Bybit Arbitrage is a trading tool that simplifies arbitrage trading by capitalizing on funding rate and price differences.

If you're seeking consistent returns with minimal risk, Bybit Arbitrage is the perfect ally.

 This robust tool empowers you to generate regular profits with minimal risks by capitalizing on price disparities across different markets. Its user-friendly interface lets you easily spot and exploit these differences, so that you can execute flawless arbitrage trading in the crypto market with confidence. Read on to learn how Bybit Arbitrage makes arbitrage trading an effortless way for you to achieve low-risk gains.

 is the buying and selling of the same or similar asset(s) at the same time across different markets to earn from slight price deviations. This act of purchasing an asset at a fixed price — while simultaneously selling it at a higher price — allows a trader to instantly make profits without any risks. 

While arbitrage trading has long been a staple in traditional financial markets, such as stock and forex, the advent of crypto trading has propelled arbitrage trading to new heights — thanks to the heightened volatility of the crypto market. Additionally, unlike traditional stock markets, crypto markets are traded 24/7, offering more opportunities for arbitrage traders to reap profits from the price gaps across exchanges and markets. 

 across exchanges or within a single exchange. Keep in mind that if you opt to arbitrage trade across different platforms, accessing your profits may prove to be complex, due to the need to transfer your assets between the exchanges, which can take up to several days to complete. On the other hand, arbitrage trading on a single platform is more straightforward — but more competitive as well.

There are multiple arbitrage trading strategies, but the most common ones in the crypto market include funding rates arbitrage, spot-futures arbitrage and futures arbitrage. 

Funding rates arbitrage allows traders to profit from variations in funding rates between 

 contracts. In contrast, spot-futures arbitrage enables traders to profit from price disparities between the spot and 

 for the same asset. Meanwhile, futures arbitrage involves profiting from price discrepancies between futures contracts with different expiration dates.

Bybit Arbitrage is a trading tool that helps traders identify arbitrage trading opportunities in two ways: funding rate and spread. 

The user-friendly interface organizes trading pairs based on either funding rates or spreads in different markets, so that traders can easily spot disparities in funding rate or price across the markets at a glance. 

Bybit Arbitrage is exclusively available to 

 mode. It facilitates arbitrage trading for USDT Perpetual, USDC Perpetual and USDC Futures contracts, thereby allowing you to enjoy arbitrage trading opportunities between USDT 

Spot pairs and USDT Perpetual pairs, or USDC Spot pairs and USDC Perpetual/Futures pairs. 

The Funding Rate Arbitrage feature exploits differences in funding rates between the Spot and Perpetual/Futures markets on the Bybit exchange. With the Funding Rate feature, traders can earn funding fees while simultaneously managing their positions in order to minimize potential losses and maximize gains through positive and negative arbitrage strategies.

Funding rates for the different trading pairs are listed in descending order. This helps traders to easily leverage the interest rate differential between Spot and Perpetual/Futures contracts.

The Funding Rate feature also allows you to 

 orders (with the same amount, but in different directions) in both Spot and Perpetual/Futures, which enables you to earn funding fees while mitigating potential losses (with potential gains).

holders in Futures/Perpetual contracts pay short position holders. You can leverage this situation by executing a positive arbitrage, which involves

 buying a Spot pair and taking a short position in 

Perpetual to earn steady funding fees. Alternatively, if the funding fee is negative, short position holders pay long position holders. In this case, you would perform a negative arbitrage by shorting a Spot pair and going long in a 

The Spread Arbitrage feature helps traders capitalize on price discrepancies between different markets for the same cryptocurrency asset. With this feature, you can easily compare the market prices of an asset traded across various trading pairs and contracts. While Spread Arbitrage may be similar to spot-futures arbitrage, it offers more arbitrage opportunities since it covers a broader range of markets, unlike spot-futures arbitrage, which targets specific markets

With Spread Arbitrage, the aim is to profit from the eventual price convergence as you buy the crypto asset at a lower price in one market (e.g., Spot) and sell it at a higher price in another market (e.g., Futures). 

