Quote from: brenzi on May 04, 2013, 10:31:11 PM

So you're using proof-of-burn to allow minters into the MBQ. But then the coins are minted by proof-of-work. Do I get that right?

Proof-of-burn is a newer term, but essentially yes.

edit: It's not really proof-of-burn as described in that wiki page. You aren't giving up any currency, just a smaller proof of work.

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I think I see how you plan to achieve a stable value. Not exactly linked to fiat but linked to electricity cost (I'm not sure that this represents the whole basket better than national fiat currency). This way you adjust the speed of minting, but the block reward is always positive, so money supply is monotonically increasing.

It is not directly linked to electricity cost. In the old thread I used the term "energy-related". If the price of electricity goes down or is lower in some places, those people can profitably burn more. Might have a bigger scale than 10% and 5%, it was just a starting point. There can be more subtleties here, it is a topic that I would hope to have thoroughly discussed before settling on something for the live network.

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How do you ensure stable value when interest in Decrits decreases? I didn't find any means to reduce money supply in your proposal.

I don't. I gave up on this idea a long time ago. Either it will be so awesome that interest does not decrease, or it is on the path to failure. If interest wanes temporarily, others are encouraged to buy up (or accept as payment) currency that is below its cost to produce. Decrits are not intended to be a primarily speculative instrument like bitcoin. It will have some of that property in the first 5-10 years, but after that I think it will start achieving some level of price stickiness that will be possible because it isn't a speculative instrument. That is where stability comes into play. If this does end up being the case, decrits will actually be deflationary compared to fiat as fiat regularly inflates or simply starts to lose value because of the competition.

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self-adjusting demurrage rate. Affects all accounts. Might lead to a stable exchange rate, but not to a stable value in the "whole basket" sense

Right, and the exchange rate is secondary, so why bother.

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extra transaction fees sent to nirvana. Affects only money in circulation and punishes those who are still actively using (spending) the currency.

Right, why punish those who are continuing to use currency for precisely what it is good for.

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fixed inflation. The currency would not be stable in the long run, but would at least degrade in a more predictable way. Only works until more "value" wants to leave the currency than is destroyed by inflation anyway

Not stable under a multitude of scenarios. Not predictable at all to know how the economy will expand. Allows for massive bouts of speculation that will ultimately hurt the people interested in using it as a currency.