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This is what I am hearing from the Bitcoin crowd 1. Bitcoin mining will eventually halvening away and all security will be funded by transaction fees. 2. Most
by ItsMonkk 5y ago
This is what I am hearing from the Bitcoin crowd
1. Bitcoin mining will eventually halvening away and all security will be funded by transaction fees.
2. Most transactions will move to the Lightning Network and be practically free.
As the LN will remove the need to pay fees with it combining so many transactions, the Bitcoin network will thus not be worth mining on, and will thus be able to be easily attacked. As the security of the network is diminished, it will quickly become worthless.
I don't see how this works long-term.
- rawtxapp 5y agoThere will always be demand for on-chain transactions (for very large transfers, cold storage movements, batch opening/closing lightning channels, etc). The 1MB limit makes it highly likely that there will always be a backlog of transactions even post reward world.
- ItsMonkk 5y agoUnderstood. So even with the Lightning Network Bitcoin will not be able to keep up with the transactions and transacting in it will be extraordinarily expensive. Currently block fees are 5% of the block reward. In 2024 when the next halvening occurs, either Bitcoin needs to double in price by then or the block fee will have to make up 45% of the gap, which is an increase in almost 10x, from $4.5/transaction to $40. If it fails to do this miners on the margin will stop mining and the security of the network will diminish.