Bitcoin proof-of-work vulnerabilities could trigger a $1 trillion time bomb — Expert

Justin Drake, a prominent cryptographer, dropped a bombshell this week: BTC’s security model is a “time bomb” due to Bitcoin proof-of-work vulnerabilities. His analysis highlights a chilling trend: transaction fees, which should replace shrinking block rewards, have collapsed to 13-year lows.

Miners now earn just 1% of revenue from fees, with 99% coming from block rewards. But with April 2024’s halving slashing rewards to 3.125 BTC, and future halvings inevitable, the math looks dire.

*“The 21 million cap breaks security. It’s self-destructive. Satoshi made an oopsie.”*
— Justin Drake

Data shows fees haven’t scaled as expected. In 2016, fees were 1% of a 25 BTC reward; today, they’re still just 1% of a 3.125 BTC reward. If this trajectory continues, Bitcoin’s security budget could crumble, leaving its proof-of-work vulnerabilities exposed to 51% attacks.

The fee fallacy: Are there really Bitcoin proof-of-work vulnerabilities?

Not everyone agrees with Drake. Kushal Babel of Category Labs argues that measuring fees in BTC is misleading:

“Fees in USD terms tell the real story. Bitcoin’s price appreciation might offset the drop.”

But Drake counters that even dollar-denominated fees are unsustainable long-term. Meanwhile, layer-2 solutions like Lightning Network and Ordinals have only caused temporary fee spikes, failing to fix Bitcoin proof-of-work vulnerabilities permanently.

Satoshi’s “mistake” or Bitcoin’s identity crisis?

Drake’s fixes are radical:

1. Abolish the 21 million BTC cap, betraying Bitcoin’s scarcity promise.

2. Switch to proof-of-stake, a move Ethereum made in 2022 but Bitcoin purists reject.

Lukasinho of Auditless fires back:

“Satoshi didn’t err. Bitcoin’s ‘pet rock’ mentality did. It was meant to be digital cash, not a vault.”

The debate underscores a deeper tension: Bitcoin’s proof-of-work vulnerabilities may stem from its shift away from everyday transactions.

Quantum threats and the urgency for change

Beyond fees, experts warn that quantum computing could exploit Bitcoin proof-of-work vulnerabilities by cracking its cryptography. While a 51% attack remains logistically tough, the clock is ticking for Bitcoin to future-proof its security before market forces or hackers force its hand.