Topic: BTC Security Broken? (Read 480 times)

Really appreciate the conversation! This is very enlightening for me. I'll continue my research.

There's an academic paper on PoEM I was referring to. I'll PM it to you if I can. One of the authors did a video recently too.

$200 is still no problem for LN, $400-500 may be the limit I'd be comfortable with, or let's say channels with capacity up to $1000. Currently the fees are low enough to do these transactions onchain.

Ideally (for Bitcoin's current security model) the transaction fee would be close to 2-3 cents per vByte (currently about 30-50 sat/vByte), i.e. about $2.50-$10 per transaction (to today's USD purchasing power). This fee level would allow both cheap LN channel creation but also ensure a significant miner income based on transaction fees ($50-100k if block space is fully used). We don't need $100 fees for this.

The "PoW mechanism" itself isn't the problem, as it's not directly related to the "zero-emission" policy from 2140 on.
One could think about a PoW/PoS combination, like Vitalik's original "Slasher" or the ones very common in the altcoin world. But regarding their theoretical security it's not totally clear if these mechanisms are an improvement; for small altcoins however "practically" they seem to be the "salvation" from 51% attacks. But a trillion dollar network is another story. The good thing is that we have a "rabbit" to conduct PoS experiments, Ethereum, which is large enough to be attractive for hackers to discover PoS vulnerabilities

I don't understand what you mean here. L2s like Lightning, Ark or sidechains are for me exactly what "subnetting" in the case of TCP/IP would be.
It is not part of the core protocol, LN uses core features like HTLCs but they were not implemented with LN in mind. LN itself doesn't create problems at Core level, it may need to solve challenges at "subnet level" only. The same is true for sidechains.
The "fragmentation" can partly be hidden from the user. For example, there were ideas in 2017 to let the Bitcoin Core client decide if a transaction uses LN or on-chain, with the user not having to intervene. I don't think I would use this feature but for people not wanting to bother with technical details such a "hidden L2" may be attractive.

Well that description at a first glance looks like pure technobabble, like we're accustomed to in the altcoin world. It doesn't explain how this solves the double spend problem. But yes, for a detailed discussion about this I invite you to create a thread in the altcoin forum.

That's what others though try to portray Bitcoin, and so it could be conflicting for others, but there could be school of thoughts that both are applicable but it will take some time to achieved that, or it might not happen.

And again, this narrative makes what Bitcoin is today, it the beginning it was just a payment scheme and then it evolved to what we call a hedge to economic issues or even wars. So it encompasses every facet that is known to man and so the narrative can take many shapes or forms.

Narratives like these are what people create for themselves to try to explain Bitcoin. Sometimes they go overboard like the second one "replace fiat". The reality is not always the same as the narratives people create.

Bitcoin is just an alternative option for people to choose. It is not supposed to replace anything. And of course Bitcoin has the potential to become money and by definition money does both: is a medium of exchange (can do what fiat does) and at the same time is a store of value (can do what gold does).

So $200 shoe purchases or general mall shopping is still up in the air?

My "BTC Zealot" sentence shouldn't be read into. I'm not a fan of alt-coins or the fragmentation that comes with L2's. I'm re-visiting PoW due to the madness that became of ETH.

I'm just wondering if our current PoW mechanism is as good as it gets or if there might be a better one that unlocks additional scalability without introducing MEV or forcing us into one direction of scaling.

For example; has anyone considered subnetting? If blockchain is a "protocol" and engineered to be the TCP/IP of value... Then perhaps we should spend some more engineering cycles on the underlying protocol instead of taking a game development approach, bolting on features that IMHO creates more problems than they solve.

I've found a paper the other day explaining Proof of Entropy Minima that seems to have a lot of potential, but I don't know if anyone is actually using it. However, that discussion is probably better suited to a separate thread. In fact, I apologize; I seem to have abandoned my OP. 

No, if you limit its scope to the use case it currently already is used for: small payments (up to $100 for example).

It is unsure for me if it will become a solution for larger payments too, but that's why I think sidechains are also a piece in the puzzle.

