Bitcoin Forum

I have been always telling my fellow bitcoin investor friends. Bitcoin is scarce!. And it is scarcer than we think.

We mined 17.5 BTC up to the present. 1m BTCs is in Satoshi's account. 4m BTCs is lost.

Grasping this scarcity may help why BTC is still undervalued!

From the article below;

If you own just a single bitcoin, only 17 million other people will ever have as much as you.

We have never had true scarcity until now, and because of that, it's a concept that's hard to grasp.

Furthermore, and scaling up a little,  let's assume bitcoin manages to hit critical mass, and everyone on the planet tries to grab a piece of the action. There would only be 0.003 BTC for each person…


Check the article below;
https://www.chepicap.com/en/news/8455/a-deep-dive-into-bitcoin-s-scarcity.html (https://www.chepicap.com/en/news/8455/a-deep-dive-into-bitcoin-s-scarcity.html)

Interesting point. I do get the point of scarcity, along with the law of supply and demand. It's actually informative,  maybe that's one of the reasons why most people, especially who are seeing this kind of potential in bitcoin is hoarding bitcoin. A lot of people believe that bitcoin is still undervalued, and take note that we are still far from mass adaptation. As mass adaptation occurs, the supply of bitcoin will be scarce, applying the law of supply and demand, the  value of bitcoin will be massive.

scarcity is an illusion in today's marketing world, it's a fugezi which doesn't exist but it is created by marketing campaigns so that people rush to buy that product. Diamond and Gold are excellent example of this! However, let's not go back to history and focus on today's marketing pattern for mobile phones. Mobile makers like Samsung and Xiomi has started this trend of flash sale where the latest piece of their hardware will be available for a very very limited time and the total numbers are also limited - we all know the result! They are selling millions of pieces within 30 minutes of window period.

While all these are fake scarcity, the scarcity of bitcoin is very very real! 21 million is the total number out of which close to 4 million is lost. Even after tough resistance from several regulatory agencies, bitcoin is growing stronger! But if we are able to scale up the adoption rate, it will be hard to find a single person holding even half bitcoin! We are indeed running through an opportunity period!

I know that Bitcoin is becoming increasingly scarce so I always try to own lots of Bitcoin before I can't hold it in the usual way. Become a Bitcoin owner before you can hold it. Become one of the world's Bitcoin owners.

under the hood (code level, not user intrface) the code has units of account(sharable split units) called satoshis.
the code shows balance as satoshis and its the upfront user interface that basket it up into groups called bitcoins

there are 2,100,000,000,000,000 sharable units currently
under the assumption of this. the bitcoin halving events would end new unit creation in ~2140

however some bitcoin devs want to split up the units of account by a further 1000x called millisats. meaning more units of account can be shared out

i know many people will say 'but there will still be only 21m btc because each btc is no longer
100,000,000 sats
but
100,000,000,000 millisats
also by having more dvisions, this would allow more 'coin creation (and thus more halving events) to occur meaning coin creation would continue for a dozen+ more years ()

it becomes the same deception of having a crate of sliced banana. where each crate had 10,000 slices. to later have 100,000 slices carried in a truck thats 10x larger to hold larger crates. but then saying theres still the same number of crates in the truck
even though theres now more slices per crate to feed more banana lovers

---

its like gold.
centuries ago they would say there are only 180,000 tonnes of gold. meaning only 180,000 rick greeks, pheroahs and kings can own a tonne

then they started breaking it up into KG bars and the socio-economic minds then started talking about how 180million rich people can own a KG of gold (less people mention the tonne number)

then they started breaking it up into 1oz coins and the socio-economic minds then started talking about how 6.3biillion people can own a 1oz of gold (less people mention the tonne or kg number)

so now we are in a situation where everyone probably has a bit of gold in their house whether they know or care about it. it maybe jewellery or circuitry. but these days just 'having gold' lost its elitist/scarce appeal

---

if btc went to $1m a coin. and people spending smaller amounts daily like $10 they wont say they are spending 0.00001btc
instead they would say they are spending
10bits or 1000sats or 1million msats.. making talking about it in terms of BTC(like gold tonnes) would not be common terminology

and with everyone able to own some bits,sats or msats it wont seem so scarce

This is old news. The problem here is that most people don't really care since they are not interested in BTC or the crypto world in general which is something that needs to change with time through mainstream adoption.

