Others have said that it is a terible idea because so many things that I will not repeat those arguments.
What I want to say is that I really cannot see any benefits to this idea, either. What is the difference if the total supply is lowered by say circa 5% to 20m? It only means that the bitcoins remaining in circulation are that little bit more expensive in a long run.
Topic: Suggestion: Redistributing Lost Funds by Erosion - page 2. (Read 324 times)
I dont like the idea of forcing others to use the coins under the threat of confiscation. The confiscation resistence is one of the main advantages of Bitcoin, not its weakness!
Maybe you should describe better how it could be a softfork change, because it all looks like hardfork to me.
Maybe you should describe better how it could be a softfork change, because it all looks like hardfork to me.
A central value in bitcoin is that we don't tell each other what to do with each others money. There is absolutely no way on Earth to tell what coins are in cold storage and what coins are lost. So any attempt to "redistribute" coins will result in massive stealing and surely cause the collapse of bitcoin. I would sell off immediately if this happened and never touch bitcoin again.
There is also no reason whatsoever to do this and it addresses no problem. Bitcoin would work exactly the same way even if there were only 1 bitcoin. Or even less. The total production of BTC, 21million coins, is an arbitrary number and could have been 10 million or 100 million. The coins that are now inaccessible are gone forever. Stop thinking about them, lol.
There is also no reason whatsoever to do this and it addresses no problem. Bitcoin would work exactly the same way even if there were only 1 bitcoin. Or even less. The total production of BTC, 21million coins, is an arbitrary number and could have been 10 million or 100 million. The coins that are now inaccessible are gone forever. Stop thinking about them, lol.
This is a terrible idea. Marketing this idea will be terrible, we will see news everywhere saying "You will lose your Bitcoins" or "Be prepared to lose".
If I find my lost private key some years later, and see that my bitcoins are vanished, makes me feel very sad.
If I find my lost private key some years later, and see that my bitcoins are vanished, makes me feel very sad.
This will discourage people to invest in Bitcoin. What Store of Value will Bitcoin be, if you wealth will erode over time? If you
did that with people's money in their Bank accounts, those people will move that wealth to financial instruments where that
does not happen.
Just imagine that lost paper wallet that are found 20 years from now... How bad would it be if those
funds eroded and you end up losing everything, because you could not find it.
did that with people's money in their Bank accounts, those people will move that wealth to financial instruments where that
does not happen.
Just imagine that lost paper wallet that are found 20 years from now... How bad would it be if those funds eroded and you end up losing everything, because you could not find it.
So if I want to store my coins in a time-locked address using OP_CHECKLOCKTIMEVERIFY (OP_HODL) for, say, 4 years after that soft-fork, my coins would slowly start to erode at the 3 year mark?
I also assume that there are many other reasons why someone would store their coins for +3 years without touching them.
I also assume that there are many other reasons why someone would store their coins for +3 years without touching them.
... funds that are actually lost.
this is the key problem with your idea.
your only base for calling some funds lost is the last time they have been accessed. so what you are calling "lost" others may call their "retirement funds".
Although this May sound horrible, it's quite legally correct. I run a banking group in London, and this is what the regulations call for. When someone is not actively using his personal or real property, it can be subject to adverse possession, where 3rd parties can simply legally take possession of the property after being in possession for quite a length of tim.
You can Google the doctrine of adverse possession yourselves for more information. Banks probably have some kind of adverse possession type clause for their inactive, dormant accounts.
Adverse possession becomes oh so natural in a decentralized landscape like crypto, where everything is public. In theory every bitcoin belongs to the public who are part of the blockchain. No one owns anything, rather, you can have access to bitcoins. There is no official rule that there is only one owner per private key. Rather, it's more like you either havery access to bitcoins from whatever means, or you don't.
