Why L1 Blockchains Are Bleeding Money on Security—And How the Tide Is Turning

Layer 1 blockchains are hemorrhaging cash to keep their networks secure—but the reckoning is here.

Security spend hits unsustainable levels

Validators and miners vacuum up billions in rewards while transaction volumes stagnate. Ethereum’s merge cut emissions, but PoS chains now face their own inflation demons. Meanwhile, Bitcoin’s $15B annual security tab looks increasingly like a hedge fund’s burn rate.

The scaling revolution nobody saw coming

Rollups aren’t just scaling L1s—they’re quietly eating their security budget. Zero-knowledge proofs and optimistic fraud proofs slash costs by orders of magnitude. Suddenly, paying $50M per attack vector seems as smart as a 2008 mortgage-backed security.

Adapt or die

From modular architectures to shared security models, the next-gen playbook is clear: do more with less. The chains that survive won’t be the ones with the deepest pockets—they’ll be the ones that stop treating security like a Wall Street bonus pool.

For BNB Chain, the chain conducts a quarterly burn of BNB through a series of different burn mechanisms. In the last burn event, ~1.6 million BNB ($916 million) was burned. Another 1.6 million BNB is slated to be burned in the next quarter, according to Bnbburn’s dashboards.

Since BNB’s token generation event, net supply of BNB has been cut down from 202 million to 141 million today.

Then finally, there is Bitcoin.

Obviously, the Bitcoin network has its famous block-subsidy halving every ~four years, currently at an annual issuance rate of ~0.85%.

Aside from that, no protocol mechanism burns BTC. 

But I guess bitcoin is a special snowflake, so it’s immune from the kinds of economic laws that economists have debated for hundreds of years. (Or is it?)

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