BIP: ?? Gradual Changing Block Rewards - page 2.

DeathAndTaxes

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Gerald Davis

Quote from: hazek on April 02, 2012, 03:12:29 PM

Do you understand how this limit of 21 million is actually enforced inside the code?

My understanding is there is no reference to 21,000,000 anywhere in the code.

The "limit" is simply an enforcement of what subsidy can be included in a block (which is based on the block's height) and be considered valid by other nodes. Since the subsidy on each block must follow a required decrease the total # of coins that will be minted can be calculated.

All values are stored as 64 bit integers in satoshis (1E-8 BTC).
The initial subsidy is 5,000,000,000 (50 BTC).

The subsidy is right shifted once for every 210,000 blocks in height.
At block height 210,000 a valid node will reduce the subsidy to 2,500,000,000 (25 BTC). Any node that doesn't will have their block rejected by other nodes as invalid.

So at block 6,720,000 the subsidy will be right shifted from 2 satoshi to 1 satoshi.
At block 7,140,000 the subsidy will be right shifted from 1 satoshi to 0 satoshi and no more coins will be minted.
Any block after 7,140,000 with a subsidy of any amount will be considered invalid by other nodes.

If you add up all the block rewards for the first 7,140,000 blocks it adds up to 21M BTC (2,100,000,000,000,000 discrete units).

Actually unless my understanding is incorrect there will never be 21M coins. Due to truncation of some rewards there will be exactly 2,099,999,997,690,000 satoshis mined ( 20,999,999.9769 BTC).

Epoch

legendary

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Quote from: casascius on March 22, 2012, 01:41:36 AM

I think it's a non-starter. It's a solution in search of a problem.

I wouldn't waste your time, or the developers' time with this. The time would be better spent petitioning US Congress to require all speed limit signs in the US to be readable at 100mph so that the worst speeders will know by just exactly how much they are speeding.

Agreed, this change is unnecessary. I would even go further and say that it is a bad idea.

The protocol is the fundamental concept of bitcoin. As the underlying foundation, it needs to remain stable for it to gain (and keep) the trust of its adopters. The protocol is the last thing anyone should be considering to change, unless there is a very good reason (i.e. fixing a flaw).

There is nothing fundamentally wrong with the concept of block reward adjustment. Why would a step change every 4 years be any worse (or, for that matter, better) than a gradual change as proposed?

As casascius and others have already stated, this is a solution in search of a problem. There is little or no benefit to do this, but it holds a real risk of undoing much of the trust that bitcoin protocol has already earned. Let's not shake the foundations of what what has defined bitcoin since its infancy unless there is a 'really good reason' for doing so. I cannot see a 'really good reason' for doing what has been proposed.

Sure, let's consider it. Let's discuss it. But then let's bury it and give it a rest. I would be deeply concerned if this idea gained any serious traction.

hazek

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Quote from: allten on April 02, 2012, 03:02:31 PM

Again, all comments are appreciated and so far I've observed a lot emotional response.

Are you a programmer? Do you understand how this limit of 21 million is actually enforced inside the code?

rjk

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1ngldh

You talk like it is definitely going to happen. Which it isn't. I'm not particularly worried.
It would be interesting to see it implemented in some kind of altcoin though.

allten

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You Don't Bitcoin 'till You Mint Coin

Alright. The key factors of this BIP have been improved and finalized.

The frequency of change is Every Block.
The Change will occur on block 315000 (Block count starting at 0)
The approximate percent decrease: 0.00031746 %

Over 100 years, the original will have approximately injected a few bitcents more than the proposed improvement.
However, these small details will be worked out during the implementation of the code. What's important is the amount injected
is approximately the same or a few satoshis less than the original.

Total Sum

Injection Rate

Again, all comments are appreciated and so far I've observed a lot emotional response.
That's ok. It's all part of reveling what it will take to get a well crafted IMPROVEMENT
adopted by the majority.

Brunic

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Certainly not.

When I've discovered Bitcoin, I've read the rules first, and took the decision of starting that mining project. I've made plans to consider the reward drop, and I'm going to live with it. You don't change the rules so late in the game. That's what we call "cheating" usually.

If you don't like the rules of Bitcoin, well, there's other crypto-currencies out there. I know Solidcoin offer a different reward mechanism, go help those guys grow their currency instead.

Changing basic rules like that will cause more harm than good. I will certainly lost a LOT of confidence in Bitcoins if you can bend the rules that way. Bitcoin was made that way, deal with it like I do.

cypherdoc

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Quote from: theymos on March 20, 2012, 11:40:20 PM

It wouldn't be right to change any aspect of the subsidy rules in Bitcoin. These rules are a "contract" that all Bitcoin users have agreed to.

