Everything about Bitcoin is heavily influenced by mathematics – defined as the study of quantity, structure, space, and variability. The amount is always of particular interest to traders – in increasing one’s own holdings and the impact on the amount of BTC that is hard-bound to its long-term value.
Recently, a thread on Twitter questioned why Satoshi Nakamoto chose 21 million BTC as the total supply rather than an arbitrary number. The answer, like everything else around Bitcoin, can be found in math very simply.
Bitcoin’s limited supply gives it unique properties. It gives it a scarce currency class without, with havoc-safe-haven assets like gold praised. It also stops inflation by never increasing the supply of BTC. We can all see why it matters to the value of Bitcoin, but still so – why 21 million BTC?
In a thread on Twitter started by Sasha Fleyshman, trader at Arca – an asset management firm focused on cryptocurrencies and blockchain – find out why Bitcoin’s creator chose 21 million BTC as total Bitcoin numbers exist. As with most Satoshi related things, the reason remains unknown.
After much discussion, Fleyshman gathered collective thoughts and, based on a simple mathematical formula, may have discovered the reason behind the 21 million BTC supply.
Time-based theory is crucial. The variables used are hours per day, day per year, year per cycle, and block per hour.
In addition, it is hardcoded into Bitcoin, which practically takes about ten minutes for each new block to be added to the blockchain. This changes in seconds, Fleyshman points out, but is eventually compensated for with each difficulty adjustment, which occurs every 14 days.
When you break four years worth of blocks at six blocks per hour, there are about 210,000 total blocks per halving cycle.
At the next halving, its supply will be cut from 12.5 BTC to 6.25 BTC. Before that, the block reward was 25 BTC and before that it was 50 BTC. The sum of all block reward sizes is 100.
When you multiply 100 by the total 210,000 blocks per halving, you get 21 million BTC. At least it is according to Fleyshman’s theory, which is logically significant.
While all lines are mathematical, it may well be just a coincidence, and the real answer will likely never be known, as Satoshi Nakamoto’s true identity may never be. be revealed. Until that happened, this theory was one of the most convincing.