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authorEric Voskuil <eric@voskuil.org>2019-07-06 15:37:45 -0700
committerbitcoindev <bitcoindev@gnusha.org>2019-07-06 22:37:48 +0000
commit144149e7ea9448ee6d64023a2ba87af8c2286394 (patch)
treee4a031d7be30393969d87d6706a9f1afb21ce323
parent0c26088df747c01acdfb5289e9247eb4181f4aad (diff)
downloadpi-bitcoindev-144149e7ea9448ee6d64023a2ba87af8c2286394.tar.gz
pi-bitcoindev-144149e7ea9448ee6d64023a2ba87af8c2286394.zip
Re: [bitcoin-dev] Generalized covenants with taproot enable riskless or risky lending, prevent credit inflation through fractional reserve
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+From: Eric Voskuil <eric@voskuil.org>
+X-Mailer: iPhone Mail (16F203)
+In-Reply-To: <16B09501-7AE3-4F8E-A1A4-3E5F6B12D127@gmail.com>
+Date: Sat, 6 Jul 2019 15:37:45 -0700
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+ <16B09501-7AE3-4F8E-A1A4-3E5F6B12D127@gmail.com>
+To: Tamas Blummer <tamas.blummer@gmail.com>
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+Cc: Bitcoin Protocol Discussion <bitcoin-dev@lists.linuxfoundation.org>
+Subject: Re: [bitcoin-dev] Generalized covenants with taproot enable
+ riskless or risky lending,
+ prevent credit inflation through fractional reserve
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+
+
+> On Jul 6, 2019, at 03:12, Tamas Blummer <tamas.blummer@gmail.com> wrote:
+>=20
+>=20
+>> On Jul 6, 2019, at 01:16, ZmnSCPxj <ZmnSCPxj@protonmail.com> wrote:
+>>=20
+>> Good morning Eric,
+>>=20
+>>=20
+>> Sent with ProtonMail Secure Email.
+>>=20
+>> =E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90 Original M=
+essage =E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90
+>> On Saturday, July 6, 2019 3:27 AM, Eric Voskuil <eric@voskuil.org> wrote:=
+
+>>=20
+>>>> On Jul 4, 2019, at 21:05, ZmnSCPxj ZmnSCPxj@protonmail.com wrote:
+>>>> Good morning Eric,
+>>>>=20
+>>>>> As with Bitcoin mining, it is the consumed cost that matters in this s=
+cenario, (i.e., not the hash rate, or in this case the encumbered coin face v=
+alue). Why would the advertiser not simply be required to burn .1 coin for t=
+he same privilege, just as miners burn energy? Why would it not make more se=
+nse to spend that coin in support of the secondary network (e.g. paying for c=
+onfirmation security), just as with the burning of energy in Bitcoin mining?=
+
+>>>=20
+>>> Good morning ZmnSCPxj,
+>>>=20
+>>>> Using the unspentness-time of a UTXO allows for someone advertising a s=
+ervice or producer to "close up shop" by simply spending the advertising UTX=
+O.
+>>>> For instance, if the advertisement is for sale of a limited stock of go=
+ods, once the stock has been sold, the merchant (assuming the merchant used o=
+wn funds) can simply recover the locked funds, with the potential to reinves=
+t them elsewhere.
+>>>> This allows some time-based hedging for the merchant (they may be willi=
+ng to wait indefinitely for the stock to be sold, but once the stock is sold=
+, they can immediately reap the rewards of not having their funds locked any=
+more).
+>>>=20
+>>> This is a materially different concept than proposed by Tamas.
+>>>=20
+>>> =E2=80=9C...he gives up his control of the coins until maturity, he can n=
+ot use them elsewhere until then.=E2=80=9D
+>>=20
+>> Possibly.
+>> In a way, this is giving up control of the coin, until he no longer needs=
+ the advertisement, i.e. dynamically select the maturity age needed.
+>>=20
+> My proposal would separate the owner of the funds from the one using the a=
+dvertizement service.