Quote from: Satoshi

The nature of Bitcoin is such that once version 0.1 was released, the core design was set in stone for the rest of its lifetime.

It's technically very difficult, anyway. You don't need just 51% of miners: you'd need essentially 99% of all users.

Thank heavens for this.

rjk

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1ngldh

The ideal test environment would be as an altchain, seriously. If you are worried about the chain being attacked by overzealous fanatics like Luke, then just create it with Scrypt as the hashing mechanism, since that is a bit more difficult to attack. Then, you would be able to tinker with the reward mechanism however you wanted, and if you came up with something good and useable you could present it to the main devs.

ripper234

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Ron Gross

Quote from: casascius on March 22, 2012, 01:41:36 AM

I think it's a non-starter. It's a solution in search of a problem.

I wouldn't waste your time, or the developers' time with this. The time would be better spent petitioning US Congress to require all speed limit signs in the US to be readable at 100mph so that the worst speeders will know by just exactly how much they are speeding.

+1

It's just not interesting, on a global scale. This proposal will never get off the ground.
I can't say that I object, but I won't support it either (not that I have any hash power, just saying).

Good luck getting 55% support for this.

casascius

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The Casascius 1oz 10BTC Silver Round (w/ Gold B)

I think it's a non-starter. It's a solution in search of a problem.

I wouldn't waste your time, or the developers' time with this. The time would be better spent petitioning US Congress to require all speed limit signs in the US to be readable at 100mph so that the worst speeders will know by just exactly how much they are speeding.

allten

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You Don't Bitcoin 'till You Mint Coin

Quote from: allten on March 20, 2012, 03:54:12 PM

BIP: ??
Title: Gradual Changing Block Rewards
Author: Slim Pickens
Status: Draft
Type: Standards Track
Created: ??-??-2012
Post-History: ??-??-2012

Abstract
This BIP proposes for block rewards to decrease more frequently.

Motivation
Every four years the block reward for bitcoin is cut in half. There is much uncertainty surrounding bitcoin prices and total network hashing power before and after these reward reductions. This author feels very confident that bitcoin will traverse its first block decrease with success; however, months before and after will be full of large price swings with a potentially modest decrease in global hash rate. Stability has yet to be one of Bitcoin’s virtues; yet, many hope (including the author) that this will change over time. The goal of this BIP is to avoid the frenzy in price fluctuations and global hash rate during these rare events by making them much more frequent with smaller decreases.

Specification
Block rewards will begin decreasing every two weeks starting at the end of the second year of the 25 BTC block reward (What’s the specific block number?). (Note: How frequent the changes are and when it goes into effect are open for debate). Unfortunately, this author is not into coding Bitcoin so the details of this BIPs implementation will rely on feedback from experienced Bitcoin programmers.

Variables:
•   Frequency of bitcoin decreases (Initial proposal is for every two weeks)
•   Date, more specifically the Block #, at which these smaller more frequent decreases take effect. (Initial proposal is for this BIP to take effect at the end of the second year of 25 BTC rewards)
•   The Percent of the decrease. Need to find a percentage that will in effect release the same amount of coins over the long term as the original block reward system.

Rationale
Two weeks were chosen for the frequency of decreases because it coincides with the difficulty adjustment. Seems like a good idea to do them together. However, this is not critical for the success of this BIP. Depending on the general consensus from the Bitcoin community and the simplicity of coding implementation, this may change.

The date for the change is proposed at the end of the second year of the 25 BTC block rewards. This gives the community 6 months to observe the market behavior of the initial block decrease and have a software implementation 18 months prior to the change going into effect. Again, depending on the general consensus from the Bitcoin community and the simplicity of coding implementation, this may change.

Based on Moore’s law and the history of computing innovation, it is commonly quoted as 18 months for computing power to double. 18 months should be enough time for miners to adjust their capital strategy before this BIP goes into effect. It will also give the community plenty of time to adopt the new code.

The implementation of this BIP would be a huge win for the bitcoin community. There are many articles written why Bitcoin is “fatally flawed”. They gloss over the fact that the brilliance and innovation of this new currency is in its decentralization and the fact that it is democratically governed. This system doesn’t have the flaws of other democratically governed bodies because there are no laws in effect that force anyone to use it. It is simply by free choice; therefore, no one would advocate changes to favor a few because it would self-destruct the currency. The implementation of this BIP would be a shining example that when problems arise the community will deal with it in way that will cause the currency to continue to excel. In other words, all supposed fatal issues are really non-issues. When the timing is right, mass consensus will be reached and they will be fixed.