As the futures price will eventually align with the Spot price when the contract expires, you’ll be able to take advantage of the simultaneous price disparity for the same asset.

In order to trade with Bybit Arbitrage, you’ll first need to 

. Currently, Bybit Arbitrage is exclusively accessible via the 

 for the web version, which will be launched soon!

Bybit Arbitrage offers multiple advantages.

Bybit Arbitrage is a powerful tool for traders seeking low-risk gains in the volatile crypto market. With its intuitive interface and exclusive features, traders can effectively leverage funding rate and price differences to maximize profits while minimizing risks. Bybit Arbitrage offers diverse benefits that make arbitrage trading more accessible and profitable than ever before.

Beginner

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How to Use Bybit Arbitrage to Achieve Funding Rate and Price Difference Arbitrage

An Ethereum Spot ETF is an exchange-traded fund that tracks the real-time price of Ether and allows investment through traditional stock markets. Learn more.

Earlier this year, the U.S. Securities and Exchange Commission (SEC) gave the green light to a number of Bitcoin Spot exchange-traded funds (

), sparking optimism that similar approval might be extended to Ethereum Spot ETFs. Adding to the excitement, news of Ethereum Spot ETF approval in Asia’s first region has heightened anticipation for a potential approval and launch in the U.S. However, despite the buzz, some industry observers remain skeptical. This article explores the potential impact of Ethereum Spot ETF approval on the broader crypto market.

An Ethereum Spot ETF is an exchange-traded fund that tracks the real-time price of 

 and allows investment through traditional stock markets. It offers investors a way to invest in Ether without having to actually buy or hold the asset itself.

An Ethereum Spot ETF operates by pooling investor funds to purchase Ether, which is held in reserves by the ETF.

Rather than navigating the complexities of 

 and exchanges, investors buy shares of the ETF through regular brokerage accounts, just as they would with traditional stocks. These shares represent a stake in the Ether held by the ETF, providing a simple and regulated way to own Ethereum indirectly.

In order to create ETF shares, authorized participants — usually financial institutions — purchase Ether in exchange for ETF shares of equal value, which are then sold onto the market. An authorized participant can also redeem shares by buying enough ETF shares and exchanging them for Spot Ether and taking those shares away from the market.

As a result, the price of ETF shares tends to fluctuate in line with Ethereum's Spot market price. If it didn’t, there would be an 

 opportunity to profit from any mispricings in the ETF price. However, it’s still theoretically possible for the ETF to trade at different prices simply because of supply-and-demand factors.

ETFs as securities are regulated by the SEC, so an Ethereum Spot ETF provides a regulated product that investors can purchase. By contrast, Spot Ether is being investigated by the SEC to determine whether it should be classified as a security, and currently lacks regulatory clarity. 

This setup offers numerous benefits for investors. It simplifies the investment process, allowing anyone with a brokerage account to invest in Ethereum without setting up a crypto exchange account or managing storage. This can save time and give some investors greater peace of mind. An ETF structure also provides the regulatory clarity that institutional investors need, which can enhance liquidity and trading volumes.

Security is paramount in the realm of cryptocurrency, and the ETF provider takes it seriously. To safeguard Ether holdings, ETF providers employ a combination of 

 and insured custodial services. As a result, they could potentially minimize the risk of theft or loss that individual crypto investors may encounter.

The Ethereum Spot ETF bridges traditional finance (TradFi) and the exciting (but still growing) cryptocurrency space. It offers the security and ease of trading associated with traditional financial markets while opening up investment opportunities in Ethereum for a broader audience.

Both excitement and regulatory scrutiny characterize the current landscape of Ethereum Spot ETFs. Major financial institutions like 

 and Fidelity have submitted applications for these ETFs to the SEC. Still, decisions have been delayed, with the next 

If applicants begin updating their filings by April, this may indicate they’re incorporating feedback from the regulator, which could be interpreted as a positive sign. However, a lack of updates to filings could indicate that the SEC isn’t maintaining the same level of discussions with issuers that led to its 

Another challenge is that the SEC is still investigating whether Ether should be classified as a security, especially since it transferred its consensus mechanism to 

. Earning rewards through staking could meet criteria that determine whether an asset is a security. Ethereum also provides a foundation for 

 (DeFi), which could add to the complexity of the review. 

