Topic: is it ok to give out testnet loans for collateral (Read 161 times)

Quickseller made his mark as an escrow scammer - his advice is valuable to someone I'm sure....

There is no reason you can't profit from any kind of service.   If you are doing something that others find value in and it costs them more to do it themselves, there is nothing wrong with asking for compensation.   Welcome to the Internet of Things.  

His words are hypocritical as usual because he's trying to assign value to his free speech with his banner campaign.  He's not able to do what you do, so he will post about it instead.  :/

I could tell you that loans always goes with collateral and any one who thinks mining is easy could just take the next easy step to run the mines themselves.

It's quite a risky business and that's why the collateral facility always goes with loans as a way of getting your money back but in a Decentralized system like this where privacy is everything to a user, the collateral facility becomes an issue of difficulty as to identity compromise.

If you feel safe and there is a way to keep track of the individuals that applies for the loan, then you can go ahead but, for security reasons, I'll advise you limit your applicants to people of your locality and you should have a way of examining them to know if they are true to their word and to ensure you don't offer them more than they can earn or handle to be on the safe side.
Should you have a policy on limited supply, stick to it if not, of what use is having such policies...!
Keep helping as much as you can.

I don't expect this to be changed, I always assumed testnet was supposed to act the same as main Bitcoin. If it's different, you may still get unexpected results after testing on testnet.

I can honestly say that, no, i didn't see gmaxwell's post (until you quoted it). What he says makes a lot of sense... On the other hand, I did get a couple of requests with a reasonable explanation as to why the person requesting a lot of tBTC would need them...
For example, if you're coding a complete exchange or a mixer: i know you can also do your tests with altcoins, or with very small values, but I do understand why you'd want to start with 10 tBTC when you want to simulate a couple hundred mixes and analyse taint afterwards.

This is why my loan thread requires a decent explanation: if somebody wants to borrow tBTC but his/her reason is a bit flaky, i"ll probably just deny the application... This isn't 100% foolproof, but it's better than nothing i guess.

As for the second issue discussed in your post: I couldn't agree more... Testnet is broken (IMHO). Testnet should be about allowing developers to test their application(s) and to allow endusers to experminent with new wallets or technology (like the LN). In my honest opinion, everybody with a half-decent CPU should be able to mine at least 12,5 tBTC within minutes by following a walktrough that's simple enough for a normal, tech-savvy person. If this can't be done, the testnet is missing it's purpose (IMHO).

I would be in favour not only to reset the testnet, but also change it's parameters (for example, remove the difficulty retarget from the testnet completely... Set the difficulty very low and keep it there). Also, I'd be in favour of setting a fixed coinbase reward without deflation: Always 12,5 tBTC/block. This would probably de-incentivise people pushing the hashrate so incredibly high on the testnet: somebody doing this would be stuck with billions of tBTC, i'm pretty sure those DEFI scams would not be able to cope with this. The biggest downside would be the fact that the testnet size could grow quite fast if somebody did push a latest gen ASIC on the testnet, but this could be solved by resetting the testnet more often. I know there are other downsides to, like the fact that if these changes would be implemented, the testnet would no longer behave the same as the main net... But let's be honest, as it currently stands, the testnet is becoming unusable anyways...

Last point: yeah, i also think that it's ok if people hold on to some tBTC for testing... I would never pass out my last tsat either

Have you seen this post?

Your calculation on the cost of mining Testnet 0.001 BTC/tBTC shows the system isn't working anymore. I don't get it: why would anyone spend that much money on mining tBTC anyway, increasing the hash rate to rediculous heights?

I have abuot half a tBTC (from various faucets), and I've used it to play around with LN channels on Eclair Mobile Testnet. I haven't used it in a while but still keep it anyway.

Yes. It is okay to do whatever you want. What right does someone have to enforce their beliefs on you? The parameters are known - the testnet can be reset at any time. Take that into consideration when using testnet coins, otherwise have at it.

I don't see anything wrong with what you are doing as long as you are not making money from giving out testnet coins while holding on to the collateral only for insurance and discouraging scammers and those trying to dump testnet coins for some shittoken:

Since i started running a testnet faucet, i receive messages asking for bigger amounts of tBTC in my mail, my bitcointalk messages, my twitter account on a daily basis.

Because i was getting tired of keeping track of everything, i decided to open up a tBTC loan thread...  
https://bitcointalksearch.org/topic/tbtc-loans-5306684
Since i want to keep any discussion seperate of the actual loan thread, i decided to open this "meta" thread instead... If you have arguments pro or contra tbtc loans, you're free to discuss them here...

The first post comes directly from my loan thread:

What's the alternative?
I run a testnet faucet, I do my part in distributing tBTC freely... But from time to time i do get valid requests, people that actually make a good case as to why they need more than the tiny fraction of a tBTC that's been distributed by tBTC faucets (including mine).
What should i do with those cases? Just give them 100 tBTC and pray they return the funds eventough it's the first time i've talked to them, and they're using a throwaway email... I don't have an endless supply of tBTC, if i run out i can either close my faucet and stop helping people, or i can setup a mining node and rent a lot of expensive hashrate and pay out of my own pocket. People seem to think it's easy to mine tBTC, let me tell you: it's not... In my loan thread you see my calculation proving the testnet has a combined hashrate of over 1 Petahash, and the block reward is smaller than 0.1 tBTC/block... Mining on the testnet is HARD... It's shouldn't be, but it IS.. It's not fair, but it's a fact...

I've given quite a few tBTC loans over the last year, and allmost all of them return the tBTC BECAUSE i asked for collateral... If you count the hours and effort i put into mining the tBTC in the first place and setting up these loans, i'm defenatly not getting rich by handing out loans...