Bitcoin's creator, Satoshi Nakamoto, encoded a strict supply limit into its protocol from the very beginning. Since its launch, new Bitcoin has been issued according to a predefined schedule, and the total circulating supply continues to grow—but it will eventually reach its predetermined cap and stop increasing.
This article explores how Bitcoin's fixed supply is implemented and maintained. As of this writing:
- Over 19 million Bitcoin have been issued.
- New Bitcoin continues to be issued approximately every 10 minutes, following a predefined emission schedule.
- Issuance will continue until the total supply approaches, but does not exceed, 21 million coins.
For a real-time look at the current circulating supply, tools like Bitcoin data dashboards can be helpful.
How Is New Bitcoin Created?
New Bitcoin is created as part of the process of validating and recording transactions on the Bitcoin blockchain. To understand this, it’s important to know how transactions are verified and how miners add them to the chain.
- New Bitcoin transactions are broadcast to a network of nodes and miners.
- The Bitcoin software checks these pending transactions to ensure they don’t spend more than the available balance and that they follow all protocol rules.
- Miners gather valid transactions and group them into candidate blocks.
- These miners then compete in a Proof-of-Work (PoW) race to append the next block to the blockchain.
- Roughly every 10 minutes, a miner wins this race. The difficulty of this competition adjusts every 2016 blocks to maintain this average.
The winning miner adds the new block to the blockchain and receives a block reward, which consists of two parts:
- Transaction Fees: Fees paid by users to transfer funds between addresses. These vary based on network activity.
- Block Subsidy: Newly minted Bitcoin paid to the miner as a reward.
What Is the Block Subsidy?
The block subsidy, paid via a special coinbase transaction, is the only source of new Bitcoin. For the first four years, the subsidy was 50 BTC per block.
As defined in Bitcoin’s code, the block subsidy is cut in half every 210,000 blocks (approximately every four years). Eventually, the subsidy will decrease to zero. After that, miners will only earn transaction fees—not newly created Bitcoin—for securing the network.
In a 2010 forum post, Satoshi Nakamoto themself addressed the eventual end of block subsidies and the 21 million cap:
“Yes. If necessary, it’s possible we can continue to have the block reward forever… but eventually, it will be very small. In a couple of decades, the reward will be too small to matter, and transaction fees will be the main compensation for nodes. I’m sure that in 20 years, the volume of transactions will be either very large or nothing.”
Here, “nodes” refer to miners performing PoW. This statement is notable both for its direct reference to the “21 million limit” and for raising a persistent question: Will Bitcoin remain secure once the block subsidy ends?
How Is the Supply Cap Defined in Code?
Bitcoin’s source code defines the block subsidy awarded to miners who win the PoW competition. This is critical for maintaining the fixed supply, since all new Bitcoin enters circulation through this subsidy.
We’ve previously published a line-by-line explanation of how the 21 million cap is mathematically implied by Bitcoin’s code.
What Is the “Halving”?
To understand how the code enforces the 21 million cap, it’s essential to understand the “halving” mechanism. The halving ensures that Bitcoin is issued in a persistent, orderly, and predictable manner. Bitcoin was initially issued at a fixed rate, but that rate periodically slows until issuance eventually stops.
You don’t need to read code to grasp the halving’s effect:
- The number of blocks between halvings is fixed at 210,000.
- The initial block subsidy was 50 BTC.
- After each halving, the subsidy is cut in half: 50 → 25 → 12.5, and so on.
- Since blocks are mined roughly every 10 minutes, the subsidy halves approximately every four years.
- The subsidy eventually decreases to less than one satoshi (the smallest Bitcoin unit), resulting in a total supply of just under 21 million BTC (specifically, 20,999,999.9769).
What Else Enforces the Fixed Supply?
While code is fundamental, Bitcoin’s fixed supply isn’t guaranteed by software alone. Code runs on computers operated by people. So, how does Bitcoin prevent bad actors from changing the rules to benefit themselves?
