The supply of Bitcoin is limited to 21 million BTC, which is one of the characteristics that makes this cryptocurrency attractive to investors. So, what happens when all Bitcoins are mined?
About Bitcoin
Bitcoin is the largest cryptocurrency in the crypto world. When it came into existence in 2008, it wasn’t all rosy at first.
The original price for Bitcoin was zero, but in 2010, it rose to $0.09.
In 2021, Bitcoin reached its all-time high value of $68,990.90. The start of 2022 has been challenging for the crypto markets, with BTC currently trading at $22,320.15 (10.45am, 18 July).
Despite its value dip, Bitcoin remains the number one cryptocurrency, massively ahead of its nearest rival, Ethereum.
Of its 21 million supply, 19 million Bitcoins have already been mined.
Bitcoin Mining Explained
Bitcoin mining can be defined as the way of creating new Bitcoins and maintaining the Bitcoin network.
Miners complete complex cryptographic calculations. The first miner to solve the next block broadcasts it to the network. If it is proven correct, it is added to the blockchain. The miner then gets rewarded with an amount of newly created Bitcoin.
The initial reward for mining was about 50 BTC. However, due to a process known as halving, that reward is cut every four years.
Bitcoin Halving:
2008 – 50 BTC
2012 – 25 BTC
2016 – 12.5 BTC
2020 – 6.25 BTC
With around two million Bitcoins still to be mined, the next halving is due in 2024.
What Happens When All the Bitcoins Are Mined?
This is the big question for many miners and crypto investors.
It is predicted that the rate of mining means the supply could continue until February 2140. This is, however, only a prediction and many disagree with the calculation.
Alongside the question of what happens when all the Bitcoins are mined, people have asked whether the exhaustion of the remaining BTC will have a negative or positive effect on the crypto market.
BTC has a massive impact on the rest of the market. When Bitcoin values rise, or fall, it affects almost all altcoins. That is why investors are keen to know what will happen when the last Bitcoin is mined.
It isn’t just about the future value of BTC; it is about the future of the crypto market.
What Happens When the Final BTC is Mined?
Even if every Bitcoin is mined, all 21 million BTC will not be in circulation.
Analysts, such as Chainalysis, have reported that 20% of every Bitcoin ever mined is missing.
A significant reason for this is people losing access to the wallets where they stored a haul of BTC.
Scarcity is Key
One of the attractions of Bitcoin is its scarcity.
It is known that the supply is strictly limited, which has contributed to the success of BTC.
The possibility of the entire supply being mined increases awareness of scarcity, which can actually increase BTC value.
Investors who suffer from FOMO (fear of missing out) will want to get ahead of the supply being exhausted.
So, it can be argued that as we near the point where all Bitcoins are mined, there will be a rush to buy. That would push prices up.
