
Bitcoin, the red-hot cryptocurrency trend-maker, has climbed in value drastically over the last decade or so. So with Bitcoin mining operations opening up all over the world, how many Bitcoin have been mined thus far? The answer: 17 million.
17 Million Bitcoin Mined. What Does That Mean?
There are only 21 million Bitcoin out there available to be mined. So 17 million is a very significant number. But how did those 17 million coins get mined? There is a complex computational process involved in mining Bitcoin. Very powerful computers solve intricate math problems. When the problem is solved, the answer is checked within the Bitcoin network. Once the answer is verified as correct, the Bitcoin has been mined. It takes loads of computational power and electricity to mine Bitcoin. Because of this, it is very hard for the mining to be profitable. Those who do it successfully have truly earned Bitcoin’s skyrocketing value. Now that 17 million have been mined, what does that mean for the value of Bitcoin?
The Significance of Hitting the 17 Million Mark—the Short Term
Seventeen million is a number that simply feels relatively close to 21 million; this helps the relevancy of Bitcoin because it puts the finite nature of the currency in the forefront of the minds of investors. The markets agreed. In the week after the mining of the 17 millionth Bitcoin, the currency climbed well over $500 in value. For many investors, particularly those investing in Bitcoin miners, this is a good thing. Let’s examine why this is so.
What Getting “Close” to 21 million Means for Miners
Miners of Bitcoin make money off the value of the Bitcoin they mine and also off transaction fees that are incurred when Bitcoin is used to buy things. As Bitcoin gets more difficult to mine due to the complexity of the mathematical problems that need to be solved, the fees associated with Bitcoin transactions are going to go up. If this trend plays out, it will be easier for money to be earned from the fees than before.
What 17 Million Means for the Long-Term Value of Bitcoin
The long-term outlook is slightly different from the short-term picture. When all of the Bitcoin are mined, the value may very well decrease. Higher fees mean consumers will have less money to spend on products they are buying because they have to pay the fees also. This will ultimately hurt the value of one Bitcoin.
When Will All of the Bitcoin Be Mined?
There are two ways to answer this question. First, we can look at the current rate of Bitcoin mining and come up with a number, and that’s easy: 122 years. However, there exist backup stores of Bitcoin that Satoshi Nakamoto has. There is a chance these will never see the light of day, but that decision is in his/her/their hands. (The true identity of Nakamoto is a mystery.) If Satoshi Nakamoto were to decide to release the other Bitcoin into the market, the price of Bitcoin would be instantly affected. How the price moves would depend much on the sentiment of the market at the time. If Bitcoin were to be losing relevancy, the price would rise as this would help cement its sense of permanency. However, if Bitcoin were still going strong, the price would see a natural dip due to the increase in supply. According to the most basic principle of marketing. Higher supply correlates to lower prices.
Regardless of what 17 million feels or sounds like, it’s a good sign for Bitcoin. It means the cryptocurrency is relevant and the mining process is a fervent one. The precise future of Bitcoin, however, isn’t as straightforward as a simple number.