BIP-42 Prevented Potential Bitcoin Supply Crisis Projected for 2265
On April 1, 2024, Bitcoin's BIP-42 celebrates its 11th anniversary. This proposal addressed a potential supply crisis that could have emerged 240 years in the future.
- BIP-42 was introduced by Bitcoin Core contributor Pieter Wuille, based on Gregory Maxwell's earlier suggestion.
- The original Bitcoin code contained a flaw in how mining rewards were calculated, risking an infinite supply of BTC if uncorrected.
- The bug would have caused the block reward to revert to 50 BTC once the block height exceeded a certain threshold.
- If left unresolved, Bitcoin's circulating supply could have reached 126 million BTC by the year 3417.
- BIP-42 ensured that Bitcoin maintains its fixed supply, preventing economic instability.
Discussions around BIP-42 raise questions about software management and what constitutes a "bug" in Bitcoin’s code, particularly compared to other unresolved issues like block size. The decision to implement BIP-42 reflects concerns over economic attacks versus technical vulnerabilities.