Topic: "Surprisingly, Tail Emission Is Not Inflationary" -- A post by Peter Todd (Read 2760 times)

One person doesn't get to unilaterally decide that, though.  Being part of a network means you need to accept that other people exist and you can't control those people or what they choose to do.  If some people want to screw about with ordinals, provide lucrative fees and then miners decide to include those transactions in a block, then you are not in a position to deny that from happening.  Bitcoin is observably not Socialist, so I don't understand your insistence in attempting to portray it as such. 

If you believe the above isn't acceptable and want to change things so that you have influence over which transactions are accepted, so you can make it more Socialist, start your own protocol and mine your own blocks on it.  Until then, freedom reigns.

Well ser, it was a hypothetical question that never debated that Ordinals can or will be sustainable. ALTHOUGH perhaps there could be an open debate whether the usage of the Bitcoin blockchain that you may not like, could or could not sustain a high block-space-demand environment to sustain the incentivization of the miners.

But I wouldn't listen to most opinions given in the forum, especially not from people who has been known to spread disinformation. I believe the best person to ask is philipma1957.

You're describing Grin's pure linear emission, except that Grin has 1-minute blocks with 60 Grin reward so the emission is 1 Grin per second forever [1].

[1] https://john-tromp.medium.com/a-case-for-using-soft-total-supply-1169a188d153

two idiots that think ordinals are a real economy that can sustain..
although miningpools will earn fees from excessive premiums caused by junk. we should not use junk for force out actual real utility.

i do find it funny how two basement dwelling miners earning only a few dollars a day think they have enough economic experience to think ruining a multimillion per hour payment system purely so they can earn a couple extra cents per day..

if they want to junk up the blockspace then they should be the ones paying the premium.. not other people

the answer is not to junk up the blockspace to make it cost multiple dollars per transaction. as that just makes people abandon the network for daily use. the answer is to allow more real use on the blockchain by real transactors so the more transactions there are the more combined income a pool can make

EG dont open a gym to serve one rich client for $1000 an hour per week. instead have a gym with 1000 clients that pay an average of $1 an hour each week, which combines to the same $1000 income

..
as for this topics title and subject

a monetary supply that always produces 50coins per block forever starts hyper inflated.. it does reduce the amount of inflation.. but inflation still occurs..
think about it
block one 50.. block two 50 means 100% inflation in 10 minutes average.. however by block 1000 there is 50,000 in circulation with only 50 (0.1%) increase per 10 min average

in reality based on yearly economics of say a healthy 1% per year inflation.. it would, based on a 2.625m coin per year(50 coin per block with 52500 blocks a year)take 100 years to get down to 1% inflation.. so unlike P.Todds theory... it would be inflationary for 100 years before it becomes un noticeable economically

Then, it would be the same situation, as it was with NameCoin, that produced completely separated coins, that were not connected with the main chain. Unless people deploying such things would make it better this time, and fix NameCoin's mistakes.

Yes, if deployed correctly. And I think people are better at discussing things, than they are at writing code, and checking for themselves, what is possible, and what is not. And as long as this is the case, I don't expect any deployment related to tail supply in the nearest future.

It would create problems, if not deployed correctly, exactly in the same way as Ordinals created many problems, that some people try to fix now, by proposing LN-based alternatives.

You can always raise on-chain fees in many different ways, for example by uploading a lot of data. But then, if you won't deploy anything, that would help on-chain users, then they will pay for that misuse. If you won't give them cut-through-like features, to fight with congested mempools, then you will see gigabyte-sized mempools, or even terabyte-sized mempools. And then, on-chain fees will be high enough to provide security budget. But at what cost? And is it worth it?

the answer is... "Yes!"


oh, it's good alright. good for miners. anyone that is looking to cash in on larger transaction fees. it's even good for someone that wants to store a monkey permanently online so it can never be deleted but that's another story...

Shower thought. What if, instead of a Tail Emission or expanding Bitcoin's coin supply, Ordinals and the demand for block-space it brings would be the answer to the question, "Will the fees be enough to support the miners when all the coins have been mined"?

I'm NOT debating whether Ordinals is good for Bitcoin. I'm merely looking at the possibility that Ordinals might make Bitcoin a better network for what Ethereum is already doing if doing them in Bitcoin will make it cheaper, and if the Bitcoin blockchain is more reliable for them.

It's possible and some pool already perform merge mining, BitMex wrote good article about it 3 years ago[1]. RSK sidechain even made claim their coin is most profitable merged mining[2].

[1] https://blog.bitmex.com/the-growth-of-bitcoin-merge-mining/
[2] https://mining.rsk.co/, section "3. Start Mining"

There has been quite a bit of discussion on this already.

You might be interested in this article from Paul Sztorc: https://www.truthcoin.info/blog/security-budget-ii-mm/
There are also a number of posts discussing it in this thread. Start from here: https://bitcointalksearch.org/topic/m.60549860

What if the Bitcoin community could get consensus on building another chain, let's call it "The Miner Chain", that's merged mined with Bitcoin to continue incentivizing the miners through the "Miner Chain" with block rewards, for them to keep securing the network? Would that be a possible solution? Or would it just be something that could make some problems on the incentive structure?

