In my estimation, when the blocks no longer hold any mining rewards after approximately 21 million bitcoin have been released into circulation, the transfer fees in each block will then replace the usual mining reward that comes with every block mined. Given the exponential diminishing rate that happens with the halving that takes place every 4 years, the last mining reward block will be minuscule in BTC quantity. This does not necessarily mean minuscule in value, as the 0.000000005 BTC in the final blocks just before 2140 could be of a “monetary” value (monetary could mean something totally different by then) much higher than what we see today. Let’s just assume bitcoin becomes the default currency by then, and there are significantly more transactions than what we have today. If we take the fee to transfer bitcoin to be flat at 0.000000000001 BTC (12 decimal places instead of the 8 we are accustomed to today), then a million of these transactions in a single block would constitute a total transfer fee reward of 0.000000000001 x 1,000,000 = 0.000001 BTC. For all the blocks after 2140 that provide no mining reward fee, the transfer fees alone will be sufficient incentive to resume mining operations to validate transactions. Will this reward be sufficient to run the mining facilities then? Probably, for 2 reasons. Even 0.000001 BTC will be of significant “monetary” value, and the means of power generation by then (think green energy and Ironman-style nuclear fusion arc reactors) could make mining more power efficient. The 22nd-century will bring about technologies nothing of what we can imagine today.
We are currently in the 3rd Reward Era with 12.5 BTC mined every block, which on average consists of 1 to 3 BTC in transfer fees total. The ratio is hence about 6:1. In this instance, the weight in mining reward is greater than transfer fee reward, and this shouldn’t be a surprise as the mining reward is crucial to get miners to come up with capital income to set up mining facilities across the globe. The mining reward offers the bulk of this capital and operational (electricity/cooling) costs. Perhaps somewhere in the 17th Reward Era from Block No. 3,360,000 onwards when each block’s mining reward fee is 0.00076293 BTC, we may begin to see a shift in the reward’s weight from mining fee to transfer fee. If this happens, then the mining and transfer fee rewards may reach an equilibrium, and we may see a ratio of 1:1 between mining and transfer fee rewards. What this means is after a few decades from today, when more bitcoin transactions have begun to take place, each block in the 17th Reward Era (Years 2072 to 2076) may consist of 0.00076 BTC in mining rewards, and also about 0.00076 in transfer fees. A 1:1 ratio.
As we approach 2140, the shift in weightage towards transfer fee rewards will be incremental, until after 2140, when all rewards will only come from transfer fees from bitcoin transactions. You can think of this era similar to the credit card machines of today, where the fee charged to every credit card transaction is used to pay all parties who provide that credit card facility. Obviously, no new money needs to be printed when credit cards are used (similarly no new bitcoin is mined and paid to miners), but the 1 - 3% of every item purchased with a credit card (i.e. the transfer fee in bitcoin transactions) is sufficient to power the global network of credit card facilities and infrastructure.
Perhaps the transfer fee then will be a percentage of the amount of bitcoin transferred. However, we won’t be here to witness it.
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