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Transaction fees will never support block creation in place of the block rewards.

Bitcoin's value growth will exceed expectations and make it necessary to introduce a regularly occurring decimal shift with increased division very soon.

Satoshi even suggested this could one day occur (see attached image) and in the code included the limit of only up to 64 halvings being allowed, even though the math of current divisibility means we can't have more than 32 halvings.

It is likely the network will fork within the next decade into one that divides further and one that doesn't, with possibly no other major changes.

This need for increased divisibility will be clear when Satoshi's reach ¢/Sat parity in the next few years. IMO consensus will be found for adding a function to increase all balances by 10 with every halving, including a 1 time adjustment to add a 0 for every halving that's already occurred since network creation. If this were to occur by the 2028 halving, than we would have added five 0s to the network after that date. One Sat today would be worth ten thousand Sats tomorrow. This would effectively gives a "Coin split" and make the network easier to work with in small amounts while maintaining the current ratio of balances between users.

We can keep the meaning of 1 Bitcoin = 1 21 millionth of the whole network, thus maintaining the ♾️/21 million aspect of Bitcoin's scarcity narrative, but we can increase the number of Satoshi's each Bitcoin contains within it to maintain usability over the long term.

This would also help us naturally shift towards thinking in Sats over Bitcoins, as the number of sats you own would multiply by 10 every 4 years while the fraction of a Bitcoin would be unchanged.

☮️🧡₿

*Not an April fools joke*

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Discussion

Jack K 9mo ago

What is the original statement based upon? What are you using to measure Bitcoins value?

I have a bold rebuttal to make but I would like to understand your stance more. Moving the decimal achieves nothing imo.

TheBitcoinBattery 9mo ago

It's based on a few things. Firstly, based on my personal model I expect Bitcoin to reach a minimum of $1,000,000 per coin by 2028, $10M by 2031, $100M by 2035 and so on until the mining network's growth slows down which isn't happening anytime soon. This is based on the 0.2046% average daily growth of the potential bottom seen outside of major macro events causing long term growth to be delayed as happened in 2020/2021.

As the mining network continues to grow over time, and the halving and difficulty adjustment continues to reprice the Bitcoin rewards relative to energy input, the value of Satoshi's will rise to be large enough to divide with little controversy. For without further division the network will gradually become unusable over time as the value rises.

Once this division occurs, the transaction fees can further drop and extend the block subsidy's use as the primary block reward. When we increase division on a regular interval automatically akin to the difficulty adjustment, then the final block subsidy will not be in 2140 on the 32nd halving but in 2268 on the 64th halving when the world will have been using Bitcoin for over 250 years.

But after only 50 years the world will see Bitcoin as a necessity and not a curiosity, and a block subsidy and transaction fees will gradually no longer be the primary reason to mine as simply securing the network becomes it's own reward. Therefore the transaction fees will never support the mining of new blocks, for we will instead see a transition from a world of mining blocks for the block subsidy to a world of mining blocks for the security benefit it provides.

Jack K 9mo ago

Firstly I would like to state that there is great folly in comparing Bitcoin to the system it is replacing (fiat). Looking backwards at fiat distorts reality. I think we need to revisit the white paper and understand what Satoshi meant by “a peer to peer electronic cash system” from the perspective of physics.

By deconstructing the word choice Satoshi used, you arrive something along the lines of a “1 to 1 (equal to equal) energy cash system”. We know that 1 joule = 1 joule so this places us in a different domain than comparing to fiat where $1≠$1 with regards to time. The measure of value is quite important after all. We define mining by energy consumption (joules) so why not value?

If energy (joules) is the true peg to satoshis, how do we get there? Well entropy, temperature and Boltzmann is the very obvious link. So I would first ask, how do we define the temperature of a Bitcoin Block? The physical process in which computational energy is crystallized into immutable information. We are in the domain of energy transformations.

Looking at Boltzmann we have a dimensionality problem of how we relate Joules per Kelvin to Satoshis. Bitcoin reveals something fundamentally overlooked in physics; the relativity of Temperature defined by a known maximum supply of energy units. This would imply that the work done by Kelvin, Planck and Boltzmann is incomplete and needs adjustment (Bitcoin fixes quantum mechanics). Anything that touches temperature has an incorrect perspective and needs to be reexamined; all of our prior assumptions are wrong. Bitcoin is energy, thermodynamics proves this undeniably.

So, how does nature/universe maintain the conservation of energy without a peer to peer energy network? How do energy transformations maintain CoE?

