There are a few issues. First, you lose 20 µm due to the saw cut between the dies. I saw an NXP patent that said this was wasting 30% of the die for their tiny

There are a few issues. First, you lose 20 µm due to the saw cut between the dies. I saw an NXP patent that said this was wasting 30% of the die for their tiny chips. If you made the chips smaller, you'd be wasting even more. Another issue is that you need some area for the bond pads, so you can't make your chips arbitrarily small or they will be useless. Looking at a random die pick-and-place machine [1], it handles dies down to 0.2mm in either dimension. So you could handle smaller dies than mine with an off-the-shelf machine, but not a lot smaller. [1] The video of the die machine in action is pretty cool: https://www.syagrussystems.com/dts-2-die-sorter https://www.syagrussystems.com/dts-2-die-sorter