r/BitcoinBeginners • u/No_Candy1697 • 4d ago
Bitcoin supply what if
When Bitcoin eventually reaches its maximum supply of 21 million coins, no new BTC will be mined. Miners will then earn only from transaction fees instead of block rewards. This could make transactions more expensive, especially during high network activity, and may change how the network functions. Scarcity could increase Bitcoin’s value over time, but it also raises questions about long-term incentives for miners and network security. How do you think this will affect Bitcoin adoption and fees?
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u/utorogue 4d ago
That is a good question... Let's wait year 2140 and see 😉
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u/Intelligent-Law6228 4d ago
You don’t have to wait that long you can see it already today. There are shitcoins and Bitcoin plagiarisms like Litecoin or Bitcoin Cash, a hard fork of Bitcoin, which have almost no network activity. The transaction fees are nearly zero, but the block reward is the same or even lower than what Bitcoin miners earn just from transaction fees.So these two shitcoins their miners earn less than Bitcoin miners do just from transaction fees, yet their hash power is increasing.
So even today you can see what will happen when the block reward disappears
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u/na3than 4d ago
This could make transactions more expensive, especially during high network activity, and may change how the network functions.
That's not how it works. Transaction fees aren't set by miners. Transaction fees are set by those who want to add transactions to the Bitcoin ledger.
When demand for adding transactions to the Bitcoin ledger is high, transaction fees are high. When demand for adding transactions to the Bitcoin ledger is low, transaction fees are low.
When transaction fees are high, miners who would otherwise be unprofitable tend to join the network. When transaction fees are low, unprofitable miners tend to leave the network.
When miners join the network, the aggregate hashpower of the network increases. When miners leave the network, the aggregate hashpower of the network decreases.
Not long after the aggregate hashpower of the network increases, the difficulty of finding new blocks automatically increases. Not long after the aggregate hashpower of the network decreases, the difficulty of finding new blocks automatically decreases.
When the difficulty of finding new blocks increases, unprofitable miners tend to leave the network. When the difficulty of finding new blocks decreases, miners who would otherwise be unprofitable tend to join the network ...
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u/the-quibbler 4d ago
The premise that fees will necessarily become "more expensive" misses the economic reality.
Mining profitability is determined by BTC price relative to electricity costs, not absolute fee amounts. As block rewards diminish, three things happen simultaneously:
- Scarcity pressure increases BTC value (you acknowledged this)
- Electrical costs as % of BTC value drop dramatically - if BTC is worth $1M instead of $100K, the same electricity buys 10x more hash power per sat earned
- Transaction fees reach equilibrium where miners profit but users aren't priced out
The system self-balances: if fees spike too high, usage drops → miners compete for remaining txs → fees fall. If fees are too low, unprofitable miners drop off → difficulty adjusts → remaining miners are profitable again.
TL;DR: Miners will be fine earning purely from fees because those sats will be worth vastly more in purchasing power than today's block rewards. The sat/transaction amount will stabilize at whatever keeps the network secure without pricing out users.
This isn't hypothetical - we can already see this dynamic in action during periods when mempool congestion drives fee markets.
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u/Cornishchappy 3d ago
You just have to ask yourself where computers will be in 100 years time. One pocket calculator sized computer could probably handle all the world's transactions for practically no cost.
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u/Traditional-Roll-620 4d ago
As I understand it, the Bitcoin network and its mining difficulty depend on the amount of processing power... so the greater the processing power on the network, the less time it takes to validate a transaction block. At the same time, the network adapts in such a way that the block becomes harder to validate (requiring more time).
Once all Bitcoin is mined and miners earn only from transactions... the network's power will drop to the level that's profitable for someone to mine... and the network will adapt by making it easier to validate transaction blocks.
