Justin Drake, a researcher at the Ethereum Foundation, has issued a warning about Bitcoin (BTC) long-term security.
In a detailed post on May 29, Drake argued that Bitcoin Network’s trading fees could become increasingly vulnerable to 51% attacks, with a sustained low transaction fee.
Bitcoin fees will be reduced
According to Drake, Bitcoin’s fee structure could not evolve along with half that schedule.
He noted that three recent harving events have reduced block rewards over the past eight years, but trading fees have not risen enough to offset the decline.
He said the fees currently contribute only 1% of miners’ total revenue, down from previous levels, hovering near the 13-year low of around 6.5 BTC per day.
With this in mind, Drake states:
“Bitcoin’s security model is broken. If Bitcoin is taken over, fallout could use the entire crypto ecosystem. Systematic risk cannot be ignored.”
Drake also challenged the long-standing assumption that fees naturally increase and ultimately replace block rewards.
On the contrary, he argued that fees were shrinking and that if miners had to resort solely to charges, their income could plummet 100 times. This reduces the hash power of Bitcoin to just 1% of its current strength.
According to Drake:
“That’s the trajectory we’re in. The 21m cap breaks security. It’s self-destructive. Now it’s clear that Satoshi has made oopsie.”
Price increases won’t save you Bitcoin
Drake dismissed the idea that a spike in Bitcoin price could solve the problem.
He outlined a scenario where Bitcoin reaches $1 million per coin, but if the rate levels remain unchanged, it only covers 10% of today’s security costs.
He pointed out:
“Today, Bitcoin is protected by 20 GW (20 GW equivalent to a 10m space heater). If miners’ revenue is reduced by 90%, it will be reduced to 2 GW of security (1m space heater). In the context, we will produce 80 GW in Texas alone.
Even if Bitcoin had hit $10 million per coin or a $200 trillion network, Drake argued that the cost of mounting a 51% attack remains trivial compared to market capitalization.
He estimated that building a 20 GW hash infrastructure would cost just $20 billion, and would cost just 0.01% of Bitcoin’s hypothetical $200 trillion worth.
Solution?
Drake concluded that Bitcoin’s current proof-of-work model may not be viable in the long run without structural adjustments.
So he proposed several solutions, including revisions to the fare market and the introduction of tail issuance. The latter involves lifting up the 21 million coin supply cap of Bitcoin to maintain ongoing miners’ incentives.
Additionally, he proposed a move to Proof-of-Stake (POS), a system Ethereum is already using to secure a network.
Still, Drake acknowledged that his ideas faced serious resistance within Bitcoin’s cultural and ideological framework.
Meanwhile, he also emphasized that some community members are proposing vague suggestions that BTC can adopt proof of approval through a consortium of mining pools. However, he pointed out that there is little detail about it.
Taking this into consideration, Drake concluded:
“Bitcoin is intended to be rebellious. But the elephants in the room are not treated. They can burn their heads in the sand. But the basics are getting bigger.”