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Forgive my ignorance but aren't there a finite number of bitcoins? A casual search says the world has mined 18.5 million out of a total of 21 million, after whi
by epalm 6y ago
Forgive my ignorance but aren't there a finite number of bitcoins? A casual search says the world has mined 18.5 million out of a total of 21 million, after which, doesn't the mining process stop, along with the current environmental impact?
- detaro 6y agoNo it doesn't, since the primary purpose of mining is processing transactions, not creating new bitcoins. The created bitcoins are merely an incentive to mine.
- chrisco255 6y agoBitcoin has a halving mechanism, every 4 years the rate of new BTC mined drops by half, so that BTC will take over a century to actually reach 21 million (2140).
- celticninja 6y agoMining is what powers transactions as well as generating new coins. Once all 22 million coins are mined it is assumed that transaction fees will replace the coins miners earn . So mining will always remain in some form or another, and also the size of the network is what makes it safe.
- FabHK 6y agoIndeed. The "Coinbase" mining reward (currently 6.25 BTC per block mined) halves every 4 years. The theory is that the proportion of fees (currently only 10%-20% of the total reward miners make) will increase and make up for the reduction in coinbase. Currently, a successful block makes 6.25 BTC * 45000 BTCUSD = 280k USD in Coinbase, or around 100 USD per transaction, plus a 10-20 USD fee per transaction. As Coinbase drops (or BTCUSD drops), users will have to pay around 100+ USD per transaction in fees, or the rewards to miners will drop and some will go offline, resulting in a reduction in difficulty and less energy wasted.