I'd like to make the suggestion that possibly getting in contact with any game developers, likely MMORPG game developers might be a good route to pursue if you're looking to study the effects of various inflations on the value of simulated currencies revolving around simplistic economic models.
Obviously, CKG would be a comparison, but its infancy would likely not yield enough information.
Anyone know anyone that works at Blizzard?
Topic: [XMR] Monero Speculation - page 1954. (Read 3313084 times)
This is getting a bit off topic but one idea that has been proposed is to simply emit one unit per hash of proof-of-work. (No magic numbers at all!)
The bold part is sarcastic, right?
No, not really. 1 hash = 1 unit removes the magic numbers from things like inflation rate, coin supply, etc. That doesn't make it a good approach necessarily.
It sounds as abritrary as anything else to me. Has the "advantage" of being a round number, but that's all.
EDIT: I mean arbitrary as "magic number".
This is getting a bit off topic but one idea that has been proposed is to simply emit one unit per hash of proof-of-work. (No magic numbers at all!)
The bold part is sarcastic, right?
No, not really. 1 hash = 1 unit removes the magic numbers from things like inflation rate, coin supply, etc. That doesn't make it a good approach necessarily.
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So no economic reasoning whatsoever to the choice of approx 0.9% inflation?
There is plenty of economic reasons, first being to secure the network,[/b] without network no transactions, like rpietila said its close to what gold is now. 1% is bellow the long-run ideal inflation on a large scale economy (believed to be 2%). 1% runs of the risk of deflation with eventual lost coins it will become de-facto deflationary in the long run.
I didn't say tail emission was a bad idea. I agree with it. It just shouldn't be a "magic number" value. And Monero is NOT gold. Most everything about it is quite different than gold. There seems to be no logical reason to choose that value based on "that's how gold is".
It wasn't logical, it was indeed a magic number (at least 1% was; 0.3 coins/minute is derived from the 1%/year) chosen at the start more or less arbitrary manner based on subjective views of what was useful to do. If it turns out to be a disastrous choice with horrible consequences, then Monero will fail. This is an experiment.
Sure, we can just say "hey it is an experiment". But wouldn't it be nicer to have a logical economic reasoning with maybe not precisely predictable results, but at least an intelligently planned results? I already see interesting brain storming in the last few posts. Generally the less magic numbers, the better. Something for Monero Research Labs maybe...
EDIT: If I'm dragging this on in the wrong thread just ask and I'll happily move it elsewhere.
I think its somewhat relevant to speculation in that if you think the parameters are extremely poor, the coin will likely fail. If you think that just picking a (vague reasonable) number and going and implementing something to see if it might succeed is a hopeless approach, you likely also think the coin will fail.
This is getting a bit off topic but one idea that has been proposed is to simply emit one unit per hash of proof-of-work. (No magic numbers at all!)
The bold part is sarcastic, right?
If XMR demand can't keep up with 1% inflation over the next 100 years, then it will have failed more fundamentally.
This is getting a bit off topic but one idea that has been proposed is to simply emit one unit per hash of proof-of-work. (No magic numbers at all!)
This is obviously terrible for value stability in the short term. Moore's Law means that the money supply will inflate at something like 60% per year. Longer term though, when Moore's Law hits the wall, it should slow way down and also inflate somewhat faster during periods when the demand for money increases (due to more R&D going to faster hashing).
This is obviously terrible for value stability in the short term. Moore's Law means that the money supply will inflate at something like 60% per year. Longer term though, when Moore's Law hits the wall, it should slow way down and also inflate somewhat faster during periods when the demand for money increases (due to more R&D going to faster hashing).
I believe I suggested this a while back. I agree it would certainly not help the value, but emission would scale linearly with the size of the network.
This is getting a bit off topic but one idea that has been proposed is to simply emit one unit per hash of proof-of-work. (No magic numbers at all!)
This is obviously terrible for value stability in the short term. Moore's Law means that the money supply will inflate at something like 60% per year. Longer term though, when Moore's Law hits the wall, it should slow way down and also inflate somewhat faster during periods when the demand for money increases (due to more R&D going to faster hashing).
This is obviously terrible for value stability in the short term. Moore's Law means that the money supply will inflate at something like 60% per year. Longer term though, when Moore's Law hits the wall, it should slow way down and also inflate somewhat faster during periods when the demand for money increases (due to more R&D going to faster hashing).
