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Report
2016 Edition
Travis Patron
18dDdaNSRXVgqkwPtKvFRf5Wcit42K1BbL
Table of Contents
Ask not how to make more money, but how to make more bitcoin.
Block 420,000
The 420,000th block mined will mark an important milestone in the maturity of the
bitcoin network.
TABLE 1: MONEY SUPPLY SCHEDULE
Block
Reward Era
BTC/block
Year
Start BTC
BTC Added
50.00000000
2009.007
0.00000000
10500000.00000000
210000
25.00000000
2013.000
10500000.00000000
5250000.00000000
420000
12.50000000
2016.993
15750000.00000000
2625000.00000000
630000
6.25000000
2020.986
18375000.00000000
1312500.00000000
840000
3.12500000
2024.978
19687500.00000000
656250.00000000
1050000
1.56250000
2028.971
20343750.00000000
328125.00000000
1260000
0.78125000
2032.964
20671875.00000000
164062.50000000
1470000
0.39062500
2036.956
20835937.50000000
82031.25000000
1680000
0.19531250
2040.949
20917968.75000000
41015.62500000
Predicted to be found in the 2 nd half of 2016, block 420,000 will be the first
block to compensate miners with a 12.5 bitcoin reward instead of the usual
25. This quad-annual event of the bitcoin mining algorithm will have
important implications for mining pools and investors alike.
Marking a new era of the mining reward scheme, block 420,000 represents
a considerable focal point for bitcoin investors: issuance scarcity is
doubled.
Our current equilibrium is represented by Q25P*. Our current supply and demand
curves are S1 and D1 respectively.
The current supply curve, S1, will shift inward by 50% at the block reward halving.
This gives us a new equilibrium of P1Q12.5 assuming demand remains constant.
Consumer surplus for investors in this scenario would be equal to area A [(P1
P*)Q12.5].
Additionally, depending on a number of market externalities, we may also see a shift
in the demand curve from D1 to D2. In this scenario, equilibrium would be at point
P2Q12.5. Consumer surplus for investors in this scenario would be equal to area A + B
[(P2 P*)Q12.5].
New bitcoin applications & increased usability for the mainstream consumer.
Bonus Content
Bitcoin Economics Course