There are of course possible usability improvements, but the general direction it is heading is the correct one I think. And I have also no problem with some people wanting to using it with a centralized service provider. I don't hear the same questionings from big blockers when people use centralized exchanges

And if the "BTC zealot" sentence is a hint that you favour an altcoin approach, then: all altcoins have the same problems and tradeoffs. If they want continuous/tail emission, then they are less attractive as store of value. If they want big blocks, then they tend towards centralization. PoS maybe is less dependant on market leadership for security, but has centralization and perhaps also undiscovered security problems, and it doesn't achieve the same amount of censorship resistance than PoW. And so on

Good point, in this case it's financial security instead of cryptographic or code/protocol integrity.

You should probably open by defining what you're talking about. When most people talk about security, they are referring to how well defended from an attack they are - the first meaning of your thread title is that some aspect of the mathematical integrity of the blockchain or bitcoin has been broken. Yet the discussion that you link to is not talking about this at all, it is just one persons opinion on whether people are willing to pay for higher transaction fees, which is also not true. I've seen bitcoin transaction fees stay relatively low even when it has been priced even higher than it is now. That is because more computational power is added to the blockchain if it is economical to the local energy prices and there is profitability involved - which is often the case especially with new green energy sources coming online daily.

You are right actually because since miners block rewards are being halved during every halving, the only way they can regain back is basically through the increase in transactions fees and since the price of Bitcoin increases during the bull season, congestion are meant to occur because a lot of people will definitely be withdrawing their Bitcoin which leads to severe congestion in mempool and in order for one transaction to be confirmed earlier than the other it will require high transactions fees before it can be quickly added to the next blocks so it is not new and since halving and increase in the price of Bitcoin will continue till the last blocks are mined, it then means that transaction fees will continue to increase. Just like the whales, high transaction fees means nothing to them so it's only those who are short term hodlers that are worried about high fees but for long term hodlers they don't care since they are hodling for long intervals and must have made huge profits that can still cover for the transaction fees.

Does anyone else think LN introduces more problems than it solves?

I'd like to believe that the underlying technology is a game changer, but probably needs a few more iterations before becoming mature enough to solve for Fiat.

Is being a BTC zealot simply easier than doubling down and trying to solve this problem? Or do we truly believe BTC is as good as it gets?

For now yeah because the price is dumping once again but we already have a solution to this problem, in case it occurs again. You already mentioned a couple of them in fact. Maybe there are only people who are not yet aware of them or they don't feel like using them, for some reasons. There are users who use those new technologies on BTC, no matter what its condition.

It is possible to stop a moving transaction and most of the times it was the exchanges are the ones that has the ability of doing it. Security can be different to that matter and there are no problems with it. The only thing is that, like you said, the future is still unpredictable but we can only hope for the best for the coin.

Good observation indeed.

My take on it is that it can do both, but not as a pure on-chain transaction tool. On-chain mechanisms are far too limited in scale, even as a digital gold it would only be of use for a low number of people, and even with slightly bigger blocks it would still not be enough that the majority of the world population could put their savings into BTC. This means that we need decentralized off-chain methods like LN, sidechains, rollups and so on.

Bitcoin's most important USPs, like censorship resistance, are more related to the "digital cash" use case. If we only pursue the pure digital gold mantra, the value would be probably more volatile over time, as liquidity would be limited to relatively few users. This would in some way contradict the "gold" concept.

If I was harsh I could say that the pure digital gold concept would lead to no value at all: If Bitcoin's main "USP" is that it goes up in value, then altcoins have theoretically a competitive advantage as they can grow much faster. Bitcoin would thus not be able to really benefit from this USP.

Instead, if we focus on censorship resistance and potential global usage also for payments, an ecosystem of different user classes (retail users and savers, merchants, service providers and so on) could be built which would be very difficult to surpass for any altcoin. I think this is already happening on a limited scale, and that's why Bitcoin's dominance stays high, but once the scalability solutions really take off, the competitive advantage of Bitcoin will be enormous and every "flippening" dream would come to an end. (Altcoins would continue to exist, though).

Thus, my opinion is that we need scalability solutions which enable Bitcoin also to be used as a fiat replacement. And this means that we have to accept the above dilemma and try to solve it.

A mix of LN and merged mined sidechains providing the "tail emission" like I outlined above would probably solve the problem.

