Eighty Percent Of All ‘Easy’ Bitcoins Now Mined
Currently with each block mined the reward to the miners is 50 BTC of new currency issued. When issuance reaches the 10.5 million BTC milestone, the rate will drop from 50 BTC to 25 BTC per block. Hitting the 8.4 million mark today means that 80% of these “easy” bitcoins have now been mined.
The 10.5 million mark will likely occur around December of this year, but could deviate based on the rate of change in mining capacity with the target being hit in November or January instead being a possibility. At that point, exactly half (50%) of all bitcoins that will ever be issued will have been issued.
Miners considering starting up or adding capacity at this point are faced with some long-term challenges. There is now competition from those using FPGAs, miners are faced with a flat or declining exchange rate for the bitcoins they produce, and they face this upcoming 50 to 25 BTC drop in the block reward.
There is uncertainty if this drop is already factored into today’s price, or if investors have not yet realized that soon the rate of currency inflation will suddenly drop by half.
In the short term even, the mining profitability currently is only about half as high as it was just a month ago thanks to a steadily increasing mining difficulty.
The 25 BTC per-block reward level, once reached, will continue for four years when again that level too will drop by half, to 12.5 BTC per-block.