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Author Topic: Is Bitcoin simply unlimited?  (Read 1287 times)
aVeryPissedGnome
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January 18, 2017, 04:03:03 AM
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Thats basically the question... I mean, if I had a mining farm in my house, could I mine from it forever and ever? I don't know 100% how bitcoin works, but it kinda triggers me when I think about it.
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January 18, 2017, 04:09:09 AM
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Thats basically the question... I mean, if I had a mining farm in my house, could I mine from it forever and ever? I don't know 100% how bitcoin works, but it kinda triggers me when I think about it.
Yes and no, with a collection of mining rigs you could mine bitcoin, but as time passes on the difficulty will increase and with it the revenue you obtain out of it will get reduced, if the earnings are too low you may lose money and you will not be able to run your mining rigs anymore.

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January 18, 2017, 04:11:32 AM
 #3

No, Bitcoin supply is not unlimited (andrei56 is mistaken).

There will only ever be 21 million bitcoins mined - that's all that are available. However we probably won't get the full number mined because as we approach that number it requires increasingly greater effort to mine remaining coins and therefore is less profitable to do so.

Now in another sense the supply of the currency can be unlimited because 1 bitcoin can be divided into ever smaller pieces, if those pieces have value. The only way for this to be a reality is if the price of 1 bitcoin increases significantly - "goes to the moon" as some say.

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January 18, 2017, 04:16:49 AM
 #4

No, Bitcoin supply is not unlimited (andrei56 is mistaken).

There will only ever be 21 million bitcoins mined - that's all that are available. However we probably won't get the full number mined because as we approach that number it requires increasingly greater effort to mine remaining coins and therefore is less profitable to do so.

Now in another sense the supply of the currency can be unlimited because 1 bitcoin can be divided into ever smaller pieces, if those pieces have value. The only way for this to be a reality is if the price of 1 bitcoin increases significantly - "goes to the moon" as some say.
Say whut?  That still don't make it unlimited tho'.  Ya still cain't chop up a bitcoin no smaller than a satoshi.   Thet there is what make btc great.  It's almost likea when we all was onna gold standard an' money was backed up by limitit gold supply. 
DannyHamilton
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January 18, 2017, 04:18:06 AM
 #5

Thats basically the question...

Bitcoin has lots of limits.  There are limits on the block size.  There are limits on the block reward. There are limits on the transaction scripts.  Whether it is "unlimited" depends on what you are asking about.

I mean, if I had a mining farm in my house, could I mine from it forever and ever?

You could, but you might find you were spending more on equipment, electricity, cooling, maintenance, etc. than you were earning in bitcoins.  Bitcoin mining is a very competitive business and unless you continue to have access to the newest and most efficient mining equipment, as well as cheap electricity and cooling, it can be difficult to maintain profitability.

I don't know 100% how bitcoin works, but it kinda triggers me when I think about it.

When mining, you are spending money on equipment and electricity to perform a proof-of-work that secures the bitcoin blockchain.  In exchange for this work, the bitcoin protocol allows the creator of the block to assign block reward to themselves in their block.  If you are solo-mining, then you are running the software that creates the block, and you assign the reward to yourself.  If you are mining in a pool then the pool operator is running the software that creates the block, and they get to choose how the reward is assigned and shared.  Most pools have published rules about how they choose to share the block reward with those that supply the hashing power.

The block reward consists of the the block subsidy (currently 12.5 bitcoins) PLUS the sum of all the transaction fees of all the transactions that are included in the block.  Approximately every 4 years (exactly every 210,000 blocks) the block reward is cut in half (and rounded down to the nearest satoshi value).  So in about 3.5 years the subsidy will be 6.25 bitcoins, and about 4 years after that it will be 3.125 bitcoins, and 4 years after that it will be 1.5625 bitcoins (and so on).  Meanwhile, as bitcoin gains popularity, those bitcoins will be worth more of your local currency, and more fees may be collected.  Right now the subsidy is significantly higher than the fees.  However, the concept is that eventually (as the fees increase and the subsidy shrinks) the amount collected in transaction fees will hopefully be greater than the subsidy.  Finally, (in about 120 years) the block subsidy will be reduced from 0.00000001 bitcoins to 0.0 bitcoins.  At that point, if bitcoin still exists, the entire reward for the miners will come from the transaction fees.

