The halving of Bitcoin's Security Ratio

Quick Take

  • Discussion around Bitcoin’s imminent issuance halving has predominantly been framed as an innately bullish event, ignoring network security implications
  • Regardless of any dollar value appreciation, Bitcoin’s Security Ratio, calculated as miner revenue over network value, is set to halve, opening up the potentially debilitating for speculative attacks
  • For Bitcoin’s Security Ratio to stay at pre-halving levels post-halving, fee revenue must increase roughly 4300%
Bitcoin’s ‘halving’, set to take place in May, has inspired active discussion around the application of the Efficient Market Hypothesis. Commonly alluded to as an innately bullish event, debate predominantly focuses on the extent to which the halving of block reward issuance has been priced in.  While some analysts find merit in these discussions, these […]

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