+
+No, it would not. I have seen no proposal requiring identity in the two role=
+s, which is necessary to show that two distinct individuals operate in the r=
+oles. Furthermore, even identity would be insufficient, as two individuals c=
+an clearly collude in these roles.
+
+> Yes, the owner lock up until maturity. But those using the UTXO for the ad=
+vertizement service could transfer (sell) the UTXO to someone else as soon a=
+s they do not need it, so it is dynamic maturity for them The new owner coul=
+d use them for an other advertizement or for an entirely different purpose.
+
+Agree, and it is the unremovable time constraint that ensures the opportunit=
+y cost. This is why in your proposal it is of no consequence that both roles=
+ can be the same person.
+
+> Regarding burning: I think burning is unsustainable as usage of services i=
+s unlimited while coin suply is limited.=20
+
+Loss is perpetual, so this implies Bitcoin is unsustainable.
+
+>>>=20
+>>> And as I have shown above, nor can a =E2=80=9Clocked-up=E2=80=9D coin be=
+ unlocked to do the same.
+>>=20
+>> You have shown no such thing, merely shown that you have not understood t=
+he proposal.
+>>=20
+>> Regards,
+>> ZmnSCPxj
+>=20
+> I also struggle to communicate to Eric and likely many other reader the ge=
+neric utility of temporary control of an UTXO. Let me try again:
+
+No, you do not. This is not the point at issue. See my previous response.
+
+> Bitcoin offers a memory with remarkable properties:
+> - it can be read by anyone anywhere
+> - anyone anywhere who knows a key controlling an UTXO, and only them, can i=
+nitiate an update to the memory
+> - global replicas guaranteed to apply updates of the memory within a short=
+ time period.
+>=20
+> This is a utility that is sufficient to implement money.=20
+
+No, it isn=E2=80=99t. Ownership must be perpetually (actually) transferable,=
+ not just known. The use of a covenant breaks this transferability, see prev=
+ious posts.
+
+> Such a reliable shared memory could have however more uses than tracking m=
+oney, It could keep track of, and thereby make scarce, arbitary other things=
+.
+
+For the same reason this cannot work for money, it cannot work for any perpe=
+tual asset. See previous posts.
+
+> We can unlock these uses by separating the money use of memory from other u=
+ses.=20
+>=20
+> The covenant achives this separation temporarily. A UTXO with a covenant t=
+hat guarantees that current owner re-gains control at a later time means,=20=
+
+> that the current owner temporarily forgoes the UTXOs use as money and ther=
+eby allows its temporary use to keep track of something else.
+
+Only if the asset expires at or before the covenant maturity.
+
+> UTXOs with different covenants or without covenant are not fungible.
+
+Of course.
+
+> Why use UTXOs of significant value to track something that is not money? B=
+ecause the reason the registry is used is to create scarcity and scarcity ca=
+n be tailored to more or
+> less severe by requiring more or less satoshis to track something.
+
+Only 1 satoshi is required for tracking. It is only the scarcity of a satosh=
+i that creates this scarcity, not the covenant on it. The covenant represent=
+s only the destruction of opportunity of the value represented by the 1 sato=
+shi, not a new system of scarcity.
+
+> The current owner of a regular UTXO will want to be paid for temporarily g=
+iving up control, and that payment represents interest.
+
+Yes, opportunity cost.
+
+> Riskless, since it is certain to re-gain control.
+
+But of no value to anyone as money.