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January 18, 2017, 04:27:17 AM
 #6

Andrei56 and DannyHamilton are correct. Although only 21 million coins will be generated, miners also collect transaction fees, which are already a substantial fraction of the mining reward and will never go away as long as people are still using Bitcoin.

As you are new to this forum, I should warn you that this is one of the few forums where users are allowed to include advertisements in their profiles and get paid to post. Most such users post without regard to whether their information is correct or helpful. Beware of misinformation from users with ads in their profile.

Will pretend to do unverifiable things (while actually eating an enchilada-style burrito) for bitcoins: 1K6d1EviQKX3SVKjPYmJGyWBb1avbmCFM4
DannyHamilton
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January 18, 2017, 04:29:00 AM
 #7

No, Bitcoin supply is not unlimited (andrei56 is mistaken).

Actually, HabBear has no idea what he's talking about and is making stuff up and hoping he sounds confident.

There will only ever be 21 million bitcoins mined

The correct phrase is: "There will never be more than 21 million bitcoins mined".  There will actually be less, so saying that there "will ... be 21 million" is incorrect.

Bitcoin was designed to create 20999999.9769 bitcoins.  That number is now slightly smaller due to bitcoins that have been destroyed.

we probably won't get the full number mined because as we approach that number it requires increasingly greater effort to mine remaining coins

The effort required is completely dependent on the amount of time it took to mine the previous 2016 blocks. If it took more than 1209600 seconds, then mining becomes EASIER.  If it took less than 1209600 seconds, then mining becomes more difficult.  If it took exactly 1209600 seconds, then the difficulty doesn't change at all. Blocks will continue to be created every 10 minutes on average, and in a bit more than 120 years the last subsidy payment of 0.00000001 bitcoin will be made.  After that there will be no new bitcoins.

and therefore is less profitable to do so.

Or more profitable if mining gets easier.

Now in another sense the supply of the currency can be unlimited because 1 bitcoin can be divided into ever smaller pieces, if those pieces have value. The only way for this to be a reality is if the price of 1 bitcoin increases significantly - "goes to the moon" as some say.

On the blockchain, bitcoins can't be divided any smaller than 0.00000001 bitcoin right now.  Changing that would probably require a hard fork, which is a difficult thing to accomplish since it requires the consensus of an overwhelming majority of all miners, nodes, and users.  It is possible that businesses might handle off-chain transactions in smaller divisions and that the blockchain will just be used as a clearing house between those businesses.

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January 18, 2017, 04:33:41 AM
 #8

You're spreading the misinformation you warn against.

The question is "can I mine [bitcoin] forever?" The answer is NO! There is a finite supply of bitcoin, you can't mine past the 21 million bitcoin that are available to be mined, so...no you can't mine forever.

What you're referring to is earning bitcoin, not mining it. If the machines are needed to verify that transactions are accurate and they get paid to do so, they're earning a fee - it's no longer mining, it's purely a fee-based service for verifying transactions.

Facts to support my claims: https://en.bitcoin.it/wiki/Controlled_supply - see the part that refers to "finite supply"

Last, please don't discredit others simply because they have an advertisement in their signature.

Andrei56 and DannyHamilton are correct. Although only 21 million coins will be generated, miners also collect transaction fees, which are already a substantial fraction of the mining reward and will never go away as long as people are still using Bitcoin.

As you are new to this forum, I should warn you that this is one of the few forums where users are allowed to include advertisements in their profiles and get paid to post. Most such users post without regard to whether their information is correct or helpful. Beware of misinformation from users with ads in their profile.

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January 18, 2017, 04:57:17 AM
 #9

The question is "can I mine [bitcoin] forever?" The answer is NO! There is a finite supply of bitcoin, you can't mine past the 21 million bitcoin that are available to be mined, so...no you can't mine forever.

