reply on: Are you comfortable with Bitcoin's security model? \ stacker news ~AskSN

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14 sats \ 4 replies \ @The_Young_Bitcoiner 3 Jun freebie \ on: Are you comfortable with Bitcoin's security model? AskSN

Hey friend. I like your concern and I once had this in mind too. You're actually missing out on something which is the price. The price tends to at least go up 3, 4x each Halving cycle, making it worth mining even though the rewards halvened.

0 sats \ 3 replies \ @klk OP 3 Jun

Bitcoin price growth follows a power law (as any network) but the mining rewards decrease exponentially. A power law grows slower than an exponential so in practice the security budget goes down with time (not considering fees).

But If you check the calculations from the post, they are made in Bitcoin and as a percentage of the total network. So it's independent from USD price. Miners make ~0.8 % of the total Bitcoin supply yearly. If that number in the future becomes 0.1 % or 0.01% (all purely in Bitcoin terms) it would be equivalent to having a castle protected by less and less security guys.

If you consider the Bitcoin price in USD, it might look like the security budget grows, but so does the potential “loot” for attackers, because the Bitcoin to “steal” is now more valuable. That's why it should be measured as a percentage of the total supply, or at least as an absolute value in Bitcoin terms.

This might not be the best chart but should be good enough to see the trend: https://dune.com/niftytable/bitcoin-security-budget

0 sats \ 2 replies \ @The_Young_Bitcoiner 3 Jun

I know (and it's a very controversial topic) that Peter Todd plans Tail Emission to fix that. What's your opinion on this? Personally I'm totally against and I'm in favor of just waiting for the market regulate itself.

0 sats \ 1 reply \ @klk OP 3 Jun

No idea. Wouldn't touch what's not broken.

It might be the case that fees itself are enough and nothing needs to be done.

32 sats \ 0 replies \ @The_Young_Bitcoiner 3 Jun

I think if miners ever "go broke" they would active drivechains. Do you know about drivechains? It is a scaling BIP that also improves miners revenue. It would be a win/win situation for Bitcoin on this case. Or the community can just activate it before them through UASF or anything. Drivechains allow multiple different technologies working upon Bitcoin with bitcoin's hashrate and token.