+
+Best,
+Eric
+
+> Regards,
+>=20
+> Tamas Blummer
+
+--Apple-Mail-5BDE4D26-59D3-454D-BC29-BFDC27E8AB91
+Content-Type: text/html;
+ charset=utf-8
+Content-Transfer-Encoding: quoted-printable
+
+<html><head><meta http-equiv=3D"content-type" content=3D"text/html; charset=3D=
+utf-8"></head><body dir=3D"auto"><div dir=3D"ltr"></div><div dir=3D"ltr"><br=
+></div><div dir=3D"ltr"><br>On Jul 6, 2019, at 03:12, Tamas Blummer &lt;<a h=
+ref=3D"mailto:tamas.blummer@gmail.com">tamas.blummer@gmail.com</a>&gt; wrote=
+:<br><br></div><blockquote type=3D"cite"><div dir=3D"ltr"><meta http-equiv=3D=
+"Content-Type" content=3D"text/html charset=3Dutf-8"><br class=3D""><div><bl=
+ockquote type=3D"cite" class=3D""><div class=3D"">On Jul 6, 2019, at 01:16, Z=
+mnSCPxj &lt;<a href=3D"mailto:ZmnSCPxj@protonmail.com" class=3D"">ZmnSCPxj@p=
+rotonmail.com</a>&gt; wrote:</div><br class=3D"Apple-interchange-newline"><d=
+iv class=3D""><span style=3D"font-family: Helvetica; font-size: 12px; font-s=
+tyle: normal; font-variant-caps: normal; font-weight: normal; letter-spacing=
+: normal; text-align: start; text-indent: 0px; text-transform: none; white-s=
+pace: normal; word-spacing: 0px; -webkit-text-stroke-width: 0px; float: none=
+; display: inline !important;" class=3D"">Good morning Eric,</span><br style=
+=3D"font-family: Helvetica; font-size: 12px; font-style: normal; font-varian=
+t-caps: normal; font-weight: normal; letter-spacing: normal; text-align: sta=
+rt; text-indent: 0px; text-transform: none; white-space: normal; word-spacin=
+g: 0px; -webkit-text-stroke-width: 0px;" class=3D""><br style=3D"font-family=
+: Helvetica; font-size: 12px; font-style: normal; font-variant-caps: normal;=
+ font-weight: normal; letter-spacing: normal; text-align: start; text-indent=
+: 0px; text-transform: none; white-space: normal; word-spacing: 0px; -webkit=
+-text-stroke-width: 0px;" class=3D""><br style=3D"font-family: Helvetica; fo=
+nt-size: 12px; font-style: normal; font-variant-caps: normal; font-weight: n=
+ormal; letter-spacing: normal; text-align: start; text-indent: 0px; text-tra=
+nsform: none; white-space: normal; word-spacing: 0px; -webkit-text-stroke-wi=
+dth: 0px;" class=3D""><span style=3D"font-family: Helvetica; font-size: 12px=
+; font-style: normal; font-variant-caps: normal; font-weight: normal; letter=
+-spacing: normal; text-align: start; text-indent: 0px; text-transform: none;=
+ white-space: normal; word-spacing: 0px; -webkit-text-stroke-width: 0px; flo=
+at: none; display: inline !important;" class=3D"">Sent with ProtonMail Secur=
+e Email.</span><br style=3D"font-family: Helvetica; font-size: 12px; font-st=
+yle: normal; font-variant-caps: normal; font-weight: normal; letter-spacing:=
+ normal; text-align: start; text-indent: 0px; text-transform: none; white-sp=
+ace: normal; word-spacing: 0px; -webkit-text-stroke-width: 0px;" class=3D"">=
+<br style=3D"font-family: Helvetica; font-size: 12px; font-style: normal; fo=
+nt-variant-caps: normal; font-weight: normal; letter-spacing: normal; text-a=
+lign: start; text-indent: 0px; text-transform: none; white-space: normal; wo=
+rd-spacing: 0px; -webkit-text-stroke-width: 0px;" class=3D""><span style=3D"=
+font-family: Helvetica; font-size: 12px; font-style: normal; font-variant-ca=
+ps: normal; font-weight: normal; letter-spacing: normal; text-align: start; t=
+ext-indent: 0px; text-transform: none; white-space: normal; word-spacing: 0p=
+x; -webkit-text-stroke-width: 0px; float: none; display: inline !important;"=
+ class=3D"">=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90 O=
