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From: Gino Pinuto <gino.pinuto@gmail.com>
Date: Wed, 13 Jul 2022 14:11:59 +0200
Message-ID: <CAA3CggEVmx+97TE05Oe3ViFHLC0ejmuRX7L_tMWrRVhYsxaF9w@mail.gmail.com>
To: Bitcoin Protocol Discussion <bitcoin-dev@lists.linuxfoundation.org>
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Subject: Re: [bitcoin-dev] Security problems with relying on transaction
 fees for security
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What about burning all fees and keep a block reward that will smooth out
while keeping the ~21M coins limit ?

Benefits :
- Miners would still be incentivized to collect higher fees transaction
with the indirect perspective to generate more reward in future.
- Revenues are equally distributed over time to all participants and we
solve the overnight discrepancy.
- Increased velocity of money will reduce the immediate supply of bitcoin
cooling down the economy.
- Reduction of velocity will have an impact on miners only if it persevere
in the long term but short term they will still perceive the buffered
reward.

I don't have ideas yet on how to elegantly implement this.


On Wed, 13 Jul 2022, 12:08 John Tromp via bitcoin-dev, <
bitcoin-dev@lists.linuxfoundation.org> wrote:

> > The emission curve lasts over 100 years because Bitcoin success state
> requires it to be entrenched globally.
>
> It effectively doesn't. The last 100 years from 2040-2140 only emits a
> pittance of about 0.4 of all bitcoin.
>
> What matters for proper distribution is the shape of the emission
> curve. If you emit 99% in the first year and 1% in the next 100 years,
> your emission "lasts" over 100 years, and you achieve a super low
> supply inflation rate immediately after 1 year, but it's obviously a
> terrible form of distribution.
>
> This is easy to quantify as the expected time of emission which would
> be 0.99 * 0.5yr + 0.01* 51yr = 2 years.
> Bitcoin is not much better in that the expected time of emission of an
> bitcoin satisfies x = 0.5*2yr + 0.5*(4+x) and thus equals 6 years.
>
> Monero appears much better since its tail emission yields an infinite
> expected time of emission, but if we avoid infinities by looking at
> just the soft total emission [1], which is all that is emitted before
> a 1% yearly inflation, then Monero is seen to actually be a lot worse
> than Bitcoin, due to emitting over 40% in its first year and halving
> the reward much faster. Ethereum is much worse still with its huge
> premine and PoS coins like Algorand are scraping the bottom with their
> expected emission time of 0.
>
> There's only one coin whose expected (soft) emission time is larger
> than bitcoin's, and it's about an order of magnitude larger, at 50
> years.
>
> [1]
> https://john-tromp.medium.com/a-case-for-using-soft-total-supply-1169a188d153
> _______________________________________________
> bitcoin-dev mailing list
> bitcoin-dev@lists.linuxfoundation.org
> https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev
>

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<div dir=3D"auto"><div>What about burning all fees and keep a block reward =
that will smooth out while keeping the ~21M coins limit ?<div dir=3D"auto">=
<br></div><div dir=3D"auto">Benefits :</div><div dir=3D"auto">- Miners woul=
d still be incentivized to collect higher fees transaction with the indirec=
t perspective to generate more reward in future.</div><div dir=3D"auto">- R=
evenues are equally distributed over time to all participants and we solve =
the overnight discrepancy.</div><div dir=3D"auto">- Increased velocity of m=
oney will reduce the immediate supply of bitcoin cooling down the economy.<=
/div><div dir=3D"auto">- Reduction of velocity will have an impact on miner=
s only if it persevere in the long term but short term they will still perc=
eive the buffered reward.</div><div dir=3D"auto"><br></div><div dir=3D"auto=
">I don&#39;t have ideas yet on how to elegantly implement this.</div><br><=
br><div class=3D"gmail_quote"><div dir=3D"ltr" class=3D"gmail_attr">On Wed,=
 13 Jul 2022, 12:08 John Tromp via bitcoin-dev, &lt;<a href=3D"mailto:bitco=
in-dev@lists.linuxfoundation.org">bitcoin-dev@lists.linuxfoundation.org</a>=
&gt; wrote:<br></div><blockquote class=3D"gmail_quote" style=3D"margin:0 0 =
0 .8ex;border-left:1px #ccc solid;padding-left:1ex">&gt; The emission curve=
 lasts over 100 years because Bitcoin success state requires it to be entre=
nched globally.<br>
<br>
It effectively doesn&#39;t. The last 100 years from 2040-2140 only emits a<=
br>
pittance of about 0.4 of all bitcoin.<br>
<br>
What matters for proper distribution is the shape of the emission<br>
curve. If you emit 99% in the first year and 1% in the next 100 years,<br>
your emission &quot;lasts&quot; over 100 years, and you achieve a super low=
<br>
supply inflation rate immediately after 1 year, but it&#39;s obviously a<br=
>
terrible form of distribution.<br>
<br>
This is easy to quantify as the expected time of emission which would<br>
be 0.99 * 0.5yr + 0.01* 51yr =3D 2 years.<br>
Bitcoin is not much better in that the expected time of emission of an<br>
bitcoin satisfies x =3D 0.5*2yr + 0.5*(4+x) and thus equals 6 years.<br>
<br>
Monero appears much better since its tail emission yields an infinite<br>
expected time of emission, but if we avoid infinities by looking at<br>
just the soft total emission [1], which is all that is emitted before<br>
a 1% yearly inflation, then Monero is seen to actually be a lot worse<br>
than Bitcoin, due to emitting over 40% in its first year and halving<br>
the reward much faster. Ethereum is much worse still with its huge<br>
premine and PoS coins like Algorand are scraping the bottom with their<br>
expected emission time of 0.<br>
<br>
There&#39;s only one coin whose expected (soft) emission time is larger<br>
than bitcoin&#39;s, and it&#39;s about an order of magnitude larger, at 50<=
br>
years.<br>
<br>
[1] <a href=3D"https://john-tromp.medium.com/a-case-for-using-soft-total-su=
pply-1169a188d153" rel=3D"noreferrer noreferrer" target=3D"_blank">https://=
john-tromp.medium.com/a-case-for-using-soft-total-supply-1169a188d153</a><b=
r>
_______________________________________________<br>
bitcoin-dev mailing list<br>
<a href=3D"mailto:bitcoin-dev@lists.linuxfoundation.org" target=3D"_blank" =
rel=3D"noreferrer">bitcoin-dev@lists.linuxfoundation.org</a><br>
<a href=3D"https://lists.linuxfoundation.org/mailman/listinfo/bitcoin-dev" =
rel=3D"noreferrer noreferrer" target=3D"_blank">https://lists.linuxfoundati=
on.org/mailman/listinfo/bitcoin-dev</a><br>
</blockquote></div></div></div>

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