# Understanding “Bitcoin Inflation vs. Time” chart

I keep seeing this chart on many sites. This discussion page offers a vector version, so I presume it was generated by the author of the post. Now, while I understand what the graph is meant to show, I struggle to understand how it's generated, i.e. what function produces the two Y's plotted on the X (210k blocks steps).

Could someone clarify this for me?

Thanks!

## 1 Answer

The blue line on the graph represents the total supply of BTC in existence at that point in time (right axis).

The red line represents the instantaneous annualized inflation of the BTC supply (left axis).

Looking at the link you posted, OP also posted with some explanations of the charts, this is a quote taken from one of their posts:

user/Fjordbit: The first curve should have met at 25%, but it looks more like 29%.

user/whitslack (OP):How do you figure? Before block 209,999, there were 10,499,950 BTC in existence. Then block 209,999 added 50 more, bringing the total up to 10,500,000 BTC. That was an increase of 0.000476193%. To calculate the annualized inflation rate, you take the natural log of 1.00000476193, multiply by the number of blocks in a year (52,595.9856), and exponentiate the product, base e, which yields 1.28461321188. So the annualized inflation rate at block 209,999 was 28.46%.