November has been a great month for Bitcoin. At the moment of writing this, Nov 21st, 2020, Bitcoin is trading above 18k. On November 1st the price of Bitcoin was around 13k. A 40% increase in the price till now.
Having this in mind, let’s see how the others Bitcoin metrics are doing.
The data presented here is mostly gathered from the blockchains charts.
We will be looking at:
- Bitcoin supply
- Bitcoin mined
- Total number of wallets
- Active wallets
- Hash rate
- Number of transactions
- Miners revenue
The limited Bitcoin supply is one its strongest side. The first Bitcoin was mined on January 3rd, 2009. More than 10 years now. When the Bitcoin network was launched the inflation was set to 50 BTC per block.
Here is how Bitcoin inflation works:
- One block is created approximately every 10 minutes
- 144 blocks per day
- X amount of Bitcoin is rewarded per block
- Daily inflation = (number of blocks per day) * (Bitcoin rewards per block)
Here is the history of Bitcoin rewards per block:
- Jan 3, 2009, 50 Bitcoins per block
- Nov 28, 2012 - 1st halving, 25 Bitcoins per block
- Jul 9, 2016 – 2nd halving, 12.5 Bitcoins per block
- May 11, 2020 – 3rd halving, 6.25 Bitcoins per block
Going from 50 BTC per block in 2009 to 6.25 BTC per block in 2020.
The halving events are taking place approximately on a 4-year periods, although looks like it’s been shortening by few months on each halving. The next, 4th halving is expected to happen somewhere in February 2024, and it will cut the Bitcoin mining rewards to 3.125 Bitcoins per block.
The halving events will continue to occur up until somewhere around 2140 when the last Bitcoin is expected to be mined. This of course if no code changes are applied till then 😊.
With this mechanics in place lets take a look at the Bitcoin historical supply and inflation.
At the moment there is 18.5 million Bitcoin in circulation or 88% of its total supply has been already mined. We can notice the flattening of the supply in the chart after each halving.
The chart for daily mined Bitcoin.
The initial Bitcoin inflation was more than 7000 Bitcoins mined per day, to around 1000 Bitcoins starting from May 11, 2020. This is a more than 7 fold decrease in inflation on a daily basis, in a period of 11 years.
For better overview here is the chart for new Bitcoin mined on a yearly basis.
Up until 2012 there is around 2.7 million Bitcoin mined each year. With the last halving starting from 2021 the yearly inflation will be around 0.4 million.
Number of Wallets
Here is the chart for the total number of Bitcoin wallets created.
Almost 59M bitcoin wallets at the moment. In January 2020, the number of BTC wallets was around 44.5M. This means a total of 14.5M Bitcoin wallets were created in 2020 only. With More than a month to go there will probably be more than 16M wallets created by the end of the year.
For reference, in from 2017, 2018 and 2019 there was around 11M to 12M Bitcoin wallets created per year. 2020 will be the record high for new Bitcoin wallets.
Obviously, a lot of wallets are created. But how many of the are being used? Here is the chart.
The record high numbers for active Bitcoin wallets per day was reached in December 2017 with almost 1M active Bitcoin wallets. A sharp drop in 2018 to the 400k daily active wallets, and a steady growth since then. In the last period the number of active Bitcoin wallets has reached 700k per day. Getting close to the 1M 😊.
The ultimate Bitcoin value is the network stability and security. The network security in a proof of work chains is measured in hash rate, or how difficult is to mine. The bigger the completion, the higher the hash rate.
We can notice that the hash rate has started to grow more significantly in 2017 and its has been going up ever since with some small bumps on the road.
Unlike the price chart, the hash rate chart has been going up and up, reaching new records every year. This shows that no matter the price miners are confident in the long-term outcome for Bitcoin and have been mined and scaling there operations even trough the bear market.
The ATH in hash rate was reached at the end of October 2020 with more than 152M TH/s.
The activity on the network is mostly represented by the number of daily transactions.
This chart is a bit out of correlation with the other trends. There was a spike at the end of 2017 and the begging of 2018 with 400k transactions per day, and a drop afterwards. But then there is a spike in the transactions in May 2019 reaching ATH for transactions. In the last period the number of daily transactions is around the 300k mark.
A bit unpopular topic the fees.
Overall, the Bitcoin fees haven’t been outrageous as the Ethereum ones. We can see that for most of the period there are around few dollars. A big spike in the fees in the previous bull run reaching 50$ per transactions on occasions. In the last period the fees are in the range of 1$ to 10$.
How are the miners doing? Here is their revenue in dollar terms.
This chart to some degree is in a correlation with the price, but not a 100%. It depends on the number of transactions and fees generated as well.
In the last year the miner’s revenue is somewhere between 10M to 20M USD per day. Some of this end up on exchanges as they need to sell to cover costs, but not all of it. The ATH for miner’s revenue was in December 2020, when a more than 50M USD per day was generated in miners revenue.
Overall, the Bitcoin network is doing just great 😊. The supply is going down with under a 2% inflation per year since the last halving. Just 0.4M will be mined in 2021.
We can notice that some of the metrics, like active wallets and number of transactions haven’t surpassed the record highs from the previous bull run. The total number of wallets created will be the highest in 2020 though.
One of the metrics that is showing a strong growth is the hash rate. It has been constantly growing and It has reached a new record high at the end of October 2020. This is great for the network security. The fees have been reasonable in the last period in the range of 1$ to 10$. Miners keep collecting revenue and with the recent spike in price they are now around 20M USD per day.
All the best
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