Return-Path: Received: from smtp2.osuosl.org (smtp2.osuosl.org [140.211.166.133]) by lists.linuxfoundation.org (Postfix) with ESMTP id CACFFC002D for ; Wed, 4 May 2022 04:19:32 +0000 (UTC) Received: from localhost (localhost [127.0.0.1]) by smtp2.osuosl.org (Postfix) with ESMTP id A3DAF40126 for ; Wed, 4 May 2022 04:19:32 +0000 (UTC) X-Virus-Scanned: amavisd-new at osuosl.org X-Spam-Flag: NO X-Spam-Score: 0.298 X-Spam-Level: X-Spam-Status: No, score=0.298 tagged_above=-999 required=5 tests=[BAYES_20=-0.001, DKIM_SIGNED=0.1, DKIM_VALID=-0.1, DKIM_VALID_AU=-0.1, DKIM_VALID_EF=-0.1, FREEMAIL_FROM=0.001, FROM_LOCAL_NOVOWEL=0.5, SPF_HELO_PASS=-0.001, SPF_PASS=-0.001] autolearn=ham autolearn_force=no Authentication-Results: smtp2.osuosl.org (amavisd-new); dkim=pass (2048-bit key) header.d=protonmail.com Received: from smtp2.osuosl.org ([127.0.0.1]) by localhost (smtp2.osuosl.org [127.0.0.1]) (amavisd-new, port 10024) with ESMTP id 3UGXcDlTdreV for ; Wed, 4 May 2022 04:19:32 +0000 (UTC) X-Greylist: domain auto-whitelisted by SQLgrey-1.8.0 Received: from mail-4324.protonmail.ch (mail-4324.protonmail.ch [185.70.43.24]) by smtp2.osuosl.org (Postfix) with ESMTPS id EAE2E400E3 for ; Wed, 4 May 2022 04:19:31 +0000 (UTC) Date: Wed, 04 May 2022 04:19:25 +0000 DKIM-Signature: v=1; a=rsa-sha256; c=relaxed/relaxed; d=protonmail.com; s=protonmail2; t=1651637969; bh=X8QuvhGKafaoAYyBiE7yiFTVvfnbqNfdXYV2nlcLdys=; h=Date:To:From:Cc:Reply-To:Subject:Message-ID:In-Reply-To: References:Feedback-ID:From:To:Cc:Date:Subject:Reply-To: Feedback-ID:Message-ID; b=geWD+UmtzWHOYEGyam2d7Rvf7IUZyVqrxJBxBM1O2t02YlfWLzZhkwr6w3Tigk1Yj qnIJLPsPq0K6PIHpTiAv7IyCrtraZYVpg653xKWHteCR18KIULkn0970t4Od13tXCl qrnf93uPOXxv/wwrAx5wSxkUsMp5U54ikS1S6bnfur9+oVNNXibmtXp/rOW2737AYH dW8tjBUXwzjy9nU4ND82ehPkBWcN0hgyfizdZ8rTjKpy54TV4GKbH3NxNok9bxnyqT ZCJu63aDtsmjGdb3CrXPV3m5IbF4reQMISCG24gOAnUuBvCs6FD8Lo2HGnzF0vf1qy PAj7dHBx8Kang== To: eric@voskuil.org From: ZmnSCPxj Reply-To: ZmnSCPxj Message-ID: In-Reply-To: <03d701d85f6c$027c5900$07750b00$@voskuil.org> References: <48D4B621-D862-4031-AE43-3F54D34FB0B5@voskuil.org> <03d701d85f6c$027c5900$07750b00$@voskuil.org> Feedback-ID: 2872618:user:proton MIME-Version: 1.0 Content-Type: text/plain; charset=utf-8 Content-Transfer-Encoding: quoted-printable Cc: 'Bitcoin Protocol Discussion' Subject: Re: [bitcoin-dev] BIP proposal: Timelocked address fidelity bond for BIP39 seeds X-BeenThere: bitcoin-dev@lists.linuxfoundation.org X-Mailman-Version: 2.1.15 Precedence: list List-Id: Bitcoin Protocol Discussion List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Wed, 04 May 2022 04:19:32 -0000 Good morning e, > Good evening ZmnSCPxj, > > For the sake of simplicity, I'll use the terms lender (Landlord), borrowe= r (Lessor), interest (X), principal (Y), period (N) and maturity (height af= ter N). > > The lender in your scenario "provides use" of the principal, and is paid = interest in exchange. This is of course the nature of lending, as a period = without one's capital incurs an opportunity cost that must be offset (by in= terest). > > The borrower's "use" of the principal is what is being overlooked. To gen= erate income from capital one must produce something and sell it. Productio= n requires both capital and time. Borrowing the principle for the period al= lows the borrower to produce goods, sell them, and return the "profit" as i= nterest to the lender. Use implies that the borrower is spending the princi= ple - trading it with others. Eventually any number of others end up holdin= g the principle. At maturity, the coin is returned to the lender (by covena= nt). At that point, all people the borrower traded with are bag holders. Kn= owledge of this scam results in an imputed net present zero value for the b= orrowed principal. But in this scheme, the principal is not being used as money, but as a bill= board for an advertisement. Thus, the bitcoins are not being used as money due to the use of the fideli= ty bond to back a "you can totally trust me I am not a bot!!" assertion. This is not the same as your scenario --- the funds are never transferred, = instead, a different use of the locked funds is invented. As a better analogy: I am borrowing a piece of gold, smelting it down to ma= ke a nice shiny advertisement "I am totally not a bot!!", then at the end o= f the lease period, re-smelting it back and returning to you the same gold = piece (with the exact same atoms constituting it), plus an interest from my= business, which gained customers because of the shiny gold advertisement c= laiming "I am totally not a bot!!". That you use the same piece of gold for money does not preclude me using th= e gold for something else of economic value, like making a nice shiny adver= tisement, so I think your analysis fails there. Otherwise, your analysis is on point, but analyses something else entirely. Regards, ZmnSCPxj