And both gold and fiat would also only be partially replaced by BTC, I think. Both fiat (dynamic supply according to economic cycles) and gold (visual/haptic quality, industrial use) have use cases I think Bitcoin can't replace entirely.

You can buy Bitcoin as it intended to be, P2P no middle man and you can save it in cold wallet no one will be able to hack it or even tax it.

most of the trading platform now require KYC but those are the one where you can turn your Bitcoins into Cash, if you want to hold it use the P2P method

I think some of the confusion comes from the conflicting narrative:

"BTC is digital gold"

"BTC will replace fiat"

Can BTC do both? Or is the official narrative one or the other?

The thing is, we can do something about it right now: The lightning network (cliché, I know) fees will remain low in the long term, so when anyone wants to make small payments they can create a Lightning channel just for that, but then you'd need something to incentivize moving channel funds the other way - maybe something like "micro-lending"?

Which one? Solana?

Solana is valued only 50% of its ATH in 2021 (about $260). It's network stops working regularly for hours, which is much worse than Bitcoin's congestion moments. Full nodes have to handle a high throughput, forget it to run one of them on relatively cheap consumer hardware. The whole network is based on a principle similar to SPV.

And it's not decentralized. It could be described as distributed as Fastly or Cloudflare are, but entities managed by the founders have a lot of control over the network due to the enormous premine.

Basically Solana is a PoS version of BSV. Same is true for XRP and Tron. And all other "platforms" have either a much smaller "real" data throughput than Bitcoin (coins like LTC, BCH/BSV or Doge) or a similar fee problem than Bitcoin (Ethereum, Avalanche).

By the way, Bitcoin's "dominance" value, even if it's a highly flawed indicator, is steady over 50% according to Coingecko. Thus I don't know what you're talking about.

And yes, scalability is important but all these coins employ basically the "big blocks" paradigm and it doesn't solve scalability as long as all transactions have to be processed by all full nodes. The goal of scalability solutions is to bundle several transactions moving them partly off-chain or to alternative chains (sidechains/rollups) where only a part of the nodes have to process them. And in addition, as written in my previous post, it can solve the long term security problem providing a "tail emission" if implemented intelligently via merged-mining.

Except that's not how it works in the crypto industry, at least as the trend suggests.

Even now bitcoin's slowly losing its grip as the number 1 coin on the ecosystem, with better and more scalable tokens slowly climbing up the ladder to take its place. And for good reason too. Cause why the hell am I gonna stick with a coin that gets congested every tuesdays when I can switch over to another crypto that could basically do everything for me for a buck fifty, including doing my taxes (a bit exaggerated but you get my point).

The concept of "antiques" or scarcity in this industry would only work if that is the intended purpose of the coin/token itself. If it is not, people will switch over to a much better coin that suits their needs and provides what they want. It's just that easy.

Scalability is a massive problem for bitcoin that if left untouched would literally cause its end. Right now we're seeing the signs, we don't need to wait for its dying throes before we actually start doing something.

Hihihi, 16 cents per kwh?
16 cents per kWh was a deal breaker 3 years ago, nobody under 8 cents is actively mining, the sweet spot for making money is around 4 cents after taxes. Phil has done a lot of calculations in the difficulty thread, but it essentially boils to this:

One TH/s of medium efficient gear will burn around half a kilowatt and earn 4.5 cents a day.
You're at 9 cents you might lose money, you're at 6-8 you might never ROI, you pay 2 cents you drink wine waiting for everyone else to go bankrupt.


Of course not $1000, but you have on average 500k tx that need to generate 30 mils a day, so $60. Would you ay twice the pizza for a pizza?
More importantly, are you going to pay $60 to open a LN and $60 to close a LN?
You and me, maybe!
Average Joe and 1 million others, no!


But, but, but...we need to ban dicks pics! 


Doge/LTC miners love it! 

Hype on transaction fee is not what the bitcoin use to come down, neither does it determine what the tax rate is, the security is solely base on the protocols set up with the bitcoin network and as long as any of these does not break it concession, then there's going to be nothing can make it be under attack or experience a bridge in protocols, the security of bitcoin also depends on whether if the Bitcoin nodes could be attacked or not.

