Bitcoin mining is the process of verifying and adding new bitcoin transactions to the Bitcoin blockchain. New bitcoins are also created by the mining process. It involves solving complex mathematical and cryptographic problems using high-powered computers.
Bitcoin miners are rewarded with new bitcoins for every block they mine. Currently. a miner receives 6.25 bitcoins for every block they add to the blockchain. They also receive a transaction fee for mining blocks. Transaction fees account for just 6.5% of the miners’ total income.
Bitcoin is designed to be limited in nature. The total number of bitcoins to ever exist is capped at 21 million. Currently, around 18.5 million (88%) of all the bitcoins are already mined. Based on assumptions, the last bitcoin will be mined in the year 2140. Then a question arises, what will happen when all the bitcoins are mined? How will the miners be rewarded?
The current and most prevailing answer is Transactions fees. Miners will be rewarded with a transaction fee for every block they discover and add to the blockchain. But, if transaction fees account for just 6.5% of the total income of the miners, will they continue to mine after 2140? Without mining and miners, bitcoin will be a non-working piece of technology. No transaction or exchange will be possible without miners.
People believe as Bitcoin is becoming more popular and more people adopt bitcoin, the number of transactions go up in the future. This will lead to an increase in transaction fees. And by 2140, transaction fees alone will be enough to reward the miners.