1M coins left to mine as Bitcoin enters ‘5% era’ — miners say the most dangerous part is only beginning
As Bitcoin surpasses 95% mined supply, miners face the capital-intensive '5% Era' where shrinking block rewards necessitate efficiency or a pivot to AI compute.Summary
Bitcoin has passed the 95% mined supply threshold, leaving under 1.05 million BTC to be mined over the next 115 years. While this validates Bitcoin's scarcity narrative for investors, for industrial miners, it marks the start of the '5% Era'—the most challenging phase due to geometric decay in block rewards (halvings).
Miners are experiencing severe revenue strain, evidenced by hashprice hitting a 12-month low, as current prices fail to cover operational costs for older equipment. This 'Miner's Paradox'—falling revenue against sustained high network difficulty—is forcing consolidation. Consequently, the industry is splitting: 'Pure Plays' focusing on efficiency, and 'Hybrid Operators' diverting power capacity to the more lucrative Artificial Intelligence (AI) compute market, a shift potentially unlocking billions in new revenue.
The long-term security of the network hinges on transaction fees replacing the diminishing block subsidy. However, current fee demand is volatile. If fees do not rise significantly to compensate for the shrinking subsidy over the next century, network security could decline, potentially impacting the entire crypto ecosystem. The surviving entities in this '5% Era' will likely be large, hybrid energy-compute conglomerates, not just traditional miners.
(Source：CryptoSlate)