News hardware Bitcoin: what will happen after the last mined BTC?
Like gold, the quantity of Bitcoin is limited. This amounts to 21 million digital coins (BTC). When the miners have mined the last Bitcoins from the network, what will happen to the cryptocurrency?
- 21 million Bitcoin and not one more
- Bitcoin mining is intensifying as it goes
- Increasingly meager bitcoin rewards
- The last bitcoin will be mined in over 100 years
- Possible scenarios after the mining of the last Bitcoin
21 million Bitcoin and not one more
Almost 14 years ago, Satoshi Nakamoto explained all the technical details of his project in the whitepaper (a complete report). In it, the anonymous creator of Bitcoin indicated, among other things, the limited number of Bitcoin and its importance.
In order to create a real digital currency, Satoshi had to rely on different foundations of the classical monetary system, including scarcity. In this sense, the Bitcoin code was initially programmed to issue 21 million coins and not one more.
This aspect makes Bitcoin particularly desirable in the eyes of investors. Indeed, Bitcoin goes even further than gold in limiting its supply since everyone is aware of the final number of coins even if these have not yet been mined. On the contrary, if an unknown gold mine is discovered, then it will inexorably increase the total supply of Gold on Earth.
In addition to the limited quantity, the more we advance in time, the rarer these pieces become…
Bitcoin mining is intensifying as it goes
To generate Bitcoins, the network mainly relies on the remuneration of miners. When an individual uses the computing power of his hardware (graphics cards, ASICs, etc.) to validate transactions, he actively participates in the operation of the network.
By validating block transactions, miners are rewarded with Bitcoin (BTC). This is called a proof-of-work (PoW) validation system. This is how miners regularly issue new Bitcoins in circulation.
Only, over time, the difficulty of mining on the Bitcoin blockchain intensifies. This increasing difficulty of the algorithm generates significant costs on the electricity spent and on the choice of equipment to be mined (graphics cards, processor, ASIC, etc.). As a result, a majority of miners develop their infrastructure in such a way that they can sustainably mine Bitcoin.
Increasingly meager bitcoin rewards
This drop in profitability has a name: the halving. Bitcoin has experienced 3 halvings since its creation in 2008, the last of which dates back to May 2020. Halving means halving in English, and as its name suggests, approximately every four years (210,000 blocks) – the written protocol in the bitcoin code halves the rewards given to miners.
At the launch of the Bitcoin network, the mining gain for a block was 50 bitcoins (which represents approximately 1 million euros at current prices). After the first halving in 2012 the reward increased to 25 bitcoins per block and so on…
The last bitcoin will be mined in over 100 years
Currently pegged at 6.25 bitcoin, the next halving is estimated to take place in March 2024 – bringing the number of BTC issued per block to 3.125. With this decline in increasing profitability, the last bitcoins will be desired…
Thus, while 19.2 million Bitcoins have been mined in 11 years, the next ones will be harder and harder to generate. It is estimated that the very last bitcoin will be mined around 2140 to reach the maximum milestone of 21 million coins.
Possible scenarios after the mining of the last Bitcoin
All Bitcoin users depend on mining. Bitcoin price and network usage are largely driven by miner interest. So what will happen if the profits associated with this activity become zero?
Well that won’t happen. Indeed, the mining will not be finished after the year 2140. The miners will continue to receive remuneration thanks to the fees of the transactions validated on the network. This is why after the last bitcoin mined, it is highly likely that a majority of miners will continue to mine the network.
If Bitcoin continues to be adopted by several organizations then it would also be interesting to see the demand for a currency whose supply is completely finished, unlike the euro or the dollar.
However, we are not there yet. At the moment, the network is only in its infancy. Because of this, it is possible that Bitcoin will experience some major innovations or changes if the players in the network establish a consensus.
Also, in 100 years, there can be a lot of negative events that could impact Bitcoin and its use. Among conceivable intrigues, Bitcoin could be replaced by a cryptocurrency deemed more efficient, or worse, be banned in several countries. China has already tried by banning minors from its territory, however this does not seem to have an effect.
All this without taking into account the many economic, political and social events of the next 120 years. So see you in 120 years to see the result…
What is Bitcoin?
Bitcoin is first and foremost a payments network allowing its users to exchange peer-to-peer currency. It is based on a digital currency called Bitcoin (BTC).
Thanks to blockchain* technology, Bitcoin offers the possibility of making decentralized payments, i.e. without third parties or trusted authorities. With this in mind, Bitcoin was initially created to be an alternative system to banks.
What is Blockchain?
The blockchain (literally chain of blocks) is in a way the digitization of trust. Concretely, his code allows web users to exchange peer-to-peer value with a decentralized validation system. All actions performed on a blockchain are anonymous but transparent.
The mathematician Jean-Paul Delahaye explains that we can visualize this large archive as “a very large notebook, which everyone can read freely and free of charge, on which everyone can write, but which is impossible to erase and indestructible”.
Who Runs Bitcoin?
If the name behind Bitcoin is known to everyone, Satoshi Nakamoto, no one really knows the identity of the creator. Either way, it doesn’t matter since Satoshi has little power over his code.
Indeed, Bitcoin is decentralized, so it does not depend on any entity. Its network does not belong to anyone since it is the consensus of its users that allows the change of its protocol. Developers can make changes only if miners and network nodes agree with the choice.
How does bitcoin work?
The Bitcoin network works thanks to its users. To carry out user transactions, Bitcoin has operated its blockchain. Concretely, each miner puts their machines (graphics card, ASICs) in competition to solve an equation in order to validate the veracity of the block. Thus, the Bitcoin network makes sure to issue secure transactions scrutinized by several binary intermediaries.
How to get Bitcoin?
Anyone using their hardware computing power (graphics card, ASICs) is paid in BTC according to their involvement in the network.
In addition to mining, Bitcoin can be obtained on cryptocurrency exchange platforms against fiat currency among others (euros, dollars, etc.).
Where to store bitcoin?
Like cash, Bitcoin can be stored on virtual wallets, generally called wallets. There are several types of wallet:
Hot wallets are Internet-connected private key storage solutions. In the form of software, these portfolios can be applications, extensions or even websites.
Cold wallets are a more secure alternative for cryptocurrencies. Indeed, the private keys of these wallets are not stored online, so it is much harder for a hacker to gain access to them. These wallets usually take on the appearance of a thumb drive or even paper.
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Bitcoin: what will happen after the last mined BTC?
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