Topic: A proposed solution to adjust for lost Bitcoins: wallet 'heartbeats' - page 5. (Read 12206 times)

Who's saying there are no more good ideas to be had?

All we're saying is that this isn't one of them.

If you really think it is, create a fork of the client and/or blockchain and see if people use it. You're not going to shoehorn this fix for a non existent problem into Bitcoin.

I have to say that I agree.  I have also come to these forums with ideas and found that there is no shortage of people who just want to shit on any idea that they didn't come up with themselves.  I think that there are some people who don't really want to think any further than whatever Satoshi wrote in the white paper.  That dude was so smart that he must have thought of everything, right?

For what it's worth, I do think that Satoshi's ideas were pure genius; but I also don't think that there aren't any more good ideas to be had.

This is an insulting and unnecessary remark, but unfortunately I have discovered it is typical of the community here. Sad, really. What basic concepts have I not grasped?

You apparently have absolutely no idea what is being discussed here in this thread when the term zero is used. Zero is referring to the fact that the ratio C:M can in theory approach the value of zero, where C is equal to the number of coins known to be in circulation recently, and M is the total number of coins minted. From this, it follows that L + S = M - C, where L is equal to the number of coins lost and S is equal to the number of coins saved in the long term. While the sum of L + S can be determined, the ratio of L to S cannot, thus creating a situation over time in which as the ratio C:M approaches zero, the uncertainty increases as to the actual valuation of Bitcoins, due to the fact that the possibility of a quantity of Bitcoins many multiples of C could be introduced into the market, a situation that is not really possible in the early stages of Bitcoins, thus introducing by design a monetary currency which changes its dynamics over time independent of external economic forces.

Divisibility is not the issue, and it's annoying when people bring it up.

If anything, the question is the rate of loss, and whether it is constant over time, or decreasing, or even increasing. Some individuals here contend that as Bitcoins increase in value, greater effort will be made to prevent their loss. However, I contend that in order for Bitcoins to increase in value, they will have to gain widespread use, thus their increase in value actually results in a diffusion where the average wallet size is no greater than any average wallet or bank account today, which means that there is no reason to assume a decreased rate of loss over time.

Since you dont understand the system, let me repeat slowly:

a) zero can only be reached if there is no longer sufficient divisibility to allow supply and demand simply take care of that by in a sense DEFLATION. as long as divisibility is assured the practical use of bitcoin will not be affected at all
b) if a trend can, in the far future, be anticipated that there might be a looming issue on the horizon, a fix to that issue, however that fix may be, can be introduced to the mainline client. if that is a "vote on branching" or something different does not matter, the tools to fix it are already there
c) why does every random person who seems to be in the "explore bitcoin phase" set his first and foremost task at solving longterm issues for bitcoin before even grasping basic concepts or the currency

Yes, it is a realistic assumption, as pointed out above by both bji and myself.

Besides, gold is a ridiculous analogy. When gold is submersed in water, it is not destroyed. It's not destroyed by fire, either. Nor by hitting it with a hammer. When it is buried, upon rediscovery, it is obvious what it is. Not so with Bitcoins. When Bitcoins are lost amongst rubble, they just look like mangled computer hardware, kind of like that scuffed flash drive I saw in the parking lot the other day. Who's going to bother resurrecting such a thing, not even knowing if it's worth it to do so? A gold coin in the parking lot is obviously recognizable, though.

Also, gold is also not accidentally deletable, so to speak. It's not subject to computer viruses, either.

I think the burden lies upon the defenders of Bitcoins to bring forth some better arguments. And leave the sniping one liners behind.

That is true, but don't you think it would just be cool to have the only currency in existence that simply could not be destroyed (on anything other than catostrophic scales of course; if the earth were blown up by Vogons then obviously bitcoin would be just as gone as dollars at that point)?  I think it would be just another really cool aspect to bitcoins that make them that much more interesting and appealing as a form of currency --  100% guaranteed 0% inflation/deflation of the monetary supply.  That's just so cool and bitcoin has a chance to achieve that; obviously there isn't the mindshare for this now due to all of the naysayers but maybe someday in the distant future the bitcoin user population as a whole will move to new rules that make bitcoin truly non-inflationary/non-deflationary ...

Please, try not to get bitter. Yes, you are right: If 1% of bitcoins were lost every year, their number would (slowly) approach zero. But that is not a realistic assumption, as pointed out above.