There is a thread Monero Economics for this kind of thinking, and Monero had a period since inception ending in December 21st, 2014 that it was a tabletopic.
It is clear that there is a need to secure the network, and no much research about what might be sufficient. Any certainty cannot be had in case of a currency that is <1 year old, but much more research should take place, to not rely on guesswork alone.
Also whether a value close to gold is optimal or not, cannot be known. Gold's inflation over history has ranged from 0-3%, with the average being as low as 0.2%.
In the long term, even the 6% inflation that has been the average in the U.S. after the 1933 ban on gold (previously gold was money and prices went down), is very destructive on your capital (leaving 0.2% left after 100 years). So a lower value is probably better.
On the other hand, the extreme of 100% premine and consequently 0% inflation is laughable.
I repeat my thesis that the inflation should mimic gold, so that new currency could be created at a variable rate depending how much need there is, preserving both the first-mover advantage without which it has no chance to take off, and the late-mover fairness, without which it has no chance to fly.
AFAIK, only CKG has this emission formula. To implement it in a P2P distributed software, might require solving challenges.
It is clear that there is a need to secure the network, and no much research about what might be sufficient. Any certainty cannot be had in case of a currency that is <1 year old, but much more research should take place, to not rely on guesswork alone.
Also whether a value close to gold is optimal or not, cannot be known. Gold's inflation over history has ranged from 0-3%, with the average being as low as 0.2%.
In the long term, even the 6% inflation that has been the average in the U.S. after the 1933 ban on gold (previously gold was money and prices went down), is very destructive on your capital (leaving 0.2% left after 100 years). So a lower value is probably better.
On the other hand, the extreme of 100% premine and consequently 0% inflation is laughable.
I repeat my thesis that the inflation should mimic gold, so that new currency could be created at a variable rate depending how much need there is, preserving both the first-mover advantage without which it has no chance to take off, and the late-mover fairness, without which it has no chance to fly.
AFAIK, only CKG has this emission formula. To implement it in a P2P distributed software, might require solving challenges.
agreed. I'd imagine it would involve a calculation involving a moving average of the current difficulty, number of transactions per block, etc.
lower difficulty, higher block reward... but once their is incentive for decreased difficulty you can encourage attacks on miners... or maybe higher difficulty, higher reward. Woof. economics.
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So no economic reasoning whatsoever to the choice of approx 0.9% inflation?
There is plenty of economic reasons, first being to secure the network,[/b] without network no transactions, like rpietila said its close to what gold is now. 1% is bellow the long-run ideal inflation on a large scale economy (believed to be 2%). 1% runs of the risk of deflation with eventual lost coins it will become de-facto deflationary in the long run.
I didn't say tail emission was a bad idea. I agree with it. It just shouldn't be a "magic number" value. And Monero is NOT gold. Most everything about it is quite different than gold. There seems to be no logical reason to choose that value based on "that's how gold is".
It wasn't logical, it was indeed a magic number (at least 1% was; 0.3 coins/minute is derived from the 1%/year) chosen at the start more or less arbitrary manner based on subjective views of what was useful to do. If it turns out to be a disastrous choice with horrible consequences, then Monero will fail. This is an experiment.
There is a thread Monero Economics for this kind of thinking, and Monero had a period since inception ending in December 21st, 2014 that it was a tabletopic.
It is clear that there is a need to secure the network, and no much research about what might be sufficient. Any certainty cannot be had in case of a currency that is <1 year old, but much more research should take place, to not rely on guesswork alone.
Also whether a value close to gold is optimal or not, cannot be known. Gold's inflation over history has ranged from 0-3%, with the average being as low as 0.2%.
In the long term, even the 6% inflation that has been the average in the U.S. after the 1933 ban on gold (previously gold was money and prices went down), is very destructive on your capital (leaving 0.2% left after 100 years). So a lower value is probably better.
On the other hand, the extreme of 100% premine and consequently 0% inflation is laughable.
I repeat my thesis that the inflation should mimic gold, so that new currency could be created at a variable rate depending how much need there is, preserving both the first-mover advantage without which it has no chance to take off, and the late-mover fairness, without which it has no chance to fly.
AFAIK, only CKG has this emission formula. To implement it in a P2P distributed software, might require solving challenges.
It is clear that there is a need to secure the network, and no much research about what might be sufficient. Any certainty cannot be had in case of a currency that is <1 year old, but much more research should take place, to not rely on guesswork alone.
