Summary

• Bitcoin, a decentralised digital currency, hit its all-time high of US$64,899 in April this year.
• In the past one year, Bitcoin has delivered an approximate return of 238%.
• The ideal time taken to mine a Bitcoin is only 10 minutes, but the time could increase to a few hours or days depending on the hardware, software, and other factors.

Bitcoin, considered as the original cryptocurrency, is attributed to triggering a new revolution for transparent and non-regulated banking and payment systems.

Despite facing its fair share of issues from governments, globally, Bitcoin (BTC) has been successfully adored and accepted as a currency in the current market. Bowing to the mighty cryptocurrency, some countries have accepted and even rolled out their own version of cryptocurrencies.

Bitcoin Five-Year Performance (Source: EODHD/Others Eikon)

Bitcoin has delivered a return of over 5,133% in the last five years of trading, much more than any conventional currency. The cryptocurrency is highly volatile, allowing its investors to trade and earn better returns than any other conventional financial instrument.

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In the past one year, the price of Bitcoin has surged by ~238%. The cryptocurrency hit its all-time high of US$64,899 on 14 April 2021. The financial instrument has consolidated significantly in recent months and preps up for the next leap in the wake of rising inflation across the globe.

Data Source: Eikon EODHD/Others; Analysis: Kalkine

Despite the ongoing COVID-19 pandemic, the cryptocurrency has been performing well and outshining other established safe haven assets, such as gold. In a nutshell, Bitcoin is a momentum and growth investment.

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Even the risk-averse investors have now begun accepting and including Bitcoin in some proportions of their portfolio. A combination of volatile and non-volatile investments makes up a good portfolio yielding healthy returns in the future.

How many have been mined, and how many are left?

The total number of Bitcoins that can be mined is limited to 21 million units. Of the total, over 18,741,525 BTCs have already been mined, as of 24 June 2021, as per Buy Bitcoin Worldwide. These Bitcoins account to roughly 89% of the total Bitcoins available and leaves just 11% to be mined in the future.

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While more and more Bitcoins are mined, the rarity of the currency will increase and may reflect in the prices.

As per Buy Bitcoin Worldwide, only 2,258,475 Bitcoins are now left to be mined and over ~900 of them is mined on a daily basis. At this rate, the remaining Bitcoins will be mined in the next seven years. Once all Bitcoins have been mined, the miners will continue to benefit from the fees for processing transactions.

However, a small fraction out of the 18.74 million units may have been lost. There have been incidents in the past when the Bitcoin owners have reported losing the private key to access their Bitcoins.

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One way to tackle this is to look for blockchains that have been sitting in a certain address without moving. In such a case, there could be only two possible conditions, either the investors have been holding them for long time or the private key is not available with the user. However, it would be incorrect to report a Bitcoin to be lost unless they have been permanently withheld from accessing it.

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How much time is required to mine a Bitcoin?

Bitcoins are created using massive amounts of electrical power via computer-based processes. Some even suggest that the power consuming process for generating Bitcoins is harmful to the environment. The process is widely called as mining.

The time taken to mine a Bitcoin depends on the computing power, equipment type and competition. In an ideal case, it should take only about 10 minutes to mine one BTC. Further, it is not easy to attain ideal conditions for mining BTC.

Though a Bitcoin is usually mined in 10 minutes, the process often gets delayed due to a wide range of factors. Eventually, the delay in the mining process may extend the timeline to an hour, a day or even more.

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More realistically, a large computing setup requires over 30 days to mine just one Bitcoin. Further, cost of the mining rig, location, power, and software used for mining impacts the economics of the mining process.

The entire mining process may leave you with less than 0.1 BTC as the overall net profit of the operation. The hardware setup for the mining process is quite expensive and so is the power consumption which may be more or less depending on the power rates in the country.

Further, the mining speed is dependent on the type of hardware and software used. The speed and economics of the process would depend on the device configuration, number of devices being used and the mining pool.

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The mining of Bitcoin is a tedious process that may not result in very promising outcomes. The mining of the cryptocurrency basically drills down to solving extremely difficult cryptographic challenges using massive computing power.

The mining process helps to find the blocks which would store the data. Once the new blocks are located, new transactions are registered and verified within the block. For the blocks located, the reward is Bitcoin.

A total of only 21 million BTCs can be mined via the mining process. This limited availability of Bitcoin is what has kept many miners interested in generating new Bitcoins. Ever since the creation of Bitcoin by the unknown developer Satoshi Nakamoto, the world’s first cryptocurrency has been trending due to mining and trading on major platforms.