Analysts' opinions vary regarding the likelihood of ETH ETF approval. One Bloomberg analyst, for instance, 

 chance of approval by May. However, the SEC's recent silence might hint at a less favorable outcome.

The approval of Ethereum Spot ETFs is eagerly awaited because it could mirror the impact of Bitcoin Spot ETF approval, which led to an influx of capital in the market. It would mark a pivotal milestone, likely to attract increased investment and further validate cryptocurrency. The crypto community is closely monitoring these developments, as the coming months will be crucial in shaping the future of Ethereum investment opportunities.

 was recently given to the first Spot Bitcoin and Ethereum ETFs in one of the Asian regions. This landmark decision positions the city as a trailblazer in the Asian financial landscape, embracing the integration of popular cryptocurrencies into mainstream investment avenues.

This milestone has sparked excitement within the crypto community, indicating a positive reception toward digital assets in that region. Analysts believe this move could set a precedent for other jurisdictions to follow, potentially leading to broader acceptance and recognition of cryptocurrencies as a legitimate asset class.

These newly approved ETFs are expected to attract a wave of fresh investors — both retail and institutional — by offering a regulated and familiar investment option for exposure to cryptocurrencies. This growth of interest could increase stability in the crypto markets, possibly influencing the price movements of Bitcoin and Ethereum in the region.

The timing of this approval is noteworthy, considering that the U.S. could also be on the cusp of approval of an Ethereum Spot ETF. If this proactive approach inspires other financial centers beyond the U.S. to consider similar approvals, it will palpably contribute to the global expansion and maturation of the cryptocurrency market.

Current Impact of Ethereum Spot ETF Applications on the Crypto Market

The buzz surrounding Ethereum Spot ETF applications is noticeably affecting the crypto market, particularly Ethereum's price and overall sentiment. Submission of new ETF applications to the SEC has coincided with an 

, pushing it to around $3,700. This uptick reflects the market's optimism and positive sentiment regarding the potential for easier access to Ethereum. However, the market has exhibited some volatility as well, with Ether dropping over 14% in a week in early April. 

Despite these fluctuations, there's a general expectation that ETF developments would significantly impact Ethereum's price dynamics, similar to what was observed with the recent Bitcoin Spot ETF approvals. Moreover, the recent approval of cryptocurrency ETFs has further fueled optimism and positive expectations for increased investment inflows and a broader recognition of cryptocurrencies.

To sum up, the current impact of Ethereum Spot ETF applications on the crypto market is marked by heightened anticipation along with some volatility. Ethereum's price is responding to changes in the regulatory landscape and the potential for broader adoption of cryptocurrency-based investment products.

What Will It Mean if an Ethereum Spot ETF Application Is Approved?

The approval of an Ethereum Spot ETF application by the SEC would mark a significant milestone for the cryptocurrency market, especially for Ethereum. Following are some of the potential benefits.

Drawing parallels to the earlier Bitcoin Spot ETF approvals, some pundits expect an initial surge in Ethereum's price following the expected announcement, reflecting renewed confidence and interest in Ether as an asset. Over the long term, Ethereum Spot ETFs could contribute to growth and stability, similar to the impact that Bitcoin Spot ETFs have had on BTC’s price.

However, there are key differences to consider. The SEC's cautious stance on Ethereum — notably because of its PoS consensus mechanism — could influence the approval process and subsequent market reactions. In addition, Ethereum's unique ecosystem, including its role in DeFi and 

, could lead to different market responses as compared to those following the Bitcoin Spot ETF approvals.

The potential approval of Ethereum Spot ETFs is a crucial turning point for the crypto market, promising easier access, increased investment and greater legitimacy. Although short-term price fluctuations may occur, the long-term effects could echo the positive growth recently witnessed with Bitcoin Spot ETFs, promoting a more mature investment environment for Ethereum.