+riginal Message =E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=90=E2=80=
+=90</span><br style=3D"font-family: Helvetica; font-size: 12px; font-style: n=
+ormal; font-variant-caps: normal; font-weight: normal; letter-spacing: norma=
+l; text-align: start; text-indent: 0px; text-transform: none; white-space: n=
+ormal; word-spacing: 0px; -webkit-text-stroke-width: 0px;" class=3D""><span s=
+tyle=3D"font-family: Helvetica; font-size: 12px; font-style: normal; font-va=
+riant-caps: normal; font-weight: normal; letter-spacing: normal; text-align:=
+ start; text-indent: 0px; text-transform: none; white-space: normal; word-sp=
+acing: 0px; -webkit-text-stroke-width: 0px; float: none; display: inline !im=
+portant;" class=3D"">On Saturday, July 6, 2019 3:27 AM, Eric Voskuil &lt;</s=
+pan><a href=3D"mailto:eric@voskuil.org" style=3D"font-family: Helvetica; fon=
+t-size: 12px; font-style: normal; font-variant-caps: normal; font-weight: no=
+rmal; letter-spacing: normal; orphans: auto; text-align: start; text-indent:=
+ 0px; text-transform: none; white-space: normal; widows: auto; word-spacing:=
+ 0px; -webkit-text-size-adjust: auto; -webkit-text-stroke-width: 0px;" class=
+=3D"">eric@voskuil.org</a><span style=3D"font-family: Helvetica; font-size: 1=
+2px; font-style: normal; font-variant-caps: normal; font-weight: normal; let=
+ter-spacing: normal; text-align: start; text-indent: 0px; text-transform: no=
+ne; white-space: normal; word-spacing: 0px; -webkit-text-stroke-width: 0px; f=
+loat: none; display: inline !important;" class=3D"">&gt; wrote:</span><br st=
+yle=3D"font-family: Helvetica; font-size: 12px; font-style: normal; font-var=
+iant-caps: normal; font-weight: normal; letter-spacing: normal; text-align: s=
+tart; text-indent: 0px; text-transform: none; white-space: normal; word-spac=
+ing: 0px; -webkit-text-stroke-width: 0px;" class=3D""><br style=3D"font-fami=
+ly: Helvetica; font-size: 12px; font-style: normal; font-variant-caps: norma=
+l; font-weight: normal; letter-spacing: normal; text-align: start; text-inde=
+nt: 0px; text-transform: none; white-space: normal; word-spacing: 0px; -webk=
+it-text-stroke-width: 0px;" class=3D""><blockquote type=3D"cite" style=3D"fo=
+nt-family: Helvetica; font-size: 12px; font-style: normal; font-variant-caps=
+: normal; font-weight: normal; letter-spacing: normal; orphans: auto; text-a=
+lign: start; text-indent: 0px; text-transform: none; white-space: normal; wi=
+dows: auto; word-spacing: 0px; -webkit-text-size-adjust: auto; -webkit-text-=
+stroke-width: 0px;" class=3D""><blockquote type=3D"cite" class=3D"">On Jul 4=
+, 2019, at 21:05, ZmnSCPxj <a href=3D"mailto:ZmnSCPxj@protonmail.com" class=3D=
+"">ZmnSCPxj@protonmail.com</a> wrote:<br class=3D"">Good morning Eric,<br cl=
+ass=3D""><br class=3D""><blockquote type=3D"cite" class=3D"">As with Bitcoin=
+ mining, it is the consumed cost that matters in this scenario, (i.e., not t=
+he hash rate, or in this case the encumbered coin face value). Why would the=
+ advertiser not simply be required to burn .1 coin for the same privilege, j=
+ust as miners burn energy? Why would it not make more sense to spend that co=
+in in support of the secondary network (e.g. paying for confirmation securit=
+y), just as with the burning of energy in Bitcoin mining?<br class=3D""></bl=
+ockquote></blockquote><br class=3D"">Good morning ZmnSCPxj,<br class=3D""><b=
+r class=3D""><blockquote type=3D"cite" class=3D"">Using the unspentness-time=
+ of a UTXO allows for someone advertising a service or producer to "close up=
+ shop" by simply spending the advertising UTXO.<br class=3D"">For instance, i=