No it means 16 cent mining is a loser at the moment.

At 8 cents power costs $6.94 thats a winner

Heck I did a stab with a hoster at ten cents for the next 12 months. cost will be 220x12= 2640 the t21 cost 3500 with mods.

so 6140 for first year. I am pointed at https://pool.laurentiapool.org/#/user/146UJM5kgzLVUV23CXCf33KQKHckoX1gx3

I will see how it does.

The difference to a block size increase is that only miners would really be affected. It would still be cheap to operate a full node without mining. With all advantages this provides, for example privacy, and helping against other attacks on SPV clients.

Transaction processing costs on Drivechains or other merged-mined sidechains/altchains, in relation to hashing costs should be negligible for miners. Miners are generally extremely well connected to the network, so the biggest problem for "household" full nodes, bandwidth, does not really bother them. And historically a big percentage of the Bitcoin miners for example merge mined Namecoin, even if the NMC block reward was/is a small fraction of the Bitcoin block reward. It's ... at least something.

You could bet on that if the Sidechain/Drivechain model gets popular there will be more than one sidechain. Let's say we have our 4MB/10min BTC mainchain and 10 4MB/10min drivechains. Thus for a full node operator who wants to use one of these chains and in addition the mainchain, they still would have much lower transaction processing and bandwidth costs (8MB/10min) than if Bitcoin had 44 MB blocks to accomodate the same number of transactions.

But actually, $1,000 fee is an exaggeration, no one would pay that high to have their transaction first in queue. Plus purchases in the blockchain that would pay high fees will not be financial transactions to pay for a $20.00 pizza. We already saw users pay more than $50.00 per transaction for their Ordinals dick pics and fart sounds, and their Runes. I believe those users are the only people who will pay high transaction fees, and therefore they might play an important part in Bitcoin's future.


I posted/asked about something the same, I believe probably last year.

But isn't merge-mining going to be like a block size increase? Because it would require miners to use more processing power, which will also require them to spend more capital to mine.

I pick Bitcoin Miner T21 with specifications:


When I calculate the profit on viabtc, 190 TH/s generate 0.0001539 BTC or $8.78

Then I use electricity calculator, average of electricity cost in US is 16 cent per 1kWh. With power consumption 3160 watts (W) and 24 hours use per day.

I got electricity cost per day $13.8624

I didn't even include the maintenance cost, cooler, fan etc, but it means mining no longer profitable isn't?

I wonder why there were so many threads open in these last weeks about that exact topic. It seems even somebody registered an account just for this mission. I think the discussion with most depth is in this thread, even if the title suggests it's about Ordinals/Runes.

I do not oppose ideas like an infinite tail emission like on XMR or Doge. But the problem is that a hard fork removing halvings e.g. from block 2xxxxxx on would drive away those Bitcoiners who firmly believe that the 21 million limit and the "deflationary nature" is the big USP. I think different, for me it's censorship resistance. But the "21 million guys" exodus would probably lead to a crash of epic dimensions, and probably also lead into another BCH-like fork, a "Bitcoin Classic" like ETC with the 21 million limit intact.

Let's see some of the options:

1) Big blocks without a tail emission would not solve the problem at all, because the miner income would actually fall, due to the less competitive fee market.

2) Big blocks with tail emission could work, but it has the problem I just wrote about - the abandoning of 21 million limit would lead to big turbulences. And there is the centralization problem if the block size limit is rised too much.

3) Tail emission without big blocks would retain decentralization, but obviously the "21 million guys exodus" danger is still there.

4) "Doing nothing" would probably gradually decrease the attack cost. There the X guy is correct. But the impact of halvings on miner income would be lower on each halving, even if the fee level stays constant at 5-20 sat/vByte.

5) Depending on higher prices like @pooya87 writes is imo not a sustainable strategy. Bitcoin should also work if it's priced lower than now.

6) There's also the hilarious idea to make Bitcoin blocks smaller to boost transaction fees. Apart from the hard-fork problem, this however would also make Lightning onboarding more expensive.

7) (this is my favourite strategy, as I wrote about in the other thread): explore merge-mined sidechains and rollups. Each sidechain can have an utility token which would be merge-mined with Bitcoin. Basically, this would be a kind of "off chain tail emission".

