Mining Reward Rule - Start with 50 BTC

Bitcoin Tutorials - Herong's Tutorial Notes

∟Mining Reward Rule - Start with 50 BTC

This section describes the Mining Reward Rule - Starts with 50 BTC and cuts by half every 210,000 blocks.

Another important Bitcoin Consensus Rule is the Mining Reward Rule: Bitcoin mining reward starts with 50 BTC and is reduced by half every 210,000 blocks.

So here is how the mining reward table looks like:

Reward era   Block height            Reward    Mined date
             
         1              0   50.00000000 BTC   2009-Jan-03
         1              1   50.00000000 BTC   2009-Jan-08
         1            ...               ...           ...
         1        209,999   50.00000000 BTC   2012-Nov-28
         2        210,000   25.00000000 BTC   2012-Nov-28
         2            ...               ...           ...
         2        419,999   25.00000000 BTC   2016-Jul-09
         3        420,000   12.50000000 BTC   2016-Jul-09
         3            ...               ...           ...
         3        629,999   12.50000000 BTC   2020-???-??
         4        630,000    6.25000000 BTC   2020-???-??
         4            ...               ...           ...
         4        839,999    6.25000000 BTC   2024-???-??
         5        840,000    3.12500000 BTC   2024-???-??
         5            ...               ...           ...
                     
        32      6,929,999    0.00000001 BTC   2128-???-??
        33      6,930,000    0.00000000 BTC   2128-???-??
        33            ...               ...           ...

The Bitcoin mining reward tells us two things:

1. After 6,929,999 blocks, mining a new block will receive no Bitcoin reward from the coinbase. The mining effort will be compensated only by transaction fees.

2. The exact total Bitcoin supply can be calculated with this formula:

Bitcoin supply 
= sum(50*210000/(2**i), i=0,1,2,...,32)
= 20999999.995110556 BTC

This ensures that the total Bitcoin supply is limited to 21 million BTC.

If you want to verify the above formula, you can run the following Python script:

C:\>type Calculate-Bitcoin-Supply.py
#- Calculate-Bitcoin-Supply.py
#- Copyright (c) 2018, HerongYang.com, All Rights Reserved.

sum = 0.0
for i in range(1,33): 
   sum = sum + 50*210000/2**(i-1)
   print("Era: "+str(i) + ", Bitcoins: "+str(sum))

C:\>python Calculate-Bitcoin-Supply.py
Era: 1, Bitcoins: 10500000.0
Era: 2, Bitcoins: 15750000.0
Era: 3, Bitcoins: 18375000.0
Era: 4, Bitcoins: 19687500.0
Era: 5, Bitcoins: 20343750.0
Era: 6, Bitcoins: 20671875.0
Era: 7, Bitcoins: 20835937.5
Era: 8, Bitcoins: 20917968.75
Era: 9, Bitcoins: 20958984.375
Era: 10, Bitcoins: 20979492.1875
Era: 11, Bitcoins: 20989746.09375
Era: 12, Bitcoins: 20994873.046875
Era: 13, Bitcoins: 20997436.5234375
Era: 14, Bitcoins: 20998718.26171875
Era: 15, Bitcoins: 20999359.130859375
Era: 16, Bitcoins: 20999679.565429688
Era: 17, Bitcoins: 20999839.782714844
Era: 18, Bitcoins: 20999919.891357422
Era: 19, Bitcoins: 20999959.94567871
Era: 20, Bitcoins: 20999979.972839355
Era: 21, Bitcoins: 20999989.986419678
Era: 22, Bitcoins: 20999994.99320984
Era: 23, Bitcoins: 20999997.49660492
Era: 24, Bitcoins: 20999998.74830246
Era: 25, Bitcoins: 20999999.37415123
Era: 26, Bitcoins: 20999999.687075615
Era: 27, Bitcoins: 20999999.843537807
Era: 28, Bitcoins: 20999999.921768904
Era: 29, Bitcoins: 20999999.960884452
Era: 30, Bitcoins: 20999999.980442226
Era: 31, Bitcoins: 20999999.990221113
Era: 32, Bitcoins: 20999999.995110556