DayOfCrypto
  • Home
No Result
View All Result
DayOfCrypto
No Result
View All Result
DayOfCrypto
Home Other
happy-18-millionth-bitcoin!-btc-scarcity-implies-large-price-rally

Happy 18 Millionth Bitcoin! BTC Scarcity Implies Large Price Rally

by Admin
October 19, 2019
in Other
289 3
0
Share on FacebookShare on Twitter

Mere hours ago (as of the time of publishing this), the 18 millionth Bitcoin (BTC) was mined.

As revealed by Statoshi.Info, a recent block brought the 18th million coin into existence, leaving three million BTC remaining out of the hard-capped 21 million coin supply.

While this milestone may seem irrelevant to those not involved in the cryptocurrency industry, the Bitcoin community has been celebrating this event, filling the Twitter feeds of cryptocurrency investors the world over.

This Friday the 18th million Bitcoin will be mined

There are only #3MillionLeft

Our mission is to make it easy for everyone to be a part of this once in a species revolution

— farbood (@farbood) October 16, 2019

This is for good reason: Bitcoin’s strict algorithmically-enforced scarcity, which many say is what gives the cryptocurrency such an advantage over fiat monies and other cryptocurrencies, is believed to imbue the asset with much of its value.

Related Reading: Bitcoin Price “Death Cross” 10 Days Out as BTC Stagnates at $8,000

Scarcity to Drive Bitcoin Price Sky High: Model

Munich-based financial institution Bayerische Landesbank (BayernLB) has predicted that the block reward halving — a key event in Bitcoin’s scarcity narrative — will give Bitcoin to fuel to jet past its previous all-time highs.

In an extensive paper authored by senior analyst Manuel Andersch, it was explained that due to its characteristics and similarities to gold, Bitcoin’s price might be able to be fairly predicted by a stock-to-flow (new yearly supply over above-ground supply of a commodity) model. The model says that once Bitcoin’s block reward reduction is cut in half next year, the cryptocurrency will have a fair valuation of $90,000 per coin.

BayernLB’s model was derived from one made by PlanB, a pseudonymous quantitative analyst working at a European financial institution.

PlanB recently determined that the stock-to-flow model is cointegrated with the Bitcoin price, implying that there is a rather high likelihood that BTC will rocket higher in the wake of the halving.

The analyst also found that his model fit Bitcoin’s price action to a 95% R2, a statistical metric used to represent the accuracy of a model (100% is perfect, 0% is absolutely inaccurate).

Related Reading: “Full Rollout”: Fidelity Opens Up Bitcoin Business to Billions

Increasing the Supply Cap? 

While Bitcoin’s supply cap will likely be enforced by HODlers at all costs, there has been some talk of an eventual supply cap increase.

As reported by NewsBTC previously, at the Satoshi Roundtable earlier this year, discussion arose regarding the abolishment of the strict 21 million BTC supply limit.

Attendee Matt Luongo, the founder of Fold and the product lead at Keep, released a thread on the subject matter after the event, explaining why more than 21 million BTC could make sense eventually.

Luongo explained that while it would be unfair to assume what will happen with Bitcoin’s transaction fee market in the long-term, a waning number of miners could pose a threat to the blockchain.

I was the guy that said we might have to one day raise the Bitcoin supply cap. Fight me. https://t.co/ysqHHdcggf

— Matt Luongo (@mhluongo) February 4, 2019

The crypto builder commented that as more halvings take place, miners’ revenue will begin to dwindle. Luongo explained that such a series of events would be a “huge change in the business model and core economics of the network.”

Considering the worst-case scenario, Luongo noted that when block rewards become scant, the Bitcoin economy could become “top heavy.” He stated that as transactions on Bitcoin’s main layer, not the Lightning Network or other layers (Liquid), become few and far between, the chain will be susceptible to block reorganizations, as seen with Ethereum Classic and ZenCash.

He thus concluded that a potential solution would be to curb the long-standing supply limit of BTC to “allow some emission for chain security, at the expense of all holders.”

Related Reading: Bitcoin Now the World’s Eleventh Largest Money Supply
Featured Image from Shutterstock

The post Happy 18 Millionth Bitcoin! BTC Scarcity Implies Large Price Rally appeared first on NewsBTC.

Admin

About Us

We bring you the best Premium WordPress Themes that perfect for news, magazine, personal blog, etc. Check our landing page for details.

Follow Us

Popular Tag

Adoption Banks Binance Binance Coin Bitcoin Bitcoin Cash Bitcoin Price Bitcoin Regulation Bitcoin SV Blockchain Central Bank China Coinbase Crimes Cryptocurrencies Cryptocurrency Exchange EOS Ethereum Ethereum Price Facebook Germany Government Investments Japan Law Libra Litecoin Markets Market Update Mining Payments Regulation Ripple SEC Security South Korea Stablecoin Stellar Switzerland Tokens Tradings Transactions USA Wallet XRP

Recent News

Poloniex Review – Buy and sell cryptocurrencies, Bitcoin, Registration, Safety, Reference

Poloniex Review – Buy and sell cryptocurrencies, Bitcoin, Registration, Safety, Reference

November 8, 2020
Bitstamp Review – Buy and sell Bitcoin and cryptocurrencies, Registration, Safety, Reference

Bitstamp Review – Buy and sell Bitcoin and cryptocurrencies, Registration, Safety, Reference

November 8, 2020
  • About
  • Advertise
  • Privacy & Policy
  • Contact

© 2021 JNews - Premium WordPress news & magazine theme by Jegtheme.

No Result
View All Result
  • Home

© 2021 JNews - Premium WordPress news & magazine theme by Jegtheme.

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms below to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
Go to mobile version
Skip to toolbar
  • About WordPress
    • WordPress.org
    • Documentation
    • Support
    • Feedback
  • Log In
  • AMP
    • View AMP version