Burritos or Bitcoin? Let’s Discuss the Latter

Great content for technologists, entrepreneurs, and content creators

Published

burritos or bitcoin
Author: D. Sylla

Table of Contents #

Burritos or Bitcoin? Help Me Decide #

I remember last April 1st when Chipotle Mexican Grill (NYSE:CMG) announced it would be giving away $100,000 in free burritos and $100,000 in Bitcoin to celebrate National Burrito Day. I remember thinking it was a huge moment for Chipotle to be the first U.S. Restaurant brand to offer a cryptocurrency giveaway to customers.

Each player had a chance to win up to $25,000 in Bitcoin by guessing a six digit code in less than ten tries. Naturally, the question was rhetorical. Would you rather be one of the 10,000 customers who won a burrito, the 50 to win $500 in bitcoin, or the 3 customers to win $25,000 in bitcoin?

I was surprised and delighted. I’m not a gambler. And you don’t have to be one to know that a point was made that day. Hopefully, after that day there was a lingering curiosity. A curiosity to know what Bitcoin is and for those familiar a larger appetite to know a little more about it.

Let’s discuss it.

Bitcoins left to mine #

21 million is the maximum number of bitcoins that can be mined. When Satoshi Nakamoto, whose real identity remains unknown, created bitcoin, and released it in 2009, he set the maximum number of bitcoins to 21 million that can ever be mined. There is no known justification for this limited supply of bitcoins. As of today, 90% of the total supply of bitcoins or 18.9 million bitcoins are already mined. Which means that there are only 2.1 million bitcoins left to mined.

Blocks #

A block is like a page in a record book or ledger. The most recent Bitcoin transactions are recorded on a block, once a block is completed it gives way to the next block in the blockchain. Block transactions are confirmed by several peer-to-peer (a computer network in which the computers share and access transaction information) computers and stored. A block usually contains about 500 transactions. Once the block has stored that number of transactions, it is completed. Then, a new block is created and chained to it, which starts that process all over again. Transactions saved in a blockchain cannot be altered.

Block Rewards #

Every time miners (peer-to-peer computers that solve the equation to save a transaction on the blockchain) complete a block, a new one is created, and miners earn a block reward. Every time a block is completed, 6.25 bitcoins are paid as teh block reward. A new block is created every ten minutes, and there are 30 more halvings left before the block reward becomes zero. The halving occurs after every 210,000 blocks, so 64 halvings will end the supply of bitcoins on the blockchain. In 2009, the block reward used to be 50 bitcoins, then after halving it became 25, then 12.5, and now it's 6.25. The last bitcoin halving occurred on May 11, 2020. The next bitcoin halving is expected in 2024. In addition to the block reward, miners can also earn money with bitcoin transaction fees. Every time someone conducts business and makes a transaction in bitcoin, miners receive transaction fees.

Bitcoin's Price #

The price of one Bitcoin crossed the $1000 mark in early February 2015. On November 6th, 2021, Bitcoin price reached its highest value of all times at $67,560, which is incredible. With only 2.1 million bitcoins left to be mined, the price of bitcoin is expected to go higher than that.

Cryptocurrency Investing #

Cryptocurrency investing became trendy in 2017, when bitcoin almost touched the 20k mark. Since then, bitcoin has never looked back except for market corrections. Nowadays, nearly all reputed financial trading brokers offer cryptocurrency investing. Others offer to trade CFDs of cryptocurrencies. Unfortunately, most government regulatory authorities do not regulate cryptocurrency investing or trading due to the high volatility. As a result, cryptocurrency markets are considered very risky.

What will happen when Bitcoin reaches its supply cap? #

When Bitcoin reaches its supply limit of 21 million, side channels like the Lightning Network will probably handle the majority of the transaction confirmation work. Only very large batches of transactions or those involving the transfer of huge quantities of bitcoin from one address to another will be confirmed by the cryptocurrency's blockchain.

How will miners earn when there are no more bitcoins to mine? #

Because Bitcoin did not reach its anticipated maximum, there is a chance that the cryptocurrency's network may continue to function for a long time after. No bitcoins will be created, but transaction blockages will be verified, and transaction fees will become the major source of income for miners. Thus, Bitcoin's network may eventually function as a closed economy, with transaction fees imposed similarly to taxes.

References #

  1. How Many Bitcoins Are There? How Many Left to Mine? (2022). https://www.buybitcoinworldwide.com/how-many-bitcoins-are-there/. Accessed 11-17-2021.
  2. Blockchain Definition: What You Need to Know. https://www.investopedia.com/terms/b/blockchain.asp. Accessed 11-17-2021.
  3. Distributed Ledger Technology (DLT) Definition. https://www.investopedia.com/terms/d/distributed-ledger-technology-dlt.asp. Accessed 11-17-2021.
  4. What's a Peer-to-Peer (P2P) Network?https://www.computerworld.com/article/2588287/networking-peer-to-peer-network.html. Accessed 11-17-2021.
  5. How Many Bitcoins are Left? How and Why BTC is Reaching Max Supply. https://coincentral.com/how-many-bitcoins-are-left/. Accessed 11-17-2021.
  6. How to Invest in Cryptocurrency. https://wtop.com/news/2021/11/how-to-invest-in-cryptocurrency-2/#:~:text=Cryptocurrency is any digital currency,using the pseudonym Satoshi Nakamoto.
  7. How Many Bitcoins are Left? How and Why BTC is Reaching Max Supply. https://coincentral.com/how-many-bitcoins-are-left/#:~:text=The mining reward halving occurs,will occur sometime in 2140. Accessed 11-17-2021
  8. Burritos Or Bitcoin: Chipotle To Give Away $200k In Free Burritos And Bitcoin To Celebrate National Burrito Day. https://www.prnewswire.com/news-releases/burritos-or-bitcoin-chipotle-to-give-away-200k-in-free-burritos-and-bitcoin-to-celebrate-national-burrito-day-301258100.html. Accessed 11-17-2021

Share Article