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Napkin math suggests Bitcoin will perish unless its mining incentives change
For years, analysts have gone on channels like CNBC calling Bitcoin “digital gold”, and many everyday crypto investors truly believe that. But gold has been a “store of value” for millennia.
This is because (written into its code) the number of bitcoins that miners receive per block mined drops by 50% every 4 years, aka the “halving”. According to YCharts, on July 13th 2024, miners made a total of $30.1M USD worth of crypto for their work in securing the network and processing transactions. It advertises “exceptionally low fees”, which kind of defeats any chance of charging people enough money per transaction to make up for the revenue shortfall.
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