Also whether a value close to gold is optimal or not, cannot be known. Gold's inflation over history has ranged from 0-3%, with the average being as low as 0.2%.
In the long term, even the 6% inflation that has been the average in the U.S. after the 1933 ban on gold (previously gold was money and prices went down), is very destructive on your capital (leaving 0.2% left after 100 years). So a lower value is probably better.
On the other hand, the extreme of 100% premine and consequently 0% inflation is laughable.
I repeat my thesis that the inflation should mimic gold, so that new currency could be created at a variable rate depending how much need there is, preserving both the first-mover advantage without which it has no chance to take off, and the late-mover fairness, without which it has no chance to fly.
AFAIK, only CKG has this emission formula. To implement it in a P2P distributed software, might require solving challenges.
Originally probably not much. When considered more during the emission debate, all possible arguments to each side were evaluated but due to the future being uncertain, no "solid truth" was reached so the old one stayed in force.
0.3 is believed to be sufficient to secure the network, while being low enough to not make XMR lose the long term storage of value property. (It is quite close to what gold is now.)
My own thinking is that it should optimally (so not in XMR) be adjustable based on the economy growth, but there is not even serious tries to make a code/formula that could monitor it with preset rules to govern the emission. (Gold has this, fully automatized.)
0.3 is believed to be sufficient to secure the network, while being low enough to not make XMR lose the long term storage of value property. (It is quite close to what gold is now.)
My own thinking is that it should optimally (so not in XMR) be adjustable based on the economy growth, but there is not even serious tries to make a code/formula that could monitor it with preset rules to govern the emission. (Gold has this, fully automatized.)
Thanks for the insight. When you start to think about this, it is actually a more complex matter with significant impact on the economics of the currency. I understand the necessity for a tail emission, but it deserves much more consideration than being simply chosen as a "magic number" value.
Over not necessarily long time periods, the inflation is significant. http://ow.ly/LyjUK
I guess "significant" is relative to the purpose the currency is intended to serve. What are it's purposes and is the value chosen economically "optimal" for those purposes?
"Because it is close to gold". Are golds values optimal for Monero for any reason? Gold has the inflation rate it does due to many factors. Do those factors apply to Monero and do they apply in the same way?
as noted by rpietila:
Originally probably not much. When considered more during the emission debate, all possible arguments to each side were evaluated but due to the future being uncertain, no "solid truth" was reached so the old one stayed in force.
0.3 is believed to be sufficient to secure the network, while being low enough to not make XMR lose the long term storage of value property. (It is quite close to what gold is now.)
My own thinking is that it should optimally (so not in XMR) be adjustable based on the economy growth, but there is not even serious tries to make a code/formula that could monitor it with preset rules to govern the emission. (Gold has this, fully automatized.)
0.3 is believed to be sufficient to secure the network, while being low enough to not make XMR lose the long term storage of value property. (It is quite close to what gold is now.)
My own thinking is that it should optimally (so not in XMR) be adjustable based on the economy growth, but there is not even serious tries to make a code/formula that could monitor it with preset rules to govern the emission. (Gold has this, fully automatized.)
There was consideration. I witnessed some of it (the tail end of it... buh dum pssshhh)
Are golds values optimal for Monero for any reason? Who knows? Gold has going for it being a store of value and medium of exchange for over thousands of years. Cryptocurrencies have a track record of 6 years.
Originally probably not much. When considered more during the emission debate, all possible arguments to each side were evaluated but due to the future being uncertain, no "solid truth" was reached so the old one stayed in force.
0.3 is believed to be sufficient to secure the network, while being low enough to not make XMR lose the long term storage of value property. (It is quite close to what gold is now.)
My own thinking is that it should optimally (so not in XMR) be adjustable based on the economy growth, but there is not even serious tries to make a code/formula that could monitor it with preset rules to govern the emission. (Gold has this, fully automatized.)
0.3 is believed to be sufficient to secure the network, while being low enough to not make XMR lose the long term storage of value property. (It is quite close to what gold is now.)
My own thinking is that it should optimally (so not in XMR) be adjustable based on the economy growth, but there is not even serious tries to make a code/formula that could monitor it with preset rules to govern the emission. (Gold has this, fully automatized.)
^^^Made this
www.googledrive.com/host/0B8ddMzM9RWuRZUFmMDVZMlB2Q2s
Some experiments with D3.js ... it's a zoomable graph of XMR emission. Maybe someone can use it.
