Topic: There are only 21 million bitcoins and they are divisible to 8 decimal places (Read 2191 times)

By the way, the above table is in "Bitcoin time" --> if difficulty had kept at 1, this would be correct.

In "Bitcoin time" (= 6 Blocks per hour etc.) we should be past summer already...

The exact yearly rate of increase for the number of bitcoins is a rather important piece of information.
I believe the following is the correct data, and it looks like it should probably be in the wiki as the topic has come up repeatedly:

Year	New BTCs/yr	Start BTCs	End BTCs	BTC Increase
2009	2625000	0	2625000	infinite
2010	2625000	2625000	5250000	100.0%
2011	2625000	5250000	7875000	50.0%
2012	2625000	7875000	10500000	33.3%
2013	1312500	10500000	11812500	12.5%
2014	1312500	11812500	13125000	11.1%
2015	1312500	13125000	14437500	10.0%
2016	1312500	14437500	15750000	9.1%
2017	656250	15750000	16406250	4.2%
2018	656250	16406250	17062500	4.0%
2019	656250	17062500	17718750	3.8%
2020	656250	17718750	18375000	3.7%
2021	328125	18375000	18703125	1.8%
2022	328125	18703125	19031250	1.8%
2023	328125	19031250	19359375	1.7%
2024	328125	19359375	19687500	1.7%
2025	164062.5	19687500	19851562.5	0.8%
2026	164062.5	19851562.5	20015625	0.8%
2027	164062.5	20015625	20179687.5	0.8%
2028	164062.5	20179687.5	20343750	0.8%

So not taking in the decreases in the generation rate, we have:
Current year + 0: 37.5%
Current year + 1: 27.3%
Current year + 2: 21.4%

As the trend in the exchange rate has shown, demand is far exceeding the rate of inflation of the supply of Bitcoins.

Oh I see, you're saying that the rate at which bitcoins are created compared to those that have already been created.  Okay.  My bad.

Of course, that means the first day of bitcoins they were inflating at infinite percent

Still, I don't think 44% annual inflation is extraordinary.

It will take still some time until even half of that 21 million are mined.

Currently we're nearly at 1/3rd --> 7 million BTC, not 21 million.

~7000/7000000 = ~0,1% per day

That's not the only reason, but scarcity is important.  When I first tell people about bitcoins, they want to know what prevents 'them' from just printing more bitcoins.  People compare bitcoins to beany babies or pogs, which started off as having some real scarcity, until the companies behind them went crazy and made more, destroying the value of all of them.  It's important that something like bitcoins is immune from greedy-founder-syndrome.

I think your math is off.

A block is created every 10 minutes (that's the target anyway). That's 50 bitcoins per ten minutes, or 300 per hour.  Times 24 hours equals 7200 btc per day.

7200 / 21000000 = 0.00034285, which is 0.03% per day.

Of course, blocks are actually found more often than once per 10 minutes (at least while the difficulty is rising).  But the rate you quoted, 0.1% is triple the 10-minute-per-block rate.  0.1% of all bitcoins would only be mined in a day if a new block was being found every three minutes instead of ten.  But if that were the case, difficulty would triple every time it adjusted, instead of going up about 10% give or take like it's been doing.

With difficulty going up 10% per adjustment (average), the rate of bitcoins per day is about 10% faster than my calculation of 0.034%, which means the real rate is about 0.037% (percentage of all bitcoins mined each day).

Additionally, even if we were to use your figure (0.1%), the annual inflation of that compounded daily over a year, is 1.001 ^ 365, or 1.44 = 44% annual inflation, which although high is not that amazing. Especially in light of the fact that, although the supply of bitcoins is growing at that rate, demand for bitcoins (which is still in infancy, really) is also growing quite rapidly.  Plus, the supply growth rate of bitcoins is GUARANTEED to slow down (by half in 2013, then by half again every 4 years, stopping completely eventually).  And that's using your number which is off.

If we use my figure (0.037%), that compounded daily over a year equals a 1.00037 ^ 365 = 1.1445 = 14.5% annual inflation.  Not so bad at all.

I don't really agree they have value just because there is a limited number of them... But I guess that could mean something to some.

They will continually be lost/deleted/destroyed overtime so it will be much less than 21 million I would say as well.

It's very temporary, constantly diminishing, and following a set pattern known to all market participants.

Inflation for Bitcoin falls to zero. Value for USD falls to zero. Big difference.

The only "tiny" fact that you're most likely NOT telling them is that currently 0.1% of all bitcoins ever get created per day. Go and calculate the annual inflation rate of that and be amazed...

When I introduce people to bitcoin, some of them immediately assume they are worthless. They say things like, "oh, come on!" as though bitcoins are play money. Then I tell them that there are only 21 million, and then their attitude changes. Suddenly, bitcoins have value to them. Then they say things like, "so if I have just one bitcoin, when everybody uses them, I'll be rich."

Another thing that comes up time and time again is that bitcoins are divisible down to 8 decimal places. When I tell people this, they say things like, "oh, I see. So they really could be a global currency."

So once you explain the big picture facts about bitcoin to people, they often get it, and they realize that bitcoins have value.