Bitcoin Forum

I keep hearing that there will only ever be 21 million bitcoins.

I think it's a myth for the 3 following reasons.

1) The 21 million figure could change if developer consensus did, and people downloaded the software

2) The base money supply can be easily inflated with off block systems, IOUs and CFDs for example, but there would be many more instruments to expand the money supply

3) Alt coins could become very similar to BTC, and can be easily created

This is important because if we estimate the long term % of bitcoin in world markets, you need to include these other factors, and it will also impact the price.

Re 2) above: promises for gold, say, aren't as good as actual gold. Which would you prefer? The only reason the fiat and promissory systems have been able to develop as they have is that gold and silver are a pain to carry about.

I can start my own cryptocurrency with its own genesis block at any time - let's call it Spitcoin, say - but that doesn't make it an expansion to the bitcoin money supply, any more than if you take rocks from your back yard, paint them yellow and call them "gald"...

This is true, but look how gold is traded.  Promises for gold are 10+ times more numerous than the actual physical gold supply.

Your point 3 is completely facetious ...

You say "I keep hearing that there will only ever be 21 million bitcoins."

Point 3 says: "Alt coins could become very similar to BTC, and can be easily created"

The two have nothing to do with each other. You have to make a point related to your original premise. Apples and oranges, or in this case, bitcoins and ... whatever.

As for (1), that will not be changed, as it will kill the credibility of bitcoin. It is fixed.

Wont it be in the year 2150 that we reach the 21 million mark? We will all likely be dead, so who cares?

1) have you ever tried to get a bunch of people to agree on anything never mind the fact that your valuables are going down in price if you change the supply? More supply means it going down in price.

3) alt coins ARE similar to BTC and are needed too. You already know about Gold, Silver, Platinum, Palladium, Iridium, and Copper. These are all used for money and / or are collected for the value that they hold. Putting all of these together is millions and millions of tons and still the price of gold is going up. You just have to look at the long term perspective.

But you are right, though, about lots of things affecting the price, just last night I was watching an article about the total value of all the money in the world and if 2% of this money was invested into BTC the price should be $700,000 per Bitcoin. Well we all know that it probably won't happen but personally I don't care if its 2% or much less, because it still seems to me that that we have a long way to go before we reach close to this number. If it was 90 times less than that the price would still reach $7000.

I think that the same basic rules apply to investing that they always have.

1)don't put all your eggs in one basket.

2)Figure out what the risk is. This means if its new, it has huge risk. This doesn't mean you don't get into it, it means you could make a lot and it could also be a flop. For me, we are in a computer age. We need to think about transferring money over the internet a lot easier than we have been doing and it needs to cost less to do it.  I remember when DOS came out and then Windows. I was just starting to learn about investing at the time. Well it's no surprise now where Windows and Microsoft have gone, but on the other side, who would have known?

3)Have patience. If you want to make a million dollars over night, you will never have anything.

I think the OP has made some good points.

I think OP makes stupid points that other have made a million times already.

1 - It could change, but that seems to be pretty unlikely.  It would cause a hard fork and I wouldn't called it bitcoin at that point anymore.

2 - That's fractional reserve banking basically, doesn't mean there are more than 21 million bitcoins out there.  It just means people could spend more than 21 million, but no more would be created.

3 - Alt-coins =\= BTC

All of the above. 2 will probably happen more, and is happening now to an extent. (more trade vols than btc generated)
3 - how long has it taken for BTC to get to where it is? Alt-coins have even further to go.


This is what's wrong with the world...?  :-X

then it would be the equivalent of an alt-coin.

>implying fractional reserve banking will work with bitcoin
>implying bitcoin users will use fractional reserve banking
>implying "off block systems" will be more than just "first bitcoin savings and trust credits".

are you that dense?

Dear OP:


I think in the future, wheels will be made square, even though it is obvious that round wheels are best.

Also, you refute yuour own premise:

2) The base money supply can be easily inflated with off block systems, IOUs and CFDs for example, but there would be many more instruments to expand the money supply

Why expand the coin supply if its redundant?

I agree that this seems an unlikely scenario at this point.  But if you had asked someone 10 years ago whether the united states would start printing money, that would have also seemed unlikely.  My point is that the theoretical maximum is based on consensus.


This sort of comes down to how you define the money supply.  I think it's more than just a theoretical point because lets say there's a 1 trillion USD is bitcoin assets.

Scenario 1: People only use on block btc.  Value would be c. $50,000 per coin

Scenario 2: 90% of assets are held in bitcoin certificates with a trusted party (e.g. mt gox IOUs are an example) ... and 10% are in the block chain.  The bitcoin price value is now 10 times lower ie $5000


Yes I agree, again.  But you can make coins that are very similar in nature to bitcoin. 

What I'm getting at is that there are ways to increase crypt coin creation and usage as part of the overall economy, and whichever route taken will impact the prices significantly.

Change your title and OP then, because you're not arguing that there will be more than 21 million bitcoins anymore.

This is what you're doing:

1. Make sensationalist claim ("all dogs are birds")
2. Attempt vaguely to try to defend it ("b-b-but dogs breathe and eat too, just like birds!")
3. Once people attack your claim, backtrack to trivial claim ("fine, all dogs are animals")


...and everyone fell for the bait. bravo.

The OP hasn't really thought about it much, and made a wild guess. Has the above points state. You are wrong. Alt-coins =\= BTC <--- That is a brilliant answer. Just think about it.

So, I guess my apple is the same as my orange.

I disagree with point 3, I can go and start printing pieces of paper tommarow and make it a new currency if I wanted to. Obvisually it wont be a secure one but that isnt the point

I dont think more bitcoin can just be printed out of thin air as long as majority of people run the version with the 21 million figure hard coded in.

