Many people do not know what the origin of Bitcoins is, why they exist, much less how they are “created”(in fact, to say that Bitcoins are created is wrong, since in reality Bitcoins are found).
One reality is that Bitcoin is not an infinite currency since it does not work like the physical ticket, which is printed by the government of a country following certain rules, and in a way it is “infinite”.
With Bitcoin, the situation is different, since it is not possible to create new Bitcoins since these are discovered through a process called mining, in which only the Bitcoins in circulation can be collected, but none more.
Since the launch of Bitcoin, the total number of these has been decreasing as time progresses, and we can expect that in a couple of years the amount of Bitcoin will be 0, so that people who still keep their Bitcoins by that time, could have a fortune in your hands.
In this article, we will deal in depth with the issue of Bitcoin mining, as well as the remaining amount of Bitcoins in circulation.
What is Bitcoin mining?
To understand why there is a limited amount of this cryptocurrency pending to be mined, we must understand the nature of how they are discovered.
To obtain Bitcoins, it is required to decipher a complicated group of algorithms, which is called the Bitcoin block.
Because obtaining a team like that is not a simple task, groups of people from all over the world have come together to decipher a Bitcoin block, these groups are called the Mining Guild.
The profits obtained are distributed equally among the members of the guild, according to the size of the block found.
Then, Bitcoin mining is a process by which transactions made with Bitcoin are added to the logbook through blockchain technology.
In other words, it is a method of interaction with the blockchain on which Bitcoin is built, and for those who participate in the complicated computational activity, there are fractions and Bitcoin coins that can be earned.
We can reduce to a simple premise the process of Bitcoin mining, the “miners”, as they are known, but powerful pieces of hardware to assemble systems capable of reproducing mining software, designed to be active day and night.
What is the remaining amount of Bitcoins?
Since we understand how the mining process is, we can move on to the central theme of the article.
When Bitcoin was created, it was thought to create a deflationary currency, such as gold. That is why there is a FINITE amount of Bitcoins, that is, limited.
There are 21,000,000 million Bitcoins in circulation, of which 85.85% have been mined.
This means that only 2,970,175 Bitcoins remain to be mined.
Many people wonder how long it will take the miners to finish with the remaining Bitcoins, and the answer depends.
It depends, because the Bitcoin mining process is something very complex and somewhat complicated to understand, and the Bitcoin release rate is slowing as time progresses.
Estimates say that by 2032, 99% of all Bitcoins will have been mined, and that, at that time, the Bitcoin release rate will be so low, that it will be until 2140 when absolutely all Bitcoins are mined.
However, it is believed that during the practice of Bitcoin mining between 2032 and 2140 the profitability will be exaggeratedly low, mainly taking into account that the Bitcoins appear after many attempts by the computer to decipher the algorithms.
Therefore, we will be in a situation where we could say that the limit has been reached, although perhaps there will still be people interested in undermining these digital assets.
The intrinsic doubt that most people have is what will happen to the miners?
Mainly, we must not forget that, without miners, transactions are not confirmed, therefore, the entire system that supports Bitcoin will collapse(the blockchain).
When the reward for mining goes down further what will happen is that the miners will live off the commissions to confirm the transactions. And it is that in every transaction that occurs from Bitcoin, a small part of the money is lost to finance the miners.
At present this is negligible concerning what is obtained by mining, but in the future, it will be the main source of income.
So that the miners do not disappear, two things have to happen: or that the commissions are higher or that only the most efficient miners survive. This we have seen in the past, the miners who used CPU gave way to those of GPU and those to those who do the mining by ASIC. In the future, only the most efficient will survive. And if it is not enough, if the energy cost is excessive, if the price of Bitcoin is low, they may disappear and with them the virtual currency.
Another possibility is that there is a Bitcoin fork that is mass-adopted precisely to raise that limit of 21 million Bitcoin. However, it is difficult to see something like this, since it would be an attempt against the value that the miners treasure. One of the reasons why Bitcoin has risen so much is because of its shortage, and therefore we can assume that a fork will not occur because it does not interest the miners.
There are indeed other cryptocurrencies that have no limit and a constant creation rate over time. This has its advantage: in the real economy, we are used to having some inflation. And deflationary currencies create very serious problems in the economy.
Another problem that Bitcoin has, due to its scarcity, is that they all end up losing. On the one hand, there are people who, due to computer problems, have lost their local purses; On the other hand, there are false addresses that are valid but whose private key is almost impossible to find out.
These two processes will make less and less Bitcoin, although surely it is a slow process (the more value Bitcoin has, the less careless its owners will be). This will make the Bitcoin that continues to circulate have more value but it is also a problem for the viability of the currency as a means of payment. Of course, a deflationary currency is not the best currency and this type of “hard” shortage, with an unbreakable limit, does not help.
So what will happen when the 21 million limits are reached?
It is hard to know what will happen. If the miners are not sufficiently rewarded, as some think, the network will fall. If they continue to function, as others think, there will be fewer and fewer Bitcoins in circulation, which will make it work as a value reserve asset, but it would not be very convenient as a means of payment. But if there is a fork or if Bitcoin banks arise that use the fractional reserve, both very remote possibilities, it may end up being used as currency.
Everything is in the air. Of course, it could always happen that 21 million Bitcoin is not reached, that all this we are experiencing is a bubble and falls apart before reaching that moment.