Linear sliders are also finite, while rotary encoders can spin forever.
If you don't need a value indicator, you don't need a circular knob as an affordance. You can have a whatever as it just reacts to your input.
If you do have a value indicator which is "infinite", such as a numerical value display, it's better to make it interactive and place the interaction on top of it, instead of splitting the UI between a value indicator and the input.
A lot of software does this.
There's no motion you could make that would infinitely increase without a break. A knob you can just move your cursor in a clockwise circle infinitely.