What Happens to Bitcoin When the Last Coin is Mined?
Who really looses when the last Bitcoin has been mined? It seems like the miners, the ones who are responsible for completing the blocks and allowing the new coins to enter into circulation would be the ones who feel the biggest impact when the supply runs out.
Some may believe that miners will simply quit mining once the 21 millionth coin has been mined. This is because they would no longer be rewarded for their mining efforts. I can certainly see how this might cause some to believe that the whole thing will come crashing down on that day. I know when I was first learning about crypto currencies I thought that way too.
If the reward of some Satoshi (Satoshi are fractions of Bitcoin, like cents within a dollar but at a much smaller fraction) were removed it is likely that many of today’s miners would fold up shop or move on to mining other coins. After all mining for Bitcoin can be a costly process, not just in the equipment required to run the operation but the electricity required to power these mining farms can be substantial as well.
Mining is not solely the process where new tokens are pumped into circulation. The mining is the way the whole system runs and is supported. This is key to the decentralized network. Everyone who is part of the network supports it, in lieu of a centralized network where a bank or a government would be in charge.
I believe that after the last Bitcoin is mined, which based on the halving schedule (Bitcoin mining rewards get cut in half approximately every four years) should take a little over 100 years to complete. Many estimate that the remaining 3 million or so Bitcoin left would be finished around year 2140. If you are reading this I am going to be you probably won’t be around in 2140, come to think about it my children won’t be either. So really what we are looking at is a problem for our grandchildren to deal with.
I also believe that even when that last coin has been produced, all of the future miners will probably continue to validate new transactions. You might ask why. The reason is that every transaction on the blockchain also has a small transaction fee attached to it.
Those fees might not be worth a ton of money today I can force these fees costing thousands of dollars per transaction in the future. The fees are determined by the block and every time a block is completed there is some bitcoin being charged. If the number of transaction on the blockchain increases significantly, which it should do as more and more blockchain technology is adopted we can see where this could continue to power the system for a long time. In addition to the number of transactions increasing the fees will likely increase as the price of bitcoin continues to rise.
At the time of this writing (December 2020) bitcoin is flirting with the elusive 20k price tag. I am bullish on bitcoin and although I do not have very much I have seen the value double over the past several months.
Do you own any bitcoin?
Do you think it is going to increase into the hundreds of thousands of dollars range?
Leave a comment below and let us know what you think.
