With each halving, mining rewards have dropped from 50 BTC to the current 3.125 BTC, and after the next halving, it will be reduced to just 1.5625 BTC. By the time block rewards reach zero in 2140, network security will have to rely entirely on transaction fees. Current Reality ————————————————————————— BTC prices have hit an all-time high, but transaction fees remain low. Empty or near-empty blocks are appearing even with Bitcoin priced at $120,000—something almost impossible during the 2017-2018 bull market. Hash price has fallen to a historic low of $35 per TH/day, and many miners are struggling near the breakeven point. If transaction fees cannot fill the gap left by reduced block rewards, the network hash rate may decline, and the cost of a 51% attack would decrease accordingly. Path to a Solution ————————————————————————— BTC is evolving from a payment network to a settlement layer. Similar to how Fedwire in the traditional financial system handles large-scale final settlements, with banks building high-frequency transaction layers on top of it. The Lightning Network has proven the feasibility of this direction: users can conduct countless transactions within multi-signature channels, requiring only two on-chain settlements—opening and closing the channel. A single large settlement transaction can thus encompass hundreds of smaller payments. @ArchNetwork is building a new economic model. When institutional-grade settlements, cross-chain bridging, and Layer 2 batch transactions become the primary use cases, the value of a single transaction will be sufficient to support higher fees. ————————————————————————— The ideal state is achieving a balanced fee market. Blocks remain consistently full, primarily with large transactions, where fees are high enough in absolute terms to sustain security but remain reasonable as a percentage of transaction value.