Not an easy task, but definitely possible through regular developments(LN etc).

I 100% agree that bitcoin is scarce, and its scarcity is what drives its use case and value. People are flocking to gold and bitcoin because they cannot be created with computer keystrokes as fiat currencies are. Because bitcoin is so scarce, we should think in terms of satoshis as the basic or reference unit.

And it is way scarcer than anything we have seen before. For instance, we really don't know how much gold there are in total. But we know how much bitcoin will be in x years (or in total). 

Well i think bitcoin is not scarse you can split it , the only thing i am wondering about it, few people held almost all bitcoin in some wallet! distributions should be more fair

The amount of lost coins we have now including satoshi's 1 million is not enough for it to be scarce because as what frank mentioned we could just divide it in to satoshis in case the price. Sure, we know there's only 21 million but when it can be chipped down even further than satoshis (if needed) there's always room for everyone to have Bitcoin.

I agree with franky1 and rallee14 that in case measuring units in bitcoins becomes difficult due to the very small amounts, satoshis will simply become a new standard.
If the op wanted to highlight how rich we, the early adopters might become one day, it's a fair point. Scarcity is what makes the price higher.
Since we have satoshis, we are save on this matter for some time. However, the problem is that if the adoption is very high, we cannot afford to time and fees of transactions. We are going to need something like LN but better.

To be honest 50% of the Bitcoins supply haven't moved in years and 20% of it has been lost .
Therefore we still have50% + 30% = 80% Bitcoins and that amounts to 80% of 21 million.

That's  16.8 million now.

Now you are considering everyone .
Why ?

What would a patient lying in a coma do of BTC ? Or someone who is too rich , too old or too young ?
And trust me their number accounts to far more than we can think , then there comes not that fortunate people with mental disabilities, it's 43.8% in the US Alone.
Therefore I don't agree !

You are focusing on only one variable in the supply-demand equation, and that's a mistake.  There could be only one satoshi left but if no one wants to buy, it doesn't have any value.

One other thing that comes to mind is that many investors are interested in cryptocurrencies in general and not just bitcoin in particular.  If you look at the crypto investing space that way, you can clearly see there is no scarcity whatsoever.  I fully understand the point you are trying to make, but I don't agree with the logic behind it.

The gold-bitcoin comparison I see constantly makes my ears ring.  They are two different beasts and again, you are not considering the demand component of the supply-demand curve.

Why should this even bother someone that "if everyone...   ...only 0.003btc"?

There are enough reasons why this would be never the case.


only around the half of the earth has internet access. ( why should then almost everyone use Bitcoin )

not everyone will be able to buy bitcoin ( cause they don´t need or afford it )

the bitcoin blockchain will fork in the Future and have a bigger supply as soon every bitcoin is held by a dead person or is lost  (regardless of the worth it could have, there will be no supporter which has an incentive to join/support bitcoin)

The Price with this estimation of bitcoin is a dream ( it´s FOMO. ( marketing is made to make you exited like sugar in the Starbucks coffee is exact at the "sweet spot" to make you want !more!)

Most people are fucking clueless when it comes to numbers, especially when they go beyond the amount of fingers and toes they have.

We hear the word 'billion' chucked around all the time these days and rarely take time to consider how large it is. 1 million seconds is 11.5 days. 1 billion seconds is 11,500 days.

I've seen people shrieking at the mining reward requiring 9-10 million dollars per day of buying. How on Earth can the human race sustain such buying? That's $45,000 per nation per day. Holy shit indeed.

Most can't conceive of how many people there are in the world by a long shot. They also can't be bothered to figure out that the number of coins is tiny in comparison and if there was REAL demand from more than a small fraction of people a time the price would be ludicrous. At present there may only be a few tens of thousands of people buying per day.

bitcoin will be scarce in the future, just a matter of time
because there will be many people who join in bitcoin, there will be more countries agreeing to bitcoin and bitcoin being mined will be less

I thought we are talking about bitcoin not a rice. I don't think bitcoin will suffer in a scarcity. Correct me if I'm wrong, bitcoin does not have any problem in supply because it is a digital currency not a hard copy that if we consume so much there will be a scarcity. The only thing will happen if the bitcoin was mined too much there is a big effect on it's price value.

the important thing about bitcoin's supply in my opinion is the fact that it has a maximum cap that can not be changed. so in the end there will only be a fixed number of coins available and no more than that.
this design gives bitcoin a big advantage over the fiat currencies that have no limit and the banks keep printing more and more causing inflation.