+f the advertisement is for sale of a limited stock of goods, once the stock h=
+as been sold, the merchant (assuming the merchant used own funds) can simply=
+ recover the locked funds, with the potential to reinvest them elsewhere.<br=
+ class=3D"">This allows some time-based hedging for the merchant (they may b=
+e willing to wait indefinitely for the stock to be sold, but once the stock i=
+s sold, they can immediately reap the rewards of not having their funds lock=
+ed anymore).<br class=3D""></blockquote><br class=3D"">This is a materially d=
+ifferent concept than proposed by Tamas.<br class=3D""><br class=3D"">=E2=80=
+=9C...he gives up his control of the coins until maturity, he can not use th=
+em elsewhere until then.=E2=80=9D<br class=3D""></blockquote><br style=3D"fo=
+nt-family: Helvetica; font-size: 12px; font-style: normal; font-variant-caps=
+: normal; font-weight: normal; letter-spacing: normal; text-align: start; te=
+xt-indent: 0px; text-transform: none; white-space: normal; word-spacing: 0px=
+; -webkit-text-stroke-width: 0px;" class=3D""><span style=3D"font-family: He=
+lvetica; font-size: 12px; font-style: normal; font-variant-caps: normal; fon=
+t-weight: normal; letter-spacing: normal; text-align: start; text-indent: 0p=
+x; text-transform: none; white-space: normal; word-spacing: 0px; -webkit-tex=
+t-stroke-width: 0px; float: none; display: inline !important;" class=3D"">Po=
+ssibly.</span><br style=3D"font-family: Helvetica; font-size: 12px; font-sty=
+le: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: n=
+ormal; text-align: start; text-indent: 0px; text-transform: none; white-spac=
+e: normal; word-spacing: 0px; -webkit-text-stroke-width: 0px;" class=3D""><s=
+pan style=3D"font-family: Helvetica; font-size: 12px; font-style: normal; fo=
+nt-variant-caps: normal; font-weight: normal; letter-spacing: normal; text-a=
+lign: start; text-indent: 0px; text-transform: none; white-space: normal; wo=
+rd-spacing: 0px; -webkit-text-stroke-width: 0px; float: none; display: inlin=
+e !important;" class=3D"">In a way, this is giving up control of the coin, u=
+ntil he no longer needs the advertisement, i.e. dynamically select the matur=
+ity age needed.</span><br style=3D"font-family: Helvetica; font-size: 12px; f=
+ont-style: normal; font-variant-caps: normal; font-weight: normal; letter-sp=
+acing: normal; text-align: start; text-indent: 0px; text-transform: none; wh=
+ite-space: normal; word-spacing: 0px; -webkit-text-stroke-width: 0px;" class=
+=3D""><br></div></blockquote><div>My proposal would separate the owner of th=
+e funds from the one using the advertizement service.</div></div></div></blo=
+ckquote><div><br></div><div>No, it would not. I have seen no proposal requir=
+ing identity in the two roles, which is necessary to show that two distinct i=
+ndividuals operate in the roles. Furthermore, even identity would be insuffi=
+cient, as two individuals can clearly collude in these roles.</div><br><bloc=
+kquote type=3D"cite"><div dir=3D"ltr"><div><div> Yes, the owner lock up unti=
+l maturity. But those using the UTXO for the advertizement service could tra=
+nsfer (sell) the UTXO to someone else as soon as they do not need it, so it i=
+s dynamic maturity for them The new owner could use them for an other advert=
+izement or for an entirely different purpose.</div></div></div></blockquote>=
+<div><br></div><div>Agree, and it is the unremovable time constraint that en=
+sures the opportunity cost. This is why in your proposal it is of no consequ=
+ence that both roles can be the same person.</div><br><blockquote type=3D"ci=
