During Bitcoin's existence, it has been declared dead approximately 473 times. However, it is still alive and shows no signs of serious problems.
It should be noted that from a technical standpoint, Bitcoin will continue to exist as long as there are at least a couple of interconnected computers running the software that stores its blockchain. Therefore, we are more likely considering scenarios of absolute loss of interest in the cryptocurrency rather than its physical existence.
The most obvious problem that could lead to a complete loss of trust in Bitcoin is a hidden error in its code that has not been discovered yet or may be introduced in future software updates, potentially affecting data integrity.
The probability of this scenario is extremely low, as Bitcoin has proven its reliability over its approximately 13 years of operation. However, it is impossible to completely rule out potential issues in the code.
Mainly, future Bitcoin updates could contain critical errors that would jeopardize the entire system's integrity. It is important to understand that even if the community manages to promptly and completely fix the code, install a new version, and restart the system, it would undoubtedly result in a fork and a price collapse.
A similar scenario was experienced by Ethereum when the current blockchain split from its classical version.
Of course, the community is aware of these risks and strives to write code with zero errors, but nothing is perfect.
Bitcoin was originally conceived as a payment system independent of any authority. Therefore, its principles contradict the interests of governments worldwide. In theory, if governments were to unite, they could not destroy the Bitcoin blockchain due to its decentralized nature, but they could significantly restrict its use within their jurisdictions, including deep traffic filtration and mining bans on their territories.
It is also worth noting that authorities could declare a crackdown on cryptocurrency owners and block the bank accounts of cryptocurrency companies. However, implementing this scenario would require the consensus of the world's major countries. Without such consensus, exchange platforms and exchanges would simply move to neighboring, more crypto-friendly countries, rendering the ban more declarative than fully effective.
For instance, when China restricted cryptocurrency exchange activities and completely banned mining within the country, the cryptocurrency itself did not cease to exist, nor did its price plummet to zero. Miners and exchanges simply relocated to other countries, and the United States emerged as the new global leader in the crypto sphere.
Investors are aware of this risk, but they also understand that a global ban is practically impossible. It would require not only unanimous agreement to ban it at the United Nations level but also strict compliance with the new directives by governments of all economically developed countries.
Perhaps the most discussed and probable scenario of Bitcoin's disappearance is its complete discredit. There are several variations of this scenario.
The first one is the "51% attack," in which malicious actors can rewrite all new blocks as they please, including repeatedly spending the same tokens by rewriting their transactions. Essentially, having more computational power than the rest of the network combined, the attacker gains the ability to determine which version of the blockchain is correct.
The theoretical possibility of such an attack has been known since the early days of all cryptocurrencies, but currently, its likelihood is extremely low. Furthermore, less popular blockchains have undergone similar attacks several times, and in those cases, the community managed to quickly increase computational power to maintain the integrity of the entire system.
In the near future, the risk of this attack may increase. Firstly, due to the constant growth of computational power available on the market, and secondly, due to the potential reduction in mining rewards. Every four years, the miner's reward is halved, and under certain conditions, mining may become more costly than profitable, leading to an exodus of individual miners and the concentration of computational power in the hands of malicious actors.
Another variation of this scenario involves hacking client software or compromising the encryption algorithm. Technically, this scenario does not appear less likely, although it is currently impossible given the current level of technological development. We discussed the blockchain's trustworthiness in "How to hack the blockchain?".
And the last, third variation represents some highly concealed virus that can discreetly infect 100% of devices storing the Bitcoin blockchain and only then reveal itself, simultaneously destroying all copies of the blockchain. In the event of any delay or desynchronization, or if several devices happen to go offline before the coordinated attack begins, even from a couple of surviving blockchains, the entire network can be restored.
All these hacking scenario options are extremely unlikely, but at the same time, they are not entirely impossible, especially considering numerous successful large-scale cyber attacks throughout history.
Can any other cryptocurrency replace Bitcoin? On the one hand, it is the most probable out of all the options, but also the most prolonged in time. Potentially, it is not possible to exclude the loss of interest in Bitcoin by investors in the distant future, favoring a younger and more promising project. However, even if this happens, the decline will be very extended in time. For Bitcoin to be completely forgotten, it would need to significantly lag behind the competition in all technical parameters for several years, if not decades.
But the new cryptocurrency would have to be much "better" in every aspect, including size and the extent of payment infrastructure development. Currently, such a project does not exist on the market, but its emergence is not ruled out in the future.
Another variation of this scenario involves a colossal rise in electricity tariffs worldwide, making mining highly unprofitable and thus rendering the maintenance of a PoW-based network too wasteful. However, once again, a mass exodus of miners from the Bitcoin blockchain would automatically reduce the mining difficulty (i.e., energy consumption). But here, a comprehensive problem may arise (as we mentioned the 51% attack earlier).
Only one extreme scenario could lead to the complete destruction of Bitcoin — if electricity disappears worldwide or Bitcoin users themselves vanish.
If Bitcoin network nodes cannot communicate with each other or if all sources of electricity and communication channels on the planet suddenly go offline, Bitcoin will cease to exist. But in that case, you would agree that the problem of lost bitcoins would be the least of our concerns.
By the way, we would have to switch to cash payments using caps from "Nuclear Cola" at that time, and the loss of Bitcoin would be a minor problem.
Although even in such a scenario, Bitcoin would not completely cease to exist; it would physically continue to exist in hypothetical museums of the post-apocalyptic world.
What's the bottom line?
- Bitcoin has been operating smoothly 24/7 for over 13 consecutive years.
- here are tens of thousands of Bitcoin nodes scattered worldwide.
- Governments can ban Bitcoin, but they cannot kill it.
- It is possible to hack the protocol, but it is currently technically infeasible.
As you can understand from our material, talking about the disappearance of Bitcoin as a phenomenon is premature for now. Formally, as long as at least one person on the planet uses this technology, Bitcoin can be considered alive, even though its usefulness will be reduced to zero.
Bitcoin is digital gold
Technologies will continue to evolve, which means more efficient cryptocurrencies will emerge, and the title of the world's leading crypto project will pass to someone else, but the technology itself is unlikely to disappear permanently.
Most likely, in the not-so-distant future, Bitcoin will transition from being a liquid asset to a reserve asset. By all indications, it already resembles gold, a metal that is inconvenient to store, difficult to convert into fiat money, and impossible to use as a means of payment in stores. Our beloved cryptocurrency will likely face a similar fate — although it may not be actively used as a medium of payment, it will remain an investment asset for a long time, possibly for thousands of years ahead, just like its prototype — gold.