Author: James Lu 2021-05-23 01:00:19
Published on: 2021-05-23T01:00:19+00:00
The idea of reducing the block reward for Bitcoin is proposed as a solution to reduce energy consumption from mining. This can be done gradually by adding fewer coins to the UTXO set per block and would be a soft fork in the consensus layer. However, there are possible weaknesses such as the cost to reverse recent transactions being less than that of a nation-state's energy, potential protests from miners, increased centralization towards Chinese miners, and the risk of the network splitting if consensus isn't built before implementation. Alternatively, rejecting transactions that attempt to spend increased block rewards could also be treated as no-ops. The value of Bitcoins comes from their acceptance by full node users, exchanges, and custodians like Coinbase, and reducing the block reward could potentially impact this value. Nonetheless, with increasing public discussion around Bitcoin's energy use, it may be socially feasible to ask individual users and major exchanges to install a version with a reduced block reward.
Updated on: 2023-05-21T02:35:04.112719+00:00