Would free energy cause a market collapse?

Consider a world where energy is free and plentiful. Bitcoin, and other cryptocurrencies, are given value since they are ‘proof’ of work. This work comes at the cost of:

  • a. time
  • b. energy

By removing the cost of electricity, hardware expenditure becomes the ceiling for hashrates. Surely this makes cryptocurrencies less valuable. Wouldn’t the market become hypersaturated as supply went up? On large enough scale, hardware turnover rates might provide some limiting factor to supply- but for the most part mining operations should be able to keep up with the increasing difficulty of the hash.

I can see otherways the blockchain would be useful, but I’m starting to wonder whether cryptocurrencies would continue to work.

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