80% of all the bitcoins that will ever exist have already been mined, leaving only 4.2 Million Coins left until supply cap, which could also mean shifts in the cryptocurrency’s price.
Cryptocurrency tracking site Blockchain.info shows that the amount of total bitcoins in circulation crossed the 16.8 million mark on Saturday, meaning the token is over 80 percent of the way toward reaching the 21 million mark.
That’s the maximum number that can ever exist, as outlined in creator Satoshi Nakamoto’s 2008 White Paper detailing the cryptocurrency for the first time, with the hard limit designed to create scarcity in the product and reduce inflation.
When Satoshi Nakamoto introduced bitcoin to the world in 2009, the goal of the capped supply was to limit the effects of inflation.
All current predictions suggest that miners are still decades away from reaching the cap, while the effort needed to successfully mine new bitcoin is getting harder by the day.
Scarcity arguably creates demand, which in turns makes the coins more valuable. Once 21 million bitcoins have been mined, it will become even harder to obtain them, also potentially making each coin more valuable.
Miners currently receive a block reward of 12.5 BTC, but Nakamoto’s protocol also requires that the mining reward is halved every 210,000 blocks, or approximately four years.
The next miner halving will take place within two years, approximately in early June 2020 depending on hashrate, bringing the rewards down to 6.25 BTC per mined block.
Other cryptocurrencies that are in vogue, like ethereum, have no cap on their number, meaning that new Ether and similar will be produced as long as people see it as a worthwhile practice to pour their computational cycles into making it. Considering that’s also required for transactions to be completed, it’s important that it continues into the future.
Some cryptocurrencies are created with the entire supply released all at once, in which case the total supply is either held or in circulation and there is no way to “mine” or mint new coins.
Some examples of non-mineable digital currencies are Ripple, IOTA, NEM, NEO, Qtum, Omisego, Lisk, Stratis, Waves, and EOS.
As for bitcoin, as the difficulty of mining the last coins continues to increase and the rewards, in turn, are reduced, the rate of new coins being created will continue to slow.
Although it’s hard to make any concrete estimations on the eventual date of the last bitcoin being mined due to the unpredictable nature of mining hardware development, some estimates put it as far in the future as the year 2140 — long after all existing investors are gone.
Here’s hoping we’ve spent at least a few of our coins before then.