If Bitcoin mining is an essential process to run the blockchain system, how would we motivate people around the world to participate in the work of validating transactions? This is accomplished through a reward system.
Here's how it's explained in the book, Mastering Bitcoin:
Miners receive two types of rewards for mining: new coins created with each new block and a commission for transactions included in the block. To earn this reward, miners must compete to solve a complex mathematical problem, based on a crypto hash algorithm. The solution to the problem, called proof of work, is included in the new block and acts as proof that the miner put in significant computational effort."
A Bitcoin miner can earn new coins and commissions for transactions on the block created by the mining work. This maintains Bitcoin's security model.
What happens when all the Bitcoins are mined?
The Bitcoin supply is limited to a final cap of 21 million. This is determined by Bitcoin's source code, programmed by its creator(s), Satoshi Nakamoto, and cannot be changed.
Once all Bitcoin is mined, the amount of coins in circulation will remain at that level permanently.
The implication as the Bitcoin supply limit is approached and ultimately reached will be that mining will become much less profitable. But the process will go on for more than a century.
Bitcoin miners will still be rewarded at that point, but only through transaction fees and not with new coins.
Reaching the supply limit will probably drive up the price of Bitcoin, as long as demand continues to grow; since, anyone wishing to buy Bitcoins will have to obtain them from someone else, giving sellers control over their price.
#BinanceTournament #Bitcoin #Mining #Education #APfinanciero
