Topic: A proposal regarding improved bitcoin money supply predictability (Read 1305 times)

I think it's fine, just like the "mtgox hacking incident", no big deal.

Don't worry, i am TOTALLY against the "invalidating" and "recycling" idiocy. The fact that sometime some trolls post the "let's invalidate old coins" spam doesn't mean it will be never applied

F all of this.

It's partly a defensive response to the far worse idea of 'invalidating' or 'recycling' old unmoved coins which seems to resurrect itself zombie like.
In a way I'm glad there is some revulsion to the rate limiting idea too - It gives me hope that the invalidation idea would never get a majority vote amongst developers/miners/users.

I suspect that my proposal would fail primarily in that it's probably not that common that a stash 'large enough to affect the economy' would be lost (and found) in a single identifiable chunk anyway.

i'm totally against this.

NO

This is so idiot and ridicolous in so many ways that probably i don't have enough space to write ALL the reasons 

@julz i don't get what is to fear of, if anything is to be implemented should be on the exit points, the exchanges. They should have the right tools to monitor the blockchain and heavy tax "old" coins. Those coins would not affect in any way trades made in btc. I see it like this and i'm no economist. We will get a real scale of value for bitcoins when ppl start accepting them for basic stuff like bread, sugar, beer or toilet paper

Please stop proposing protocol changes ppl. Think of it as the road everybody drives on, we agreed having the signs on it's sides.

I would say that it is the other way around: it is easy to implement, but understanding the implications is difficult. Bitcoin has been very clear about the rules from the beginning: send coins to anybody for free. Now you propose a restriction. That's not going to work. Start your own blockchain and implement it there ;-)

It also provides an incentive for large holders of really old coins to 'refresh' them, but doesn't totally penalize by 'stealing' them if for some reason they can't.
It would allow economists to better analyze the bitcoin economy, and the users to have more faith in it.
(Huge stashes that haven't been moved in X decades 'probably' are lost - but even if not, won't suddenly inflate the money supply)


It's not putting a limit on the spend amount for any ordinary user, or even any massive participant such as mtgox currently is.
It's only if you let a huge stash get *many* years old - without ever having spent anything from it that it would kick in.  


I agree it would be complex to implement, and the value is debatable.
Also - if the majority of coins are lost in small amounts by average users, it  won't help that much in estimating how many coins were lost versus those just sitting in small long term savings.  It may however allow some better estimations, and more confidence in the system.

So development should stop?  No more features/improvements even if the majority of miners/users were to agree?  Which 'foundations' in particular do you feel are violated?

if you put limits on spend amount, people would just make stack of wallets, each up to that limit so in the future they could spend them all at once if needed

This idea is too complex and violates the foundations of Bitcoin.

In the situation where the world is running on some reduced fraction of the 21M supply due to years of presumed bitcoin destruction - it would be public knowledge the instant someone even bought a coffee using an old mega-stash. 
Whether or not the controller were intending to dump or spend with abandon, surely it would cause a sudden crash?   This sort of sudden devaluation certainly seems to be people's concern, so wouldn't such a reintroduction rate-limiting system alleviate this fear and help provide confidence in bitcoin as a store of value?

If someone finds some old coins they'd be economically stupid to suddenly dump them all on the market and make their holdings worthless. And at most it would result in short term volatility, not long term instability.

Firstly, this is not a suggestion to change the 21Million limit, the generation reward rate/fees or to 'invalidate' old coins that haven't moved in years!

Perhaps this idea sort of belongs in 'Development and Technical Discussion' - but It's light on tech stuff and is also somewhat economics/political/general discussion related.   
Mods - file it where ye will.

In various discussions people express concern at large losses of BTC from the system, as well as the difficulty of determining whether in fact the BTC are truly lost and might actually reappear suddenly - thus providing a sudden money-supply shock.
e.g http://bitcoin.stackexchange.com/questions/1638/what-could-be-the-consequences-of-many-bitcoins-being-lost-out-of-circulation-if

It seems there's a certain asymmetry in concern, in that people aren't quite so worried if their bitcoins suddenly become more valuable due to reduced supply, but are quite fearful of the idea that old huge wallets could suddenly come online, devaluing holdings and discouraging further investment flow into bitcoin.

I'm dead set against 'invalidating' coins that haven't moved in years - as in future
a) we don't know what the average lifespan of a human may be
b) People sometimes get locked up for decades for political reasons - this shouldn't result in automatic loss of their bitcoin assets.

My proposal is that the system simply place a rate limit on how quickly old unmoved coins can be spent.  This would be proportional to whatever is the recent value of transactions occurring per block.  (or proportional to the total reward/fees per block)

The idea is not to cause any particular slow down for spending some small stash that comes online after 50+yrs because some grandson finally worked out a byzantine puzzle in a will..  but if the stash is both old  and *large relative to the current size of the bitcoin economy*, then it will only be valid for the miners to include spends from this stash at some sensible rate relative to recent transaction history.

I'm assuming here that it's not technically too difficult to track the larger chunk of change while allowing only small chunks to be spent off it.
This wouldn't perhaps be easy to do if the old 'lost' wallet was made up of a vast number of tiny amounts rather than one consolidated amount - but hopefully even then it may be possible to automatically apply some rate limiting.


Combined with tools that watch for activity on long-inactive coins - this would mean that even if some previously-assumed-lost multi-million BTC address suddenly showed as an input to a transaction - there need be no fear that the whole amount would be entering the economy in one hit.
For the purposes of estimating the total money supply at any particular time - a lot of old unmoved amounts could be in many cases chopped out of consideration because they would be known to only be capable of coming into the economy at a certain maximum rate.


I'd be interested in people's thoughts on the feasibility and desirability of this.
(and I'm hoping that this will also help kill the oft resurfacing idea of 'invalidating' old unmoved coins)
Apologies if this particular idea has been suggested - please point me to discussion if you know of it.