48MHz ARM Cortex-M0+ … 1.6mm x 2.0mm. They just keep getting smaller. Now, if LEDs would also get smaller while keeping their high lumens values …
http://www.cnx-software.com/2014/02/26/freescale-kinetis-kl03-smallest-mcu/
Indeed. The problem with getting smaller however is that you would also have to start using thinner traces to route all the pins. Or switch to multi layer boards since it’s all BGA. However, most of the cheap PCB fab shops won’t go any smaller than 6mils.