Topic: AURORACOIN - Empowering Financial Freedom - page 60. (Read 138034 times)

Changing the halving doesn't give anyone more of an advantage with mining than anyone else.  It actually creates a fairer distribution of coins over time.  Additionally, if we aren't talking about "a better way" or "a greater good", then why are we working on AUR, and not just pumping up BTC?  If BTC is does things right, then why try to compete with that?

Evening out the halving schedule doesn't change the supply, nor does it centralize the power of control to the deciding few.  If anything, it broadens the base of wealth and creates a fairer distribution.  It also eases the fluctuations in price caused by halving over the next *nth degree of years.  Sure... acceptance is going to create a skyrocket price increase... but what about 2 years from now when we hit the next halving?  Are we saying that in 2 years, we won't want the price and chain to be as smooth as possible, or are we hoping for a rollercoaster coin that we make day trades on?

The only argument I've heard so far for leaving it as-is is because BTC did it that way, and Satoshi knows best.  The only other reason I could think of is because it's more complicated code.  This can't be an issue with the fact that we're pushing a pretty large update to the wallets soon that will have a change far greater than changing the halving schedule.

I'm still waiting for someone to tell my why it is financially or technically more beneficial to have hard halving schedules rather than gradual block reductions that match the mining timeline.  Sell me on why it's better to leave it as is.

-Fuse

It means sheep and wealth. But then again the vikings used sheep as food and as commodity money.

I used the Android wallet earlier this week. It is the old one from 2014.

the fehu symbol means mobile wealth.

What is happening with auroracoins mobility?

Has anyone been able to use an android wallet yet?

I just wanna say that change is the only constant, but the blockchain.
I enjoyed this discussion 

No point in fixing stuff that isn't borken.

While price stability might be a nice thing in theory, if it comes at a cost of confidence in the coin then it is not worth it.

If Auroracoin becomes widely accepted, its price will jump many-fold from here, irregardless of whether the block reward halves or not. In fact the halving will have a minor impact compared to acceptance. We could easily see a 100x jump from here based on acceptance.

However if users don't have confidence that there will not be fundamental changes to the rules of the coin, Auroracoin will go no where but down.

I don't know if halving is the ultimate mechanism in this case, but it was good enough for Satoshi. I'm pretty sure he would have had the capability of programming a gradually-scaling reward system if he had thought that was best. The beauty of the present method is it is easily understandable. As is PoW. That means players can make decisions and act accordingly. As more complexity is introduced, it gets harder for average participants to act rationally, so they drop out of the system.

The genius of bitcoin is that it removes currency from the control of a group of elites who manipulate it for their own advantage, OR who manipulate it for what they think is 'the greater good' or 'a better way'. We should inoculate ourselves against the idea that we can somehow out-smart the market, and we should be very careful to make changes to what Satoshi has designed in terms of the economics of the coin. Adding features is one thing, playing Paul Krugman is completely another.

Finally someone who gets it ;-)


Again: not sure above does work like that for AUR.

Correct.  If the price doesn't go up, the miners would jump ship, and the difficulty would fall, essentially creating price/reward equilibrium.  The first halving of BTC was an interesting time, because you saw a shift in mining technology.  I'm pretty sure it's safe to assume that everyone who was mining BTC with GPUs(myself included) before the halving pretty much stopped in the following months when the price was stable.  But the price jumped like 15x shortly after that, and then ASICs hit chain.  So it was a really interesting time for BTC market dynamics.  However, this summer should be a true indication of the effect the halving schedule has on market dynamics.  Even if the increase is gradual, it will be very sharp when looked at from a longer timeline.  Yes, month to month it's not going to look crazy, but over a 3-6 month span I'm almost guaranteeing that you will see a considerable increase in price following the halving.  I don't think you'll see enough of a decrease in mining to equalize the price/reward ratio.  Time will tell though which way it will go.

But either way it goes, it's still disruptive.  Sharp increases or decreases in price or hashrate aren't ideal, especially when we're talking about a daily use coin.  I personally want to see things run as smoothly as possible for the foreseeable future.

I'm not an economist like some of the folks in the team or in this thread. I would think though that a gradual decrease in the inflationary rate would be better than hard halvings.  I'd love to know why it wouldn't.  The only reason I could see BTC using a hard halving is because it was easy to code and it was simple.  That can't be the only reason why coins continue to follow the halving model started by BTC.  If AUR is going to be the model for how a country coin replaces the fiat currency, lets get really serious about how the currency is modeled, and not just because BTC did it that way.

-Fuse

I'm pretty sure that with auroracoin (or any other coin mainly mined by pools that mine altcoins in order of profitability) that this effect would happen really quickly, within a couple of blocks, too.

It's very different for Bitcoin, of course (there is no other coin to hop to). I don't share the belief expressed above that the halving had (will have) no effect on Bitcoin price. En contraire. But this is not the place to argue that.