You have, however, repeatedly asserted that from the pure fact that the number of bitcoins will not increase over time it follows that this number approaches zero. That is not the case. That is all I tried to point out. If you are of the opinion that this number will approach zero, you should argue why that might be the case. A constant ratio of loss would be such a reason. But you have not argued anywhere why such a constant ratio is a realistic assumption.

Now, even if what you call "uncertainty" were to increase, consider the interesting case of gold: We have no idea how much gold there will be available in a few years. That is because huge amounts of it lie around in space waiting to be mined. Still, I have not noticed any uncertainty in gold prices. Actually, there are people going around claiming gold to be the most secure monetary standard there is.

I suspect you're not a mathematician, otherwise you wouldn't make such a fallacious statement. It makes you sound doubly condescending. 10.5 million, eh? Funny!

Assuming 6.5 million Bitcoins (we could assume 21 million if you want, it makes no difference), and a rate of loss of one percent per year, which I will admit is probably high, we get the results listed below for one thousand years. I don't see it stopping at 3.25 million. It does not matter what we set the rate of loss to, it will not stop at half. So please, don't ever make assumptions about your understanding of math vs. mine, again, ever.

And yeah, you are condescending, and apparently, not even right, by a long shot.

year: 2020 5878483.487557
year: 2030 5316395.094382
year: 2040 4808052.427024
year: 2050 4348316.430703
year: 2060 3932539.436394
year: 2070 3556518.175540
year: 2080 3216451.287401
year: 2090 2908900.889465
year: 2100 2630757.822409
year: 2110 2379210.218276
year: 2120 2151715.074087
year: 2130 1945972.543530
year: 2140 1759902.686828
year: 2150 1591624.443727
year: 2160 1439436.617053
year: 2170 1301800.674574
year: 2180 1177325.195319
year: 2190 1064751.803103
year: 2200 962942.445059
year: 2210 870867.886577
year: 2220 787597.306321
year: 2230 712288.886162
year: 2240 644181.300873
year: 2250 582586.021565
year: 2260 526880.355054
year: 2270 476501.148785
year: 2280 430939.097683
year: 2290 389733.595365
year: 2300 352468.077676
year: 2310 318765.811463
year: 2320 288286.086013
year: 2330 260720.768665
year: 2340 235791.189763
year: 2350 213245.325467
year: 2360 192855.249931
year: 2370 174414.831109
year: 2380 157737.646871
year: 2390 142655.100384
year: 2400 129014.715696
year: 2410 116678.596288
year: 2420 105522.031020
year: 2430 95432.233373
year: 2440 86307.201241
year: 2450 78054.685746
year: 2460 70591.258659
year: 2470 63841.468984
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year: 2580 21133.638641
year: 2590 19112.883966
year: 2600 17285.349661
year: 2610 15632.560394
year: 2620 14137.807406
year: 2630 12785.979598
year: 2640 11563.410760
year: 2650 10457.741417
year: 2660 9457.793883
year: 2670 8553.459257
year: 2680 7735.595231
year: 2690 6995.933667
year: 2700 6326.997006
year: 2710 5722.022681
year: 2720 5174.894745
year: 2730 4680.082048
year: 2740 4232.582314
year: 2750 3827.871575
year: 2760 3461.858438
year: 2770 3130.842718
year: 2780 2831.478034
year: 2790 2560.737979
year: 2800 2315.885527
year: 2810 2094.445359
year: 2820 1894.178840
year: 2830 1713.061389
year: 2840 1549.262014
year: 2850 1401.124795
year: 2860 1267.152149
year: 2870 1145.989690
year: 2880 1036.412534
year: 2890 937.312918
year: 2900 847.689002
year: 2910 766.634738
year: 2920 693.330715
year: 2930 627.035871
year: 2940 567.080002
year: 2950 512.856989
year: 2960 463.818668
year: 2970 419.469289
year: 2980 379.360506
year: 2990 343.086842
year: 3000 310.281590
year: 3010 280.613108

It might sound condescending. But it's not. It is really a concept that is hard for non-mathematicians to understand, because people rarely get to think about infinite things.

See, you still haven't understood it: The number of active bitcoins will NOT "approach zero". Not at all. It will approach some large positive number. Ofcourse, it is hard so estimate the exact number today, but I believe it will be more than half the number of total bitcoins, that is more than 10.5 million.

bji has it one hundred percent correct. If the value of Bitcoins is to rise, it will be due to increased adoption, and more likely, widespread adoption. Remember, the increasing value today is due to speculation that they will become a useful vehicle for commerce, not because they are currently a useful vehicle for commerce.