Intermediate

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Ethereum Spot ETF Approval: Its Impact on Crypto Markets

Grayscale Investments has filed a registration statement on Form S-3 with the SEC to register shares of its Grayscale Ethereum Trust (ETHE) as part of efforts to uplist the trust to a spot Ethereum ETF on the NYSE Arca.

Daily Top Performer — Automata Network (ATA)

The SPX index is up 0.02%, investor focus on earnings and U.S. interest rates continues. The broader cryptocurrency market is down, with Bitcoin and Ether dropping by 3.78% and 2.41%, respectively in the past 24 hours.

Today’s outperformer is ATA, which jumped 8.9% after Automata launched Multi-Prover AVS on Eigenlayer Holesky Testnet to boost decentralized security.

Automata Network (ATA), founded in 2019, is a Web3 platform providing private web services for decentralized applications, focusing on secure, anonymous transactions and governance. Key features include a private voting system and MEV minimization to enhance user privacy and security. Automata's Multi-Prover AVS, which utilizes TEE Coprocessors to enhance security, is now available on the Eigenlayer Holesky testnet. This system employs the TEE Prover as a secondary security measure in decentralized systems. Operators, restakers, and developers are encouraged to learn more about this advancement on their website.

Check Out the Latest Prices, Charts, and Data of 

Grayscale Investments, the world's largest crypto asset manager, has filed a registration statement on Form S-3 with the SEC to register shares of its Grayscale Ethereum Trust (ETHE) as part of efforts to uplist the trust to a spot Ethereum ETF on the NYSE Arca. This filing follows NYSE Arca’s application and is a crucial step in the regulatory process required for offering shares continuously upon approval. The shares will not be sold until the registration is declared effective, and this offering is subject to the Securities Act of 1933. Grayscale emphasizes that the trust, not registered under the 1940 Act, involves high risk and volatility, is focused solely on Ethereum, and does not offer direct investment in Ethereum.

BlackRock's spot bitcoin ETF, IBIT, has significantly impacted the firm's overall ETF flows, comprising 24% of its total. Eric Balchunas, Bloomberg's Senior ETF Analyst, highlighted the fund's success during a panel on Hong Kong's newly approved spot crypto ETFs. Since its launch in January, IBIT has attracted consistent inflows for over 70 days, accumulating more than $18 billion in assets under management and becoming one of the most successful ETFs in history. The IBIT fund is second only to Grayscale's ETF in terms of assets but has seen remarkable trading volume along with other spot bitcoin ETFs, totaling nearly $230 billion.

Gamium, supported by Parachain Ventures, DAO Maker, and Mr. Beast among others, has its token $GMM listed on major exchanges with a fully diluted valuation of around $43M. The platform is promoting a beta points airdrop to reward early users, where participants can sign up and earn points through various activities like launching an MST, trading, daily logins, and referrals. Details on point earning and distribution are available in a dedicated blog post. However, potential users are cautioned to research due to the inherent risks associated with DeFi protocols and trading.

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Grayscale Files for SEC Registration to Convert Ethereum Trust into a Spot ETF on NYSE Arca

Sharky is a Solana-based lending and borrowing DeFi solution that utilizes NFTs as loan collateral.

Cryptocurrency lending and borrowing has always been a prominent niche of the decentralized finance (

) industry, championed by platforms like Aave (

). A much rarer variant of DeFi borrowing and lending is based on non-fungible tokens (

Sharky.fi, or simply Sharky, is a Solana-based lending and borrowing protocol that uses NFTs as collateral to facilitate the DeFi processes on the network. By putting up NFTs as collateral, users can borrow funds via short-term loans in Solana's native SOL tokens. For lenders, the platform is also a great way to earn high APY rates in just 7 to 14 days, while having their loaned funds protected by the NFTs.

Having established itself as the leader of NFT-based lending and borrowing on Solana, the Sharky project has ambitious plans to integrate two more highly popular crypto asset types — Ordinals and real-world assets (RWAs).

 (SHARK) is a lending and borrowing app on the 

 (SOL) blockchain that lets users provide NFTs as collateral to access short-term loans in SOL tokens.

