The Bitcoin Paradox 2044: When Game Theory Meets Economic Reality

The perspective of 2044 is not simply an arbitrary date for future speculation. It marks the point at which Bitcoin’s fundamental mechanisms will begin to reveal internal contradictions that game theory, which underpins the network’s security model, may not be able to resolve. When we observe Bitcoin’s economic dynamics through this analytical lens, disturbing questions arise about the long-term viability of a protocol that promised to be the ultimate digital currency.

The Economics of Halving and the Illusion of Doubling Price

Every four years, Bitcoin undergoes a halving that reduces the block reward by half. Currently, miners receive approximately $65 per transaction as a subsidy through the block reward (assuming an operational capacity of 3 transactions per second). Longtime Bitcoin advocates argued that the natural doubling of the price would compensate for these successive reward reductions.

But there is a growing problem with this optimistic assumption. If Bitcoin’s price continued doubling every four-year cycle as historically suggested, its market capitalization would surpass gold’s by three times before 2044. Once that happens, the external source of new capital simply would no longer exist to sustain further doublings. Even gold holders would lack sufficient wealth to invest increasing amounts into Bitcoin to maintain this growth pattern.

The Game Theory Deadlock: Why Cheaper Energy Doesn’t Solve Anything

The game theory structure behind Bitcoin’s Proof of Work creates a paradox often misunderstood: network security depends precisely on it being expensive to attack the network compared to the legitimate incentive structure. When energy becomes cheaper or mining equipment more efficient, the network’s automatic response is not to become more secure — it becomes more vulnerable under game theory logic.

This is because cheaper energy benefits both honest miners and hypothetical attackers equally. An increase in total hash rate does not change the relative reward for attacking versus cooperating. Bitcoin’s game theory remains secure only as long as attacking the network is significantly more costly than defending it. Future energy efficiency improvements do not alter this fundamental dynamic — they merely distribute the cost differently without strengthening security incentives.

The Inevitable Fee Collapse Scenario

Once mining rewards fall to unsustainable levels, the conventional narrative suggests transaction fees will replace block subsidies. But Bitcoin already operates at the edge of its capacity: 3 transactions per second with a theoretical maximum of 7 tps. If average fees needed to reach $650 per transaction just to keep miners’ income at current levels (at 0.3 tps), the network would become unusable for any transaction not of extremely high value.

This would create an exponential fee spiral. Last users trying to exit the network would pay over $10,000 per transaction, causing desperate congestion that would push processing rates down to 0.03 tps. Worse: even these exorbitant fees would only be the average needed. To get confirmation in the first block, users would have to offer even higher fees, creating a catastrophic auction dynamic.

The Unresolvable Issue of Lightning Network and Layer 2s

A common response is to point to the Lightning Network and other Layer 2 solutions as salvation. But this answer ignores a critical detail: Layer 2s retain fees within their own ecosystems without passing that value to Layer 1 miners who provide the fundamental security. The same problem applies to future ZK rollup Layer 2s. The more successful Lightning is at retaining transactions and fees on L2, the worse the security dilemma on L1 becomes — not better.

Game theory again reveals a contradiction: solutions that improve scalability would make the security problem more acute, not less.

The Only Viable Path: Abandoning the Finite Limit

There is only one theoretical solution that would prevent this inevitable collapse: Bitcoin would need to abandon its core commitment to a maximum finite supply. A perpetual issuance of about 1% per year would transform Bitcoin from “digital gold” into a “decentralized fiat currency” — exactly what its original advocates promised never to accept.

Bitcoin supporters have yet to fully realize that this dilemma exists and is mathematically inevitable. When we consider pension providers offering Bitcoin in 401(k) plans, those remaining 18 years until 2044 suddenly no longer seem like a distant, abstract horizon but rather too close for comfort.

Theory Remains Until a Flaw Is Found

The analysis presented here invites scrutiny: find a flaw in the logic. Cite any line and demonstrate where it fails. Respond not with disdain but with rigorous argumentation. Until someone does — until someone shows why Bitcoin’s game theory does not lead to this outcome — the paradox of 2044 remains a legitimate question about the viability of a system that promised to be eternal but built its own temporal limit.