What you're referring to is earning bitcoin, not mining it. If the machines are needed to verify that transactions are accurate and they get paid to do so, they're earning a fee - it's no longer mining, it's purely a fee-based service for verifying transactions.
You're wrong. At the abstract level, transaction fees are the result of a transaction's output being less than its input, thus "destroying" the bitcoins. These bitcoins are "recreated" by the miner who includes that transaction in a block (this step is optional - some bitcoins have been permanently destroyed by miners not collecting the fees to which they're entitled). A transaction fee is fundamentally different from simply transferring bitcoins to a miner - in particular, it is impossible for the sender of a transaction to specify which miner will mine the transaction and collect the fee, which is radically different from traditional fee-based services.

A a more concrete level, which is what the OP was asking about, if you run a miner in the far future, when the block subsidy drops to zero, the miner will keep running, and keep producing income, for as long the owner is able to maintain it.

Last, please don't discredit others simply because they have an advertisement in their signature.
There's no need for me to discredit those who have ads in their signatures; they do that to themselves.

Will pretend to do unverifiable things (while actually eating an enchilada-style burrito) for bitcoins: 1K6d1EviQKX3SVKjPYmJGyWBb1avbmCFM4
HabBear
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January 18, 2017, 05:18:53 AM
 #10

Alright, i'll concede. Foxpup and Danny have certainly been around longer than I have and I don't doubt the level of knowledge both of you have on the topic.

I do think Danny twisted a few of my comments, when essentially we're saying the same thing. E.g., There will only ever be 21 million bitcoins (my comment) vs. his there will never be more than 21 million bitcoin is splitting hairs. My theoretical comment and his practical comment are both true.

Additionally, his comment that it could take less effort to mine the final bitcoins is theoretically possible in the future but not practically true today. He can't say today (with existing technology and general principles of the economics of ROI) that it would be easier to mine the smallest of blocks in reward era 34 than it is to mine blocks of BTC12.5 today.

I say "supply is not unlimited" and Danny comes back and says "HabBear has know idea what he's talking about" followed a few paragraphs later with "...after that there will be no new bitcoins"!?

Danny's basis for argument is inconsistent for both of these examples - he's using the practical argument for one point and the theoretical argument for a second point. And to be fair - so am i! But he's doing this to attack my response, and it seems it's motivated largely (if not solely) because of the content of my signature.

Thanks for the education from both of you - this Forum community will only improve when we can treat each other based on the merits of the posts and thought (and nothing more). The content of our character over the color of our signature.

I know I'll be seeking to set the right example, I hope you both will too.

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January 18, 2017, 05:24:10 AM
 #11

You can mine forever, because the miners block rewards will be substituted with fees. < Well in theory, if this experiment goes according to plan > Yes, there is a limited amount of coins, and it will run out, when we are not around anymore. Most of these coins < more or less 16 000 000 have already been mined >

A lot has to happen, for everything to fall in place. If the block reward halves to a point where it is not profitable to mine for that, then we are hoping the transactions would increase enough for the miners fees to fill that gap. ^smile^

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January 18, 2017, 06:03:54 AM
 #12

The answer is no. But as you have have already read the maximum amount is 21 Million , there is a possibility that it might increase.
Currency always has a tendency to increase.
So you can never predict.
Moreover , there is sufficient amount for users to earn.
Its just like unlimited as you can keep earning until and unless people stop using Bitcoin.


You can't increase the amount of bitcoins that can every be mined! That is simply impossible. Maybe if there would be a hard fork that can be done, but as of now there is no chance you could increase it. But what is nice is that bitcoin is divisible till 1 satoshi or 0.00000001BTC. However, what is impractical about is the fees.

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January 18, 2017, 06:21:13 AM
 #13

Thats basically the question... I mean, if I had a mining farm in my house, could I mine from it forever and ever? I don't know 100% how bitcoin works, but it kinda triggers me when I think about it.

my answer is no, bitcoin is not unlimited and it would ended for mining but it needs long time before its ended. if bitcoin is ended, you can still mining in your house but with another coins with the same algorythm like bitcoin which is sha-256. but from time to time, with the increasing of the diff, the amount that you can earn from the mining is getting reduce and finally you can not get profit to mining bitcoin because your cost is much higher than your profit.

you should have read the above comments. although btc supply is limited to 21 million, anyone with the right devices can mine btc forever.
the question however is that the cost of electricity. will it be worth mining the btc then the electricity bill plus the money to support you for life.

