Quote from: stwenhao on May 24, 2025, 03:16:46 AM

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The economic incentives behind mining on testnet and mainnet are fundamentally different

Yes, but when testnets are no longer worthless, and they get some value, then they start competing with altcoins, rather than testnets. And in that case, if you have a long chain, where coins are traded at 100 satoshis per test coin (at the time of writing in testnet3), then if you can still see, that people are transacting, and moving whole coins without any problems, you can assume, that if mainnet in the future will be worth more, than testnets are worth today, then the network will still be in use.

BTC mainnet can't be meaningfully compared to testnet -- not just because the latter is a testnet, but because the two systems differ in fundamental and structural ways. In fact, Bitcoin isn't even directly comparable to altcoins either, but that's another topic.

Here are a few reasons why testnet behaves so differently from mainnet:

1. Lack of real economic incentives:
Testnet coins are essentially almost free. You can find people on this very board offering to donate thousands of them. Nobody does that with real BTC. There's no real risk or cost involved in using testnet coins. On mainnet, every transaction carries a financial cost, which fundamentally changes how people behave, how fees are prioritized, and how valuable block space is perceived.

2. different fee market dynamics:
On testnet, people routinely create massive or inefficient transactions and spam the network without any concern for fees. On mainnet, users actively optimize for fee efficiency. The cost of inclusion in a block matters, which creates a real fee market. That alone creates vastly different network behavior.

3. mining incentives are not the same:
Testnet blocks are mined at artificially low difficulty. It's not uncommon for someone with a single CPU to outmine an ASIC farm, like what we saw in testnet4. This has gone on for months with little concern because there is nothing valuable at stake. In contrast, mainnet miners are in constant competition for rewards, which shapes everything from block frequency to what kind of transactions make it into a block.

4. artificial usage patterns:
Most testnet activity is scripted, automated, or intentionally constructed to test edge cases. It's not representative of real-world usage where businesses, wallets, and exchanges operate under economic pressure. The behavior on testnet has no bearing on how people behave when money is on the line.

5. value dictates everything:
The amount of money at stake fundamentally shapes user behavior. BTC is a unique ecosystem where every layer is built with long-term value in mind. The testnet doesn't simulate that -- it can't.

In fact, I think the number of on-chain BTC transactions will decline as we move into the future. We've already seen days in 2018 with more confirmed transactions than some recent days. That suggests Bitcoin isn't heading toward mass adoption in the way most people imagine. It will likely evolve into a final settlement layer -- fewer transactions, but each representing a significant value transfer.

It doesn't matter if we increase the block size or not. People will naturally spend BTC less frequently over time. So all the high-volume, high-activity behavior seen on testnet probably won't ever apply to BTC -- if anything, the opposite is more likely in my honest opinion, and I will be willing to change my mind the moment I see a real BTC faucet. Cheesy