Cant someone create new bitcoins
In the Bitcoin protocol, there is a fixed total supply of 21 million Bitcoins that will ever exist. This is because the protocol is designed to gradually reduce the reward for mining new blocks, which is how new Bitcoins are created, over time.
The reward for mining new blocks is halved every 210,000 blocks, or approximately every four years. This is known as the "halving" event. The first halving occurred in 2012, and the second halving occurred in 2016. The next halving is expected to occur in 2024.
As the reward for mining new blocks decreases, the rate at which new Bitcoins are created also decreases. This is designed to slow down the rate at which new Bitcoins enter circulation, which helps to maintain the value of existing Bitcoins.
It's important to note that while new Bitcoins can't be created out of thin air, there are some exceptions:
- Lost or forgotten Bitcoins: If someone loses their private keys or forgets their wallet password, the Bitcoins associated with those keys are effectively lost forever. This means that the total supply of Bitcoins is not fixed, as some Bitcoins may be lost or forgotten over time.
- Mined Bitcoins that are not spent: If a miner mines a block and the transaction outputs are not spent, those Bitcoins are effectively "lost" and will not be added to the circulating supply.
- New Bitcoin forks: In rare cases, a new Bitcoin fork can create new Bitcoins. A fork occurs when a group of developers creates a new version of the Bitcoin protocol, which can result in the creation of new coins. However, these new coins are not considered part of the original Bitcoin supply.
In summary, while new Bitcoins can't be created out of thin air, there are some exceptions to the fixed total supply of 21 million Bitcoins.