 Lenders can view NFTs offered as collateral, and make loan offers secured by their preferred NFTs.

Although Sharky's public launch on the Solana mainnet dates back to April 2022, the platform operated without its 

, SHARK, for its first two years in the market. The SHARK token was eventually launched in mid-April 2024.

Using its innovative business concept, Sharky quickly established itself as the leader of NFT lending. According to the project’s team, Sharky has a 90% share of the NFT lending market on Solana and has issued more than 1.4 million NFT loans.

Following the recent launch of its SHARK token, the project aims to integrate additional crypto asset types in the future. These include 

 (RWAs). Another ambitious product type considered for future implementation on the platform is uncollateralized consumer loans.

As a lender on Sharky.fi, you can browse NFTs from a variety of collections offered on the platform and make a loan offer for potential borrowers. The collections available on Sharky include the platform's own 

 collection, Mad Labs, Solana Monkey Business (SMB), Tensorians, Namaste and more. Lenders’ offers are shown to potential borrowers on the platform, who then choose the best offer based on their borrowing needs.

The NFT provided by the borrower is used as collateral, and the lender makes their funds available in SOL tokens. Lenders earn interest on the funds, with the loan duration typically between 7 and 14 days. Interest rates, naturally, will vary depending upon on-platform activity. Usually, 

 for active loans range between 120% and 220%, though they can go up to 360%. As such, Sharky loans are an excellent way for lenders to earn some serious interest quickly. If a borrower fails to repay the loan in full, the NFT used as collateral is transferred to the lender.

For borrowers, the Sharky platform is an excellent opportunity to access SOL funds for short-term needs quickly and flexibly using their NFTs, rather than cryptocurrency, as collateral. The best part of the platform's borrowing mechanism is that you remain in possession of your NFT during the loan period as a borrower. While your NFT is used as collateral, its ownership isn't transferred to the lender while the loan is active. The ownership transfer may only happen at the end of the loan period if you fail to repay the loan in full.

Maintaining the ownership of your NFT allows you to keep using it on various DeFi and other apps for purposes such as staking or satisfying 

 eligibility requirements, among other potential uses.

Sharx is the platform's own NFT collection. One of the most popular collections used in Sharky's lending and borrowing operations, sharx is made up of 10,111 adorable shark characters. Purchasing a sharx NFT not only opens up borrowing opportunities but also entitles you to upgrade or boost your Chowder points, rewards that are used in Sharky's loyalty program. 

As a sharx holder, you're entitled to the airdrop of Sharky.fi’s governance token, SHARK, and you can also stake sharx to earn FISHY tokens.

The newly launched SHARK token is envisioned as the platform's governance asset, with a total supply of 100 million. As of the time of writing in late April 2024, only some specific details on the actual governance processes powered by SHARK are available. Thus, the token's actual use in on-platform governance is expected to be outlined in the future.

SHARK will be airdropped in two phases, with 4.25% set aside for the first phase and 3.5% for the second. Of the former, 70% is allocated to its community, with the remaining 30% is distributed to partner communities. Meanwhile, the second phase is held as a staking pool event with a lockup duration of 30 to 60 days exclusively for OG, new users and sharx holders.

 of Sharky. Unlike the brand-new SHARK token, FISHY was issued back in 2022 at the start of the platform's operations. FISHY can be earned by staking sharx NFTs, accumulating reward points and participating in Sharky's social media campaigns. The token can be used to boost sharx NFTs, which in turn can earn you additional Chowder points. FISHY also gives you access to NFT raffles and auctions held on Sharky.

The SHARK token can be bought on Bybit through a Spot pair with USDT (

). Additionally, you can also take part in Bybit's current campaigns for the token for the chance to grab a share of the 

, which includes a Token Splash event featuring 456,000 SHARK through Apr 30, 2024, 9AM UTC, and a Lucky Draw with 58,000 SHARK in rewards through Apr 30, 2024, 9:59AM UTC.

Lending and borrowing using NFTs as collateral is a novel concept that has earned Sharky leadership positions in this niche. As more platforms adopting this business model emerge, the competition in the field is likely to intensify. However, as of now, Sharky remains the absolute leader of the Solana-based NFT lending and borrowing market. 

