Recently one of our readers asked the question, how is a new Bitcoin created?
In her words, this thing that is worth so much money, if it’s not issued by the government, then how is it created, and who creates it?
I have also seen people who don’t know that new Bitcoins are created every 10 minutes.
To clarify this for you as a beginner, there will never be more than 21 million Bitcoin.
But as of the time this post was published, theirs currently about 19.279 million Bitcoin in circulation. This number increases every ten minutes and will continue until the year 2140 when the last Bitcoin will be added into circulation.
In other words, new Bitcoins will be released every ten minutes until the set maximum of 21 million Bitcoin limit is reached.
But how is a new Bitcoin created?
Where does new Bitcoin come from?
Who creates them, and how many new Bitcoins are created every ten (10) minutes?
These and more are the things you will find out soon, so continue reading.
How is a New Bitcoin Created
A new Bitcoin is created by miners through a process called “mining”.
Miners solve complex mathematical problems that verify Bitcoin transactions, and when a miner successfully creates a new block, they are rewarded with a fixed amount of newly minted Bitcoin, along with transaction fees collected from transactions included in the block.
To give you further insight, transactions in Bitcoin are grouped into blocks, and new blocks are added every 10 minutes to the Bitcoin blockchain.
The Bitcoin blockchain is a collection of all the blocks that have ever happened on Bitcoin, all the way back to the genesis block, which was the first block ever mined on Bitcoin, and happened on January 3, 2009.
As of this moment, 6.25 new Bitcoins are created with every single new block that miners add to the Bitcoin blockchain every ten (10) minutes, but it used to be higher.
It used to be a 12.5 Bitcoin reward every 10 minutes. Before that, it was 25 Bitcoins every 10 minutes, and before that, it was 50 Bitcoins every 10 minutes, which was in the early years of Bitcoin.
The process of the block reward is cut in half once every 210,000 blocks, which is roughly every four years, and it will continue until the total supply of 21 million Bitcoins is reached, which is expected to happen around the year 2140.
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Conclusion
So, in conclusion to how a new Bitcoin is created.
New Bitcoins are created by miners, as a reward for successfully adding a new block to the Bitcoin blockchain.
A block is added every ten minutes, which means new Bitcoins are created every 10 minutes.
As of this moment, the reward received by a miner for adding one block to the Bitcoin blockchain is 6.25 new Bitcoins.
This reward used to be higher, as I already stated, and it will continue to be cut in half once every 210,000 blocks, meaning the current reward of 6.25 new Bitcoins will be reduced to 3.125 new Bitcoins after the next halving expected to happen in 2024.
I hope you found the post helpful.
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You should also check out other content from us below to learn and understand Bitcoin and the cryptocurrency market better.
read also:
- What is the Minimum Amount to Invest in Bitcoin
- How to Start Investing in Bitcoin as a Beginner
- What is Bitcoin Halving?
IMPORTANT; you must never send money to anyone you meet online asking to help you invest in cryptocurrency. They are scammers. Crypto is easy, and you can do it all by yourself.
DISCLAIMER:
The information presented here should not be used as the sole basis of any investment decisions, nor should it be construed as financial, tax, legal, or accounting advice. I will also advise that you invest in cryptocurrency only what you are comfortable living without, at least temporarily.