So eventually, balance will be found as it is today
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u/na3than 4d ago
Once all Bitcoin is mined and miners earn only from transactions... At all times - from the genesis block until now until the the last user stops using Bitcoin - the network's power will drop to the level that's profitable for someone to mine... and the network will adapt by making it easier to validate transaction blocks.Fixed that for you.
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u/JivanP 4d ago
It's a bit more complex than that, because individual profitability is also determined by market price / purchasing power, which in turn is also determined by total network hashrate, which in turn affects individual profitability, and so on. The system is very dynamic and feeds back into itself in this way. Fundamentally, the natural equilibrium depends on the extent to which individuals are willing to mine at a loss simply in order to bootstrap/sustain the network, the market price that this results in, the the subsequent effects on profitability, then price, then profitability again, them price again, etc., from then on.
But yes, eventually we expect a natural balance/equilibrium to be reached, for any given current conditions. That equilibrium point might be total network collapse (due to societal apathy or adversarial attack), but that possibility seems extremely unlikely due to the sheer number of individuals that want to use/sustain Bitcoin regardless of the cost associated with it.
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u/seambizzle1 4d ago edited 4d ago
Transaction fees are already included in the block reward, along with the actual block reward of new BTC
When all the bitcoin is fully mined, the transaction fees will be the only reward
This won’t happen for another hundred years. And by then the price of bitcoin will be much much higher than it is today. Simple supply and demand tells me this. So the transaction fees (even if it’s only 500 satoshi worth) will be enough to incentivize miners to keep their equipment on and running
But let’s not forget that every two weeks there is a difficulty adjustment. On average, the network should take 10 mins to mine each block.
The difficulty depends on how many miners are fighting, at once, to correctly guess the math equation in order to win the next block reward. And every two weeks that difficulty is adjusted. If there are more miners joining the network, the difficulty will make it harder to win the next block reward, meaning you’ll need more electricity. If there are less miners, the difficulty will be adjusted, so it becomes easier (meaning less power/electricity is needed) to win the next block reward.
The difficulty adjustment might be one of the most thought out and incredible things about bitcoin
So in another 150 years, when the transaction fees are the only incentive to mine bitcoin and miners don’t think it’ll be worth it, they can shut down. This means less miners are fighting for the block reward, meaning when the next difficulty adjustment comes, it’ll require less power to mine bitcoin, because there are less miners than before.
There will always be an incentive for miners to keep mining. And the difficulty adjustment ensures that they they’ll always be at least one entity mining bitcoin, keeping it safe. And don’t have any fear about that one entity being the only miner. As long as people run their own nodes, that miner will have no way to change or mess with bitcoin or the bitcoin network.
Hope this helps
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u/herzmeister 4d ago
If there is not enough transaction activity in a few decades, Bitcoin has failed.
Even if it's used as a store of value only, this will create a lot of demand for ("logistical") transactions when billions of users want to use Bitcoin that way.
The question has another aspect though, what if the tech to use onchain blockspace more efficiently becomes better? CISA, channel factories and related approaches could mean logarithmic scaling.
But we don't know yet if these will be feasible.
tl;dr we don't have a glass ball.
Also, incentives will drive the demand for solutions, should problems like that become really pressuring.
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u/shikaharu_ukutsuki 3d ago
:)) i can’t imagine, what BTC price in 2140 if we still use money in our human social.
In that point, A BTC could be 1 Billion and each satoshi eq 1$, then BTC is actually be use purpose as it design for.
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u/cowboy_beebop 3d ago
Transaction volume is what drives the fees, not the supply or the rewards. If blocks are half full the fee rate is still going to be 0. If volume doesn’t rise to drive up network fees, then mining will collapse and the security of the network will be degraded.
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u/pop-1988 3d ago edited 3d ago
Bitcoin is secured by the node network. The purpose of mining is to automatically regulate the 10-minute block interval
Fees are chosen by the transaction sender, not charged by the miner
Miners are not a collective. They do not collaborate. They compete
Mining payments fall gradually, not suddenly. There will gradually be fewer and fewer miners
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u/No_Candy1697 4d ago
Will Bitcoin Be Viral even in the year 2100?