Another idea I wrote about (some years ago) that there could be synergies if miners work also as Lightning hubs and collect fees there too. This would of course make it necessary that Lightning is used a lot more than now, in the current state I believe no miner has really incentives to enter the LN fee market.

"Extremely high fee" is not what we have even right now, let alone in the future when we may even find a solution. Yes, it could do that now, if everyone started to move their money, there is nothing stopping it, but why not consider something like LN may eventually get to working, and we may do better. Look at the past ,we had legacy, and then we moved to segwit and now we are paying less, it has happened before and it may happen again, why not?

This is why I think security question here is not fee structure, that can change, we just need to make sure that we know that future is not decided and known, so we have no idea how the future will be. Maybe it will be very high, maybe it won't be, we just need to make sure we are in bitcoin for the right reasons.

that’s true. the transaction fee is proportional to how much you are going to be sending but if you are sending such a huge amount, it might seem like a few dollars might be worth it just to send out that specific transaction. meanwhile if you are only sending relatively a small amount then you might regret that few dollars off for a transaction fee
the problem is that it will not go through right away which could cause the problem because it might be a transaction that is needed to be done by the moment this is why many do not use bitcoin for daily transactions for this specific reason

It's pretty simple:
1) Go here and find out the price of a miner as well as its hashrate and consumption:
https://shop.bitmain.com/?coin=BTC%2FBCH%2FBSV
2) Current income is 4.8 cents per th/s
https://www.viabtc.com/tools/calculator

Do the math on your power cost and how much you would earn! What would be easier? 


So tell me, just because 100 more people use Visa than let's say American Express, you're going to pay 100 more in fees for that card instead of an AE one? Also if Nvidia shares went up 10x and Mirsoft only 2x, would you pay your broker 5 times the fees when you sell $1000 them? 

When BTC reaches 1million , you're going to be ok with paying a $1000 fee to order a $20 pizza? 
Just because the price of BTC has increased?

That depends on if Bitcoin will be used more than what it was intended to be. We've already seen what meta-protocols can do to increase demand for block space. Plus Ethereum has high on-chain fees and that never stopped their users from paying them to buy a dick pic or to mint one.

this has already been discussed
https://bitcointalksearch.org/topic/m.64306383

anyway lets address the points
the first ignorance of the OP's quote is that the assumption that only ~3000 transactions should occur and each transacter should pay more.. when reality is more transactions could and should go into a block and thus each transacter doesnt need to pay more due to more transactions getting into a block to accumulate a better total for a mining pool

the second ignorance of the op is that miners(asics) do not select the transactions. they just hash no matter if a block is full or empty. its the mining POOLS that select the transactions and even if there were not many unconfirmed transactions waiting, a pool can set a minimum fee to accept thus there is also not a need for network policy to have set defaults to bump/force a fee up.. the mining pools make the choices

pools can also decide how full a block needs to be, if the blocks had a network policy of say xxmb. this does not force pools to fill a block to xxmb if it caused network propagation congestion. the pools will see the delay of their block candidate propagation if it got too full and so would decrease transactions in a block even if the limit was higher(as the case of blocks only filled <0.5mb when the limit was 1mb 2009-2013)

so with all that said. the pool can choose the amount of data to include to ensure the data is not going to cause delays in the fastest broadcast competition. we do not need devs playing politics forcing economics on users to force users to pay more when the network can self regulate.
different pools can choose their transactions and if a miner on a certain pool is only getting a few sats for their time due to having too many other miners on the same pool cutting into its reward share, they can move to a less competitive pool.


also when it comes to the cost/reward for miners. they can jump to different pools/coins if they dont get the results they like or temporarily move to altcoins of same hash algo if the market conversion rate of coin to fiat is on a dip. but its worth noting even if a block only has <4btc reward total($280k) its not actually a <$280k cost to break/harm/undo/reorganise a block or the chain.. miners costs are not per block. they are spread out over a ~2 year life cycle of the hardware. meaning ~105000 blocks so the actual security/cost to be malicious at 51% is
$280k * 105k * 51%=~$15b of hardware and electric on average in recent times.. and so if its going to cost $15b to accumulate the hardware and pay electric contracts to mine at these levels. they need to then want to be malicious to a point of getting ROI of more then $15b to break even/profit

most transactions are not worth $15b and even if they re-orged a block to empty block each block for 2 years. unless they owned all utxo's of all them blocks to undo their confirmations or mess around.. they wont break even. so its not worth breaking bitcoin.. even if the per block cost is only $280k of security

