Bitcoin (BTC) is designed in concept as a rare commodity with built-in inflation brakes. Now 19 million of the maximum 21 million Bitcoin have already been generated. What does this suggest for the future?
Newspaper reports about Bitcoin often mention that the last of all 21 million BTC will not be mined until 2140. Now, Bitcoin mining has just reported the symbolic figure of 19 million BTC mined, and discussions are sparking on Reddit. More important than the year 2140 for the future of Bitcoin are at least two much closer dates, they say. Already in 2026 the number of 20 million Bitcoin will be reached and already in 2035 99 percent of all BTC will be generated. Why these calculations are much more than a math game, we explain here:
1. Halving is embedded in Bitcoin’s code for every four years. Bitcoin halving halves the number of BTC that miners receive for their efforts in the blockchain. The last Bitcoin halving in May 2020 resulted in Bitcoin miners receiving only 6.25 BTC for producing a new block instead of the previous 12.5 BTC. Through the mechanism of Bitcoin halving, inventor Satoshi Nakamoto wanted BTC to experience no or only low inflation.
2. In practice, the previous Bitcoin halvings of 2012, 2016 and 2020 have each led to strong pluses in the price curve and new all-time highs with a slight time lag. In the popular stock-to-flow theory of Bitcoin price development, the halvings are a decisive factor. It is assumed that the halvings artificially reduce the inflow of new Bitcoins. This is a parallel to the price of gold, because the development of new stocks of gold is also becoming more and more difficult, thus causing the price to rise.
3. At the moment, the next Bitcoin halving is predicted for the beginning of May 2024, but the exact date can still shift a bit because, from a technical point of view, it is also related to difficulty levels and hash rate in the network. Optimists and the widespread BTC HODLers therefore expect Bitcoin to jump in price in the second half of 2024 and to cross the “magic” threshold of $100,000 per BTC by then at the latest.
4. There are two common theories on the question of why exactly 21 million BTC was defined as the final target, which we have summarized for you here. More importantly, the amount of all BTC is limited and fewer and fewer new Bitcoin are coming into circulation.
5. This is another reason why it has long been worthwhile not only to think and calculate in whole Bitcoin, but also to understand the subunits such as Satoshi. After all, 1 BTC currently costs more than 45,000 US dollars, which is probably beyond the budget of many savers and investors. But Bitcoin can also be traded or saved in smaller units, making it possible for everyone to profit from positive price developments.
6. The discussion is not only on Reddit: The part of the Bitcoin price development that is influenced by the limited amount and inflow of new BTC will theoretically come to a conclusion well before 2140. For the last of all Bitcoin, a mining period of 36 years is assumed.
Conclusion: “Digital Gold” Bitcoin – new BTC are not infinite
The first Bitcoin was generated in January 2009, by inventor Satoshi Nakamoto’s computer. This BTC would now be worth as much as any other Bitcoin that has been mined since. In Bitcoin’s 13-year history so far, all investors have ended up in the black sooner or later, with each new all-time high generating such a situation. Bitcoin’s current most recent all-time high of just under $69,000 dates back to November 2021. The fact that Bitcoin significantly beats all other asset classes in terms of returns over the medium and long term has now become common knowledge and was confirmed again in 2021. Conclusions can be drawn from this information, and Bitcoin halvings are just as important as the ever-approaching peak of 21 million BTC.
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