Blocks that holds these transaction records are created in every 10 minutes by the miners. A miner gets a reward for creating a new block with valid transactions in form of bitcoin and transaction fees from the include transactions inside the block. This reward system get reduced to half every four years. Right now a new block creation reward is 12.5 BTC.
Blockchain is a continuous and constantly growing ledger keeping a permanent track record of all the transactions in blocks. These transactions records are stored in a chronological order and are immutable.
To create a new block miners have to find a nonce (a sequence of predefined zeros) to be appended with the hash of all transactions inside the block, to create a block hash. This process is known as proof of work. The difficulty rate of finding the nonce and then finding block hash get adjust every 2016 blocks.
As block rewards get reduced to half every four year, it is projected that the last bitcoin will be mined sometime in the year 2140. The process of reducing block reward is known as halving. Next halving will occur in year 2020.
This raise some serious concerns about the sustainability of the blockchain in the longer run. When all the bitcoins will be mined, miners will only get transactions fees and they have the full control to decide the minimum transactions fee for transactions to be included in the block.
Also, as only transaction fees are the only reward for miners. So, number of miners will reduced and it become possible to create a 51% attack on the bitcoin blockchain and take down the whole Bitcoin Blockchain.
There are still many questions need to answer to make bitcoin blockchain sustainable for a longer run. I will keep investigating and posting about the same.
The idea has always been that by the time the reward shrinks to nothing, transaction fees will more than make up the difference as a result of increased usage. Of course, back when I was introduced to this idea, the notion that in 2018 Bitcoin blocks would still be capped at 1MB would have been considered absurd. Everyone understood that decentralization didn't come from everyone running their own full node, but from the incentive structures that govern the behavior of the miners.
There is also the possibility that eventually it could move to Proof of Stake for block generation and consesus, which would also solve the problem of unsustainable energy consumption.
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Proof of Stake may be a possible solution but in case of PoS block creation will become dependent on the guy who is holding the maximum stake which makes other participants less interested in maintaining the network.
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