The key selling point of Bitcoin as a store of value has everything to do with the credibility of its monetary policy. As Bitcoin inventor Satoshi Nakamoto once wrote, the rules of the system were “set in stone” when the network first launched, and those rules included the 21-million-Bitcoin supply cap and the related issuance policy maintained by the roughly four-year halving cycle.
But are those rules really set in stone? Is there really no chance Bitcoin’s monetary policy will change at some point in the future?
Some critics believe that after the block reward drops too low as a result of the halvings — and if transaction fee revenue has not risen substantially — there will no longer be enough incentive for miners to secure the network. They argue the Bitcoin network may be forced to increase the supply as a result.
“If fees don’t magically grow orders of magnitude there are two candidate solutions: 1) add tail issuance, remove the 21M limit [or] 2) switch to proof-of-stake,” Ethereum Foundation Researcher Justin Drake wrote on X earlier this year. “Both ‘solutions’ seem to be cultural non-starters. Also tail issuance only works proactively, not after a 51% takeover.”
To Drake’s point, there is indeed strong resistance to potential alterations to Bitcoin’s monetary policy. As Plan B Network director Giacomo Zucco hyperbolically stated in a recent debate, “It should be punished by death if you propose it.”
And many Bitcoin holders also see the supposed security budget issue as nothing more than fear, uncertainty and doubt (FUD) from altcoin promoters. “The crypto orthodoxy is that Bitcoin has an unsolved security budget problem,” The Bitcoin Bond Company CEO Pierre Rochard posted on X. “Any arguments against this dogma are seen as heretical by the pious cryptobros.”
So, who’s right? Can Bitcoin remain secure over the long term, or is an impending crisis looming?
Bitcoin’s declining block subsidy
Throughout Bitcoin’s history, miners have been rewarded with both the block subsidy and transaction fees. The block subsidy is the newly created Bitcoin included in each block, while fees are the mechanism used to incentivize miners to include specific transactions. When you put these two together, you get the total block reward, which is what provides a reason for miners to spend resources on the mining process in the first place.
The block subsidy is cut in half roughly every four years via halving events. The subsidy started at 50 BTC per block when the system first launched, and it’s now down to 3.125 BTC per block in 2025. Despite the decline in the Bitcoin-denominated block subsidy over time, the value of it in US-dollar terms has increased due to Bitcoin’s price appreciation. But the block subsidy decreases and asymptotically approaches zero, meaning that the aspect of miner incentivization will eventually run out.
“Once a predetermined number of coins have entered circulation, the incentive can transition entirely to transaction fees and be completely inflation free,” wrote Satoshi in the original white paper.
Increasing Bitcoin fees could fix the problem… of spam
Due to Bitcoin’s block size limit, increased fee revenue for miners would also mean an increased fee rate on a per-L1 transaction basis. In other words, an onchain transaction that costs $1 or less today may eventually cost $20. Of course, this increased cost at the base layer can potentially be offset by allowing many cheaper payments to take place on secondary layers before settling on the base chain.
While this raises costs for those who want to make transactions on Bitcoin’s base layer, some Bitcoin users see this as a potential benefit because it can crowd out non-Bitcoin use cases, such as Ordinals or Runes, as using the Bitcoin base layer as a generalized database would become more costly.
In the past, fee increases have had the side effect of pricing out inefficient use of the base Bitcoin blockchain. Examples of this phenomenon include exchanges dragging their feet on upgrading to Segregated Witness and integrating transaction batching (and later the Lightning Network), Veriblock going from 30% of all Bitcoin transactions to near zero, and Tether’s USDT moving to cheaper, alternative crypto networks such as Ethereum and Tron.
Of course, not everyone agrees with this assessment, and that disagreement ties into the recent conversation in Bitcoin regarding individual nodes’ potential use of filters on the peer-to-peer relay network, specifically for larger OP_RETURN outputs. While there are concerns from much of the Bitcoin userbase around “spam” from Ordinals and…
cointelegraph.com