EDIT : Y-axis are percentages of total supply according to the emission formula
www.googledrive.com/host/0B8ddMzM9RWuRZUFmMDVZMlB2Q2s
Some experiments with D3.js ... it's a zoomable graph of XMR emission. Maybe someone can use it.
EDIT : Y-axis are percentages of total supply according to the emission formula
Neat! Does this incorporate the tail emissions? it stopped at 2040, so .....
I made a new graph with tail emission :
www.googledrive.com/host/0B8ddMzM9RWuROEVrbnE0U1RXaTQ
The model makes following assumptions :
* genesis block @ april 18 2014 00:00:00 (according to Moneroblocks.eu the first block was mined @ 2014-04-18 10:49:53 UTC, but something isn't working properly in my javascript code)
* every block gets mined exactly every 60sec
* it doesn't take penalties into account
* every block reward gets calculated according to the formula : (M - A) * 2-20 * 10-12 with A the current supply and M = Atomic Units = 264-1 and the calculated block reward is added to the current supply UNTIL the calculated block reward <=0.3 XMR
* Whenever the calculated block reward for block x <=0.3XMR the actual block reward for block x to block x+infinity becomes exactly 0.3XMR
Some calculations I made with this model (it calculates 26280000 blocks ~ 50 years) :
* first block with a calculated block reward < 0.3XMR is block 4269201 ~ 2022-4-30 (year 9) with a current supply = 98.29469862785216% of M
* block 5317920 ~ 2024-4-27 (year 11) is the first block for which the current supply >= 100% of M (from now on current supply grows greater than M ?)
* year over year inflation at the end of year 9 = 0.874171704788429%. (Indeed ~0.9% see Smooth's reply)
* year over year inflation is calculated every year. You can look at them by pressing F12 in your browser.
Javascript code is very messy, so I could have made a mistake. If something is wrong with my reasoning and assumptions for this model, or any suggestions to fine-tune the model, please tell me.
EDIT : definitions of A and M
ArticMine is right, Monero being the electronic cash of the future needs the 1 min confirmation time. 30 secs would be good but theres no reason to change imo. When tail emission kicks in and blocks are 0.3 XMR, the 1 min confirmation time will make even more sense.
Sure, but whether or not Monero needs it matters less than whether or not it's currently possible (without sacrifice).
Ultimately, I believe point-of-sale transactions will eventually be handled off-chain, which makes the case for 1 minute block time somewhat irrelevant.
OK here is another scenario. You fund an account to make an off chain point of sale transaction. A 5 min wait time is acceptable while a 30 min wait time is not. There is a tradeoff here and we need to find the optimal solution.
The problem is you can't really guarantee 5 minutes or even 30 minutes. Several weeks ago I was moving some Bitcoin and it took over an hour for one confirmation. And then a week later I did the same thing and I waited close to an hour for one confirmation again.
The probabilistic nature makes it very hard to use confirmations to meet any kind of real-time requirement. Granted if you are conservative enough (multiples of the target time), there are some targets you can meet with high probability that you can't meet with a slower target. In that sense I agree with ArticMine and Anon136 to a point, I just find those cases to be of limited value compared to the inherent disadvantages of an aggressively fast block time right now.
ArticMine is right, Monero being the electronic cash of the future needs the 1 min confirmation time. 30 secs would be good but theres no reason to change imo. When tail emission kicks in and blocks are 0.3 XMR, the 1 min confirmation time will make even more sense.
Sure, but whether or not Monero needs it matters less than whether or not it's currently possible (without sacrifice).
Ultimately, I believe point-of-sale transactions will eventually be handled off-chain, which makes the case for 1 minute block time somewhat irrelevant.
OK here is another scenario. You fund an account to make an off chain point of sale transaction. A 5 min wait time is acceptable while a 30 min wait time is not. There is a tradeoff here and we need to find the optimal solution.
ArticMine is right, Monero being the electronic cash of the future needs the 1 min confirmation time. 30 secs would be good but theres no reason to change imo. When tail emission kicks in and blocks are 0.3 XMR, the 1 min confirmation time will make even more sense.
Sure, but whether or not Monero needs it matters less than whether or not it's currently possible (without sacrifice).
Ultimately, I believe point-of-sale transactions will eventually be handled off-chain, which makes the case for 1 minute block time somewhat irrelevant.
