Bitcoin (BTC), the first and the most dominant cryptocurrency in the market, recently reached a round figure, as the 17 millionth Bitcoin was mined at block 520,013. The amount is extremely significant, leaving only 4 million Bitcoin (BTC) to mine on the horizon.
Let’s remember that Bitcoin’s White Paper, authored by Satoshi Nakamoto, included a maximum of 21 million bitcoins. However, despite the apparent closeness to the figure, it is estimated that the last Bitcoin (BTC) will be mined at the height of block 6,929,999, somewhen in the year 2140, according to the nowadays technologies.
The readjustment of the mining difficulty, which occurs every 2016 blocks, and the reductions in the reward are the key to this activity
The programmed reduction of the coins is called halving and occurs every 210,000 mined blocks (approximately every four years), halving the reward.
The first reduction occurred in November 2012 and the split reward was from 50 to 25 BTC. The second, occurring in July 2016, let miners earn only 12.5 BTC per a single mined block.
When reset to 0, miners will only receive rewards for commissions paid for transactions made by users.
Bitcoin (BTC) is a deflationary cryptocurrency
The fact that there are only 21 million BTC is important, as this limit prevents inflation. The amount of coins produced through mining is reduced in a programmed manner, which helps to make this cryptocurrency deflationary.
With increasing difficulty, Bitcoin (BTC) mining is demanding for more and more high-end equipment with increased computing capacity.
In fact, BTC can currently be mined only with ASIC chips specialized in the SHA-256 algorithm. The Chinese company Bitmain is the largest producer of this type of hardware and its most powerful equipment, so far, is the Antminer S9.
It is estimated that the concentration of ASIC miners in a blockchain threatens the decentralization of the blockchain, especially if they belong to the same producer, mainly due to the powerful computing capacity of this equipment.
Other cryptocurrencies, such as Etherum (ETH) or Ripple (XPR), on the other hand, do not have a clear production limit, so they have important inflation rates. However, at least the Ethereum community and its own founder, Vitalik Buterin, have begun to examine this aspect and to assess the advisability of setting a maximum.
In short, Bitcoin (BTC) mining has reached to only 4 million BTC left, thus, the Bitcoin (BTC) is becoming rarer. Thus, Bitcoin (BTC) might go up.
Jackson Bey was born and raised in Lethbridge Alberta but moved east when he was 22. Apart from running his own consulting firm. Jackson spends his time canoeing the many lakes of Ontario. As a financial journalist Jackson has published stories for CBC Business Online, as well as Buzz Feed and Motherboard. As a contributor to Billionaire 365, Jackson mostly covers markets and trade.