounds down to the nearest integer using bit-shift operators. This consistent downward rounding of fractional satoshi rewards is why the total bitcoins issued will fall just short of 21 million.
As of February 2023, about 19.51 million bitcoins have been mined already. This leaves around 1.49 million bitcoins left to be released until hitting the total supply cap of 21 million.
With the number of new bitcoins per block halving about every 4 years, the final bitcoin (or satoshi in practice) is projected by 2140. When Bitcoin began, 50 new bitcoins were minted per block. This decreased to 6.25 by May 2020, with the next halving to 3.125 expected in 2024. Over time, the declining block rewards push the final bitcoin issuance farther into the future.
Although 21 million is the maximum supply, the actual circulating bitcoins will stay well below that due to lost coins. Bitcoin owners can permanently lose access by misplacing private keys or dying without sharing wallet information. A 2020 Chainalysis study estimated up to 20% of mined bitcoins so far may be irretrievably lost in this manner. So while 21 million can be minted in theory, the circulating supply is apt to be far lower.
Implications after All 21 Million Bitcoins Are Mined
Once the limit of 21 million bitcoins is reached (though the actual number might be slightly below due to the reasons previously stated), no additional bitcoins will be issued. However, bitcoin transactions will still be consolidated into blocks and processed. Bitcoin miners will continue to receive rewards, but the rewards will primarily be from transaction processing fees rather than new bitcoins.
The impacts of reaching the upper supply limit on miners largely depends on Bitcoin's evolution. If the Bitcoin blockchain in 2140 processes numerous transactions, miners might still generate profits from only transaction processing fees.
On the other hand, if Bitcoin mainly functions as a store of value and is not used for everyday transactions, miners can still profit—despite low transaction volumes and no block rewards. Miners can charge high transaction fees for processing high-value transactions or large batches of transactions. More efficient "layer 2" blockchains like the Lightning Network can work alongside the Bitcoin blockchain to facilitate daily bitcoin transactions.
Bitcoins Mined So Far
As of February 2023, about 19.51 million bitcoins have been mined already. This leaves around 1.49 million bitcoins left to be released until hitting the total supply cap of 21 million.
Time to Mine One Bitcoin Currently
The mining time per bitcoin depends on the block reward amount paid to miners for generating a new block. The current reward is 6.25 bitcoins per block. With new blocks produced about every 10 minutes, this equals .625 bitcoin mined per minute.
Mining Time After Next Reward Halving
When the block reward halves in 2024 to 3.125 bitcoins, about 0.3125 bitcoin will be mined every minute at that point.
What Happens to Fees at Max Supply
Once the 21 million bitcoin limit is reached, mining fees will disappear. Miners will then likely rely only on transaction processing fees for income, rather than a combination of fees and block rewards.
Summary
At present, the future of Bitcoin, whether it functions as pocket change or as gold bars, is still developing. The Bitcoin ecosystem might continue to evolve in the upcoming decades. However one thing is certain, no new bitcoins will be distributed once the 21-million coin limit is reached. This event is likely to impact Bitcoin miners the most but could also have implications for Bitcoin investors.
Source: Investopedia
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