Bitcoin: What happens when the last BTC is mined?
At some point, it will be over.
At some point it's going to be over. What happens if the last bitcoin is mined in 2140? Is crypto mining still worth it?
Bitcoin is capped at 21 million units. The deflationary supply ensures that through mining new Bitcoins regularly enter the market. In mining, the miners (the ones keeping the network alive) receive the block reward as compensation.
This currently consists of 6.25 BTC and transaction fees. In the so-called halving, which happens 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 when all bitcoins are mined?
It may sound banal. But once all BTC are mined, no new ones come in. The miners then validate and confirm transactions only, their work yields no new coins. Your reward then consists only of transaction fees.
How will this affect the Bitcoin price? The Bitcoin price is driven by supply and demand. A BTC is always worth as much as someone is willing to pay for it. Likewise: The cryptocurrency is always worth the price someone is willing to sell their coins for. How the BTC ending affects the Bitcoin price depends mainly on adoption.
It may be that the end of production leads to price increases. But if Bitcoin does not gain dominance and slowly fades away, it could very well be that nothing happens or that the price loses value.
Yet history has looked different so far. Steadily rising demand amid declining supply has so far pushed the Bitcoin price from a few euros to the peak of almost 69,000 US dollars in a few years.
Is bitcoin mining still worth it?
If bitcoin adoption increases, transaction fees are likely to rise as well. After all, there is limited space in the blocks of the blockchain — so there will likely be competition over whose transaction gets included in the next block. This competition can be managed by raising transaction fees. In other words, miners get more compensation for including certain transactions in the blocks. So Bitcoin mining could still be worth it even after the last bitcoin is mined.
Furthermore, one can — hopefully — expect mining to become generally more efficient. In other words: lower energy costs and more efficient mining hardware. Mining should therefore still be worthwhile after the next halvings.
Ultimately, if you’re convinced of the fundamental use case of the cryptocurrency, the shrinking total supply and the gradual end of the replenishment flag in 2140 can be viewed as bullish. If, as things look now, adoption continues and the orange pill rolls out, neither miners nor hodlers should worry about the eventual absence of new Bitcoin.
