BitCoin: is it really finite?

[o_e_l_e_o]

A key limiting factor is that the smallest unit of Bitcoin is 8 digits after the decimal point.So 1/2ⁿ must be greater than 0.00000001

This will first play a part when we hit block 2,100,000. At that point, the block reward will drop from 0.09765625 BTC to 0.04882812 BTC, meaning we will lose 0.5 sats from every block mined.

Because of these accumulated rounding errors, the total number of bitcoin which could ever be mined is actually 20,999,999.9769. There have also been a couple of occasions in which miners have failed to claim the entire block reward they were allocated, and so these bitcoin are also permanently lost and would need to be subtracted from the total supply. And of course the very first 50 bitcoin mined in the genesis block can't actually be spent, so you could subtract them from the total supply as well.

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[BlackHatCoiner]

There have also been a couple of occasions in which miners have failed to claim the entire block reward they were allocated, and so these bitcoin are also permanently lost and would need to be subtracted from the total supply.

When did the miners fail to claim the reward? You mean that they chose to enter a burning address as the one rewarded?

And of course the very first 50 bitcoin mined in the genesis block can't actually be spent, so you could subtract them from the total supply as well.

Actually, those bitcoins are by default not included into circulation. We count with halvings and the genesis block isn't included into any period. The first 210,000 blocks rewarded bitcoins that can be normally spent and if you sum them all you'll get 10,500,000 BTC. I still don't understand why Satoshi chose to be rewarded with 50 non spendable bitcoins.

I think we should properly exclude only the OP_RETURN values. A study says that around 1.8 million OP_RETURN transactions have been made, but I can't find the number of bitcoins lost. It should be easy with to calculate with a bitcoind and a script.

[pooya87]

When did the miners fail to claim the reward? You mean that they chose to enter a burning address as the one rewarded?

When the miner constructs the coinbase transaction they can set the amount to anything <= (reward + fees) for example if they set it to 5 they lose 1.25 + fees. I know of one occasion when the user set their amount to 50 (in early days) and forgot to add the fees, obviously this was modified software and the user made the mistake.

I still don't understand why Satoshi chose to be rewarded with 50 non spendable bitcoins.

Because block 0 (ie. Genesis block) was mined before the software was released which makes those coins premined. I don't know if this was actually the intention but if those coins were included in spendable UTXOs it would have been considered unfair. That goes against bitcoin's principles.

[o_e_l_e_o]

When did the miners fail to claim the reward?

One example is block 124,724, where the miner claimed a reward of 49.99999999 BTC instead of 50 BTC and also failed to claim the 0.01 BTC in fees, permanently destroying 0.01000001 BTC.

A more notable example is block 501,726, where the miner failed to claim the entire reward of 12.5 BTC.

Block 526,591 only claimed 6.25 BTC instead of the maximum 12.5 BTC permitted.

Block 162,705 failed to claim any of the fees in the block, only claiming the 50 BTC block reward, resulting in a loss of 0.0240192 BTC.

There are lots more examples of miners making similar mistakes.

[kxwhalexk]

When did the miners fail to claim the reward?

One example is block 124,724, where the miner claimed a reward of 49.99999999 BTC instead of 50 BTC and also failed to claim the 0.01 BTC in fees, permanently destroying 0.01000001 BTC.

A more notable example is block 501,726, where the miner failed to claim the entire reward of 12.5 BTC.

Block 526,519 only claimed 6.25 BTC instead of the maximum 12.5 BTC permitted.

Block 162,705 failed to claim any of the fees in the block, only claiming the 50 BTC block reward, resulting in a loss of 0.0240192 BTC.

There are lots more examples of miners making similar mistakes.

Sir, from which channels did you get these news? News、data on the chain or something else?
By the way, I read your other replies, you are very knowledgeable and proficient in Bitcoin, which makes me not surprised at your 6000+ merit.

[o_e_l_e_o]

Sir, from which channels did you get these news? News、data on the chain or something else?

You can get all this data simply from examining the blockchain.

If you aren't running your own node, then the easiest way of searching blockchain data that I have found is via blockchair.com. For example, take a look at this customized search link - https://blockchair.com/bitcoin/blocks?q=reward(5000000000),fee_total(1..)#

This link shows all the blocks in which the miner claimed a reward of exactly 50 BTC, but which also included at least 1 satoshi in fees. Since the miner only claimed the exact 50 BTC block reward, then all the fees from these blocks - some 194 blocks, totallng 9.66234623 BTC - are permanently lost.

