Last update: January 2020
How many bitcoins are there? After a decade of its launch, let’s take a look at one of the most popular cryptocurrencies in the world and see what is the status quo.
Ever since the mysterious ‘Satoshi Nakamoto’ invented Bitcoin in 2009, it has dominated the crypto ecosystem. Bitcoin offers lower transaction fees compared to the standard payment system. Unlike government-issued fiat currencies, Bitcoin operates in a decentralized authority.
Just like gold, Bitcoin is also mined, but by digital means. The mining process requires either a GPU (Graphics Processing Unit) or an application-specific integrated circuit (ASIC). The process is also quite costly as it requires a lot of electricity and powerful computing machines.
Bitcoin ‘miners’ can earn the cryptocurrency as a reward for completing ‘blocks’ of verified transactions that are then added to the blockchain. Mining rewards are paid to the miner (or group of miners) who discovers a solution to a complex hashing puzzle first, and the probability that a participant will be the one to discover the solution is related to the portion of the total mining power on the network.
In order to earn bitcoins, miners need to verify a group of transactions (grouped in the so-called blocks of information), and also, they have to be the first miner to solve a numeric problem, a process defined as proof of work.
You may also be interested in…
In total, there are only 21 million bitcoins that can be mined. After Bitcoin miners have unlocked all 21 million coins, the Bitcoin supply will be reached and no more bitcoins will be created.
However, its protocol may change in the future to allow for more supply if the majority of the users approve it. Nevertheless, this proposal has been discarded by the major part of the crypto community because precisely, one of the major features of Bitcoin is its programmed scarcity.
So far, over 18 million bitcoins have already been mined. That leaves a remainder of almost 3 million.
The number of bitcoins in circulation does affect the value of the coin because it impacts its supply. As mentioned earlier, the number of bitcoins is currently capped at 21 million. Once this number is reached, no more bitcoins will be mined. Also, once the entire 21 million gets in circulation, prices will vary depending on the easiness-of-use in transactions. This, in turn, will be influenced by how accessible other crypto assets are.
Bitcoin’s inflation rate is another aspect that plays a significant role in the coin’s price. According to the latest price charts, Bitcoin is going to have an inflation rate of 1.8% in over a year. In 2020, Bitcoin’s daily issuance is going to drop by 50%. This will reduce the release of new bitcoins in the market. It is, however, believed that the fixed supply of Bitcoin gives the cryptocurrency anti-inflationary properties.
Recently, bitcoin witnessed a significant sell-off by losing $1500 in less than 24hours for the first time in many months. The coin has seen some notable vitality this year. Despite this event, the cryptocurrency continues to rise, having reached almost $13,000 during 2019.