No dude, there are only 21 million btc that can be mined, if we asumed that they are all mined then no more new coins will add in the circulation. What happens? Yes you are right, it will greatly affect its price. It could skyrocket because of the high demand or it may fall down very hard but actually it is way more than that. The worst case scenario that might happen is btc will become valueless if the world finally lose interest to it.

Anyway, don't worry too much about its scarcity (IMO). I'm pretty sure that we will not experience the struggle since the estimated time it will be all mined is in the next century.

the 1 in a million thing has been a very old saying and it is with the max amount meaning if you own 21 bitcoin then you are only 1 in a million. I started a topic about it in 2017 here: https://bitcointalk.org/index.php?topic=1790863.0 which I stopped updating because the price got too high that being that "1" became exponentially harder and saying 1 in 21 million or 17 million doesn't have that nice ring to it in my opinion.

well you have some good point on it
but before it happen bitcoin need to go mainstream for mass adoption
it will take a long time before it happen but as one of supporter im willing to wait
the best thing to do more is accumulate more while i can

How do you know how how much Bitcoin has been lost? There is no way of telling as far as I know. What may look like lost Bitcoin to you may be long term holders. Atleast we have seen the kind of long term holders move part of unmoved Bitcoin all of a sudden 

By the way, the satoshi 1 million Bitcoin is just a speculation. No one is certain how much he really owns

I've read a lot of reports on the estimated amount of lost bitcoins and it is definitely in the millions.  Think of how many people had btc when it had no value, would you put any effort into keeping it secure? Doubt you would just how they did.  It would be really heart wrenching to have lost thousands of bitcoins only to find them worth millions in the future. ::)

It is an interesting subject, but if it is available to everyone, what will it value?
The increase in the number of people using bitcoin will cause it to become more scarce in the future.
But that will not happen if output increases.
It is a digital currency, not paper.

It has been discussed over many times on this forum and the solution is just to use the divisible units of bitcoins 'Satoshis' to the maximu extent.
Since bitcoin has not gone mainstream it is easy to classify bitcoins as a whole but as the adoption takes place and bitcoin grows bigger, the classification should switch to Satoshis instead.
Only then it would be appropriate to  make the payments and transactions smooth. Further more as Franky1 said if later in the future the devs decide to divide it into milli sats, it would be an addition to the current maximum divisible units of bitcoin.

Next year will be a great year for bitcoin, miners will start hoarding bitcoin because of the halving to 6.25BTC per block reward, and at this stage, I believe people won't be selling for cheap price, people have to be careful because greedy Ponzi schemes and HYIP will be on the rise once more. I think the big banks and some critics of the bitcoin are busy filling their bags while the suppose apostles of bitcoin are listening to FUD.

It will be really interesting to see how fast the price will rise when the next block reward gets cut in half.  Inflation rate will be lower than all fiat currencies and it will only continue to drop in the future, this will make bitcoin a better store of value than gold

dont get to set on thinking the halving will be a direct cause.

put it this way. imagine the hashrate was 50ex and the mining cost was ~$5k/btc
but imagine that the market rate was $12k(future time)($7k speculative margin/profit)
....
this continues for months until the halving event. and then when it happens it obviously makes mining costs move to $10k/btc
but because the market is already(at the time) $12k miners are still in profit. so you dont see any big change and wont see a big instant change to $24k.

what happened in 2012 was that the price didnt change much. it wasnt until ASICS launched and the mining costs rose in 2013 did the prices suddenly go crazy.

so if there is already alot of speculative margin(profit above cost) then dont expect the halving to cause much reaction

Well you know what that means, start holding your bitcoin, it is actually crazy i though that the supply was supposed to last us at least 100 years before all the bitcoin is mined, but with the supply running low this could lead to many thing not just people having less that 1btc in their wallets, but it will require a lot of machine power to mine what is left of it, meaning that transactions will take more fees and more time, which than may lead to micro transactions made through bitcoin impossible.

