On Christmas Day, the families and children were not the only ones chivalrous, but so was Bitcoin. It was a big day for bitcoin on Christmas Eve, when miners gained about 19.8 million coins from their machines. This marked bitcoin supply cap comes closer to its famous 21 million supply capacity, which has reignited debates around what will happen to cryptocurrency’s future.

Key-Takeaways:

• Only 1.2 million coins remain before the Bitcoin supply cap hits 21 million. We would have Bitcoin mining until 2140 before miners move into earning on transaction fees.
• The total estimated amount of permanently lost bitcoins is somewhere between 3 and 8 million, which means the real amount circulating is never going to be the total cap.
• And increasingly, institutional investors are valuing virgin bitcoins, newly mined and with no transaction history.

Gift for Bitcoin on Christmas Eve 

On December 24, 2024, Bitcoin mining broke a record of 19.8 million units when the cryptocurrency community came together and witnessed BTC reaching this milestone. Following the 2024 event, miners are currently producing around 450 bitcoins per day. And in a steady development, there are only 1.2 million bitcoins left before they could reach their maximum supply.

While nearly 20 million bitcoins were mined in the first 14 years, more than 20 million bitcoins are still needed for them to reach completion, and the road is still long. But Bitcoin’s unique distribution mechanism means the final bitcoin supply cap would not appear until 2140. About every four years, because of this system, mining rewards are cut in half, making it so new coins are produced at a slower rate.

The Economic Impact of Scarcity

However, bitcoin is unique because its supply cap is totally fixed. Bitcoin is scarcer than government money because, unlike government money, its scarcity is kept by a code. Because of the absence of any inherent limitation, Bitcoin has become a particularly attractive deflationary asset.

As the Bitcoin supply cap reaches its final cap, there are questions regarding the sustainability of bitcoin mining. In 2140, when new bitcoin creation stops, mining won’t earn in bitcoin, but transaction fees will. But these fees already make some contribution to mining rewards, keeping the crypto space secure.

Lost Coins and Real Circulation

It’s also notable that the actual number of bitcoins in circulation won’t ever get up to 21 million. Currently, there are about three to eight million bitcoins already lost forever. All these losses happen in different ways. From forgotten passwords to hardware wallets damaged to wrong transactions.

The development of ‘virgin bitcoins’ (coins that have never been used before) is a fascinating development in the Bitcoin ecosystem. These clean units attract a premium price, particularly among institutional investors who want nothing to do with problematic unit sale histories. Unfortunately, true virgin bitcoins are becoming progressively harder and impossible to get from miners.

And as Bitcoin treads towards its supply cap, the digital currency is still developing. Some talk about theories and the possibility of getting rid of the supply cap through a net change; others say that such changes will fundamentally change bitcoin. The bigger debate that this has been referring to is the debate surrounding whether Bitcoin plays an important role in the global financial system.

Conclusion: Bitcoin supply cap

Bitcoin’s distinct economic model can be understood as the road toward Bitcoin’s final currency. Bitcoin’s scarcity is becoming more and more crucial to its worth as its daily mining activities continue and we get closer to the real cap with each halving occurrence. As these historical turning points occur, the cryptocurrency’s deflationary design stops it from being included in the new digital asset market.