So do you find it discouraging to hold and transact with bitcoin as a course of the excessive fees?
I also do not think the high fees are results to maintain security longways as said but it is usually an index to meet with miners rewards and as a cost of market demands, transactions becomes congested for progressive transactions which as a loophole, transaction are jammed leading to more charges to solving technical factors.

I checked that social media account and it seem they are making up conclusions on many blockchains not just bitcoin. Maybe they are right, maybe they are wrong, nobody can predict what bitcoin will become in future. But the usual trend on that account is pessimistic about every coin.

I have my doubts about the integrity of that fund.

However, I agree with @pooya87, I think their comment is spot on. Price of bitcoin in terms of local fiat currencies are never considered when making this statement. Miners need the transaction fee, but the fee will be here for as long as bitcoin exists.

Shifting to POS is a poor choice, in my opinion. Temporary blocking of ordinals seems to be a better solution in the short term.

1.The Bitcoin transaction fees aren't "extremely high" 24/7. The fees are pretty normal 90% of the time.
2.Why this guy thinks that the "extremely high" transaction fees are some kind of "last line of defense" that guards the overall security of the BTC blockchain? I'm not the biggest expert on blockchain technology, but this idea seems weird to me. Maybe some blockchain expert should explain this in detail.
3.The whole topic about BTC transaction fees being "extremely high" probably would have been completely avoided, if the BTC blockchain wasn't clogged with useless stuff like Runes and Ordinals.
4.I can agree that Bitcoin might not exist in the current state after 100 years, but there's no way for me to see what's going to happen after 100 years.

I agree with you, if mining is not profitable logically Bitcoin mining will stop forever from yesterday or today. In fact, more and more new and old miners are expanding their scale. And I am sure that the miners are not stupid or lack knowledge, many of the miners are currently using green energy and environmentally friendly solutions, noise problems and other environmental problems are always being improvised or updated to make them environmentally friendly, even at the level of countries or world governments. also contributed to the improvisation of environmentally friendly Bitcoin mining

---

Apart from that, regarding what the OP said regarding transaction fees, Bitcoin transaction fees do go up and down but tend to be stable at around $2. The spike in transaction fees that we experienced up to $20 only occurred for a few moments and was not permanent, this is indeed a problem but not that serious considering that even with low fees we can still send Bitcoin even though we have to sacrifice time which can reach 1 week for transactions BTC confirmed. I'm sure Bitcoin developers are still racking their brains to make Bitcoin even better in the future.

There are more industries which are worse for environment than Bitcoin mining industry.

Bitcoin Mining Council report on H1 2023.

More details from their report in the video on Youtube

From BMC member data to Global Bitcoin Mining data, the percent of sustainable power mix is 63.1% and 59.9% that are better than many countries like Germany (48.5%), EU (43.5%), United States (31.4%), Canada (22.5%).

Some articles to debunk Bitcoin fud on energy.
https://endthefud.org/energy.html

This is basically the new "bitcoin is bad for the environment" FUD that started a while ago to also justify the ongoing spam attack against Bitcoin that is known as Ordinals.

The flaw in this types of argument is that they forget the price.
You see, miners don't pay their bills in bitcoin, they pay it in fiat. So if they earn 1BTC they pay the same electric bill in fiat (eg. $100) than if they earn 1.2BTC with fees. That means if bitcoin is worth $120 they are already making a profit ($20) and if they earn 1.2BTC they make a bigger profit ($44). In other words they don't need that extra income generated by the fees.

So far the price has been on the rise in the long run (in each halving cycle) and you can't find anybody who would argue that the rise is going to stop here and never go up.
Keep in mind that this is for the near future, like next 10 years. Anything beyond that (like speculating on year 2140 where there is no more coins left to mine) is silly because it is impossible to know how the cryptocurrency and cryptography scene is going to be beyond next 10-20 years let alone talk about 100 years from now!