"In economics we have a concept called rational expectations where agents use all the available information to decide their actions in equilibrium. In this framework the halving in the block rewards would have been anticipated and factored into the price. You are right to emphasize that when doing a demand and supply analysis, it is not the coins produced on a daily basis that matter but rather the entire stock of bitcoins in circulation. In that way the price of bitcoin should not double for a halve in the hashrate, in fact the effect should be negligible. This is considering just transactional demand and total supply. With goods/commodities this is likely to hold true but in currencies or cryptocurrencies this may be different. There are issues of security and speculation.
...
In my mind, economics would predict the hashrate to halve as the reward halves. Essentially the argument would go if the price has not doubled the hashrate must fall."

With Bitcoin, market prices will need to increase after the halving to keep mining ROI intact.  The big mining farms won't sit around and mine at half the profitability.  The correlation between halving and price might not be 100% connected, but there is a strong influence on price when the market is as big as BTC.  I've also seen coins try to manipulate halving schedules to increase price, only to see huge decreases in price because it was a stupid idea(never try to manipulate coin price through blockchain mechanics).  In 2012/2013 also had the momentum of BLF ASICs coming onboard too.  Between the halving and the rush for ASICs, it was a crazy time for BTC price.  They even made commemorative coins for "halving day".

I'm not going to say that AUR will double(or more) in price when a halving occurs, but when we're trying to create a stable blockchain and market price, we're not doing ourselves any favors with a hard halving.  In a few months, we'll be able to witness it again with BTC.  It's not going to happen overnight, but I'm extremely confident in the fact that with S7s still selling, miners won't take a 50% on mining rewards for very long.  They'll drive the price up to match original ROI.

AUR doesn't need big swings like that when it's trying to be a stable, everyday use coin.  Just my $0.02.

-Fuse

Why Market Prices Do Not Double With a Block Reward Halving

http://www.ofnumbers.com/2014/10/15/why-market-prices-do-not-double-with-a-block-reward-halving/
and
http://www.ofnumbers.com/2014/07/02/ray-dillinger-discusses-block-reward-halving/

This was briefly discussed on a developers meeting yesterday. Like many things this is also a topic that we look into at those meetings.

Rest assured though, no fundamental changes will be made without wide consent of the "economic majority".

In principle the supply will remain untouched. The only exception that I see is implementing Proof of Transaction if the total amount of coins is insufficient for a proper AUR-based economy (undefined yet what that would be).

The first halving of Bitcoin had no measurable effect on the price (the price increase before and after that time could have more be attributed to more people discovering Bitcoin and the fraudulent actions by MtGox at that time. At the block where the halving happened, the price hardly reacted, the largest changes happened with weeks of interval.

If the economy and money supply is healthy enough (the latter is already the case for AUR, the first not so yet), there should be no shock in price. Also, I've had already discussions with the ISX people on measures to stabilize the price on their Icelandic exchange. The price calculations/speculations from Guðmundur (new Icelandic MBA that the foundation had a 5 hour talk with last week) are part of determining strategies for this.

But if people want this discussion (IMHO it is a solution for a problem that does not exist), the official Auroracoin forums is the place to do that.

I'm sorry I came across a bit harsh before. I was getting a little alarmed when hearing you were going to fiddle with the supply


I'm relieved.


It sounds like a good idea (it also means we'd have to start earlier than the scheduled halving, though. So we might not have as much time as you stated before)


I'd be interested to hear the arguments for keeping the current schedule, too.

If I'm welcome, I'd like to be part of the discussion because I think it's interesting and also relevant to Aurorocoin adoption (as you argued). Hoping it will be on the forums or somehwere accessible to me and not on skype (I have a rule to not use that)

I think that's the biggest point I'm trying to get across- stability in price.  To be honest, I think you'll see the price shake-up this summer when BTC halves again.  It has to reflect the halving or else the miners will abandon the chain.  When bitcoin halved in Nov 2012, it went from ~ $14 to $200+ in a matter of a couple months.  It's like saying gold is going to go from $1100 an ounce to $15k an ounce in a couple weeks.  That's not stability, that's just crazy.

On the back-end, a gradual decrease over time would ease miners into reduced block rewards, and it would eliminate the halving price shock I've seen firsthand with other coins.  On the front-side the supply would be more evenly distributed over time, rather than everyone who got in before the halving being the big block bag holders.

-Fuse

I have this crazy theory that moist of the premined coins are already sold (airdrop stage 2-3) or lost (airdrop stage 1). This is good news for the bag holders but it's creating as we speak, some kind of plutocracy.
AUR it's supposed to be a democratic enterprise and the current rate of  reward/block does not fit it's long time purpose, in absence of a widespread adoption in Iceland.
The idea of a linear AUR reward/block decrease it's more natural then a sharp one.
Sharp reward/block changes may fit well BTC, but AUR is different because it's addressed to a local economy that needs stable rate of supply/inflation in the first place. I'm not an economist so all my assumptions but first, could be a complete nonsense