Bitcoin is capped at 21 million units. The deflationary supply replenishment ensures that mining regularly brings new BTC onto the market. When mining, the miners, i.e. those who maintain the network, receive the block reward as a reward.
This currently consists of 6.25 BTC and transaction fees. With the so-called halving, which takes place every 210,000 blocks or roughly every four years, the reward (but not the dynamic transaction fees) is halved.
The Block Reward is the financial incentive for miners. But what happens when the last bitcoin is mined?
What does it mean if all Bitcoins are mined?
It may sound banal. But when all BTC are mined, there will be no more new ones. The miners will then only validate and confirm transactions, their work will no longer produce new coins. Your rewards then consist only of the transaction fees.
How will this affect the Bitcoin price?
The Bitcoin price is made up of supply and demand. A BTC is always worth as much as someone is willing to pay for it. Vice versa applies: The cryptocurrency is always worth the price for which someone is willing to sell their coins. How the BTC endgame affects the Bitcoin price depends primarily on its adoption.
It could well be that the end of production will cause price increases. However, if Bitcoin does not prevail and disappears into insignificance anyway, it may well be that nothing else happens or that the course loses value.
Nevertheless, the past has looked different until now. A steadily increasing demand with a falling supply has so far ensured that the Bitcoin price has risen from a few cents to its peak value of almost 69,000 US dollars within a few years.
Is Bitcoin mining still worth it?
Assuming BTC adoption increases, transaction costs are likely to increase as well. After all, there is limited space in the blocks of the blockchain – so there is likely to be competition over whose transaction will be included in the next block. This competition could be controlled, for example, by increasing transaction fees. In other words, miners get more fees for including certain transactions in the blocks. BTC mining could therefore still be worthwhile once the last bitcoin has been mined.
Furthermore, one can – hopefully – expect mining to become more efficient overall. In other words: lower energy costs and more efficient mining equipment. So mining should still be worthwhile after the next halvings.
Ultimately, if you are convinced of the fundamental usefulness of the cryptocurrency, you can rate the declining total supply and the gradual end of the replenishment flagpole in 2140 as bullish. If, as it currently looks like, the adoption continues and the “orange pill” rolls on, neither miners nor hodlers have to worry about the fact that there will eventually be no more new BTC.
