What-will-happen-when-all-the-bitcoins-in-the-world-are-mined What-will-happen-when-all-the-bitcoins-in-the-world-are-mined

Since its inception in 2009, Bitcoin (BTC) has remained the most mainstream cryptocurrency of all time. After more than a decade of existence in the financial and technological fields and in the crypto market, many individuals and institutions have begun to explore the highly innovative and original features of Bitcoin for use in their daily lives.

This digital asset is often compared to the main commodity gold because of the many functional similarities between the two. For example, both assets have monetary functions and both are used to store value. Wall Street even refers to both as “alternative investments.” Although Bitcoin and gold operate differently, the value of both is easily verifiable. The most striking similarity between them is that both have limited supply and are obtained through “mining”.

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A Quick Look at Bitcoin Mining

Gold and other precious metals are obtained through hard rock mining, which requires multiple steps and processes, while Bitcoin is obtained through digital mining. This process is completed by “bitcoin miners” who are responsible for ensuring the security of the entire network and using high-Performance equipment as well as software specially designed for mining to process transactions.

Miners of gold and other precious metals mine precious ore by smashing rocks such as quartz, while miners of bitcoin have to crack very complex mathematical equations and get rewards in the form of bitcoins. Gold is hidden in hard ore, while Bitcoin is hidden in blocks of data, mined using a unique algorithm developed by Satoshi Nakamoto, the pseudonym of Bitcoin’s creator.

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Bitcoin’s fixed supply

In addition to the similar acquisition process, gold and bitcoin are considered rare assets because of their limited supply. There is an unknown tonnage limit for the supply of gold, while there are only 21 million bitcoins that can be mined and used. One might ask, “ Why are there only 21 million bitcoins? ” Some articles claim that Satoshi Nakamoto’s intention was to bring bitcoin’s unit price “ eventually in line with traditional fiat currencies .” Setting limits also gives bitcoin an inflation-resistant characteristic.

As of this writing, Bitcoin has sold over $8,600 and has a market cap of $158 billion. As mentioned above, the maximum supply of Bitcoin is 21,000,000 BTC, and this limit is also one of the factors that cause the price of this digital asset to fluctuate greatly. Currently, the circulating supply of Bitcoin is 18,239,300 BTC, with 2,700,000 BTC remaining before reaching the maximum supply. In this case, one might wonder, what happens after 21 million?

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When 21 million bitcoins are mined

This could be an exciting event for all Bitcoin enthusiasts in the cryptocurrency space. After 21 million bitcoins are mined, will there be no new bitcoins in the network? Is the situation as we expected?

Once miners have mined all the bitcoins, there will be no more new bitcoins to mine. Additional bitcoin supply is only possible if the bitcoin protocol changes to allow for an increase in supply, otherwise, the maximum bitcoin limit will remain at 21 million.

Today, the supply of Bitcoin is close to the limit, what impact might this have on users and the market? Reaching Bitcoin’s supply limit can have the following effects:

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Impact on miners

Through the Bitcoin mining process, miners are rewarded for each block that is successfully verified in the network. Through mining, miners receive two kinds of rewards—a portion of bitcoin for each confirmed block, and a reward from transaction fees, which are paid to miners in exchange for their effort in processing and validating each transaction. Higher fees give miners higher rewards, and they decide which transactions in the network are prioritized based on fees. The higher the transaction fee you pay, the faster your transaction will be confirmed by the block.

When all bitcoins are mined, miners will not receive block rewards anymore, because no new bitcoins will be generated, they can only earn transaction fees from each confirmed transaction. Miners can continue to secure the network because they can still earn revenue from these fees. Whether these fees are sufficient for miners, however, we cannot be sure.

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Impact on Bitcoin mining and its network

The rise in Bitcoin’s price also marks an increase in miner transaction fees. While this is good news for Bitcoin miners, there is no guarantee that mining costs will remain high for years to come. No one can predict the future of bitcoin technology and what exactly it will look like in the next few years.

If the mining process develops further and improves to the point that it is very simple and inexpensive, the process can also be transformed into another business. On the other hand, due to the high level of energy consumption of Bitcoin mining, many jurisdictions consider it to be detrimental to the environment. If the energy efficiency of Bitcoin mining improves in the future, then miners can consider continuing to secure the network and stay in the industry.

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Impact on market prices and investments

As mentioned earlier in the article, there are only about 2.7 million bitcoins yet to be mined. When all the remaining bitcoins are mined, the supply of bitcoins will become scarce, eventually causing the price to rise.

This would be good news for investors, as Bitcoin is a fickle asset with extreme price rises and falls. This is an excellent opportunity for investors who want to enter the market and give it a try.

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When will it reach 21 million?

Guessing when Bitcoin will reach its maximum limit can be difficult. But some crypto folks say that if the mining power of bitcoin is the same as when the first block was mined, the last bitcoin would be mined on October 8, 2140. Others say that if Bitcoin is still used as a currency and still has functions similar to fiat money, it has the potential to be highly stable.

As the most popular and leading virtual asset among thousands of cryptocurrencies, Bitcoin will be remembered as an inexorable asset, not only for its market capitalization and price but also for its outstanding and valuable participation in today’s improvements in the state of the global financial system.



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