[Ebede]

You stated your findings very well and well articulated, but I didn't get you. I tried my best to compare your water molecules analogy,  I read and read bur I didn't understand. However, I have always have it in mind that BTC is no finite but I cannot prove it. Maybe I will get to understand you first and research more

[songchunlai]

Now we have about 18000k Bitcoin. In future, year 2140,we will have 21000k bitcoin. If you have one，that means you have 1 of 21000k wealth of the world. Because he eating company ct earth and Et. This is our plan. Your wealth will adding everyday. Don't sell it. Don't play it .Remember.

[inashed]

First  bitcoin rewards will stop at 21000000

This is not a rule, but part of the rules that make bitcoin, the fact that halving exist and the fact that minimum amount of bitcoin is 0.00000001 lead to that 21000000 coins.

Someone could say its not finite (or its not finite in a way that matters) because the coin will only reach the limit at the future, and they would be PARTIALLY right.

While the coin will only only reach its limit at far future, when people talk about bitcoin limit they are comparing with state inflation methods.

Talking about the state, they believe at doing enought monetary inflation to make sure they can be 100% sure price inflation will occur.
With bitcoin you can't be sure about that since its decided by a program at a fixed rate (not based at transaction fees, harsh rate or anything that could be used to try to maybe calculate price inflation), more after the first 4 years half of the coins were already mined, and then after more 4 years, 75% of the coins were mined..... This inflation amount is low enough and wont cause by itself, price inflation.

One can say that while it wont cause bit itself price inflation it will help to make it happen. The thing is, its obviously possible to have price inflation without monetary inflation, nxt dont have monetary inflation (and because of lost coins will even have monetary deflation), yet price deflation exist, so dont think you will evade price inflation by making the coin premined after X years.
PS:If you want a monetary inflation smaller then 2% per year (the amount of price inflation per year the state want), instead of halving you would need to EACH YEAR divide the block reward by 50, instead of dividing it by 2 every 4th years, or divide it by 12.5 every 4 years (but the less than 2% monetary inflation will happen only after start of year 6).

Also even if bitcoin is changed to allow a value smaller than 0.00000001 bitcoins, those small amount of bitcoins would be small compared to the rest of it and wouldnt matter for those who hate price inflation.

[Fortify]

Hello all,

I am new to this forum, so I hope you will not take my question wrongly.

I have been discussing Bitcoin with friends and people who have some substantial amounts.

I hear the claim that Bitcoin is finite, with a total of 21 million over and over again. However, this all seems like mind games to me and the people involved are not realising that in actual fact Bitcoin is infinite (or at least it's supply is!).

I'm not sure how exactly this is distinct to Bitcoin, it always applies to any other cryptocurrency or any currency that can be represented within a digital form. Comparing it to a water molecule is a bit silly as it is not traded like an asset in the same way and pointless as an example really. You could compare it to gold, which can have a digital representation of the value behind it and that could also be broken down to however many decimal places you wanted. The fact is people like their money have traditionally and for a very long time been used to having their money represented in large whole numbers - it doesn't sound very appealing to say I am the proud owner of 0.000001 Bitcoin, which is the direction you seem to be heading.

[BlackHatCoiner]

One example is block 124,724, where the miner claimed a reward of 49.99999999 BTC instead of 50 BTC and also failed to claim the 0.01 BTC in fees, permanently destroying 0.01000001 BTC.

Why would that block be valid? The rules are very simple; you generate a valid proof of work, you earn a specific amount as a reward plus the fees. It shouldn't be accepted by the network whether he generated lower or exceeded the 5 billion satoshis. Conversely, everyone have the right to burn their coins, I guess that's why the developers allowed that.

But, that would be the only reason I can think of.

[o_e_l_e_o]

Why would that block be valid? The rules are very simple; you generate a valid proof of work, you earn a specific amount as a reward plus the fees. It shouldn't be accepted by the network whether he generated lower or exceeded the 5 billion satoshis.

That's not what the rules state though. They state that you cannot earn above a specific amount, which is currently 6.25 BTC. The rules place no lower limit on what the miner can earn.

The actual constraint is that the sum of all the outputs in a block must be less than or equal to the sum of all the inputs in a block plus the block reward. This means a miner can never generate more than (currently) 6.25 BTC per block, but there is nothing stopping them from generating less than that.