As of May 2025, a staggering 93% of Bitcoin’s finite 21 million supply has been mined, underscoring the cryptocurrency’s unique position as a deflationary asset in a world of fiat currency expansion. The implications are significant, not just for miners but also for investors and market dynamics as a whole.
The Dance of Scarcity: Bitcoin’s Halvings
Bitcoin’s protocol has a built-in mechanism called “halving,” which gradually reduces the reward miners receive for processing transactions. The initial block reward in 2009 was 50 BTC, but this has diminished exponentially, currently standing at 6.25 BTC. The next halving in 2028 will see it drop to 3.125 BTC. This geometric reduction implies that while 19.6 million BTC are already in circulation, the remaining 1.4 million will trickle into existence over the next century.
This engineered scarcity is a masterstroke, drawing parallels with commodities like gold, yet surpassing them in predictability. Unlike gold’s annual supply growth of 1.7%, Bitcoin’s issuance is transparent and declining, fostering an environment where demand increasingly dictates value. As explored in our analysis of Bitcoin ETFs and government adoption, these factors could drive Bitcoin’s price to unprecedented heights by 2029.
Lost and Found: The True Circulating Supply
But there’s a twist—many Bitcoins are effectively lost. Analysts from Chainalysis and Glassnode suggest that up to 18% of all BTC—somewhere between 3 and 3.8 million—could be permanently out of circulation. These are coins tied up in forgotten passwords or early adopters’ wallets that were never touched again.
This reduction in accessible Bitcoin means the actual circulating supply might be closer to 16-17 million. Unlike gold, which remains in circulation even after being melted or reused, lost Bitcoin cannot be recovered, permanently constraining supply over time.
Navigating the Mining Landscape
The looming question of what happens when Bitcoin is fully mined is a hot topic. Critics warn that declining block rewards might jeopardize network security. Yet, the Bitcoin ecosystem is notoriously adaptive. As block rewards shrink, transaction fees are expected to pick up the slack. A case in point: on April 20, 2024, transaction fees surged to over $80 million in a day, eclipsing the $26 million block rewards.
Moreover, Bitcoin’s self-correcting mechanism ensures stability. When mining becomes less profitable, miners exit, leading to a difficulty adjustment that lowers the cost of entry for remaining players. This cycle ensures consistent block times and network resilience, as evidenced by the swift recovery post-China’s 2021 mining ban.
The Energy Equation: A Renewable Future?
Contrary to popular belief, Bitcoin’s energy consumption is not set to spiral out of control. Profitability, not price, dictates energy use. With thinner margins, miners are increasingly drawn to cost-effective, sustainable energy sources. Post-2021, the hashrate has pivoted toward regions with abundant renewable energy, such as North America and Northern Europe. The Cambridge Centre for Alternative Finance reports that over half of Bitcoin’s mining operations are now powered by renewables.
Regulatory frameworks are further encouraging this shift, offering incentives for clean energy mining while penalizing fossil fuel operations. Thus, while Bitcoin’s price might rise, its energy footprint is likely to stabilize due to these self-regulating mechanisms.
The Road Ahead
As Bitcoin inches towards its 21 million cap, the market is poised for transformation. The convergence of reduced issuance, lost coins, and increased demand could heighten price volatility and shift value concentration towards those adept at securing their holdings. In extreme scenarios, a bifurcation between “circulating BTC” and “unreachable BTC” could emerge, with the former gaining greater economic significance. This aligns with the trends observed in Grayscale’s Bitcoin Trust dominance in ETF revenue, highlighting the shifting dynamics in Bitcoin investment vehicles.
While the distant future of Bitcoin’s final satoshis is uncertain, the current system—characterized by adaptive mining, robust security, and increasing use of clean energy—remains a testament to its ingenious design. As always in the crypto world, the only certainty is change. And Bitcoin, the digital gold, continues to set the pace.
Source
This article is based on: 93% of all Bitcoin is already mined. Here’s what that means
Further Reading
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
