the change described in the above paragraph may be a hard sell
I edited the wiki to explain how such a revision could technically be possible but why realistically it likely would not occur.
Topic: Is Bitcoin going to change its inflation algorithm? - page 2. (Read 4963 times)
I edited the wiki to explain how such a revision could technically be possible but why realistically it likely would not occur.
Thus, extremely rapid price inflation is a serious risk to anyone accepting payment in bitcoin.
More so it's the risk of anyone holding significant shares of their assets or get their earnings in Bitcoin. They have to eat at some point, the eventual deflation later on doesnt help.
I know. But isn't the reason for the rapid price inflation that there's simply a lot of coins are being produced right now? Inflation is like 40% per year. This will eventually change, of course, as the 50 coins per 10 minutes become a smaller and smaller part of the total pool (and when the mining payouts get reduced to 25 coins).
Why is it so hard to get, that prices are not just a function of the existing money and even if they would, Bitcoin won't be the only currency on this planet.
Well lets implement your awesome new variant. The longer we delay in doing so the longer the world will remain deprived of its advantages.
So far we have at least done the constant creating of coins part, in GRouPcoin, which will keep making 50 coins per block forever.
-MarkM-
So far we have at least done the constant creating of coins part, in GRouPcoin, which will keep making 50 coins per block forever.
-MarkM-
I'll post a blog to describe the specifications soon.
"The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back."
-Keynes
I'm a very patient person.
-Keynes
I'm a very patient person.
Dont give up so quickly on your trolling. This cite that has nothing to do with what anyone said is very poor even for you. You can do much better.
Well lets implement your awesome new variant. The longer we delay in doing so the longer the world will remain deprived of its advantages.
So far we have at least done the constant creating of coins part, in GRouPcoin, which will keep making 50 coins per block forever.
-MarkM-
So far we have at least done the constant creating of coins part, in GRouPcoin, which will keep making 50 coins per block forever.
-MarkM-
"The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back."
-Keynes
I'm a very patient person.
-Keynes
I'm a very patient person.
Cant't blame Vladimir. All of the reasonable changes to the algorithm I can imagine would involve redistribution of wealth from people currently mining to current wealth holders and people who will be mining in the future. I would not be happy with such arrangements if I was Vladimir. I'm not mining currently, so I wouldn't feel the pinch.
it's not FAAIIIRRRR!!!!
who decides?
who profits?
who loses?
The market.
then write the software and put it out there. see how you do. and stop whining about it.
i'm no early adopter, but i like the current setup just fine. if vladimir is the first Bitcoin billionaire (i kinda miss that sig, but i get it...) then i'll have plenty to keep me happy. and nothing but appreciation for those with greater will, vision and courage than i have.
If we simply have a number of different types of coin similar to but not quite the same as bitcoin, wouldn't market forces balance them out, taking as much advantage as needed from each variant to achieve the purposes of each market participant?
-MarkM-
-MarkM-
That is a possible outcome, but I don't think it is likely in the long-run. There are network economies at work. Two identical currency networks with 100,000 people each would yield a lower transaction volume per person, then one network with 200,000 people. Keeping up membership in a network has an opportunity cost. The larger networks offer more buying and selling opportunities, so there is always an incentive to desert small or shrinking networks and join large or growing networks.
If people want to miss out on the awesome advantages of your scientifically social-planned by economics experts currencies merely because few people use them, that is their problem. Skillful economists with the intelligence to perceive its advantages can then keep its amazing advantages to themselves and profit from it themselves leaving the unwashed masses in the dust.
-MarkM-
The market.
You are such a troll.
If you want the market to decide why were you arguing yesterday that the market can not handle the fee structure and that we all need to follow a fixed set of rules regarding fees following your oh so intelligent advise?
Cant't blame Vladimir. All of the reasonable changes to the algorithm I can imagine would involve redistribution of wealth from people currently mining to current wealth holders and people who will be mining in the future. I would not be happy with such arrangements if I was Vladimir. I'm not mining currently, so I wouldn't feel the pinch.
it's not FAAIIIRRRR!!!!
who decides?
who profits?
who loses?
The market.
If we simply have a number of different types of coin similar to but not quite the same as bitcoin, wouldn't market forces balance them out, taking as much advantage as needed from each variant to achieve the purposes of each market participant?
-MarkM-
-MarkM-
That is a possible outcome, but I don't think it is likely in the long-run. There are network economies at work. Two identical currency networks with 100,000 people each would yield a lower transaction volume per person, then one network with 200,000 people. Keeping up membership in a network has an opportunity cost. The larger networks offer more buying and selling opportunities, so there is always an incentive to desert small or shrinking networks and join large or growing networks.
