What is the incentive for Bitcoin miners to continue operating a few halvings down the road when the subsidy is <1 BTC? Transactions will of course become more expensive, but I worry about a death spiral scenario where a meaningful percentage of mining goes offline due to on-chain fees remaining low, due to L2 network scaling, Bitcoin banks, and the like.
#asknostr #Bitcoin
Replies (2)
Some points off the top of my head:
1. L2-s will always need settling TXs onchain, and they have risks and limits(eg liquidity management and online requirement of LN) that base layer doesn't
2. Bitcoin banks have plenty of risks that base layer doesn't so a substantial amount of ppl will still choose that
3. Banks will also need onchain settlement between each other
4. Therefore sheer number of onchain transactions is gonna be through the roof, taking adoption into account. "Mempools will never clear" argument
5. Bitcoin appreciates tremendously in multiple halving's time
6. Bitcoin miners are getting more and more cost-effective
7. At the end of the day Bitcoin might not need _as_ much hashpower as ppl might think to survive. It depends on the real demand for base layer transactions and the mining business can dynamically grow or shrink as necessary
So, here's a different take for you:
In the future there's a good possibility most mining will be done by energy companies. They need to produce more energy than people consume for peak spikes... This also means they can have ASICs themselves to recoup money while they burn energy no one else is using.
If you're mining for sub penny per kWh do you really care about subsidy vs tx fee? You're basically getting paid for free so it doesn't matter.