+te"><div dir=3D"ltr"><div><div>Regarding burning: I think burning is unsusta=
+inable as usage of services is unlimited while coin suply is limited.&nbsp;<=
+/div></div></div></blockquote><div><br></div><div>Loss is perpetual, so this=
+ implies Bitcoin is unsustainable.</div><br><blockquote type=3D"cite"><div d=
+ir=3D"ltr"><div><blockquote type=3D"cite" class=3D""><div class=3D""><blockq=
+uote type=3D"cite" style=3D"font-family: Helvetica; font-size: 12px; font-st=
+yle: normal; font-variant-caps: normal; font-weight: normal; letter-spacing:=
+ normal; orphans: auto; text-align: start; text-indent: 0px; text-transform:=
+ none; white-space: normal; widows: auto; word-spacing: 0px; -webkit-text-si=
+ze-adjust: auto; -webkit-text-stroke-width: 0px;" class=3D""><br class=3D"">=
+And as I have shown above, nor can a =E2=80=9Clocked-up=E2=80=9D coin be unl=
+ocked to do the same.<br class=3D""></blockquote><br style=3D"font-family: H=
+elvetica; font-size: 12px; font-style: normal; font-variant-caps: normal; fo=
+nt-weight: normal; letter-spacing: normal; text-align: start; text-indent: 0=
+px; text-transform: none; white-space: normal; word-spacing: 0px; -webkit-te=
+xt-stroke-width: 0px;" class=3D""><span style=3D"font-family: Helvetica; fon=
+t-size: 12px; font-style: normal; font-variant-caps: normal; font-weight: no=
+rmal; letter-spacing: normal; text-align: start; text-indent: 0px; text-tran=
+sform: none; white-space: normal; word-spacing: 0px; -webkit-text-stroke-wid=
+th: 0px; float: none; display: inline !important;" class=3D"">You have shown=
+ no such thing, merely shown that you have not understood the proposal.</spa=
+n><br style=3D"font-family: Helvetica; font-size: 12px; font-style: normal; f=
+ont-variant-caps: normal; font-weight: normal; letter-spacing: normal; text-=
+align: start; text-indent: 0px; text-transform: none; white-space: normal; w=
+ord-spacing: 0px; -webkit-text-stroke-width: 0px;" class=3D""><br style=3D"f=
+ont-family: Helvetica; font-size: 12px; font-style: normal; font-variant-cap=
+s: normal; font-weight: normal; letter-spacing: normal; text-align: start; t=
+ext-indent: 0px; text-transform: none; white-space: normal; word-spacing: 0p=
+x; -webkit-text-stroke-width: 0px;" class=3D""><span style=3D"font-family: H=
+elvetica; font-size: 12px; font-style: normal; font-variant-caps: normal; fo=
+nt-weight: normal; letter-spacing: normal; text-align: start; text-indent: 0=
+px; text-transform: none; white-space: normal; word-spacing: 0px; -webkit-te=
+xt-stroke-width: 0px; float: none; display: inline !important;" class=3D"">R=
+egards,</span><br style=3D"font-family: Helvetica; font-size: 12px; font-sty=
+le: normal; font-variant-caps: normal; font-weight: normal; letter-spacing: n=
+ormal; text-align: start; text-indent: 0px; text-transform: none; white-spac=
+e: normal; word-spacing: 0px; -webkit-text-stroke-width: 0px;" class=3D""><s=
+pan style=3D"font-family: Helvetica; font-size: 12px; font-style: normal; fo=
+nt-variant-caps: normal; font-weight: normal; letter-spacing: normal; text-a=
+lign: start; text-indent: 0px; text-transform: none; white-space: normal; wo=
+rd-spacing: 0px; -webkit-text-stroke-width: 0px; float: none; display: inlin=
+e !important;" class=3D"">ZmnSCPxj</span></div></blockquote></div><br class=3D=
+""><div class=3D"">I also struggle to communicate to Eric and likely many ot=
+her reader the generic utility of temporary control of an UTXO. Let me try a=
+gain:</div></div></blockquote><div><br></div><div>No, you do not. This is no=
+t the point at issue. See my previous response.</div><br><blockquote type=3D=