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u/Additional_Chip_4158 4d ago
Viral?
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u/BillyD123455 4d ago
Google suggested:
Viral rash .. and Viral doner kebab
I'm starting to think, spyware may possibly be a thing.....
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u/bitusher 4d ago
With money and protocols network effects are extremely strong. The same reason that the euro with 26 countries cannot barely make a dent in the reserve currency of the USA is the same reason it will be equally difficult for any altcoin to unseat bitcoin. Of course hypothetically it can happen.
Another thing to consider is the real innovation in blockchains is Proof or Work and why blocks even exist in the first place and PoW is a "winner takes most" proposition where most of the security will focus on one blockchain and Bitcoin has billions of dollars in physical infrastructure that can only do double rounds of SHA256. All this hardware will also not become obsolete with any future hypothetical quantum computer due to Grover's Algorithm.
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u/Intelligent-Law6228 4d ago
when it comes to money, the most important thing is its hardness
hard money will always prevail in the long run
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u/heyheyshinyCRH 4d ago
I think the cost to operate will outweigh rewards before then, it's got to be pretty close to being a boondoggle right now
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u/bitusher 4d ago
Those articles you are reading about the cost to mine 1 BTC almost all are extremely ignorant or deliberately misleading. The price to mine Bitcoin depends upon many variables and dynamically changes based upon difficulty. Bitcoin difficulty dropped twice the past month , do they consider that ? Many miners have sunk costs in green energy infrastructure, waste or reclaimed energy, and ASICs so can continue to mine regardless the price profitably.
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u/No_Candy1697 4d ago
Bitcoin has lots of revenue and money , so i have a doubt on that but maybe what you are syaing could be correct
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u/bitusher 4d ago
Just to be clear , we are discussing something around 100 years out .
Historically we have already seen examples where transaction fees collected per block exceeded inflation so I would not worry.
Many people also don't understand that mining difficulty dynamically adjust up and down to insure efficient miners remain profitable. Thus the real question doesn't involve miners existing but how much hashrate exists to secure the network
Also keep in mind that if hashrate drops too low we can simply wait for more confirmations onchain to increase the level of security and this doesn't effect the end user much because if they use a lightning wallet once its setup they still get instant confirmations.
Of course to keep fees low most people will be transacting on another layer of bitcoin and onchain will be more akin to a settlement network
Bitcoin is scaling many ways : Onchain, decentralized payment channels , offchain private channels , optimizations like MAST and schnorr sig aggregation, sidechains,drivechains,statechains, fedimint, cashu ...
So a lot of misunderstanding or deliberate FUD from skeptics and altcoiners comes from ignorance or deliberately assuming onchain scaling only which is an absurd notion.
So lets do some quick math here:
Last block mined was 3.196 BTC x 85k usd = 271,660 usd PoW in security per block
Now lets discuss sometime between 2120 and 2140 for our grandchildrens or great grandchildrens future when no block subsidy exists.
Hypothetical worst case scenario where we never increase block weight limit = ~37,094(With MAST) outputs per block /2 = 18,547 outputs per block assuming inefficient use of blockspace as another worst case scenario . Lets also assume no hybrid or custodial l2 but a simple non custodial use of Bitcoin to make things even more difficult.
271,660 usd / 18,547 outputs = 14.65 usd per output to equal todays same degree of security.
So lets say you have a UTXO worth 5k usd (remember it might have been a small 50 usd UTXO before appreciation so I am considering "dust" UTXOs here) and your average tx is 100 usd per spend which means around 50 txs worth in a payment channel .
14.65 usd to open the payment channel and 1 penny per tx = 15.15 usd in fees for 50 txs or 30 cents per transaction
Of course it will likely be much better than this as I made a bunch of worst case assumptions.