Only 10% of bitcoin remains to be mined: what does that mean?

Over 19 million bitcoins have been mined – almost 90% of the total. Will exceeding this historic threshold have an impact on cryptocurrency? Not immediately.

Nearly 90% of bitcoins have been created to date: the 18,899,000th block was mined on December 12, 2021, according to data from the blockchain.com site. It is a very symbolic level that has just been reached, almost 13 years after the creation of the very first bitcoin. Because bitcoin is not unlimited: it was decided, from its creation, that there would only be 21 million units of bitcoin. At first very distant, the date on which the last bitcoin will be produced is getting closer and closer. However, will crossing this level change a lot of things for miners and bitcoin buyers?

The fact that there are “only” 10% of bitcoins left to be mined does not change the cryptocurrency for the moment: the blockchain continues to operate as usual – even if the price of the crypto is in sharp decline since the beginning of December 2021. But rest assured: even if 90% of the units have been generated, we are still far from the end of bitcoin.

The value of bitcoin in December 2021. // Source: Coinmarketcap

What is this story of 21 million bitcoins?

It was the creator of bitcoin, the mysterious Satoshi Nakamoto, who decided to put a limit on the number of units available. Why did you choose this approach? Because it is partly this notion of rarity that gives a product or a resource its value. This limit has been written into the code of the blockchain, which guarantees that it can never be transgressed.

Why was the sum set at 21 million? The total sum was chosen by Satoshi Nakamoto, who never gave an explanation for this number, or why it was chosen. Nevertheless, experts have concluded that there are two very likely hypotheses.

The first hypothesis would have a symbolic aspect, linked to the final value of a bitcoin. Specialists assume that Satoshi Nakamoto would have chosen this number taking into account an external fact: in 2009, when bitcoin was created, the total value of money in circulation in the world was 21 trillion dollars. He would therefore have chosen for a limit of 21 million, hoping that bitcoin would one day become the basic currency in the world, having in mind that a bitcoin would have a fixed value corresponding to 1 million dollars.

The second track is based on the time it takes to mine a block. Bitcoin parameters mean that today a block is mined approximately every ten minutes, thanks to a protocol that constantly adjusts the difficulty. The number of 21 million would therefore correspond to a mathematical logic, applied simply for a matter of convenience.

Only 10% of bitcoin remains to be mined: what does that mean?
Only 21 million bitcoins can be mined altogether. // Source: Executium / Unsplash

When will the last bitcoin be mined?

It is estimated that the last bitcoin must be mined in 2140. If the precise date is not yet known, and that the event is planned for more than a century, many questions are already being asked about the post- bitcoins. Because when the last bitcoin is mined, the 21 millionth, miners will no longer be rewarded with cryptocurrency to maintain the blockchain. However, the validation of transactions on the blockchain is what partially guarantees its integrity, and if miners no longer receive a reward, it could be abandoned.

This scenario, however, seems unlikely: the solution envisaged for the moment would be to set up some kind of service fee, which would be paid to miners in exchange for maintaining the blockchain and validating new blocks.

What is the halving?

In order to slow down the creation of bitcoins and allow the project to continue, Satoshi Nakamoto has also set up cut it in half. The halving (which means “dividing by two” in English) is an event that takes place every 210,000 blocks, which is equivalent to 4 years. Concretely, miners receive a determined number of bitcoins as a reward for their work on the blockchain and for mining a new block. And the halving cuts their income in half each time.

The amount of bitcoin they receive is not chosen at random: it was fixed from the conception of bitcoin by Satoshi Nakamoto. In the early days of bitcoin, a miner received 50 bitcoins for each new block. But this situation has since changed: during the first halving, in 2012, the reward granted to miners was increased to 25 bitcoins. In 2016, during the second halving, it rose to 12.5. Since the last halving, which took place in 2020, miners receive “only” 6.25 bitcoins for each new block. At the next halving, which is due to take place in 2024, the remuneration will increase to 3.125 bitcoins, and so on.

It is the halving that will allow the remaining 2 million bitcoins to be mined in more than a hundred years, while the first 19 million were created a dozen years ago. The last bitcoins will thus take an extremely long time to produce: it has been calculated that the last bitcoin will be mined in 40 years.

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