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January 18, 2017, 07:18:25 AM
 #14

Alright, i'll concede. Foxpup and Danny have certainly been around longer than I have and I don't doubt the level of knowledge both of you have on the topic.

I do think Danny twisted a few of my comments, when essentially we're saying the same thing. E.g., There will only ever be 21 million bitcoins (my comment) vs. his there will never be more than 21 million bitcoin is splitting hairs. My theoretical comment and his practical comment are both true.

Additionally, his comment that it could take less effort to mine the final bitcoins is theoretically possible in the future but not practically true today. He can't say today (with existing technology and general principles of the economics of ROI) that it would be easier to mine the smallest of blocks in reward era 34 than it is to mine blocks of BTC12.5 today.

I say "supply is not unlimited" and Danny comes back and says "HabBear has know idea what he's talking about" followed a few paragraphs later with "...after that there will be no new bitcoins"!?

Danny's basis for argument is inconsistent for both of these examples - he's using the practical argument for one point and the theoretical argument for a second point. And to be fair - so am i! But he's doing this to attack my response, and it seems it's motivated largely (if not solely) because of the content of my signature.

Thanks for the education from both of you - this Forum community will only improve when we can treat each other based on the merits of the posts and thought (and nothing more). The content of our character over the color of our signature.

I know I'll be seeking to set the right example, I hope you both will too.
Thet rite there was well said.   Unlike mosta these mouth breathers on thissa forum, ah do read tha threads.  Evverone else who posted below here is sayin' the same dam thang!  DH is almost completely rite bout these campaigns.   People be spoutin' spammin an' babblin' in evvery dialect known ta man, an' 90% of it is trashola. 

I did learn a few thangs from tha responses here, s'thank you for that.
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January 18, 2017, 07:37:15 AM
 #15

the profit is and should be potentially unlimited for the mienrs otherwise it mean that miners will shutdown their farm or reduce the hash which would render bitcoin unsecure when it will be big already

and this profit will be done via fee, which hopefully will deliver at least the same profit as today for the miners

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January 18, 2017, 08:54:01 AM
 #16

Bitcoin supply is limited. But you can keep on mining since bitcoin users are doing transactions you will actually profit from it. But if nobody sells or transfers their bitcoins into others wallet then you will mine nothing. Unlike other coins that every year an additional of million to billion coins will be generated bitcoin is not programmed to do that.

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January 18, 2017, 01:15:06 PM
 #17

It's unfortunate that people refer to mining bitcoin. As I understand it, you mine blocks for use in the Bitcoin system. In return you receive a reducing benefit from the system. This was obviously introduced to get things started. and you also recive a reward from users of the sytem in the form of fees. As the supply of unmined blocks is effectively unlimited, mining can continue forever, but the source of the rewards for mining will shift from the Bitcoin system itself to the users of the system.

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January 18, 2017, 01:25:41 PM
 #18

Thats basically the question... I mean, if I had a mining farm in my house, could I mine from it forever and ever? I don't know 100% how bitcoin works, but it kinda triggers me when I think about it.

You have to understand that miners can earn from reward and transaction fees. Discovering a block gives you 12 bitcoins. And each halving, reward is decreased into half. As time goes by, the main source of income of miners will switch from rewards to transaction fees. Hopefully, the price of bitcoin will keep up as the reward diminishes so that transaction fees will be enough for miners to cover expenses and have some profit.

To answer your question, you can mine bitcoin forever until you decide that it is not profitable to you already.


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January 18, 2017, 01:35:15 PM
 #19

Meanwhile, as bitcoin gains popularity, those bitcoins will be worth more of your local currency, and more fees may be collected.  Right now the subsidy is significantly higher than the fees.  
This is what I fear the most - that in the future bitcoin's transaction fee will be so high that sending BTC would be more expensive than using other payment processors.
Currently standard transaction fee is ~20k satoshis (and it's growing) it is roughly $0.20 ATM. In the future BTC might be used only to send very large sum of money (hundreds of dollars equivalent or more)
Bitcoin microtrasactions will be impossible.
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January 18, 2017, 03:39:31 PM
 #20

There is no such thing as forever in the first place but one thing is for sure for me that this technology would last probably much longer than you and your decendants exist and it would just keeps on revolving the process and keeps on improving so why should worry hard?


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