Topic: Bitcoin Deflation - page 2. (Read 496 times)

The authentication procedure is the recovery phrase. Inheritance would be passed down the line through the recovery phrase regardless of a system of recycling for lost coins.

The verification of activity, or "confirmation of aliveness", is any sender transaction. Wallet activity would happen regardless of the recycling system.

Extreme holders, or people who have lost access to their wallets, have 131 years to perform a simple active transaction to declare the wallets as alive. This system ensures that the law of conservation of energy is upheld and no energy/money/effort is permanently lost.
 
To explain this using a human metaphor, both breathing and transacting are forms of exchange with a system. Each breath in the human body resets the death clock, and if breathing ceases for a certain period, brain death can occur, leading to the body's recycling back into the system. Bitcoin wallets are more efficient than human bodies and can remain without transactions for longer. However, just like human bodies, wallets should also be able to die, especially when money is primarily for the benefit of the entire system, rather than the specific single owner.

The argument lacks reasonableness. The recycling processes would be executed by the code based on a collective consensus, without any centralized authority. The only centralized entity would be the neutral machine, if one were to be identified. Therefore, there would be no biased authority responsible for recycling. The protocol would aim at preserving the fixed supply and ensuring balance in accordance with the law of conservation of energy over an indefinite period. If one were to consider this centralized, then the whole protocol would be, regardless of the specific features.

Regarding the rest of your arguments, I abstain from responding, since I've already addressed them previously.

Regarding Satoshi: rejecting new ideas on the basis of a cult-like mentality is dangerous for the system over time. Furthermore, while Satoshi is certainly superior to you in matter of creativity, mind, and especially reading capability, It is advisable that you avoid suggesting that anything spoken by them is imperishable and incorruptible.

I understand your concern about the proposed bitcoin laundering, and you've raised some valid concerns.

 Indeed, recycling could raise security issues if not implemented properly.  The issue of tampered wallets and children's inheritance is an understandable concern, but there are some steps that could be taken to ensure funds are only accessible by rightful owners.  For example, an authentication procedure may be required to access funds from an inactive wallet or even provide for the creation of a special fund for such cases.

Thank you for addressing this problem. People that may consider their right to pursue the recovery of their wallet would have 131 years to do so, after all. On the other hand, if people would not accept a finite time, regardless how long, it would most likely be for unreasonable greed and attachment, rather than believing in the chance, 10, 100, or 1000 generations from then, that they will be recovered by relatives down the line.


This issue could be solved by new mining. It would reintroduce quantities of money gradually over time.


There's no threat to whales. More generally, there is no threat to anyone having access to their wallets. A simple active transaction performed once every 131 years would enable a wallet owner to hold coins indefinitely. Most users need not concern themselves with recycling as they typically perform transactions more frequently due to their activity. Even if an individual were to perform active transactions only once every 100 years, recycling would not be a concern.

Verifying ownership through a sender transaction within a long timeframe is the easiest part of the design. For a very, very small effort, which for most users would be any conscious effort at all, we obtain a system that earns back lost coins and autonomously maintains the predetermined fixed supply, responding efficiently to the law of conservation of energy.

The real complexity and effort to justify such an effort/outcome ratio come from finding the right design of cycles of mining and block rewards post original cycle, as the recycling would be asynchronous. This is the one thing that would require great feats of creativity and neutrality.

I think the idea of bitcoin recycling was not liked anyone, the idea is generally good in theory, but it raises many side problems in practice.

The main problem is that people do not accept that their wallets are tampered with even if they are missing because they consider this their right and the legacy of their children may be able to recover them one day in some way.

Also re -inserted inactive wallets to the network may lead to dumping the price due to the entry of large quantities of bitcoin into the market and this is what no one wants.

I think that the most opposed to the protocol (if applied) will be the whales who have asleep wallets that contain thousands of bitcoin waiting for the time to sell them, the whales that they have all the sleeper wallets will do everything to prevent the application of the protocol.

I strongly disapprove of long abandoned/lost Bitcoins being reintroduced to the network for whatever reason. These lost or abandoned bitcoins will make the value of Bitcoin itself strong and it will prevent significant depreciation of Bitcoin in the future.

No, it's actually no point debating this anymore as it has been already labeled a waste of time a decade ago.
It has been debated since Satoshi was still on this forum, it's about time we quit


It's no point trying to reinvent the wheel, and certainly not by taking control over other people's money in name of economic stability.
That's why Bitcoin exists in the first place, so you don't get locked out of your account once a bank decided 50k is enough for you and the rest goes Cyprus-style donations.