Full Node Validation
As mentioned, transactions are validated by nodes—computers running Bitcoin software. Nodes play a crucial role in enforcing consensus rules, including the 21 million cap. These rules are embedded in the Bitcoin code and agreed upon by all node operators. Any transaction violating these rules is rejected by the network.
If a malicious actor (or even a powerful entity or state) attempted to change Bitcoin’s emission schedule or create invalid Bitcoin, the rest of the network would immediately reject their transactions.
Market Forces
Beyond code and node governance, another layer protecting Bitcoin’s hard cap is market economics.
While highly unlikely, it is theoretically possible that some Bitcoin users might someday propose a controversial change to increase the supply.
In such a scenario, they would likely face strong opposition from the majority of users who support the hard cap. Each user could choose, via their node or wallet software, whether to adopt the new rules or stick with the old ones. This could result in a chain split—one blockchain splitting into two.
Users could then trade coins on one chain for coins on the other. All else being equal, the scarcer version of Bitcoin would likely be more valuable to users. Since scarcity is foundational to long-term value, rational investors would be incentivized to acquire the limited-supply asset, perhaps even trading unlimited “Bitcoin” for limited Bitcoin.
The mere possibility of this outcome acts as a deterrent. Users don’t need to actually engage in such trades; the threat itself helps discourage attempts to alter Bitcoin’s supply.
Self-Interest Reinforces Scarcity
Bitcoin’s growing appeal as sound money is largely due to its scarcity. This drives adoption, which leads to more nodes and wallets, further decentralizing the network. This creates a positive feedback loop: participants are economically incentivized to defend the features that make Bitcoin valuable, especially its 21 million cap.
As Parker Lewis explains in Bitcoin Obsoletes All Other Money, a growing network of participants helps secure the network and reliably enforce the 21 million cap:
“The blockchain alone doesn’t make the supply fixed; the supply schedule isn’t credible just because the software says so. The 21 million is credible because it is enforced on a decentralized basis by a growing network of participants… As more individuals converge on a common standard, the 21 million becomes more credible. Over time, as each participant’s control over the network diminishes, the 21 million ultimately becomes a more reliable constant.”
For a deeper dive into how scarcity and adoption reinforce Bitcoin’s fixed supply, consider reading Parker Lewis’s essay series, Gradually, Then Suddenly.
👉 Explore real-time Bitcoin data
Frequently Asked Questions
How many Bitcoin are left to be mined?
As of now, about 2 million Bitcoin remain to be mined. The exact number decreases with each new block. The final Bitcoin is expected to be mined around the year 2140.
What happens when all 21 million Bitcoin are mined?
Once all Bitcoin are mined, miners will no longer receive block subsidies. Their income will rely solely on transaction fees paid by users. The network’s security will depend on these fees being sufficient to incentivize miners to continue validating transactions.
Can the 21 million cap be changed?
Technically, the cap could be changed if a majority of users adopted new software rules. However, doing so would require overwhelming consensus, and it is highly unlikely because Bitcoin’s scarcity is a key feature valued by its users. Economic incentives strongly discourage such a change.
Why was 21 million chosen as the cap?
The exact number is a result of the initial block subsidy (50 BTC) and the halving schedule every 210,000 blocks. Satoshi Nakamoto never explicitly stated why these parameters were chosen, but they produce a predictable, diminishing emission curve that asymptotically approaches 21 million.
What is a satoshi?
A satoshi is the smallest unit of Bitcoin, named after the creator. One Bitcoin equals 100 million satoshis. This divisibility ensures that Bitcoin can be used for transactions of any size, even as its value per coin increases.
How does Bitcoin’s fixed supply compare to traditional money?
Unlike traditional fiat currencies, which central banks can print in unlimited quantities, Bitcoin has a fixed and predictable supply. This makes it resistant to inflation and devaluation, positioning it as a store of value similar to digital gold.