Bottom line is that high fees is a problem that needs to be fixed specially when it is caused by a spam attack like Ordinals that is exploiting the protocol and is abusing the bitcoin blockchain.

I wonder how much exactly the miners spend to mine Bitcoin and verifying the transactions, then how much they actually earn from that, so we can get better illustration what he said is true or not. We can't just look at the miners revenue graph which continue to drop, because it was rise so high due to ordinals.

I'd say miners will be more centralized, small miners will leave (many already left) and they will move to country where electricity cost is cheaper.

A lot of people do no realize that high transaction fees is a problem! Even if someone realizes, they would not recognize! But the high transaction fees is indeed a problem that needs a resolution. However, the way current network is designed and the halving events are organized, I don't see much hope here! Miners who have invested heavily into ASICs to mine Bitcoins, will have to make profit out of it. As the mining reward part is constant and reducing, the only variable here is the transaction fees. So if I am a miner, I would want to transaction fees to go up so that I can make profit. I don't see an immediate resolution to this pain point.

A temporary solution will be to ban all ordinals from the network so that they can't block the network. That might give a temporary relief to us. But a long term solution needs to be worked out. Possibly moving from POW to POS can give a long term relief where people wouldn't have to invest a huge amount of money upfront to be able to mine Bitcoin.

Bitcoin transaction fee is paid in bitcoin or its smallest unit, satoshi.

Assuming that in future, Bitcoin continues its adoption and price growth, with higher price of Bitcoin, transaction fee will become higher with same fee rate. Not yet considering that with bigger adoption, same capacity of Bitcoin block to handle number of transactions, people might have to join fee rate race and use higher fee rate, this will be a second factor to cause higher and more expensive transaction fee.

Transaction fees depend on demand that is usually higher in bull market but if people know well about Bitcoin mempools, they can wait and plan for transactions in times of mempools without congestion.

I don't know if you are aware of Lightning Network (LN), it's a second layer protocol that is being developed for small and micropayment transactions like for a cup of coffee. Here is a good introduction,

[All Lightning Network Threads In One Place.

I'm not sure who is Justin Bon's though, but we all know that fees are dynamic and recently there was a deliberate attack that's why the tx fees goes as high as we have never seen before. But guess what, now it's back to normal, and so those kind of attacks are not sustainable, and it will cost a lot of money to them or the project that they have created have died down already.

You can also check the tx fees here: https://mempool.space/

What makes rarities or antiques valued the way they are in our everyday society?

To answer that I would say simply because they are hard to come by and someone somewhere is willing to pay an unbelievable amount just to own it.

You can say the same goes for Bitcoin. If you look at it, the fee isn’t always that high, depending on the amount your sending at any point in time. Also, the intent you wish to archive which wouldn’t be far from privacy wouldn’t keep you far away from the innovation.

It really isn’t up to the fees you know, the purpose for which you wish to archive with it. You can swiftly get a large some across and get things done from the comfort of your home without following any definite procedure or stands to be audited on a transaction. This too is okay to keep things going for Bitcoin.

I guess that's debatable, but I'm reluctant to say that a $2 fee is acceptable for a cup of coffee. That being said, I think Justin Bon's is saying that as the amount of rewards per block decrease TX fee's will continue to increase and must replace the miner's revenue from mining blocks otherwise they will exit the ecosystem. Current block sizes and a reduction in miners producing blocks will also increase TX fees?

What's an extremely high fee? What's high for you may be low for someone else.


In 2019 the average fee was around $1
In 2021 it was $2. In 2023 it went up a bit again, but stayed around $2.5.
I don't count extremes where due to congestion it skyrocketed above $20, which happened in 2018, 2021 and 2024.
What makes you think the fee will be much higher in the coming years? The history points towards a slow and gradual increase. You can still send a $2 tx if you want and it will go through.

This is a well thought out thread in my opinion.

Here's the summary:

"
BTC's longterm security depends on people paying extremely high TX fees which won't happen in a free market.
"

Is there a gaping hole in this argument?

https://x.com/Justin_Bons/status/1810357305390616839