Fidelity Digital Assets research analyst Daniel Gray released a new report in June 2026, officially rebutting concerns that the Bitcoin network becomes less secure after its quadrennial halving events. The analysis, titled “Bitcoin’s Programmed Security: Part Two,” asserts that the network’s economic incentives remain robust enough to maintain long-term security even as mining rewards decline.
The report directly challenges a longstanding criticism that reducing the issuance of new coins weakens the chain’s defenses. Critics have long argued that as the block subsidy vanishes, miners will lose the financial motivation to secure the network unless transaction fees grow significantly.
Mining incentives and historical revenue growth
However, Fidelity argues that security relies on a broader set of economic forces, including rising asset prices and the self-correcting nature of the protocol.
A central pillar of the research is the dramatic growth in total miner revenue despite the programmed reduction in new coin supply. While the block subsidy was halved from 6.25 BTC to 3.125 BTC on April 20, 2024, the dollar-denominated value of these rewards has scaled dramatically over time.
Fidelity notes that average daily miner revenue has increased from approximately $26,300 during the first halving cycle to more than $40.2 million today.
Key details
This revenue has supported a massive expansion in the hardware dedicated to protecting the network. The report reveals that the Bitcoin hash rate has surged by more than 8,000% since the 2016 halving and climbed 394% since the 2020 event. Daniel Gray stated that “despite declining issuance, miner incentives — and by extension, network security — historically strengthened alongside Bitcoin’s price.”
The report also highlights the potential for transaction fees to sustain the network. During the April 2024 halving, transaction fees in a single block at one point reached approximately 12 times the actual block subsidy. This suggests that demand for block space can provide a necessary floor for security as the subsidy eventually disappears.
This shift occurs as Bitcoin exchange supply maintains multi-year lows, reflecting a changing market structure where long-term holding is prevalent.
The role of difficulty adjustments in network resilience
A secondary argument in the Fidelity research focuses on the difficulty adjustment mechanism. This programmed recalibration occurs every 2,016 blocks, or roughly every two weeks, ensuring that blocks are produced consistently regardless of changes in miner participation. By adjusting the computational effort required, the network avoids a permanent loss of security if some miners exit the market.
Fidelity argues that these incentives make sustained attacks on the network prohibitively expensive. As the network grows, the capital required to execute a 51% attack becomes astronomical. Even as individual miners face profitability squeezes, the difficulty adjustment helps the system reach a new equilibrium. This systemic resilience is a factor as investor sentiment shifts toward regulated crypto products and institutional-grade assets.
However, the report acknowledges immediate financial pressures. With the next halving expected in 2028, rewards will fall further to 1.5625 BTC. Many publicly traded mining companies are currently facing pressure due to these lower rewards, rising costs, and growing competition. This financial reality is forcing firms to rethink their operational strategies to survive the coming cycles.
Mining firms pivot toward artificial intelligence infrastructure
In response to these financial pressures, several miners are diversifying into high-performance computing (HPC) and artificial intelligence (AI). Publicly traded mining companies could require up to $50 billion in additional capital to fully transition to AI infrastructure, according to an estimate from VanEck. This move allows firms to leverage their existing power infrastructure and data center assets to generate alternative revenue streams.
This diversification potentially strengthens the Bitcoin ecosystem by creating more financially stable operators. Miners with multiple income sources are less likely to capitulate during market downturns, leading to a more professionalized group of network participants. The transition reflects a broader trend where macro environmental factors and rising costs drive firms toward more efficient capital allocation.
Ultimately, Fidelity’s report suggests the “security budget” of Bitcoin is outgrowing its reliance on new coin creation. While the debate over the long-term fee market will likely continue, the current data points to a network that remains economically sound. As the 2028 halving approaches, the industry’s focus will remain on whether transaction fee growth can continue to offset the scheduled reductions in block subsidies.