Key Points
- As of December 24, 2024, over 19,800,000 bitcoins have been mined, leaving less than 1.2 million left.
- Questions arise about the implications of Bitcoin’s scarcity and the possibility of removing the supply cap.
On December 24, 2024, the total mined bitcoins exceeded 19,800,000. This means that less than 1.2 million bitcoins are left to be mined until the total supply is exhausted.
Following the 2024 halving, around 450 bitcoins are mined every day. The milestone of 19.8 million mined bitcoins was reached on December 24, according to the Clark Moody website, a long-standing collector of Bitcoin data.
Bitcoin’s Supply Cap and Scarcity
Bitcoin has a supply cap of 21 million units. The question arises: what happens when all bitcoins are mined and the supply is exhausted? Also, why does Bitcoin’s scarcity matter and can the supply cap be removed?
Nearly 20 of 21 million bitcoins were mined within the first 14 years of Bitcoin’s existence. However, the last fractions of Bitcoin will only be exhausted in 2140. This is due to the Bitcoin emission set to drop by 50% roughly every four years, each time another 210,000 blocks are mined. This drop in BTC emissions is known as “halving.”
As of December 2024, each mined block unlocks 3.25 BTC as a mining reward. By 2140, this amount will drop below the smallest fraction of Bitcoin, known as Satoshi. The 2140 halving will effectively stop the emission of bitcoins.
Bitcoin Mining and Inflation
Mining is crucial to the Bitcoin network’s validity and safety. When the emission of new bitcoins stops, miners will still receive rewards from the transaction fees charged by senders. These fees already make up a significant portion of miner rewards.
Bitcoin is often celebrated as a deflationary asset. Unlike governments that can print more dollars, Bitcoin’s supply is immutable and limited to 21 million units. As the overall amount of bitcoins decreases over time, it is believed that the value of each unit will continue to rise.
The scarcity of Bitcoin is one of the factors that drive its value. However, scarcity is not the only or main value driver. The high value of Bitcoin, coupled with its scarcity, forces buyers to bid more for each unit, driving the BTC price up.
Can the Supply Cap be Removed?
The possibility of removing the supply cap has sparked online debates. The Bitcoin network’s structure has been edited through hard forking, so it’s not impossible. If the Bitcoin community votes for making Bitcoin inflationary and makes necessary changes to the Bitcoin architecture, we could see an inflationary Bitcoin. However, opponents argue that such changes would transform Bitcoin into something entirely different.
Actual Number of Bitcoins in Circulation
Many believe that Satoshi Nakamoto himself holds large amounts of BTC mined in the early days. However, the bitcoins in Nakamoto’s identified wallet have not been moved since 2009, and millions of such frozen bitcoins are scattered across the ledger.
The Clark Moody website states that there are 220.31 ‘provably’ unspendable coins. Various sources claim that 3 to nearly 8 million bitcoins are lost forever. Bitcoins are lost for various reasons, such as people losing access to their private keys, hardware, and paper wallets getting fatally damaged, coins being sent to invalid addresses, etc. The amount of lost bitcoins will continue to grow, decreasing the number of bitcoins in circulation.
Virgin Bitcoins
The term “virgin bitcoins” refers to bitcoins that have never been used and have a clean transaction history. These bitcoins are extremely rare and can only be obtained directly from the miner via a P2P service. As soon as a virgin bitcoin is sent in parts, it loses its virginity status.
Virgin bitcoins are sold at higher prices than usual bitcoins. Institutional investors are willing to pay extra for bitcoins with a clean transaction history to reduce the risk of buying bitcoins involved in criminal transactions.
Nic Carter, a notable crypto writer, questions the existence of virgin bitcoins, noting that it’s nearly impossible to produce them. He dismisses the importance of a clean transaction history, citing the purchase of bitcoins seized by the U.S. government from the Silk Road market by venture capitalist Tim Draper.
