The historic milestone happens at a negative moment for the cryptocurrency, which has fallen more than 40% from its all-time high.
The Bitcoin network has reached the historic milestone of 20 million bitcoins (BTC) mined. According to the original programming of the cryptocurrency, only 1 million units of the digital currency remain to be issued by the year 2140.
The principle of Bitcoin mining was invented so that the asset, despite being digital, could not be issued freely. Thus, it has rarity and, therefore, retains the perception of value, as occurs with traditional currencies.
In mining, specialized machines use a lot of electrical energy to solve the blockchain cryptography of Bitcoin and thus discover a new block. When they succeed, the miner is rewarded with the issuance of new bitcoins, which are sent directly to them.
From 2009 to 2012, this reward was 50 BTCs per block, but every 210,000 blocks mined, an event known as 'halving' occurs, in which the reward to miners is halved. Today, discovering a block yields 'only' 3.125 bitcoins.
What makes the mining of the twentieth millionth bitcoin important is that the cryptocurrency, by design, will never have more than 21 million units. In other words, more than 95% of the supply that will exist forever is already in circulation.
Fabrício Tota, vice president of crypto business at Mercado Bitcoin (MB), says that the number is a reminder that bitcoin is running 'out of new stock'.
"This has economic and behavioral consequences: each cycle makes it harder to accumulate significant positions because the new supply is shrinking and the competition for coins increases. The goal of becoming a 'wholecoiner', the term used for someone who has an entire bitcoin, is becoming rarer and more expensive over time," he claims.
A question that often arises is what will happen when there are no more bitcoins to be mined. At that point, miners will only be compensated with the fees paid on transactions.
Despite the historic milestone, investors' enthusiasm to celebrate is low. Even with the recent rise, bitcoin is 44.5% below its all-time high, reached on October 6 at $126,080.