Plus the whole thing is a waste of time, let's assume Satoshi is still in control of his coins and passes down the keys to his family but those want to keep the coins intact. They will still sign a message and keep the coins but the coins won't be in circulation, so how does this help anything?
You would still have 1 million coins missing from daily activities and things will be the same, all you have is the confirmation they are not lost!
Economic impact, zero!


No, there will be a centralized entity that will decide how much time you have before your funds are taken away from you.
Automation doesn't mean it's not centralized,  it will be the same as banks, once you go over a limit based on the decision of the government the money above the limit is not yours anymore, it will still be a protocol that central authority decided on a whim for how long can you keep your funds (account) unused.

@stompix don't be so hard on @HandcraftedBreads! I think it is worth having that discussion and I must say that I also had these thought experiments on my mind years ago. What if this or that happens and can the supply ever become too scarce to keep up with the economic requirements of (monetary) policy and society. I think it is nice to have these discussions and see what everybody has to say. It is not that there is no point thinking about it, but as has been said before here Bitcoin will always have a sufficient number of satoshis to keep functioning properly.

@stompix even though I concur with you that taking away coins from dormant addresses and reintroducing them into the system goes against my expectations and understanding of how Bitcoin is supposed to work (and will hopefully always do), the signaling to the network whether or not a wallet is still active would not necessarily have to be done using a centralized service right? Couldn't it just be a signed message to the network and the protocol would do the work? No centralized entity needed.

@HandcraftedBreads, you should also take into consideration that the incentive for the vast majority of those who have a say about protocol changes is essentially zero regarding your proposal. Unless the economic viability of the protocol is so badly threatened that the wealth contained by the network is seriously at risk, you won't ever convince the majority of voting power to vote in favor of that protocol change. A fork is a possibility and you could decide to shift your wealth from Bitcoin to the new fork operating on your newly proposed rules. Speaking of which, this is what you could actually do. Introduce the new rule into the protocol, get a fork going and see how people react to it.

Yet you're thinking of this over a 100 years period when it's obvious the bulk happened in the first years.
So just as we lived till now like this and we're going to do so over decades from now on till your "clock" starts ticking.
Just as an example, if we assume there are 1 million lost coins only in Satoshi's case then you have half of the next century's future supply just there.


Future maintenance? Lowering satoshi?
You do realize that even if half of the coins would be actually lost, it would mean only an increase in the price of 100%, the last bull run made a 6x, there is no need for that and won't be anytime soon, for one satoshi to reach 1 cent you need first Bitcoin at 1 million and even in that case, you still have milisatoshi on LN.


I can still burn all my banknotes before I die, take that from me!


No, it's not!
I have wallets I haven't touched in years and there is no way you're going to make me go through some centralized bullshit of proving I own this or force me to change my address every year to show the world my wallet is active.
Just deal with it, nobody likes your idea, it will never be implemented as it goes against the main principles in BTC and that's it!

Just one thing, don't touch other people's Bitcoin.  The system is working fine as it is.  As many people say, don't reinvent the wheel if it is not broken.  Let the lost BTC be idle for eternity, this will add more rarity and value to the existing and circulating BTC.

I think this kind of approach introduced by @OP is exploitable and may bring a threat to the security of the Bitcoin network.  And honestly, I think the idea isn't brilliant at all.

The reintroduction of coins from dead wallets would occur gradually through new mining cycles. Please note that the reintroduction of coin quantities would be asynchronous, as each wallet would have its relative clock. The primary benefit of recycling would be reducing the need for future maintenance and forks aimed at lowering satoshis. Without recycling, these forks would become inevitable. In general, recycling would reduce the need for manual maintenance to comply with the constantly changing conditions of the system. Recycling would help avoid subjecting the system to the risk of human failure.


Gold is not a fixed supply; instead, it is potentially infinite. On the other hand, Bitcoin has a finite supply limit (21 million BTC = 1; limit in absolute quantity), but it is infinite inwardly (the smallest unit can be subdivided infinitely, meaning that there is no limit to the amount of decimal places).


When humans pass away, they cannot take their money with them. If coins are irreversibly lost, they cannot be stolen. Once someone loses their coins irreversibly, they no longer own them. Through recycling, the Bitcoin protocol ensures that the original supply is preserved, just as the law of conservation of energy dictates.

Regarding the last criticism, the Bitcoin protocol will not access a wallet and steal the money as long as it is still owned. The wallet's contents will be recycled into the system once it is no longer owned. The way to determine if a wallet is unowned is through the expiration of a set period of zero active transactions.