Without going very indepth in the physics here, the existence of the universe and our ability to observe it reveals that we exist in an epoch in which a terminal subsidy of energy units (Kelvin) has been reached and our existence is solely sustained by transactional nature. Our existence is proof that Bitcoin can and will sustain itself solely fees by fees. This first assumption you made is fundamentally wrong and can be disproven with physics. Therefore we must really reconsider any change we want to make to the protocol.

If your physics is wrong, how can you even understand what you are looking at or comparing to? Are you certain we even understand what a Kelvin is? Are you certain peer to peer energy networks are not fundamental to reality and existence? Are you sure we even fully understand bitcoin and the changes we wish to make to it?

As far as moving the decimal, it’s relatively meaningless but it would be a way to adjust the perception of numbers we are looking at. But fiat has no place in this discussion. Some food for thought.

#Bitcoin #Physics

TheBitcoinBattery 9mo ago

Analysis of Bitcoin and its relation to energy is such an interesting field that is developing alongside the network.

Bitcoin fundamentally changes how humanity interacts with energy and time forever, and our understanding of this change is only just beginning.

Fiat is probably as far from a perfect measuring stick as one could get, but as it's currently the unit of account globally I feel it can be useful as a simple substitute for energy measurement and analysis of network growth trends until we start measuring energy more directly with joules or other.

Appreciate the response, I look forward to discussions like this becoming more common and in depth as adoption and understanding of Bitcoin grows.

Jack K 9mo ago

Thank you, by no means do I want to shoot your thoughts down, but I don’t think we truly perceive how deep fiat corrupts our understanding and perception of Bitcoin. The space is stuck in the understanding as just money/currency/digital gold. It’s way more and fiat digs deep in our psyche.

To say I know anything/everything is far from the truth, but I am pulling on the thread of Bitcoin as far as I can go, and to me it’s obvious the rabbit hole is quite deeper; like we’re only in the 1st inning in our understanding of Bitcoin.

I truly believe Bitcoin fixes quantum mechanics and our physical models of reality at the deepest of levels; starting with temperature. All of cosmology, big bang, quantum mechanics, general relativity is up for a complete reinterpretation through the new definition of temperature that Bitcoin provides us. Spacetime as well; it’s likely timespace in my opinion.

If you think disrupting the money is crazy, wait until it disrupts all of reality. It’s fundamentally changing us and the structure of reality itself. This has me both and excited and fearful of what I may be beginning to uncover. Bitcoin is bigger than me and could use all of the help I could get.

I think we are all wrong about Bitcoin; even the maximalists. A very inconvenient truth requiring yet another ego death of as all.

If anything I am saying holds any weight at all, then do we really understand Bitcoin and what we are building on top of? This idea would flip the entire space on its head. Every change to the protocol has a much deeper meaning and it’s important to have all perspectives. What if we are wrong?

Bitcoin being acknowledged as THE quantum computer is only the beginning. I think things are about to get crazy; especially when there is no second best.

dshf 9mo ago

I disagree with the first statement. I’d rather say I don’t know. Moreover the miner might find other incentives in cooperation with other businesses to offset some of reduction in income from block reward. For example like now with energy producers or houshold heating.

Bitcoin ecosystem is evolving like living organisms. Hard to prodict the future paths.

Secondly, what 1 cent will even mean in the future? Would we still use it as denominator?

TheBitcoinBattery 9mo ago

"I don't know" is the more honest and accurate statement in many cases. I generally use it, but in this case my view is that the cost of energy ultimately plummets to nothing as energy becomes abundant. At that point energy's primary use becomes to secure the Bitcoin network and our own savings, then when the block reward won't be replaced by transaction fees as the reward will be users simply helping to secure the network.

Users will possibly subsidize the network to secure their own savings. In hundreds of years when the block reward drops to zero the world will look completely different. We may not even need Bitcoin at that point, perhaps Bitcoin is transitory to whatever the future ends up being.

As for the last point, it's hard to say what we will use to measure the ever growing spending power of Satoshis in the future. The dollar and cents will only be useful for so long until Bitcoin becomes the dominant money globally. Perhaps we'll measure value in Gold oz, I don't know. But we're at least a decade away from the downfall of the dollar IMO.

Pre 9mo ago

Lightning already allows microsats, and the on chain's fees will never really go below one sat per byte, however much a sat is worth, so it'll never need the change. If sats are the equivalent of a hundred dollars each (though the actual dollar is long gone by then) then fees will just be hundreds of dollars per byte. The chain will be that full.