How Many Bitcoins Are Already Mined?
People believe Bitcoins are synonymous to digital gold. Like how you cannot create gold arbitrarily, you cannot create Bitcoins arbitrarily. This is true for all cryptocurrencies, including Litecoin, Ethereum, Ripple, etc. Bitcoins and other cryptocurrencies are not mined via the earth but through computational means. Every cryptocurrency, when it was coded, came with an upper limit in the source code. It is for this reason why only 21 million Bitcoins will be produced. A Bitcoin is introduced to the market at a fixed rate. A block of Bitcoins is released every ten minutes. Additionally, the number of Bitcoins released in each of these blocks decreases by half every four years.
One question that always plays on crypto enthusiasts mind is how many Bitcoins are mined. Well let us find out.
Read also — 20 interesting facts about Bitcoin
Supply is Limited to 21 million!
The source code for Bitcoins defines an upper limit of 21 million Bitcoins. The supply of Bitcoins will be exhausted when miners unlock the total number of Bitcoins. There is, however, a possibility that the source code can be changed to increase the supply of Bitcoins. Many cryptocurrency investors and fans worry about what will happen when we reach the limit of the global supply of Bitcoins. Since 18.5 million Bitcoins have been mined so far, there are only 2.5 million Bitcoins left to mine.
Since Bitcoins are bought using private keys, many Bitcoins may be lost. Some people may forget or lose their private key while others may have died and not left the key with anybody else. This means that the number of Bitcoins in circulation are lesser than 2.5 million.
People have invested in Bitcoins, Bitcoin cash and other cryptocurrencies since the launch of the network, and there are 18.5 million Bitcoins mined. Since there are only a few million Bitcoins left to mine, it looks like we are nearing the end of Bitcoin mining. That said, this is only partially true. While most of the available Bitcoins have been mined, it is hard to understand the timeline of the crypto mined.
There is a reward offered to Bitcoins miners, and if you want to invest in Bitcoins or invest in crypto, it is important to understand this. The reward process gives miners a small chunk of Bitcoins when they verify a block. This process changes over time. When the Bitcoin was first introduced and mined, the reward offered to the miners was 50 Bitcoins. In 2012, the reward dropped to 25 Bitcoins. This continues to happen every four years. According to this calculation, it is believed that the last Bitcoin will be mined in the year 2140. It is, however, possible that the protocol may change.
What is the impact of this finite supply?
The Bitcoin miners will be the ones affected most by the upper limit on the supply of Bitcoins. Some claim that the reward will no longer be available to miners once the limit of the Bitcoins is reached. Since miners no longer have a reward, they may stop investing in Bitcoins. This can have significant consequences on the Bitcoin network.
It is important to understand that the process of mining is not the only way new tokens are added to the cryptocurrency ecosystem. This process is the way the blockchain is maintained or supported, since the blockchain is decentralized. If miners stop investing in Bitcoins, the network will become centralized or collapse. If there are rewards, miners will continue to be competitive until the last Bitcoin is mined. These rewards represent a few hundred dollars for each block, and the amount can increase to thousands if the number of transactions increase. The function will ultimately lead to a closed economy, and the rewards and other fees will be assessed as capital gains and taxes.