That said, it's fitting for a majority decision whether or not clearly abandoned coins are redistributed or not. Let the decentralized majority decide to adversely possess dormant bitcoins. No one can complain because it is a majority vote
You can Google the doctrine of adverse possession yourselves for more information. Banks probably have some kind of adverse possession type clause for their inactive, dormant accounts.
Adverse possession becomes oh so natural in a decentralized landscape like crypto, where everything is public. In theory every bitcoin belongs to the public who are part of the blockchain. No one owns anything, rather, you can have access to bitcoins. There is no official rule that there is only one owner per private key. Rather, it's more like you either havery access to bitcoins from whatever means, or you don't.
That said, it's fitting for a majority decision whether or not clearly abandoned coins are redistributed or not. Let the decentralized majority decide to adversely possess dormant bitcoins. No one can complain because it is a majority vote
this is basically forcing people to move their coins. maybe i like to buy 1 bitcoin and hold it for my retirement and i don't care what happens during that time.
Yes I agree, that is the downside of this suggestion. However, this seems acceptable to me. How much effort is it really, to broadcast a simple transaction every 2 year? It could alternatively be 5 year, or 10, and with slower erosion factor, whatever seems acceptable to 95% of users. Any erosion will increase transparency and security, it will just take longer to start and be less effective. Still an improvement from what we have now.
you have not touched your pension pot in 3 years so its time you start handing it out..
Yes maybe I should have been clearer about this here: the count will only begin after the soft-fork takes effect, so all users will have a good few years to hear about this change in consensus (I did write it in the link I posted btw). Haven't thought about people that have already intentionally locked their private keys away for many years without them being able to access them at all. It that a thing?
Just want to clarify once again, the point is not that people should hand out money after some time, only to redistribute funds that are actually lost.
OP
you start first. please hand your retirement/pension fund to the community. you have not touched your pension pot in 3 years so its time you start handing it out.. your not allowed to keep it safe. your not allowed to hold it for inheretance. you have to hand out any pension funds or life savings after the third year that you have deposited it..
you have no say in the matter. if any funds gain 3 years maturity. its no longer yours. no one cares about your personal choice to have locked your funds in a time vault burried in your back garden. no one cares that you wrote it into your will that only your offspring can get it. no one cares that you are waiting until your 60yo to touch it... its time you started giving your pension/life savings to the community.
oh and make sure you give the money to your bank and hope that they do the trickle down economics rather than them hoarding it and laundering it every 2 years 364 days to prevent them losing it.. oh wait.. they wont. because if they forgt the 3rd anniversary.. they just pay themselves again.. thus only the banks win..
you start first. please hand your retirement/pension fund to the community. you have not touched your pension pot in 3 years so its time you start handing it out.. your not allowed to keep it safe. your not allowed to hold it for inheretance. you have to hand out any pension funds or life savings after the third year that you have deposited it..
you have no say in the matter. if any funds gain 3 years maturity. its no longer yours. no one cares about your personal choice to have locked your funds in a time vault burried in your back garden. no one cares that you wrote it into your will that only your offspring can get it. no one cares that you are waiting until your 60yo to touch it... its time you started giving your pension/life savings to the community.
oh and make sure you give the money to your bank and hope that they do the trickle down economics rather than them hoarding it and laundering it every 2 years 364 days to prevent them losing it.. oh wait.. they wont. because if they forgt the 3rd anniversary.. they just pay themselves again.. thus only the banks win..
nice effort. but this is basically forcing people to move their coins. maybe i like to buy 1 bitcoin and hold it for my retirement and i don't care what happens during that time. my retirement is not for (lets say) 30 years. with this you are forcing me to move my coins against my will every couple of years.
and that creates a large number of on-chain transactions that wouldn't have existed otherwise.
i haven't really checked this but i believe UnitedBitcoin (UB) is already doing something similar to this. you may want to see for yourself what the differences are: https://www.ub.com/
and that creates a large number of on-chain transactions that wouldn't have existed otherwise.
i haven't really checked this but i believe UnitedBitcoin (UB) is already doing something similar to this. you may want to see for yourself what the differences are: https://www.ub.com/
I have a suggestion, and I'd like the community's thoughts.