Cant't blame Vladimir. All of the reasonable changes to the algorithm I can imagine would involve redistribution of wealth from people currently mining to current wealth holders and people who will be mining in the future. I would not be happy with such arrangements if I was Vladimir. I'm not mining currently, so I wouldn't feel the pinch.
it's not FAAIIIRRRR!!!!
who decides?
who profits?
who loses?
Just for everyones information, cunicula comes daily to the forums to discuss Bitcoin while at the same time thinks that a decentralized currency is not possible (or has serious doubts about it). So basically he does not believe in the basic Bitcoin idea. Thats why he wants to kill it.
Oh yes, and he continuously uses class warfare rethoric.
Cunicula if you think you can create a better currency go do it. The Bitcoin community has released the code in open source and you just need to change a couple lines to be up and ready. Go take over the world with your inflationary currency.
Cant't blame Vladimir. All of the reasonable changes to the algorithm I can imagine would involve redistribution of wealth from people currently mining to current wealth holders and people who will be mining in the future. I would not be happy with such arrangements if I was Vladimir. I'm not mining currently, so I wouldn't feel the pinch.
Oh yes, and he continuously uses class warfare rethoric.
Cunicula if you think you can create a better currency go do it. The Bitcoin community has released the code in open source and you just need to change a couple lines to be up and ready. Go take over the world with your inflationary currency.
If we simply have a number of different types of coin similar to but not quite the same as bitcoin, wouldn't market forces balance them out, taking as much advantage as needed from each variant to achieve the purposes of each market participant?
-MarkM-
-MarkM-
Quote
Is Bitcoin going to change its inflation algorithm?
no
/thread
Cant't blame Vladimir. All of the reasonable changes to the algorithm I can imagine would involve redistribution of wealth from people currently mining to current wealth holders and people who will be mining in the future. I would not be happy with such arrangements if I was Vladimir. I'm not mining currently, so I wouldn't feel the pinch.
Quote
Is Bitcoin going to change its inflation algorithm?
no
/thread
I know. But isn't the reason for the rapid price inflation that there's simply a lot of coins are being produced right now? Inflation is like 40% per year. This will eventually change, of course, as the 50 coins per 10 minutes become a smaller and smaller part of the total pool (and when the mining payouts get reduced to 25 coins).
You don't need to commit to destroy coins if you don't produce them in the first place.
You don't need to commit to destroy coins if you don't produce them in the first place.
In the current system everyone can anticipate how many coins will be issued, so there is no reason why a change in the issuance rate should lead to a change in prices or price volatility. The real problem is that the market participants are uncertain how widely bitcoin will be used in the future. Given this uncertainty, volatility in bitcoin's total market cap is inevitable. The prices of individual coins, however, can be partially stablized by allowing rates of creation and destruction to vary according to changes in market sentiment. Essentially you allow the market cap to fluctuate as normal, but cushion coin holders against these fluctuations by creating and destroying coins.
There are serious limitations of course. Current difficulty growth rates (still well above 50% per annum in the current difficulty cycle), my system would not have begun destroying coins. You can see then that prices would still be highly volatile. Still the knowledge that the system would begin destroying coins if difficulty stagnated even more would make an inflationary spiral much less likely.
I know. But isn't the reason for the rapid price inflation that there's simply a lot of coins are being produced right now? Inflation is like 40% per year. This will eventually change, of course, as the 50 coins per 10 minutes become a smaller and smaller part of the total pool (and when the mining payouts get reduced to 25 coins).
You don't need to commit to destroy coins if you don't produce them in the first place.
You don't need to commit to destroy coins if you don't produce them in the first place.
You could put breathing room in by setting a high difficulty growth target (I thought 50% per annum was high, since it implies a 125% increase in computational speed every two years). As I understand Moore's law it is a 100% increase in computational speed every two years.
If you want an inflationary currency, why all the complicated stuff, and not simply set a fixed inflation rate of, say, 2% per year instead of the current 50 coins per 10 minutes? And remove the cap at 21,000,000. The only thing that would be needed is to base miner payouts on the current total number of coins (which is trivial) and you have your geometric "growth".Perhaps you should read my posts more carefully. The exact problem I am concerned with is Bitcoin's inability to prevent price inflation. Preventing or even limiting inflation requires establishing a commitment to destroy coins to prop up prices. Bitcoin does not have any mechanism to destroy coins on net. Thus, extremely rapid price inflation is a serious risk to anyone accepting payment in bitcoin.
You could put breathing room in by setting a high difficulty growth target (I thought 50% per annum was high, since it implies a 125% increase in computational speed every two years). As I understand Moore's law it is a 100% increase in computational speed every two years.
If you want an inflationary currency, why all the complicated stuff, and not simply set a fixed inflation rate of, say, 2% per year instead of the current 50 coins per 10 minutes? And remove the cap at 21,000,000. The only thing that would be needed is to base miner payouts on the current total number of coins (which is trivial) and you have your geometric "growth".Jump to: