No More 21 Million Bitcoins
You must have heard that the number of Bitcoins that can ever exist is 21 million. Well, to your surprise you have been misinformed about the same.
This is because of the rounding fact that a Bitcoin can only be divided into eight decimals. Therefore, we are unable to comprehend the fact of halving the block reward, that left us with 20,999,999.9796 BTC to be the maximum number of Bitcoins that will ever exist.
But why "21 million" in the first place?
21 being a triangular number itself counts objects which are arranged in the form of an equilateral triangle, to make the computation efficient and easier.
On the top of it, the mathematical explanation for "21 million" is credited to Bitcoin's deflationary "Block Halving" protocol which occurs every four years calculated by a user in Stack Exchange as below:
6 blocks per hour translate to 24 hours per day, 365 days per year, and 4 years per cycle. This in total sums up to 210,240.
The addition of block reward size like 50, 25, 6.25, 3.125, 1.5625, 12.5 = 100 multiplied by 2 gives 210,000*100= 21 million.
21 million was an educated guess by Nakamoto. Nakamoto expressed this while having an interaction(email) with Bitcoin developer Mike Heam.
Why does the Bitcoin Block Halving matter?
Is it because of the scarcity or the factor of laws of demand and supply? 4 million of bitcoins may be lost. However, there won't be a single satoshi more than the supply cap of Bitcoin's 20,999,999.9796 BTC.
The black halving also ensures inflation to never occur so that the purchasing power never diminishes. Before you end up, it is stated in Nakamoto's email with Heam that Satoshi's vision is of a world where 0.001 BTC = 1 euro. For example, 0.001 is worth 1 euro, then it will be easier to change the decimal point part.
Presently, 0.001 BTC will be around something closer to 8 euros. Well, we don't know the future of HODLS, but are excited to know What's next?