It is well known that many bitcoins are no longer accessible due to loss of private keys, but no one knows how much. While estimates exist, they rely on imprecise methods. Most famously, there is still a large amount of bitcoin in Satoshi's wallet, and it is unclear whether they will ever be spent. This phenomenon causes undesirable uncertainty in the market, undercuts the slogan "there will eventually be ~21 million bitcoins", and in a sense causes deflation.
I thought of a way to increase transparency as to how many bitcoins are actually in circulation, and also increase miners' rewards, through a process that somewhat resembles erosion (hence the name). Seems to me it can be implemented as a soft-fork, though I haven't worked out the details to verify this (I'd like to hear what the community thinks about this idea before delving in more deeply, if ever).
Onto the idea itself. I'll make up some parameters as an example. Basically, from the moment an address receives funds, a countdown begins. Whatever funds are left in the address after 3 year will start eroding, meaning that every week from then on another 0.1% of the amount in that address may be taken by the miner (technically each block will contain a list of addresses with the funds that were taken).
If you have funds sitting in an address and you don't want them to erode, all you have to do is spend them to yourself once every 3 years. Hot wallets can automate this, and cold wallets can warn you to do this manually. Even if you forget, assuming you at least check once in a while that your funds are in place, you would see the erosion that began, and take action before much damage took place.
Although I don't think it's technically possible to include these eroded funds in the coinbase transaction itself (as that would make it a hard-fork), they could be implemented to act as if they were, i.e. they must mature 100 blocks before being spendable.
So to reiterate, we gain (a) transparency as to how many bitcoins are in circulation, since users are incentivized to prove that they still possess their private key every once in a while, and (b) miners will be able to access lost funds, returning them into circulation and increasing the security of the network.
I go into a bit more detail here to those interested: https://gist.github.com/yotamDvir/e7ff52a34460f3c9a6bf3051b0e51414.
It is well known that many bitcoins are no longer accessible due to loss of private keys, but no one knows how much. While estimates exist, they rely on imprecise methods. Most famously, there is still a large amount of bitcoin in Satoshi's wallet, and it is unclear whether they will ever be spent. This phenomenon causes undesirable uncertainty in the market, undercuts the slogan "there will eventually be ~21 million bitcoins", and in a sense causes deflation.
I thought of a way to increase transparency as to how many bitcoins are actually in circulation, and also increase miners' rewards, through a process that somewhat resembles erosion (hence the name). Seems to me it can be implemented as a soft-fork, though I haven't worked out the details to verify this (I'd like to hear what the community thinks about this idea before delving in more deeply, if ever).
Onto the idea itself. I'll make up some parameters as an example. Basically, from the moment an address receives funds, a countdown begins. Whatever funds are left in the address after 3 year will start eroding, meaning that every week from then on another 0.1% of the amount in that address may be taken by the miner (technically each block will contain a list of addresses with the funds that were taken).
If you have funds sitting in an address and you don't want them to erode, all you have to do is spend them to yourself once every 3 years. Hot wallets can automate this, and cold wallets can warn you to do this manually. Even if you forget, assuming you at least check once in a while that your funds are in place, you would see the erosion that began, and take action before much damage took place.
Although I don't think it's technically possible to include these eroded funds in the coinbase transaction itself (as that would make it a hard-fork), they could be implemented to act as if they were, i.e. they must mature 100 blocks before being spendable.
So to reiterate, we gain (a) transparency as to how many bitcoins are in circulation, since users are incentivized to prove that they still possess their private key every once in a while, and (b) miners will be able to access lost funds, returning them into circulation and increasing the security of the network.
I go into a bit more detail here to those interested: https://gist.github.com/yotamDvir/e7ff52a34460f3c9a6bf3051b0e51414.
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