Quote from: Peter Todd on Today at 06:17:46 PM

Let's suppose a truly devastating war somehow kills half of the global population.

I wouldn't be surprised if a dozen well placed high altitude EMP optimized nuclear bombs couldn't destroy access to substantially more than half of all coinswithout killing anyone (well, okay, killing some through long term fall out, but not directly).

It also doesn't have to happen all at once to result in totally distorted rates over time, though obviously all at once makes it worse. 4 25% loss events is a 70% loss.

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In no world is 2x unconscionable where 1x was just fine. Especially when the 1x happened to be what people lose by accident on a regular basis.

Not sure who you're responding to here, since nowhere did I say that AFAICT.

Quote from: gmaxwell on Today at 03:20:38 AM

Again, there is no way that we can be "disruptively overpaying" with a tail emission approximately equal to what people lose by accident.

"Equal to what people lose by accident" is only an equilibrium reached after an unspecified, arbitrary, and potentially very long time.

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...and yes, obviously the continued subsidy isn't guaranteed to be high enough to support security.

Right. So what problem does it solve? As far as we know today: none. You can conjecture situations where some specific proposal might do something useful, but the concept as a whole doesn't by itself.

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the level of threat a 0.1% to 1% subsidy is protecting against is the kind of very expensive outside attack that's difficult to predict anyway. All you can do is spend an affordable level of wealth to protect yourself, and hope it'll be enough.

By the same argument you've made-- that the supply and circulating supply aren't fixed-- a tail subsidy cannot achieve any specific inflation rate.

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If it's not, there's a good chance that Bitcoin is entirely nonviable anyway, as it's just worth enough to be worth protecting. If Bitcoiner's need to spend 10%+ per year of their entire wealth to protect the network, it may not be worth it at all.

The same argument could be made if it weren't viable without an additional "0.1%" subsidy: that if it doesn't work without it, there is a reasonable odds that it's not viable with it.

Quote from: gmaxwell on Today at 03:20:38 AM

That's absurd. Overpaying isn't a concern when you're paying a tiny % of your wealth.

You've posted an overly technical argument that after an unspecified timeframe constant subsidy will eventually match coin loss. Yet in this discussion you are acting as though your conclusion guarantees that the subsidy is a tiny % of your wealth, it doesn't. This is a slight of hand. I get that you intuitively and informally believe that would be the case, and I would agree that it's possible for it to be the case. But it is also unambiguously possible for it to be very much not the case.

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build into it a massive long-term unknown in how we'll pay for security.

Which would also be true in the presence of tail subsidy, particularly if it's not set to a conservative rate to increase the confidence that the rate won't become unacceptable in the face of coin loss or economic contraction.

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I sure don't care about spending 0.1% or 1% per year of my wealth to keep Bitcoin secure. But I do care that everyone else also chips in so we don't have a tragedy of the commons.

People chip in when they transact. How about spending 1% of your wealth to unnecessarily pay people to burn energy with no practical benefit to your security? Or 0.1% of your wealth and still have the result be insecure. Again: You argue as if its clear that a credible level of tail subsidy would have make a meaningful improvement to security-- we don't know that. It might, or it might not. Right now, as I pointed out, Bitcoin current fee income already produce income greater than the total subsided income for a number of altcoins which are going without attack. While that's far from conclusive, it's evidence that a subsidy level of 0 may be currently viable.

Quote from: gmaxwell on Today at 03:20:38 AM

If you were right, that'd still be happening in alt-coins. So where are the examples?

There have been many altcoin forks to change inflation rates, including several of ethereum's, as the highest profile and highest value example. (there have been many others that have been forked to change the subsidy schedule, there was even an attempt to create a 50 BTC forever fork of bitcoin back around the first halving).

Quote from: tromp on Today at 07:23:21 AM

This entirely misses the point of the block subsidy. It is for *distributing* coins, the only way to bring coins into existence.

There are many possible ways to bring coins into existence.

The subject being discussed here is redirecting wealth from the existing users of the system in the long term in order to subsidize providing security to the system.

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Is it desirable, much less moral, for a percentage of the world's wealth to be in the hands of some early whales?

Tail subsidy as discussed by the author of this article doesn't solve that except to the extent that it forever enshrines an additional industry in that privileged position.

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That is just wishful thinking. Coin loss will never be arbitrarily small.
Any rules that guard against accidental loss are themselves a risk of abuse,

The potential for abuse can be irrelevantly small.

For example, allowing your coins to be spent by another party if they go 120 years-- which will cover the expected lifetime of the owner *and* their heir-- without moving appears to me to have an inconsequential risk for abuse (and the risk could be mitigated by making it somewhat longer). And it would be economically rational for a very long lived entity to pay people small amounts to encumber their coins accordingly, and economically rational to accept those offers.

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It's just not realistic to think that the yearly loss rate would ever drop below 0.01%. More likely it will remain above 0.1%.

I think I've given a completely realistic way that it could become extremely low. I think it's inevitable that if bitcoin continues to be widely used that such schemes will be adopted at some scale, though I admit I'm less confident that they'd be universal.

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offering an option for people to dedicate their long lost coins to development help fund future development

How would that even work technically? Coins whose keys have been lost cannot be moved...

At the time what I'd considered was writing far-future timelocked spends as soon as the coins were received and sending them off via tor to a host that collected them. Though today that kind of thing is better accomplished by having an alternative spending path with a relative timelock on it.

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If bitcoin had a fixed block reward of 600 since launch, then its emission of 1 coin per second forever would be recognized as the ultimately simple and fair emission. It would take 2-5 decades for its yearly supply inflation to become competitive with fiat, but what's the hurry? At least the high initial inflation rates would keep the speculators at bay, and bitcoin could focus on its *intended* purpose: use as a *currency*.

How's that been working out for you so far? Grin

Speculation brings its own varrious annoyances, but it's an important part of adoption too. I believe that a high inflation rate Bitcoin would never have taken off at all-- and, if anything, just been replaced by a low inflation coin.

It is, of course, impossible to prove such conjectures about alternative histories-- but as far as I can tell every high inflation rate altcoin (or things with similar economic policy) have been total adoption failures so far. I can't attribute this to Bitcoin's first mover advantage because they've been unsuccessful compared to other bitcoin alternatives not just bitcoin, including when they had more to offer.

I take it you would argue that this trend will reverse in the long term. I don't think so: Network effect is more important than jealousy (not that this doesn't conflict with the above: network effect doesn't happen until something is already successful). It's just a fact of life that the people that came before you had myriad opportunities you missed. Imagine how wealthy you could have been to buy apple shares in 1985, San Francisco real-estate in 1982, or traded your silver for gold in the year 1200?

Economic activity diffuses wealth over time-- particularly if some systematic effect isn't sticking it back in the hands of the few as our central banks do today or as tail subsidy might in some cryptocurrency schemes. -- maybe not as quickly as we might like. The OP's argument was fine with reasoning about the state of the system arbitrarily far in the future: if we adopt that approach we can argue it doesn't even matter how the wealth was initially distributed, since at some arbitrarily far point in the future it won't matter. But that doesn't hold true in the presence of tail subsidy: Tail subsidy will always continue to enrich the mining industry (and those close to it in the economy) at the expense of everyone else.