As NFTs experience a resurgence in popularity following the post-2021 dip, DeFi solutions that make innovative use of these assets, such as Sharky, stand to benefit. Later in 2024 and beyond, we’ll likely hear more about NFTs being used as legitimate collateral in crypto finance — a new trend helped to no small degree by the Sharky platform.

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Sharky.fi (SHARK): The Decentralized Platform for Instant NFT Loans

Crypto

Bitcoin

Curious about the 21 million Bitcoin limit? From price surges to legislative support, here's what happens when all Bitcoins are mined.

 continues gaining traction and popularity for its decentralized nature and potential long-term value growth. More than 19 million bitcoins have been mined, and the next Bitcoin halving is taking place less than a year from now. This leads us to a most perplexing question: What happens when all the bitcoins have been mined?

As of Jun 2023, approximately 19.402 million bitcoins are already in circulation, which means only 1.59 million bitcoins are left for mining.

 An average of 37.5 bitcoins are being mined hourly, which makes 900 BTC mined each day. No bitcoins are truly lost. The assignment of the term “lost” to Bitcoin relates to owners who have 

, which results in their Bitcoin being locked away permanently.

 is used to reduce the number of available bitcoins entering circulation by half every time 210,000 

 have been mined (roughly every four years). This means the last Bitcoin will be mined by the end of 2078. In other words, no more bitcoins will be left to mine.

There is some confusion surrounding the exact date when the total Bitcoin supply will have been mined. If you search Google for the answer, chances are that the date of this event is listed as 2040 instead of 2078. 

The reward for mining started out at 50 BTC per block when Bitcoin was released in 2009. When the first Bitcoin halving took place in Nov 2012, the reward was halved to 25 BTC per block, followed by block rewards of 12.5 BTC in Jul 2016 and the most recent halving (May 2020

lowering the block reward to 6.25 BTC. It’s estimated that the next Bitcoin halving will occur on June 5, 2024, reducing the Bitcoin block reward to 3.125 BTC.

As of Jun 15, 2023, the current block count is 794,416, with 45,584 left to be mined until the next halving at 840,000 blocks.

, determined in 2008 that the total Bitcoin supply cap would always be pegged at 21 million, ensuring a virtual currency without inflation. However, since Bitcoin is intended for transactional use, just like paper currency, too many bitcoins in the market could generate wild BTC price swings.

With that in mind, the inventor stipulated a 21 million Bitcoin limit to control the supply and, thus, future Bitcoin prices and fluctuations.

One way to control the mechanism was to gradually release bitcoins, without overwhelming the market by releasing all 21 million bitcoins. For this reason, Bitcoin’s code was designed to allow only a fixed number of bitcoins to be mined every year until the 21 million limit is reached.

New bitcoins enter circulation whenever a new block is mined and added onto the Bitcoin blockchain. 

 is programmed with a difficult mathematical algorithm that helps keep the entire system stable by maintaining a 10-minute duration for finding new blocks. This difficulty is updated every 2,016 blocks, or roughly every two weeks, as the network itself determines if the activities of miners have increased or decreased. The network then adjusts the Bitcoin mining difficulty to keep each block time to roughly 10 minutes.

Every day, fewer Bitcoin blocks are available to mine as the Bitcoin mining end date gradually approaches. However, it’s essential to understand that not every Bitcoin mined to date is in circulation — which further reduces the total supply of bitcoins in circulation at any given moment. There are many reasons why the existing supply of bitcoins doesn’t correlate to the total number of bitcoins already mined.

One of the main reasons is the method of storing Bitcoin. Since the owner needs to protect their Bitcoin using 

 and passwords, there’s no way to access the stored bitcoins if the owner passes away without giving someone else access to the password. Bitcoin can also be rendered permanently inaccessible due to other errors on the part of its owners. This innovative digital currency is unlike any other assets in that it’s almost impossible to retrieve without the consent of the owner.

According to a recent study by the New York Times, almost 20% of bitcoins are trapped in

, with a total value estimated to be around $140 billion. These bitcoins will likely stay trapped indefinitely, which affects the total supply of bitcoins in circulation.

