Summary
Bitcoin has a finite supply of 21 million coins, with less than 2 million left to be discovered over the next 120 years. The scarcity of Bitcoin, coupled with increasing demand, will reshape its future. Miners will rely on transaction fees as their primary income source once all Bitcoins are mined. The average fee per transaction is currently around $15. The Bitcoin network is designed to maintain security through the difficulty adjustment algorithm. Up to 20% of Bitcoin in circulation may be permanently lost. Demand for Bitcoin may continue to grow, potentially driving up prices. The scalability debate continues among developers, with solutions like the Lightning Network being proposed. The future of Bitcoin remains uncertain, but it will continue to function as a decentralized network.
Key Points
1. The Bitcoin network just hit a significant milestone with the fourth halving event, reducing its inflation rate by 50% and leaving less than 2 million Bitcoins to be mined over the next 120 years.
2. As block rewards decrease, miners will rely more on transaction fees as their source of income, potentially leading to higher fees for processing Bitcoin transactions.
3. The scarcity of Bitcoin may increase due to factors like lost wallet addresses and burned coins, making it more valuable as demand continues to grow. This could drive up prices as more people seek to acquire a share of Bitcoin’s limited supply.