By the time we hit the limit of 21 million the world could be a very different place. For example:

- Mining is done by a few large corporations or governments. They are the ones who control the currency.
- When the limit is reached these large organizations get together and decide to increase the limit because they feel there is more money to be made in mining than in hoarding coins.
- Maybe this results in a hard fork but because these organizations have so much power people have to go with it.
- End result is that the previous limit of 21 million is breached!

surpsised that the OP is a senior member yet delivers a noob idea. No offense but if we go that route why dont you send me your dollars and I will send you my IOU. the reason is that this only happens becuase banks dont give you a choice, while you would tell me to go fuck myself. Same principle applies to BTC.

LTC doesnt affect BTC money supply. Silver does not produce more gold.

Its not a myth, its wrote in the script of bitcoin only 21 million can ever be created. The devs arent just going to raise the limit when they feel like it, it would have to be a consensus from the majority of Bitcoin users.

if one bitcoin more than 21 million is produced the market cap of all bitcoins will be 0

ROFLOL!  ;D

This may help clear things up regarding 21 million coins; under subtitles:
'21 million coins isn't enough; doesn't scale' 
'After 21 million coins are mined, no one will generate new blocks'

https://en.bitcoin.it/wiki/Myths#21_million_coins_isn.27t_enough.3B_doesn.27t_scale

This

Nothing more to add :)

Yes but it's just a parameter.  Parameters can change, at least in theory, in the future.  Parameters HAVE changed, e.g. the default dust size.

So it's correct to say that we are currently scheduled to have 21 million coins, right now.

NOT that there will never be more than 21 million coins in the future.  The final number of coins will be decided by consensus.

There are like 608 sites now that offer bitcoin coupons.

What's to stop one of these from just making coupons... Kind of like how the feds do it. Its always backed by coin, but if everyone pulls out there wont be enough.

Sure, that's called a "short squeeze".  But you can settle in cash.  So instead of me giving you your 10 coins i could give you say $1200

No that's called an IOU, like printing money only generating it.

Exactly yes.  So a trusted third party can lever up the money supply using IOUs.

The short squeeze occurs if they dont have enough bitcoins to pay all the IOUs.  But that's exactly how the current system works with fractional reserve banking.

nothing to see here, move along.

It wouldn't be if there were a blockchain for gold.

Perhaps, though it's hard to conceive of even what a block chain for gold might mean.

There's three good reasons to make transactions "off block"

1) Translate your trust into new money

2) You dont have to pay the tx fee, so this allows high volume

3) Instant confirms are possible

People got suckered into letting the state hold their gold in return to a gold backed IOU because gold was not divisible into small units and was heavy, then they came in and said "said sorry our bad rather than 28$ being worth an ounce of gold its 35 now" and people sheeply agreed. Then they pushed it further and said "hey we changed our minds.....yea there is no gold behind your money, just trust us its necessary for the economy to thrive, bartering for something that can't be manipulated by us will stunt the economy" And thats how we got off the gold standard.

The reason this wont happen with BTC (besides the fact that we are wiser this time) is that there is no major benefit in trading BTC for a token representing BTC , as the BTC is already easy to carry, send and divide, contrary to gold. In the case that a BTC token system were to be implemented in order to circumvent blockchain problems, the low barriers to entry of competing token systems, and the ability to return to the system the token is backed by with ease (bitcoins) would result in the token system always being highly competitive by nature in order to be adopted by the community. In other words we would agree to use a token system that cancelled transaction fees, but would disagree if it started issuing loans with our BTC; in the case that the system did something we didnt like it would fail (unlike the dollar, you cant decide to not accept the dollar as legal tender, or go and compete with the dollar

This is precisely why BTC has ZERO INTRINSIC VALUE.

people often say that BTC is valuable because I can transfer and spend it in ways that other currencies don't offer, however nothing is preventing me from making an ALTCHAIN and providing this same exact intrinsic value for presumably any price.

At the beginning I let it slide, but enough is enough, people have had enough time to analyze bitcoin. If you dont understand why bitcoin is valuable you are a retard

I am going to assume this isn't a troll and hopefully make this clear and easy to understand.

Bitcoin has value compared to other Crypto-currencies because of the strength of the bitcoin netowrk.  As more people mine, the value will increase.  This is simple because the more hash power a coin has, the harder it is to be subverted by bad actors.  It really is as simple as that.

Coincidentally, I believe Litecoin will increase in value relative to USD (but not BTC) as more and more GPU miners switch to Litecoin mining.

Full disclosure: I do not own any Litecoin.

belive in math dude

There is the wrong believe that after certain years no more Bitcoins will be mined, that is incorrect, technically mining will continue  forever but that the block will be half every 4 years.

so to have a idea of the value of the block after so many years this is the formula.

n= number of years
v= value of block.

v = 50 * 2^trunc[-1*n/4 ]

where trunc just takes the integer part of the number.

so for n=1 to 3 v=50 BTC
for n=4 to 7 v=25 BTC

for example at 60 years later the blocksize for the reward will be.

60/4=15   so it will be 50*2^-15 which is 1.52 * 10^-3

in other words the block size will be 0.00152 bitcoins of course by then the bitcoin wil be very valuable.
Very different than dead as some made the comment, by then most will be  using satoshis.

the block size will continue to get closer to 0 but it will never be 0.

So when people say mining will stop at 2040 they are wrong, some will quit mining but that is a different story, the blocks will always be there.

This is what is called a geometric series, so even though the number of blocks is very much infinite (finite for other reasons) but mathematically infinite, the total number of bitcoins converges to 21 millions.

A couple of things to consider.

Bitcoin is a brand, and a valuable one.

Satoshi said bitcoin is a collectible.  I think there is some intrinsic value there.

There are a lot of altcokes but Coca Cola can still charge a premium.