The next time someone asks you how many bitcoins are in circulation, simply look at the circulating supply. As of this writing, that number is 

, minus any bitcoins trapped in inaccessible wallets.

Even if there were no trapped bitcoins, it’s theoretically impossible to reach the supply limit of 21 million once all the bitcoins have been mined. In reality, the final figure will be very close to Bitcoin’s supply cap because Bitcoin’s supply is never expressed in exact terms. Instead, the code Bitcoin uses rounds off decimal points to the closest integer. As a result, a supply of 6.2589 bitcoins is represented as 6 bitcoins.

Bitcoins are split into smaller units, known as satoshis. One satoshi constitutes one 1/100 millionth of a Bitcoin. Due to these smaller units — and the rounding off of figures — experts suggest the Bitcoin supply cap will be limited to 20,999,999 instead of 21 million.

Incentive to Increase Bitcoin’s Total Supply

Bitcoin mining is popular because there’s a tremendous incentive for miners who can successfully mine the maximum amount of Bitcoin for their gain. Although the incentive is paid in block rewards, besides receiving Bitcoin miners also receive a part of the transaction fees associated with the completion of a block.

After the three previous halvings, miners currently receive 6.25 BTC for confirming a block. Despite the reduction in the mining reward amount, the higher value of each Bitcoin makes up for the halving effect. Transaction fees have also increased as a result of Bitcoin going mainstream. While Bitcoin transaction fees are expected to rise, not all BTC transactions need to be settled on the blockchain. Additional layers, such as 

, provide cheaper, faster ways to transfer Bitcoin, and will likely help with mass adoption as well.

Some experts believe that incentive isn’t an issue — because the transaction fees, which make up only 6% of the existing revenue for miners, will increase substantially, making up for the loss of Bitcoin block rewards. Still, this isn’t a satisfying answer for many stakeholders who are actively engaged in the Bitcoin industry. They still want to know what will happen when all 21 million bitcoins have been mined, and if there’s something they can do about how many bitcoins there will be in the future.

Is It Possible to Change the Bitcoin Supply Cap?

It’s theoretically possible to change the total Bitcoin supply by altering the underlying code. Since Bitcoin itself is software, experts agree that it can be changed. To do so will require developers, stakeholders and the community at large to agree to alter the code. If an agreement were to be reached, the developers would write a code to integrate those changes into the 

In order for everything to work properly, the next step would be to ensure that all nodes on the Bitcoin network either accept the changes — or are forced off of it. However, getting every node to accept the changes is no trivial task, since the Bitcoin platform was primarily designed as a standalone system that requires no changes. At that point, the developers would need to deal with a 

, which is a consensus change that makes a previously invalid behavior valid. In the perfect scenario, all the nodes would be upgraded to accept the proposed changes.

Another scenario would have only some Bitcoin users favoring the existing 21 million BTC limit. In this situation, miners and nodes who didn’t accept the change would continue to operate on the existing Bitcoin platform. These dissidents would likely compete with the new Bitcoin platform to capture market share. This is known as a 

, as it would create another chain that splits the miner base. One such example is 

Impact on Stakeholders: What Happens When All 21 Million Bitcoins Have Been Mined? 

At this time, no one can accurately predict what will happen when all the available bitcoins have been mined.

Several analysts favor using higher transaction fees to compensate for the absence of block rewards. New technologies will likely help to cut the mining cost, eventually resulting in more profit for miners. Another theory suggests that Bitcoin platforms will only be used for large transactions of very high value, offering sufficient revenue to satisfy stakeholders. Still other theories speculate about proof of stake (PoS) and mining cartels.

From a stakeholder’s perspective, the following is a brief overview of what will happen when all of the bitcoins are mined.

Miners are responsible for verifying transactions and adding new blocks to the Bitcoin network. They must solve complex mathematical puzzles, which nowadays require costly ASIC computers with substantial computational power that use a lot of electricity.

To compensate for their effort and cost to secure the network, miners are awarded block rewards and transaction fees.

