Justin Bonds, founder and chief investment officer of Cyber Capital, predicted that Bitcoin (BTC) could collapse within 7 to 11 years.
He pointed to decreasing security budgets, increasing risk of 51% attacks, and what he called impossible choices for networks. Bonds warns that these fundamental vulnerabilities can undermine trust and even lead to chain disruption.
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Bitcoin’s economic safety model comes under scrutiny
Experts have long warned of several risks to Bitcoin, particularly quantum computing, which could undermine current cryptographic standards.
But Bonds outlined another category of concerns in a detailed post. He argued that Bitcoin’s long-term threat lies in its economic security model.
“BTC will collapse within 7-11 years from now! First, the mining industry will decline as security budgets shrink. That’s when the attacks will begin: censorship and double spending,” he wrote.
His discussion centers on the decline in Bitcoin’s security budget. Each halving reduces miners’ rewards by half, reducing their incentive to protect the network.
The most recent halving is April 2024, with additional halvings scheduled every four years. Bonds argued that maintaining the current level of security would require either Bitcoin’s price to continue to rise exponentially or permanently incur high transaction fees, both of which he believes are unrealistic.
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Miners’ revenue decreases and attack risk increases
According to Bons, the most meaningful measure of network security is miner revenue, not raw hashrate. He emphasized that increasing hardware efficiency can increase hashrate even as hash generation costs decrease, which can be a misleading indicator of attack resistance.
In his view, lower revenue for miners directly translates into lower costs of attacking the network. 51% When the cost of launching an attack is less than the potential benefits of double spending and disruption, such an attack becomes economically reasonable.
“The game theory of the crypto economy relies on punishment and reward, carrots and sticks. This is why the miner’s revenue determines the cost of the attack. When it comes to the reward side of the calculation, double spending is a very viable attack vector due to its huge potential reward, including 51% of attacks targeting exchanges,” the post reads.
Currently, transaction fees make up a small portion of miners’ income. As block subsidies approach zero in the coming decades, Bitcoin will need to rely almost entirely on fees to secure the network. However, Bitcoin has limited block space, which limits transaction throughput and therefore total fee income.
Bonds further argued that high fees are unlikely to persist because users tend to leave networks when fees spike, and fees cannot reliably replace block subsidies over the long term.
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Congestion, banking dynamics, and a potential death spiral
Apart from concerns about the security budget, Bonds warned of a potential “bank run” scenario. According to him,
“At the most conservative estimate, if all current BTC users performed only one transaction, the queue length would be 1.82 months.”
He explained that a panic event could prevent the network from processing withdrawals fast enough, effectively trapping users through congestion and higher fees. This results in a situation similar to mounting installation.
Bonds also pointed out that Bitcoin’s two-week difficulty adjustment mechanism increases risk. If prices drop sharply, unprofitable miners may be shut down, delaying block production until the next correction.
“The panic causes the price to collapse, which causes more miners to shut down, which in turn slows down the chain even more, causing more panic, which causes the price to collapse again, more miners to shut down, and so on and so forth…This is known as a vicious cycle in game theory, also known as a negative feedback loop or death spiral,” he said.
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He added that such congestion risks make collective self-management dangerous during periods of stress, warning that users could become stuck on the network if demand spikes.
Bitcoin’s inevitable dilemma
Bonds concluded that Bitcoin faces a fundamental dilemma. One option is to increase the total supply beyond the 21 million coin limit to maintain miner incentives and network security. However, he noted that this would likely undermine Bitcoin’s core value proposition and lead to a chain split.
Another option, he said, is to allow the security model to steadily weaken and become more open to attacks and censorship.
“The most likely outcome is that seven to 11 years from now, both of the options I have described, and more, will occur simultaneously,” Bonds wrote.
He also linked this issue to the legacy of block size wars, arguing that governance constraints within Bitcoin Core make meaningful protocol changes politically unlikely until a crisis forces action. By then, he warns, it may already be too late.
