I have been stopped on the ski slopes to explain the formula on my helmet. It is the Bitcoin Scarcity Formula.
210,000: The number of blocks in each Halving period.
50×10^8: The initial block reward in Satoshis (50 Bitcoin, converted to Satoshis). A Satochi is the smallest unit on the Bitcoin blockchain.
2^i: The divisor representing the Halving effect, where i is the Halving index, starting from 0 up to 32. Each Halving cuts the block reward in half, hence the division by 2^i.
The reward is the amount the miner gets for solving a mathematical puzzle that allows a block to be written on the Bitcoin blockchain. Watch out for what you might have heard lately on a French TV channel, it's not the price that is cut in half, but the reward...hence the scarcity !
This formula sums the total supply of Bitcoin, measured in Satoshis, adjusted for the decreasing block reward across all Halvings, and rounded down (Floor function) to whole Satoshis to reflect the indivisible nature of the Satoshi. The slight reduction from the often-cited 21 million Bitcoin total is due to this rounding down at each Halving.