Currently, most miners and mining firms use the Bitcoin block reward system to offset the cost of mining and still make a profit. But as mining rewards are halved, it’s expected that Bitcoin mining costs will eventually exceed the BTC rewards that miners make, well before the fixed supply is reached.

However, if the price of Bitcoin increases over time, it can sometimes offset a decrease in Bitcoin block rewards. Currently, using a regression model, the average cost of mining a Bitcoin is roughly $17,600, and the most efficient miners using 

 can still mine at breakeven between $7,700 and $10,560, depending on the network difficulty and cost of electricity. All miners from the previous generation of 2016 to 2018 are no longer profitable, and many of the mining rigs between 2019 and 2020 are also no longer profitable.

In the next Bitcoin halving in 2024, these breakeven prices will double if more efficient mining rigs aren’t created or cheaper sources of electricity aren’t found. This could spell trouble for miners if Bitcoin’s price doesn’t increase enough to reach those levels, creating a potential death spiral in which too many miners stop mining as it becomes unprofitable. There just won’t be enough hash power to mine sufficient blocks for the mining difficulty to readjust within two weeks.

The only question is: What happens to transaction processing fees when all the coins are mined? Theoretically, if a miner validates enough transactions, the fees earned can help compensate for missing block rewards. But the transaction fee amount will depend on the state of the network in the future.

If the current limit of 21 million isn’t breached, one of the existing scenarios will need to occur: Higher transaction fees and reduced operational costs should be enough to keep things rolling; or, at the opposite end of the spectrum, miners may form cartels to control the supply and demand of bitcoins, as practiced in oil production and in diamond mining industries.

As Bitcoin mining nears its limit, the value of Bitcoin is expected to rise. Assuming that Bitcoin remains popular, the limited supply and investment value will tempt people to use Bitcoin as an investment commodity that acts as a store of value rather than for transactional use.

The price graph of Bitcoin favors this extrapolation because its value has consistently risen, despite the decrease in reward per block. HODLers and retail investors will hoard bitcoins in their wallets instead of releasing them. These actions will further decrease the supply, and keep Bitcoin’s value high.

In the future, whenever a new crisis emerges, central banks around the world are likely to print more money to combat it, causing a devaluation of the currency. Citizens of that country may choose to use their highly inflationary local currency to 

, a disinflationary digital currency that cannot be controlled, as a store of value, regardless of the supply of Bitcoin, as long as its supply is limited.

A growing number of companies are eager to test the crypto waters. Tesla, Block, Morgan Stanley and many other brands already have long-term plans to adopt crypto. Even 

. If the popularity of cryptocurrencies continues unabated, it’s likely to attract more institutional investors who will be ready to take first-mover advantage.

According to Philip Gradwell, Chief Economist at Chainalysis, institutional investors are treating

. Due to Bitcoin’s mining limit, scarcity and potential price increase, institutional investors will use virtual currency as a hedge against inflation, just as they’ve used precious metals in the past.

Bitcoin and other cryptocurrencies have proven to be a double-edged sword for governments worldwide. While many countries don’t accept Bitcoin as legal tender, they’re keenly watching its impact on the world’s economy. As of now, El Salvador is the first country to adopt Bitcoin legally, but 

Instead of the take-it-or-leave-it approach, policymakers will probably favor a middle ground, such as approving a 

. Governments will adopt Bitcoin — but they’ll try to regulate every aspect of its operations. Rather than waiting to find an answer to what happens when all the bitcoins have been mined, there’s a strong possibility that individual governments, including that of the U.S., will create their own versions of digital currencies to compete with Bitcoin, known as 

Given the enduring popularity of Bitcoin, we can safely assume that, 

, it will continue to attract stakeholders even when the total Bitcoin supply has been mined. Reaching the maximum number of bitcoins won’t create a doomsday scenario unless Bitcoin loses its demand and traction. More likely, the Bitcoin ecosystem will continue to adapt to changing patterns in the global economy, giving it a stable outlook for the foreseeable future.

21 Million Bitcoin Limit: What Happens When All the Bitcoins Have Been Mined?

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