The replies provide much clarification to the problems you've addressed. If you're interested, I invite you to have a read.

You can solve the legitimate inheritance problem by verifying wallet activity through a simple transaction. The clock will restart safely after every transaction. Wallets that haven't made any transactions in the predetermined time (I proposed 131 years, referencing the mining cycle) will be identified as "dead" by code, and it will reintroduce the energy/money into the network as a form of recycling.

Furthermore, the number of coins necessary for the economy to function properly must be scalable over time. Bitcoin's scalability problem does not only involve scalability over space.

It is very possible that, in the future, the current satoshi will be too large for the proper functioning of the bitcoin economy. The causes could be a too valuable bitcoin, or a too large user base. This may not concern us soon, but future generations will, as they will have to implement more decimal places and perform forks.

There are enough sats for now. In the very-long term, there will be a necessity for manual system maintenance. Specifically, since lost coins will inevitably increase over time, the network must increase the decimal places for a bitcoin each time the necessity presents itself. Recurrent manual maintenance, regardless of how long the period between one and the other, can be a flaw in the system. Each manual maintenance will require to subject the network to risk of failure. Completely neutral and automatic maintenance, such as one provided with the code itself, is necessary to guarantee that bitcoin can persist forever.

The system should be able to perform self-maintenance. Recycling is a form of self-maintenance.

A wallet can "verify" its activity with a single transaction. One can preserve his coins just by verifying once every 131 years through a simple transaction with the given wallet. This will state to the protocol that the wallet is still "alive". If the wallet doesn't make transactions after a period of 131 years, the wallet will be stated as dead by the protocol, and the coins recycled into the network.

There is no threat to holding coins, nor to keep diversified portfolios, or threats to legitimate inheritance.

Reintroduced by the protocol, the code, the system itself.

Yes, it would be possible to implement, but the moment it does happen you can count Bitcoin as dead, and this time for sure.

Furthermore, it's quite funny that OP thinks we should re-add coins that have not moved for 131 years and that would be a solution but what will happen 108 years from now, when there is still one year before the great reset? It's highly possible that the amount of coins lost for sure, dust left rotting in deleted wallets and so on would already be half of the coins in circulation so what help would that be if we already have gad decades of less than 21 million moving coins behind us?


So, you have the right of stealing the banknotes I keep in my safe after around 200 years when polymers start degrading but despite that seems like you have no right to "recycle" the gold I bury in my garden since gold doesn't degrade. Funny how sometimes nature can be a bitch and stops mimicking human activities exactly when you need it more.

It's stealing! You have no right to take over my coins, simple as that!
Just as you can't enter my house and grab a painting because the museums are running low, you can't touch my coins!

So the first wallet balances to get recycled will be the genesis block and Satoshis'/early miners. At that point in time the block reward will have already reduced to zero, how do you propose to reset the block reward? You'll have a completely irregular supply of coins for the reward, you'll get a million or two BTC, and then after that you're not going to get big lumps and you might be able to track the possibility of any wallet reaching old age at a specific time, you can't be sure the owner won't move them and now you don't have new coins to hand out in block rewards. What kind of model is that for miners? By this point it is hoped that the transaction fees will be high enough to cover the cost of the miners, but you're going to release a bunch of "recycled" btc back out to them, do you know how that will effect the mining/transaction/user economy of the future? I don't.
There are a myriad of factors you need to address to make this idea realistic or beneficial.

It means new Bitcoin can be created that loads more bitcoins to total supply that is initially set at 21M.

Do you think about who will be new owners of reintroduced bitcoins as replacements for inactive owners?

What do inactive owners think if such reintroduction of bitcoins is made?
They likely are dead people, lost their private keys or they just inactively with their bitcoins but still have private key access.

Your proposal is not logic in thinking and it's controversy if it is activated on the network.

I don't know, is this even possible? But supposed it is, there might be advantages if old and inactive coins are reintroduced to the network, but I think the disadvantages far outweigh them. There are definitely technical matters that will be introduced that will surely compromise some fundamental rules of Bitcoin. I am not technically knowledgeable to get into it in details but I wonder who will be powerful enough to be able to bring back lost coins? Will it not damage Bitcoin's decentralized design?

Even if you waited 200 years and remove Bitcoin that is inactive and put it back in the market you can not guarantee that someone has not just inherited it and kept it in that address. We do not need to reintroduce Bitcoins back into the economy because there is enough Bitcoin for the whole world to use. Lost coins do not mean any thing but they do push the demand for Bitcoin up a little but not any thing that is noticeable.