Widespread adoption will result in increased value, but as bji says, it will not likely result in a decreased rate of loss. In the far future, widespread use might mean hundreds of millions, or billions of users. Regardless of increased value, due to diminishing numbers in circulation, the increased user base will cause any one wallet to likely have a relatively constant average value, based on external economic factors. This wallet value will be no different than average values of checking accounts and wallets in use today. Increased valuations of Bitcoins is unlikely to mean that any one wallet in existence is protected at a security level greater than a wallet today.

The widespread use, if it comes to fruition, will mean exposure all across the world at a high density level, and even the Solar System, if we are talking about the far future. Bitcoins will be subject to all the same accidents that can befall physical objects today, such as natural disasters (how many Bitcoins were lost in the recent Japanese tsunami?), but Bitcoins are also subject to loss via mechanisms that usually aren't an issue with normal physical objects: hardware failure of the hosting device, software viruses, accidental deletion, malicious deletion, and so on.

I contend that the most likely vector for Bitcoins to gain widespread use will be if they supplant the unstable currencies of the Third World, usable on smartphones, allowing near instant commerce between the citizens of the Third World, across state lines. This is the exact scenario which creates a situation ripe for loss, but is also likely the only real hope Bitcoins have for mass adoption.

If Bitcoins fall out of favor, either due to competing currencies, the increasing uncertainty that has been described here, or actually fail to gain widespread use, then the speculation which attaches an increasing value to them today will not guarantee a high valuation for them in the future,.

The end result of this thread could be better protection if people like you would just go away and leave the discussion to people willing to discuss new ideas without resulting to trivialization and demeaning them.

I am not so sure.  If bitcoin becomes widespread in use, then I would think that there would be a spreading around of bitcoins more than anything else.  So if right now there are 10000 people with an average of 200 bitcoins each (just to pick some numbers), then if bitcoin becomes very popular then there might be 1000000 people with on average 2 bitcoins each.  Now there are many, many more opportunities for people to lose bitcoins.  We can see that even today with a high value of ~$20 per bitcoin, some people lose them due to carelessness (the recent heist because a person didn't bother to encrypt their wallet file comes to mind), and even web sites that were pretty much printing money (mtgox) don't do a good job of securing their coins and (possibly - hopefully!) killed their goose that was laying golden eggs.

So clearly just because bitcoins are valuable, it doesn't mean that there won't be careless people who lose them.  And if you spread the bitcoins around, there will be less value to lose per individual 'wallet', but many more wallets.  I personally think it's kind of a wash, and I would expect a constant rate of loss that actually exceeds that of paper money since digital currency like bitcoins is so much easier to destroy (with a single keystroke you can destroy a large quantity of bitcoins instantly; with paper money you'd probably have to throw a big suitcase into the ocean or something, which takes alot more effort).

Right now that incentive is being expressed by feeding this thread not protecting better.

I don't. You still haven't addressed my point that as the value of a bitcoin increases, the incentive to protect it from loss (or theft, but that doesn't decrease the bitcoin in circulation) increases. This, I think, will lead to the slowing of loss over time.

It's amazing how many people insist I think divisibility is an issue.

How will the market value bitcoins when the total number in circulation is unknown?  Does it matter how deeply the bitcoins can be divided if no one knows if there are 10 million bitcoins in circulation or 20 million?

This is an honest question.  Maybe someone with a better grasp of economics can tell me if it matters at all whether the total number of units of a currency that exists is known or not known; maybe it doesn't matter because people value the currency based on its current supply, by which I mean the availability of units of currency to purchase, not on the total number in circulation.

Like I said before I personally would find it satisfying to have a system where no units of currency could ever be lost and with Bitcoin we could have that; but practically speaking the difference between 0.5% deflation and 0.0% deflation is probably not very important on anything other than millenia time scales.

No, the root of the problem that you are trying to find and cure would be divisibility. Your initial posting is full of "i dont know" and in that regard very valid. You fail to actually identify a problem yet want to make a connection mandatory, however long the duration might be. Bitcoins will be valued at supply and demand related rates. This is possible as long as divisibility is sufficient, hence the problem you are trying to cure is not there. You try to solve a problem that doesnt exist by introducing a system that gives alot of people with offline savings a maintenance overhead that is neither desireable workload wise nor smart in the pseudo anonymous context. But of course, you wouldnt know about that.

If in the very long term bitcoin is still around, the system can be branched to adress that issue without changing the rules, if 50+% of the network agrees to it. You would know that if you would take time to understand a system before suggesting LOOONG term solutions for LOOONG term issues that may or may not be there.