Can the world run out of Bitcoin?
The world has enjoyed using Bitcoin since 2009. However, the average investor started thinking about this virtual currency recently. Bitcoin's popularity and success have led to the emergence of other digital currencies. However, Bitcoin remains the most dominant cryptocurrency. After existing for over a decade, many institutions and individuals are exploring this digital currency's unique and highly innovative functions.
Many people often compare this digital asset to gold, a leading global commodity, due to its similarity with this precious metal. For instance, people use both assets for value storage, and they possess a monetary feature. Some institutions and individuals consider them as alternative investments. That's why some people are rushing to purchase this cryptocurrency on platforms like crypto engine. You can use fiat money to buy this digital asset and then send it to your crypto wallet with such platforms.
But what has attracted many people to Bitcoin is its increasing price. In 2021, Bitcoin's price dropped by over 50%. However, this digital asset is still 250% over the past year and more than 32,500% from 2014. Although Bitcoin has excited many investors looking to get rich with their Bitcoin investments, some don't understand this virtual currency and how it functions.
For instance, some have heard that Bitcoin's supply has a limit. However, some investors don't know how this works or what it means. Therefore, an investor might pause and ask, can the world run out of Bitcoin?
Understanding Bitcoin Mining
People acquire precious metals like gold by digging them underground. On the other hand, people mine Bitcoin using computers and the internet. People called Bitcoin miners run the Bitcoin mining process. They do this by securing the Bitcoin network and validating transactions with high-power software and hardware. Essentially, you require a computer with high processing power to mine Bitcoin.
Bitcoin miners validate and record transactions on a blockchain database or decentralized ledger. Miners solve complex algorithms to validate and record transactions using powerful computers. After recording a transaction for about 10 minutes, the network rewards a miner with this digital currency. The current reward is 6.25, although the system halves this reward every four years.
While gold miners find it in sturdy and rigid materials, Bitcoin lies in data blocks. Therefore, minders use a unique algorithm that Satoshi Nakamoto developed to mine this virtual currency.
Bitcoin Limit Explained
According to the way Satoshi Nakamoto wrote Bitcoin's source code, the world can't have more than 21 million tokens. Thus, miners won't produce more than 21 million Bitcoins in the system. But Satoshi set the mining system to ensure miners wouldn't mine the last Bitcoin until around 2140. That means the Bitcoin production rate will continue to slow down, and there could be more tokens emerging for more than 100 years.
What Will Happen After Miners Produce All 21 Million Tokens?
Perhaps, this is a thrilling eventuality for Bitcoin enthusiasts. Essentially, the world won't have more Bitcoins to mine after miners have generated all tokens. That means the world can only have additional supply if it alters Bitcoin's protocol.
However, there are no confirmed plans for increasing the maximum cap for this virtual currency after many years. With this in mind, assuming that Bitcoin will maintain a supply limit of 21 million tokens is the safe option. And miners are nearing this limit.
The world might never run out of Bitcoin because the available tokens are not more than 18 million. And the system will ultimately have 21 million coins. Nevertheless, the production of new coins will eventually end. That's why Bitcoin's value keeps increasing. Finally, the demand for this virtual currency will overcome its supply and drive prices up exponentially.
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