What Happens When All The Bitcoin Are Finally Mined?
Bitcoin and gold are often compared to each other as people tend to use both as a way to store value and protect assets. They are similar in another way, however. And, that is the fact that both are finite resources. There is only so much gold in the ground and Bitcoin is capped at a limit of 21 million.
Though, we know the exact amount of Bitcoin but have no idea how much gold is still left on the Earth. When a company like Tesla buys up over a billion dollars worth of Bitcoin, it makes people want it even more and so we get closer to that date when there will be no more Bitcoin left.
What happens when there is no more Bitcoin to mine? In this article, we will go over the scenario of when that eventually happens.
The miners
The first people to feel the effects of the end of the line for new Bitcoin will be the miners. Ordinary people won’t see anything abnormal about the buying and selling of Bitcoin. Exchanges will go on as normal and you’ll still be able to use credit cards or even exchange gift card to Bitcoin to buy and trade.
There will still be transactions to verify, however, as long as Bitcoin is still in use as a currency. And there seems to be no reason why it wouldn’t be. The difference will be that the reward will not be new Bitcoin that gets mined. Instead, the economy will be closed so there will be a sort of tax that gets paid to the miners instead.
This could mean that we will see higher fees once there are no more coins to be mined, but that isn’t a certainty. Right now, the rewards get halved every four years so there are diminishing returns per block that are verified, but this is to control the circulation of the coins.
As it stands now, it seems it will take over 100 years before we see the last Bitcoin mined even though there are only 3 million left due to the halving of the reward.
The protocol can change
One of the tenets of cryptocurrency is that the users decide what happens with it rather than a central authority. There is no governing body with Bitcoin and the 21 million limit was imposed by the inventor of Bitcoin. This means that there may actually be no limit to how many Bitcoins end up being minded.
At some point in the future, there could be a removal of the cap and this scenario could play out very differently. There has to be consensus, but that is the root of cryptocurrency anyway.
There have been a lot of changes to other protocols already regarding the mining and even how the transaction methods are used to verify the blocks. It stands to reason that this would be the case with the limit as well.
*This article has been contributed on behalf of Paxful. However, the information provided herein is not and is not intended to be, investment, financial, or other advice.
