# On Inflation, Transaction Fees and Cryptocurrency Monetary Policy

DevFeed: [On Inflation, Transaction Fees and Cryptocurrency Monetary Policy](<https://devfeed.tech/articles/on-inflation-transaction-fees-and-cryptocurrency-monetary-policy-16777.md>)

Original publisher: [Read original article](<https://blog.ethereum.org/en/2016/07/27/inflation-transaction-fees-cryptocurrency-monetary-policy>)

Author: Vitalik Buterin

Published: 2016-07-27T17:00:00Z

Content type: article

Language: en

Sources: [Ethereum Foundation Blog](<https://devfeed.tech/sources/ethereum-foundation-blog.md>)

Topics: [Blockchain](<https://devfeed.tech/topics/blockchain.md>), [Cryptocurrency](<https://devfeed.tech/topics/cryptocurrency.md>), [Security](<https://devfeed.tech/topics/security.md>), [Protocol (disambiguation)](<https://devfeed.tech/topics/protocol.md>), [Bitcoin](<https://devfeed.tech/topics/bitcoin.md>), [Ethereum](<https://devfeed.tech/topics/ethereum.md>)

Tags: [bitcoin](<https://devfeed.tech/tags/bitcoin.md>), [blockchain](<https://devfeed.tech/tags/blockchain.md>), [cryptocurrency](<https://devfeed.tech/tags/cryptocurrency.md>), [ethereum](<https://devfeed.tech/tags/ethereum.md>), [protocol](<https://devfeed.tech/tags/protocol.md>), [research-development](<https://devfeed.tech/tags/research-development.md>), [security](<https://devfeed.tech/tags/security.md>)

## AI overview

The article examines how blockchains fund security through inflation or transaction fees. Using Bitcoin and Ethereum as examples, it discusses transaction-fee revenue, declining mining rewards, and the estimated cost of acquiring enough mining power to overwhelm the network.

## Source excerpt

The primary expense that must be paid by a blockchain is that of security. The blockchain must pay miners or validators to economically participate in its consensus protocol, whether proof of work or proof of stake, and this inevitably incurs some cost. There are two ways to pay for this...