Effect in theory might be bad, but it might start something that could lead to a more feasible solution.

well, i think it would be unfair to single out people that don't move their bitcoin very often and try and debit their accounts periodically aka an inactivity fee. banks do that and they'll take your account down to 0 over time.

yeah and they paid for it. or the person that sent them the bitcoin paid for it through transaction fees. end of story.

it doesn't matter how many transactions someone sends. each transaction stands on its own. it doesn't matter who it is attached to. that's how bitcoin was designed.

everyone that has any bitcoin their bitcoins were put through that same procedure. they all paid.

it's one thing to start debiting inactive bitcoin addresses. it's another thing to have a tail emission. it's probably best to do neither. and leave it at that.

"... inevitability of lost coins"

That is a really interesting concept.  While not mathematically inevitable, human nature makes it, in practice, inevitable.  This should be given serious consideration.  But it will be very far from easy or simple. 

When are there two few coins?  That might be determined by some combination of the cost of coins becoming too high, and/or the churn/turnover rate of coins in circulation becomes very high.  Both of those are almost completely subjective.  But maybe some top-flight number crunchers can get together and make some objective criteria.

Once that is determined, then the path to resolve the situation needs to be considered.  I see a couple of possible solutions, but this conversation is already complex so omit that for now.

In general, I would agree with this point.

I think the question of tail emission is more about who should pay for security. If someone is holding their coins for a long time, they have the benefit of the security of the network, while someone who is sending many transactions will need to pay transaction fees to the miners, which ultimately pay for this security. There is also the point that someone who is paying a transaction fee is also paying for the service of getting their transaction confirmed, and for the block space necessary to include their transaction in the blockchain.

well why would doge be better than btc. btc has more development effort behind it. btc has more features than doge. i don't see any reason for doge coin to exist. other than for people to speculate and try and get rich at the expense of other people. need to transfer money? btc can do that. you got your answer, you're not too old to find out the answer now!

You seem to be confused with Grin, which has a fixed reward from launch and therefore 1/n inflation after n years.
Doge had MUCH bigger rewards in the first year (emitting 100B DOGE, vs only 5B DOGE for every later year).

Curiously, 1 DOGE costs about the same as 1 Grin, even though the former emits at a 167x higher rate (10000 per minute vs 1 per second).

POW is a hammer and hammer can be used to do wrong.

This thread is not about the misuse of a hammer in Texas by a bunch of rich motherfuckers.

Its about inflation and whether fixed block mining rewards are better than vanishing rewards.

I hodl a lot of DOGE

I think that

1x
2x 100% inflation
3x  50% inflation
4x  33% inflation
5x  25% inflation
.
.
.

10x
11x 10% inflation
.
.
.
.
20x
21x 5% inflation
.
.
.
50x
51x 2% inflation
.
.
.
100x
101x 1% inflation

in the case of Doge

may be better then no new coins in the case of BTC

I am 65 I won't live long enough to see if doge is better than btc.

If you are 20 consider buying 10000 doge and leaving them be only costs 700 dollars.


and please post on topic.

It's more like a "discuss, speculate, wait and see" situation. If the fees alone aren't enough to make the system survive, then it's probably because it's already dead.

To explain my previous utterly philosophical sentence that I'm proud of: If the fees alone can't sustain the network, it's probably because there's no activity at all (or much less). There are lots of halvings before the subsidy drop to minimum, and hence much time left to witness some serious recognition. If there's exponentially more activity in 10, 20, 30 years, we can be more assured about sustainability.

Playing the Devil's Advocate, does everyone truly believe that the fees alone would be enough to subsidize the miners when the block rewards go close to zero? Or is it a situation of "let's wait and see", because a hard fork to break Bitcoin's ethos will not be that worth it in "fixing" the "mining subsidy problem"? OR, it's not going to be a problem?

This is not true, because they are based on some fee rate, and you have no guarantee that fees will be on that level in the future. So, if you assume that minimal fees will be lower than today, then you are safe. But if you assume they will be higher than today, well, then your transaction could be rejected as non-standard, or could require RBF/CPFP to be confirmed.

We already have those spikes, they are called halvings. So, the solution is to make fees more smooth globally, by adjusting coinbase transactions, not by adjusting users' transactions.

It is not the simplest way, because:
1) if it is a hard-fork, then it can be rejected by just doing nothing (I won't upgrade to the tail supply version, what then?)
2) if it is a soft-fork, then miners could say "no", and people could burn or lock coins, to resist "tail supply attack", and remain in the same network (I prefer locking, because it is more resistant to this attack, and people can always agree to spend coins, that are circulating in some loops, to keep those coins away from "the legacy supply"; expect every additional satoshi to be tracked and blacklisted, and to be used to counter-attack)
3) if it is a no-fork, then it has the highest chances to be introduced, and it is unstoppable at the same time, because you can keep it on the sidechain; then if tail supply enthusiasts are right, users will join them (I expect this chain would fail, or would need being "rescued" by burning all additional coins)

If the security of the network depends on a subset of the users of said network, over time, some of the people who "donated" to the security will stop doing so and will allow the remaining of those who is providing security to continue doing so. Over time, this will result in a small group of people being responsible for security.

LN closing transactions are currently designed such that they can be broadcast at an arbitrary time in the future. Further, if coin is removed from (a subset of) the UTXO set at intervals less frequent than every block, there will be incentives to get transactions confirmed prior to this frequency, and as such, the cost of getting transactions confirmed will spike immediately prior to these block heights.

This issue can be entirely resolved by simply increasing the total supply of bitcoin. Tail Emission is already a major change, so if this change were to be adopted, you may as well adopt it in the most simple way, and increasing the total coin supply is the simplest way to achieve this.