ArticMine is right, Monero being the electronic cash of the future needs the 1 min confirmation time. 30 secs would be good but theres no reason to change imo. When tail emission kicks in and blocks are 0.3 XMR, the 1 min confirmation time will make even more sense.
Ideally yes. But the issue of orphan blocks raised by smooth is very valid. My take is getting a handle on the number of orphan blocks by monitoring the current network at various points may provide valuable data that can be used to make an informed decision. There is a tradeoff here.
Edit: While I was posting this a
Code:
REORGANIZE SUCCESS!
I think you are trying to win an argument rather than really listening to what I'm saying. What im arguing is incontrovertible but i don't think you are really listening enough to know specifically what it is that i am arguing.
Oh well its not that big of a deal anyway. As far as i understand it fluffypony is only wanting to increase the block time to 2 minutes or something like that. For all i know without having more information that could very easily be an improvement to the security of monaro. In fact i would bet it is since FP is a really smart guy.
Anyway I'm done arguing.
Oh well its not that big of a deal anyway. As far as i understand it fluffypony is only wanting to increase the block time to 2 minutes or something like that. For all i know without having more information that could very easily be an improvement to the security of monaro. In fact i would bet it is since FP is a really smart guy.
Anyway I'm done arguing.
You're right that it's a "sliding" scale, but I think you're being a bit ridiculous to suggest that any significant number of users would stop using a crypto that ups it's block target from 1 minute to 2 or 3 or 4.
I think smooth's point is that a transaction is either fast enough for real time, point-of-sale purchases, or it isn't. Beyond that, the differences don't mean much.
For those who haven't seen it, Vitalik Buterin wrote an interesting article on what it would take to achieve ultra fast block times in a PoW currency: https://blog.ethereum.org/2014/07/11/toward-a-12-second-block-time/
There are a host of scenarios where a 1 min block time can be very advantageous over a two min block time. We must keep in mind that were are dealing with the outlier event of say a 5 min confirmation vs a 10 min confirmation here also. XMR.TO is a perfect case. With a 1 min blocktime on the XMR side there is a very high probability of meeting the 15 min transaction time set by XBT processors, with a 2 min blocktime on the XMR side this is no longer the case since there is a significant chance of an outlier 10 -12 min XMR confirmation that not allow for the 15min overall time limit.
Restaurant and bars are another example. Ever being out with a group of say 10 people and 8 of them pay by debit card or credit card? By the time the debit machine reaches the last person easily 10 min or more has elapsed. XMR or XBT transactions can be processed in parallel rather than in series for example by scanning a QR code printed on the bill with a smartphone. In this scenario XMR with a 1 min blocktime would beat debit while XBT with a 10 min blocktime would not. The target here is an average wait of 5 min with debit.
There may well be a very good case to increase the blocktime in XMR to say 2min; however if this is done it should be done promptly before more services that are dependent upon the 1 min blocktime are built on top of the network. We simply cannot predict what will be built on top of XMR. By the way XMR with 1 min blocktime is getting close to the theoretical limit, and I suspect that Vitalik's 12 sec confirmation could easily run afoul of the law of special relativity.
Edit: I will take a look at Vitalik's paper.
I think you are trying to win an argument rather than really listening to what I'm saying. What im arguing is incontrovertible but i don't think you are really listening enough to know specifically what it is that i am arguing.
Oh well its not that big of a deal anyway. As far as i understand it fluffypony is only wanting to increase the block time to 2 minutes or something like that. For all i know without having more information that could very easily be an improvement to the security of monaro. In fact i would bet it is since FP is a really smart guy.
Anyway I'm done arguing.
Oh well its not that big of a deal anyway. As far as i understand it fluffypony is only wanting to increase the block time to 2 minutes or something like that. For all i know without having more information that could very easily be an improvement to the security of monaro. In fact i would bet it is since FP is a really smart guy.
Anyway I'm done arguing.
You're right that it's a "sliding" scale, but I think you're being a bit ridiculous to suggest that any significant number of users would stop using a crypto that ups it's block target from 1 minute to 2 or 3 or 4.
I think smooth's point is that a transaction is either fast enough for real time, point-of-sale purchases, or it isn't. Beyond that, the differences don't mean much.
For those who haven't seen it, Vitalik Buterin wrote an interesting article on what it would take to achieve ultra fast block times in a PoW currency: https://blog.ethereum.org/2014/07/11/toward-a-12-second-block-time/
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