The world’s most usable cryptocurrency
To reach mass adoption, we need to create the world’s most usable cryptocurrency suited for payments, whether you are a consumer or a business. Think descriptions for every transaction, nicknames for addresses, monthly statements, connectivity with social media platforms and full accounting software integration. BitCash makes a difference by combining the power of blockchain with features of traditional banking, always focusing on user experience.
The goal of this article is to present the emission schedule of BitCash (BITC). Besides showing just plain numbers, I will also add some qualitative context and explanations. Information presented in this article is entirely from public sources such as Bitcash webpage, Discord channel and Whitepaper. Some statements in this article reflect my own views and opinions, which may (not) be in line with those of the BitCash team.
Lastly, before I move on, the source sheet with all calculations covered in this article can be found here. You can download it, go through all formulas and play with inputs or assumptions, if you wish to do so.
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Key Supply Parameters
BitCash is a Proof-of-Work cryptocurrency currently using the Cuckoo Cycle system and forking over to x16R algorithm, scheduled for 23 February 2019. BitCash’s first (genesis) block was publicly mined on 27 August 2018.Figure 1: Key supply parameters
Total supply is set to 100 million BITC. However, due to the BitCash Stable feature (“burn and mint”), which is upcoming, this figure will fluctuate. The actual effect of this feature on circulating supply can be deflationary or inflationary at any given time. To understand this effect on circulating supply in more detail, please refer to this link for a good explanation with examples. For this article, I assumed that the BitCash Stable feature effect on circulating supply is zero (non-existent) as it is not possible to forecast it. In other words, deflation caused by burning (BITC > BITC Dollar) and inflation caused by minting (BITC Dollar > BITC) would even out on average and have no particular effect on circulating supply, most of the time.
Block reward schedule
The initial block reward in Period 1, which started in August 2018, amounts to 21.5 BITC. BitCash block rewards are set to halve approximately every four years (2.1 million blocks). At 60 seconds block time, the daily emission (inflation) is close to 31 thousand BITC during Period 1. After 4 years, around August 2022, Period 2 will start and the block reward will be halved, from 21.5 BITC to 10.75 BITC per block. Period 3 (after August 2026) block reward will amount to 5.38 BITC per block and so forth. For a more detailed overview of the emission schedule, see the underlying sheet.
It should be mentioned that 90% of the block reward goes to miners (POW reward), while 10% is allocated for BitCash development. In particular, with the current block reward of 21.5 BITC, 19.35 BITC (90%) goes to miners and 2.15 BITC (10%) to the BitCash development fund. This 10% block reward for development is aimed at covering running costs and expenditures, to the extent possible, such as marketing, bounties, translations, community engagements and similar. If at any given time there is not enough BITC in the development fund to cover expenses, the premined funds will be utilised.Figure 2: BITC POW emission per Period and reward split
OMG There is a Premine…
Everyone’s favorite and most exciting topic. Not. The premine amounts to 9.7 million BITC (9.7% of total supply). No ICO or money or any other form of funding was ever raised by the team. The dynamics of how much premine will be spent going forward will mostly depend on:
- BITC price. A higher BITC price would imply that less premine needs to be spent.
- Scope and size of expenses (listings, marketing and adoption campaigns, designers, copywriters, etc. etc.).
For example, if BitCash gets an opportunity for a good exchange listing at reasonable prices or the team wants to hire a developer or marketing person, then the premine will be utilized. This enables the project to have self-sustainable finances from early on, especially while the market cap is still low. There is no release schedule for the premine. Having said that, the team has been transparent about tapping into premined coins to fund the development.
Circulating Supply Projection
Given that there is no release schedule for the premine, I want to show a realistic case here. Therefore, I will assume that every year 5% of the premine will be spent and effectively put into circulation. Precisely, 5% of 9.7m translates into 485,000 BITC per year for the next 20 years. In other words, this will be the inflation resulting from spending the premine. Now, let’s put the premine and the block reward in context with circulating supply.Figure 3: Annual Emission and Circulating Supply calculation
Note how the annual emission from POW decreases every 4 years due to the block reward halving after each Period. The projected circulating supply at the end of 2019 and 2020 would be 15,6 million and 27,5 million BITC, respectively. After about 5 years, at the end of 2024, over 60% of all coins will be in circulation. Again, note the actual circulating supply figures might be higher or lower depending on:
- the amount of premine spent, and
- fluctuations in supply resulting from the BitCash Stable feature (“burn and mint”).
Market Cap Scenarios (wen cmc?)
Lastly, it would be interesting to add a price assumption for BITC to get to some simple market cap scenarios. Following inputs are considered:
- BTC / BITC price range 1,000 to 20,000 satoshi
- BITC circulating supply: 5 to 50 million
- Bitcoin price: $3,500
While writing this paragraph, BITC price is around 1,500 satoshi and circulating supply is close to 6 million. This implies a current market cap of 90 BTC. At a price of $3500 per BTC, 1 BITC is worth about $0.035 or 3.5 cents.
Hopefully this article provides a clear(er) overview on supply and block reward metrics for BitCash miners and holders, as well as adds a little more clarity on topics related to premine, dev block reward, effect of burn and mint and market cap scenarios. If you are looking for more information about BitCash and want to join our community, check out the following links:
Discord channel: https://discord.gg/ZuvU4T
Btctalk Ann: https://bitcointalk.org/index.php?topic=5106123.0