The calculation is too cold.According to Your statement, everyone should strive to purchase bitcoin in view of its growing deficit.But not everyone on the planet has gold and not everyone wants to buy it.But if you look from a pragmatic point of view, right today you can buy 1 Bitcoin and not worry about your old age 8)

Im still not totally convinced that miners will be perfectly fine with living off transaction fees alone.  They may move to another chain with higher rewards once the inflation drops below 1 percent.  Being a deflationary currency is a gift and a curse.

That's going to be in 2032. By that point lord knows what the landscape will look like but if BTC is still up there the idea of another SHA256 coin consistently paying out more to miners will be laughable. They'll have been left in the dust years before.

Any chain can dole out more coins. Whether those coins are worth anything is another matter.

OK. Satoshi has more than 1 million. But 1 million is certain.

According to the rich list of Bitcoin, there are lots of investors who have more than a BTC so the equation is close to accurate. An ordinary guy in this forum has more than a BTC for sure too.

That is why bitcoin operate on the economic law of demands and supply, the more the demands for bitcoin rise the higher the price will go, bitcoin is a deflating commodity it can never be scarce but the price can increase to any amount as long as the demands for the currency keep rising.

Demand is the key. No question about it. However, bitcoin is designed to be 'scarce'. Halving, 10-min rule, steady increasing of difficulty etc. are the indicators of it.

You should definitely read this post made by franky1 and if you already did then do it again. This clearly explains the fundamentals of mining difficulty and the units of bitcoin.

The issue at hand is will bitcoin be too scare? Inflation will drop to near zero percent and mirns will have little incentive to keep on mining, I dont think transaction fees will be enough.

Once Bitcoin hits mass adoption then we will see its true value.
Take note that Bitcoin is divisible into 1.00000000. Making 1 BTC into 100,000,000 satoshis.
IMO, max bitcoin that will be generated should not be viewed as 21 million btc as we might soon be dealing with satoshis only in the near future.

The amount of bitcoin circulating on the market falls, and the total bitcoin supply is about to reach its maximum level through mining. When the amount of Bitcoin reaches a maximum of 21 million through mining, everything will officially begin. When Bitcoin cannot exploit the market with high demand, it will make Bitcoin price rise and the number of people who want to own it increases. Buy Bitcoin now, or you won't be able to hold it in the future.

Nowadays scarcity is a relative concept.

If exchanges are using fractional banking, and I believe some of them are, then there is an unlimited amount of "paper bitcoins"

Fractional banking is an accepted and "legal" practice in banks, so why would they not be using it  in exchanges too.

Even Satoshi thinks about this, he says the lost bitcoins can be considered as a donation because less btc on circulation means they should have more value.

But this is a good bump signal, at least it has a reason to bump.

Yeah! I agree with you OP. Due to the scarcity of bitcoin, it might grow up. The price of it will increase because someday, people will gradually adop the changes when it comes i  currencies. Hopefully, by that time I hold already 2 to 5 bitcoins in my wallet. So that,if ever it goes up, I have many dollars to be converted. I am imagining that bitcoin becomes 30k dollars and I am buying a lambo soon.

I am not sure about it , price of bitcoin it will be speculation matter  when is good time to explode it will and someone will help the markek to make huge profit!

It seems to me that Bitcoin continues to be undervalued due to the fact that it is easy to fork. Altcoins bite off a piece of cake from the total value of Bitcoin. The availability of alternatives reduces the cost of a financial asset.

Scarcity isn't just about the supply. It's also about the quantity demanded.

If adoption doesn't pick up, then bitcoin will not become more scarce, and none of these calculations that you have made would matter whatsoever. I also think that the assumption of everyone in the world holding equal amounts of BTC is not a valid one, as that would pretty much never happen.

But I understand where you are coming from in terms of your concept of "true scarcity", and I agree. Given the fact that fiat doesn't have a limited supply the way that bitcoin does with a capped supply, it can be difficult for people to see the advantages that bitcoin has regarding its function as a store of value compared to that of fiat currencies, though it is be apparent to many BTC adopters.