Appreciate everyone's comments even if they totally disagree. I would like to continue to push to get this published in the WIKI BIP. Doesn't mean it will be adopted. I just want to make it an official record of what is possible and not possible with Bitcoin.
Before doing so, I would like to kindly request that you humor me and this BIP "as if" it was going to be adopted and help me nail down all 3 variables and hold off from commenting on its feasibility.

Please comment on the following:
1)Frequency
2)Block # of implementation
3)Percent decrease.

Also, what if we rounded the block reward after each decrease to four significant digits? Any thoughts.

Other request for help:
Graphs of Bitcoin curve over time compared to the original.
Graphs of the injection rate over time compared to the original.
Psuedo code for the implementation.

Thanks again.

Transisto

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The first reward halving will be the biggest puzzle speculators will face.

Aside the technical challenge parts of the equation are :

How much better is this proposal VS. What negative effect will this breach of contract have on the perception of users, especially those who've planned long term for this.

Changing the reward every two week could be cause accounting problems for some pools.

4 year is a good time frame for new mining technologies to develop and be deployed.

Abrupt reward changes will times where miners show their cards (figuratively as in what proportion of hashing has which efficiency / costs)

... Just some thoughts.

Maged

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Quote from: theymos on March 20, 2012, 11:40:20 PM

Quote from: Satoshi

The nature of Bitcoin is such that once version 0.1 was released, the core design was set in stone for the rest of its lifetime.

It's technically very difficult, anyway. You don't need just 51% of miners: you'd need essentially 99% of all users.

Not really, actually. You'd just need 100% of miners. However, it'd be even riskier than BIP 16/17. To do it like this (only requiring miners to upgrade instead of every single user), you'd have to throw away a LOT of bitcoins by having miners not claim the maximum block reward (we already know that this can be done, since it was done accidentally in the past). Done like this, it becomes a more restrictive block acceptance rule, qualifying for reverse-compatibility for users (not miners, though).

I highly doubt that miners would ever be willing to cut their own pay, however.

Revalin

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165YUuQUWhBz3d27iXKxRiazQnjEtJNG9g

Bitcoin is the new religion: everyone quoting what the founder said; no one agreeing on what he meant.

Vladimir

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-

[serious]

@Blitzboom:
  Thank you for spelling out the "slippery slope", it is what I have implied in my first post.

@hazek:
  Indeed, it would be silly to ruin simple, magical, and elegant in so many areas design of Bitcoin protocol.

@theymos:
  Yes a "social contract" exists and it would be wrong to break it. Nigh impossible too, just as you have said.

@allten:
  Please do not be upset that your proposal was so quickly and so harshly criticised. You are not the first one who became excited about Bitcoin and thought that one should or can improve the protocol by introducing some simple changes. Some people, myself included, thought about it for a while and moved on, doing something more productive. Others thought about it, got their ideas ignored and laughed at and then went on creating shitcoins. One thing I know for sure, your proposal is not going to fly.

[/serious]

hazek

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Quote from: theymos on March 20, 2012, 11:40:20 PM

It wouldn't be right to change any aspect of the subsidy rules in Bitcoin. These rules are a "contract" that all Bitcoin users have agreed to.

Quote from: Satoshi

The nature of Bitcoin is such that once version 0.1 was released, the core design was set in stone for the rest of its lifetime.

It's technically very difficult, anyway. You don't need just 51% of miners: you'd need essentially 99% of all users.

This post right here just ended this thread and gged this BIP idea.

theymos

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It wouldn't be right to change any aspect of the subsidy rules in Bitcoin. These rules are a "contract" that all Bitcoin users have agreed to.

Quote from: Satoshi

The nature of Bitcoin is such that once version 0.1 was released, the core design was set in stone for the rest of its lifetime.

It's technically very difficult, anyway. You don't need just 51% of miners: you'd need essentially 99% of all users.

FreeMoney

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Strength in numbers

Quote from: Revalin on March 20, 2012, 06:21:19 PM

The reward drops are always cutting it in half. It may cause sudden drops in block rate or changes in value. This doesn't just apply to the first drop.

If fees remain the same or increase then level the impact of the fixed subsidy halving will actually be less each time.

N12

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Vladimir, both of you have made no arguments against the change or for the current design.

My only issue with this is the "slippery slope" problem. I don’t see why it should be better to do it every 4 years than regularly. Consider the psychological impact and impression of scarcity it would have if miners were getting slightly smaller payouts on the same difficulty on a regular basis.

Vladimir

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-

Quote from: hazek on March 20, 2012, 05:51:30 PM

People don't realize this, but a lot of what looks like a huge bug in Bitcoin is actually an ingenious design.

Unfortunately to realize that one would need to perform some higher order nervous activity, like having a brain, for example. Not going to happen. Grin

Topic: BIP: ?? Gradual Changing Block Rewards - page 2. (Read 6400 times)