Bitcoin Crosses the Hallmark of 19.8 Mined Units on Xmas Eve

On December 24, 2024, the amount of bitcoin mined exceeded the 19,800,000 mark, leaving less than 1.2 million bitcoins left until the total supply runs out.

After the 2024 halving, approximately 450 Bitcoins are mined every day. According to Clark Moody, one of the first websites to collect various Bitcoin data, the 19.8 million bitcoin mining milestone was reached on December 24.

As most of you know, Bitcoin’s supply limit is 21 million units. Does this mean that soon all bitcoins will be mined and what happens when the remaining supply is exhausted? Why is Bitcoin scarcity important and can the supply cap be removed? Answers to these and other questions are below.

When will all 21 million Bitcoins be mined and what happens next?

Although approximately 20 of the 21 million Bitcoins were mined in the first 14 years of Bitcoin’s existence, the last remaining Bitcoin will only be exhausted in 2140. This is because Bitcoin emissions drop by 50% roughly every four years. 210,000 more blocks are mined each time. The decrease in BTC emissions is called “halving”.

As of December 2024, each block mined unlocks 3.25 BTC as mining reward. By 2140, this amount will drop below the smallest fraction of Bitcoin known as Satoshi, which is one part per million of Bitcoin. Since Satoshi is set as a minimum fraction of Bitcoin, the 2140 halving will effectively stop bitcoin emission.

While mining is at the heart of the validity and security of the Bitcoin network, mining rewards are the main incentive for miners to continue their laborious operations. Happily, miners will still receive rewards when the emission of new bitcoins stops. Instead of receiving newly minted coins, they will receive a portion of the transaction fees charged to senders. It is worth mentioning that the fees paid by senders for transaction prioritization make up a significant portion of miner rewards.

Why is Bitcoin scarcity important?

While inflation is not inherently bad, Bitcoin is often appreciated as a deflationary asset as it drives the economy when it is healthy. While the government can print more dollars and reduce the value of the dollar you have, the Bitcoin supply is immutable and coded to be limited to 21 million units.

It is believed that the value of each unit will continue to increase, as the total amount of Bitcoins will decrease over time and more and more units will be “stuck” in closed wallets forever.

Proponents of the stock-to-flow model argue that scarcity increases value. However, it appears that scarcity is far from being the sole or primary driver of value. Can you withdraw a single unit of your own currency and expect it to become the most valuable unit due to extreme scarcity? Probably not. Considering that Bitcoin is already highly valued, its scarcity forces buyers to bid more for each unit. This is how halvings constantly increase the BTC price.

Is it possible to remove the feed cover?

A three-minute educational video about Bitcoin published by BlackRock in December 2024 sparked an online debate about the possibility and consequences of removing the supply hard cap.

Since the structure of the Bitcoin network has already been adjusted through hard forking on several occasions, removal is not impossible. So, if the community working on Bitcoin improvements votes to make Bitcoin inflationary and makes the necessary changes to the Bitcoin architecture – well, one day we may see Bitcoin become inflationary.

Opponents of this move claim that such changes would transform Bitcoin into something completely different. Moreover, they remind us that those who do not want Bitcoin without a fixed supply can still use the classic version of Satoshi Nakamoto’s invention.

What is it that says there is no guarantee that the fixed supply will change? It definitely has a warranty. If they change this, the Bitcoin hard fork will be two bitcoins. The old fixed supply will still be around and that’s what people will value.

— Bludex (@0xBludex) December 18, 2024

Why will the actual number of bitcoins in circulation never approach 21 million?

Many people believe that Satoshi Nakamoto owns a large amount of BTC mined in the early days, with some calling it 1 million BTC. However, the Bitcoins in Nakamoto’s detected wallet have not moved since 2009, and millions of such frozen Bitcoins are located all over the ledger.

According to the same Clark Moody website we mentioned at the beginning, there are 220.31 ‘provably’ unspendable coins. This means that more than 220 BTC may never be used because they are isolated through unclaimed rewards, null data outputs, or other means.

However, the word “provable” indicates that there are more “lost” coins. Various sources claim that between 3 and 8 million Bitcoins are lost forever. According to CryptoSlate’s June 2024 article, 7.7 million people were either lost or “waited.”

Bitcoins are lost all the time for a variety of reasons: people lose access to their private keys, hardware and paper wallets are fatally damaged, coins are sent to invalid addresses, etc. It is understood that the amount of lost bitcoin will continue to increase and decrease. The level of bitcoins in circulation.

What is raw Bitcoin and why would anyone want to pay extra for them?

2140 will see the end of an era of so-called “raw bitcoins.” This term refers to bitcoins that have never been used before and therefore have a clean transaction history.

Virgin bitcoins are already extremely rare. The only way to obtain this type of Bitcoin is to buy it directly from the miner via a P2P service (since depositing a virgin Bitcoin in return will taint the transaction history). Moreover, if some of the BTC was received while mining in the pool, it cannot automatically become “virgin”, as the mining pool distributes the rewards among mining participants, that is, miners do not receive these bitcoins in the first place.

Moreover, as soon as Bitcoin is included in the unspent transaction output (UTXO), it loses its virginity status. This happens by sending raw Bitcoin in chunks.

Since raw Bitcoins are rare and difficult to obtain, they are sold at higher prices than regular Bitcoins. Why would someone want to pay extra to get a Bitcoin with a clean transaction history? The answer is not difficult to grasp; institutional investors do not want to increase risk by purchasing bitcoins involved in criminal transactions. Such bitcoins in the portfolio could potentially harm their wealth. The only way to eliminate these risks is to buy virgin bitcoin.

Nic Carter, a prominent crypto writer, questions the existence of virgin bitcoins and states that it is almost impossible to produce them. In his article, he ignores the importance of a clean transaction history, citing the US government’s purchase of bitcoins from the Silk Road market that were seized by venture capitalist Tim Draper.