are probably still wondering why Bitcoin has become so recognizable and why no other cryptocurrency has or will reach its heights. I will now briefly answer this question for you.
The initial number of bitcoins that mankind can mine is 21 million coins.
The entire stock of BTC in humanity’s hands ends at the 21,000,000 mark. For example, Ethereum (the second most popular cryptocurrency) already exceeds 200 million and has no upper limit.
Currently, miners (people engaged in mining cryptocurrency) have already mined 19 million BTC, traded on exchanges, or waiting for their time in crypto wallets.
Of course, with each coin mined, the difficulty of mining increases, and it is predicted that the last BTC will not be mined until 2140. But there is one big BUT!
Tremendous parts of these coins have disappeared without a trace or are considered lost. According to statistics, the share of lost coins is about 20—30% of all existing bitcoins, i.e., about 4—6 million. Some are still stored on lost or failed flash drives or hard disks. It is 30% of users who violated the rules of Bitcoin storage and transfer and failed to save their seed phrases.
Thus, twice as much BTC has been lost in the past ten years as will be mined in the next 120 years!
What’s the point of all this? The simple answer is that Bitcoin’s value is rising not only because it has absorbed so many unique values but also because it is incredibly limited. And given that coins are lost, and their numbers dwindle, their value only increases over time.
Fortunately, if you don’t have the ability to buy an entire BTC coin, you can purchase a portion of it by spending the amount of money you have.
The smallest part of it is called a satoshi and is one hundred millionth of a bitcoin (0.00000001 BTC), and one dollar can currently buy 3,500 satoshis.
Holders of 10 million satoshis or 0.1 bitcoin will be the custodians of a great fortune.
The catch is that bitcoin mining will one day end, and the losses will continue. Given the growing number of users and turnover of cryptocurrencies, this could lead to almost inevitable deflation, and the price of BTC will only rise from this!
But why is the number of BTC so severely limited to 21 million? First, it is due to the principle of limited money issuance, an essential aspect of economics similar to the gold standard. No one can arbitrarily increase the amount of money, and inflation will be spread evenly to all participants, regardless of individual countries or groups.
Second, the number 21 has symbolic significance is often associated with positive events or achievements, and is also the age of adulthood for many people.
Thirdly, it all correlates with the need for a new world government in which 3% of people will own 96% of the world’s wealth. On the day Bitcoin was created, about 7 billion people were on Earth, of which 3% were very wealthy. It means that about 210 million people may still be wealthy in the future. Only now, they will own bitcoins and will be completely different people. So, about 21 million people are potential holders of 21 million BTC.
Security
We’ve talked quite a bit about Bitcoin but still haven’t figured out why keeping money in this digital currency is so secure.
Bitcoin uses 12, 15, 18, 21, or 24 words as standard options for generating a seed phrase. The most common and recommended length of a seed phrase is 12 words. These words are chosen from a predefined list of vocabulary words known as the BIP39 (Bitcoin Improvement Proposal 39) dictionary. Using a seed phrase allows wallets and their private keys to be recovered and recreated if the device is lost or damaged. 5,444,517,870,770,770,735,735,974,381,410,031,699,376 (five and a half quintillion) unique seed phrases can be generated from a list of 2,048 words in length, using a minimum of 12 words in each seed phrase.
To understand – if some person wants to guess your phrase, he will have to go through 680,564,733,842,966,996 combinations.
Assuming his server will process one variant per second, he has to live 21,598,892 years or use 21 million computers for an entire year! With such a resource, there is no need or logic in searching for someone else’s wallet, as you can spend resources on mining new BTC. This calculation is made for a seed phrase of 12 words, but I couldn’t even write a 24-word seed phrase calculation. Otherwise, the resulting number would take up half a page!
Example of a keyword phrase (seed phrase):
«dynamic modify glow puzzle primary ivory chair tank spray whisper echo timber.»
Example of a public address:
1BvBMSEYstWetqTFn5Au4m4GFg7xJaNVN2
Add to this Bitcoin’s code as a program consists of 77,000 lines. The 70,000 lines are written in the programming language C++. In addition, the length of the chain in the Bitcoin blockchain has exceeded 710,000 blocks. To guess the bitcoin phrase to crack all the blocks will take over 38 nonillion years because the system has acquired a reliable cryptographic hashing algorithm – SHA-256. And that’s another reason why no one has been able to crack Bitcoin yet.
Not everyone has heard of SHA-256, but in my opinion, it is one of the greatest American inventions of the 21st century. Developed by the National Security Agency (NSA) in 2001, SHA-256 is a secure hashing algorithm used in the iPhone to hash data, including the unique facial characteristics many of you use to unlock your phone.
I won’t bore you with the details, but SHA-256 has never been broken or compromised, making Bitcoin one of the most secure protocols in the world. That is why it was decided to create a digital asset based on it. In 2010, SHA-256 was said to «have the potential to last several decades unless a large-scale breakout attack occurs.» That is good news, as Bitcoin was designed to be mined and stored for the next 140 years, maybe even longer.
Remember that there is currently no hardware capable of damaging Bitcoin. The only thing that can damage it is the «51% Attack», in which an attacker captures more than half of the network’s mining capacity.
The 51% attack is a potent threat to blockchain networks, including Bitcoin. It occurs when a single participant or group of blockchain participants control more than 50% of the network’s computing power. It means they can manipulate the transaction validation process and create fake transactions.
In theory, a 51% attack allows an attacker to perform the following actions:
– Transaction Veto. The attacker can reject or cancel certain transactions that they deem undesirable. It can cause a loss of trust in the network and reduce its integrity.
– Double Spending. An attacker can conduct double spending, meaning he can spend the same bitcoins twice. He can cancel transactions that have already been made and use the same bitcoins for new payments.
However, the 51% Attack requires significant computing power to implement successfully, making it complex and expensive. Despite the possibility of a 51% Attack, it is unlikely in the case of Bitcoin, something on the level of a myth, if you will.
Perhaps mining will change hands, and one owner will gain control of 51% of the hash rate. But in this case, he is unlikely to jeopardize his business, as not only the network’s credibility would collapse but also all of his profits. It is all the more important to consider that this has happened many times in history if it makes sense. Just look at the distribution of miners across all the world’s mining companies (Figure 13). It would be enough for the two top players to collude and launch a 51% Attack, but they don’t, and for good reason.
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