+"cite"><div dir=3D"ltr"><div class=3D"">Bitcoin offers a memory with remarka=
+ble properties:</div><div class=3D"">- it can be read by anyone anywhere</di=
+v><div class=3D"">- anyone anywhere who knows a key controlling an UTXO, and=
+ only them, can initiate an update to the memory</div></div></blockquote><bl=
+ockquote type=3D"cite"><div dir=3D"ltr"><div class=3D"">- global replicas gu=
+aranteed to apply updates of the memory within a short time period.</div><di=
+v class=3D""><br class=3D""></div><div class=3D"">This is a utility that is s=
+ufficient to implement money.&nbsp;</div></div></blockquote><div><br></div><=
+div>No, it isn=E2=80=99t. Ownership must be perpetually (actually) transfera=
+ble, not just known. The use of a covenant breaks this transferability, see p=
+revious posts.</div><br><blockquote type=3D"cite"><div dir=3D"ltr"><div clas=
+s=3D"">Such a reliable shared memory could have however more uses than track=
+ing money, It could keep track of, and thereby make scarce, arbitary other t=
+hings.</div></div></blockquote><div><br></div><div>For the same reason this c=
+annot work for money, it cannot work for any perpetual asset. See previous p=
+osts.</div><br><blockquote type=3D"cite"><div dir=3D"ltr"><div class=3D"">We=
+ can unlock these uses by separating the money use of memory from other uses=
+.&nbsp;</div><div class=3D""><br class=3D""></div><div class=3D"">The covena=
+nt achives this separation temporarily. A UTXO with a covenant that guarante=
+es that current owner re-gains control at a later time means,&nbsp;</div><di=
+v class=3D"">that the current owner temporarily forgoes the UTXOs use as mon=
+ey and thereby allows its temporary use to keep track of something else.</di=
+v></div></blockquote><div><br></div><div>Only if the asset expires at or bef=
+ore the covenant maturity.</div><br><blockquote type=3D"cite"><div dir=3D"lt=
+r"><div class=3D"">UTXOs with different covenants or without covenant are no=
+t fungible.</div></div></blockquote><div><br></div><div>Of course.</div><br>=
+<blockquote type=3D"cite"><div dir=3D"ltr"><div class=3D"">Why use UTXOs of s=
+ignificant value to track something that is not money? Because the reason th=
+e registry is used is to create scarcity and scarcity can be tailored to mor=
+e or</div><div class=3D"">less severe by requiring more or less satoshis to t=
+rack something.</div></div></blockquote><div><br></div><div>Only 1 satoshi i=
+s required for tracking. It is only the scarcity of a satoshi that creates t=
+his scarcity, not the covenant on it. The covenant represents only the destr=
+uction of opportunity of the value represented by the 1 satoshi, not a new s=
+ystem of scarcity.</div><br><blockquote type=3D"cite"><div dir=3D"ltr"><div c=
+lass=3D"">The current owner of a regular UTXO will want to be paid for tempo=
+rarily giving up control, and that payment represents interest.</div></div><=
+/blockquote><div><br></div><div><span style=3D"background-color: rgba(255, 2=
+55, 255, 0);">Yes, opportunity cost.</span></div><br><blockquote type=3D"cit=
+e"><div dir=3D"ltr"><div class=3D"">Riskless, since it is certain to re-gain=
+ control.</div></div></blockquote><div><br></div><div>But of no value to any=
+one as money.</div><div><br></div><div>Best,</div><div>Eric</div><br><blockq=
+uote type=3D"cite"><div dir=3D"ltr"><div class=3D"">Regards,</div><div class=
+=3D""><br class=3D""></div><div class=3D"">Tamas Blummer</div></div></blockq=
+uote></body></html>=
+
+--Apple-Mail-5BDE4D26-59D3-454D-BC29-BFDC27E8AB91--
+
generated by cgit v1.2.3 (git 2.39.1) at 2025-07-26 05:58:09 +0000