A Possible BTC Future

Take this as a little piece of science fiction; the chances the future looks like this are small, but of all the possible futures I think this has as good a chance of any of happening:

Imagine: it is the year 2061.

The BTC price is six million US dollars– equal to about a million 2021 dollars because of inflation.

Miners are being rewarded 0.006103515625 BTC per block, plus transaction fees of about 5 BTC for 4,000 or so transactions ($7,500 per transaction).

But most BTC transactions don’t happen on the BTC network. Most BTC is locked up in multisignature outputs secured using multiparty computation and mirrored on another chain as “wrapped” tokens. People moved their BTC either because they want faster transactions, lower fees, more privacy, or want to invest their BTC in decentralized financial stuff. Or maybe all of the above.

The transactions that do occur on the main BTC network are high-value, mostly between super-whale-size holders (centralized exchanges, central banks, and the decentralized multiparty computation addresses that hold all the wrapped coins).

These whales maintain the BTC network forever. They are the miners and the transaction creators; they don’t care how high transaction fees go, because they receive as many fees as they pay.

In the year 2100 the whales notice that the mining reward is basically zero, and there are fewer and fewer transactions happening on the slow, expensive, zero-privacy BTC network. So they decide to simplify and save money by shutting it down.

One by one, they shutdown the “bridges” that move BTC between chains. Then they burn any BTC locked on the BTC chain by sending it to the 0x000… address, to make sure nobody can ever spend it on the BTC network.

Eventually, there are zero new BTC being produced on the BTC network, and zero BTC circulating on the BTC network. There is nothing left to secure, and the chain stops.

But 20-or-so million BTC live on, circulating on other blockchains, valuable because there are a limited number of them and because BTC was the first scarce digital asset.


Now read this

Designing for success

I just listened to Emin Gün Sirer and Ittay Eyal from Cornell University on the Epicenter Bitcoin podcast. They’re doing great work; full-scale emulation of the Bitcoin network is a fantastic idea, and I plan on doing a lot of testing... Continue →