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Subject: [bitcoin-dev] Reducing block reward via soft fork
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Background
===
Reducing the block reward reduces the incentive to mine. It reduces the
maximum energy price at which mining is profitable, reducing the energy use.
Bitcoins have value because they are accepted by full node users, from
individual node operators, to exchanges and custodians like Coinbase.
Anything else and the Bitcoins don't exist and are worthless. Like all
currencies, Bitcoin has value because others recognize that they have value.
Idea
===
Reduce the block reward by adding fewer coins to the UTXO set per block.
This should be done gradually
Consensus layer
===
This is a soft fork, because it tightens the
Some Possible Weaknesses
===
- It will cost less than a nation-state of energy to reverse recent Bitcoin
transactions.
- Some miners may protest and lobby exchanges.
- By pushing mining towards the cheapest energy sources, centralization
increases towards Chinese miners.
- The Bitcoin network may split if consensus is not built before flag day.
However, given the current political headwinds and widespread public
discussion around Bitcoin's energy use, it may be socially possible to ask
individual users and major exchanges to install a version of Bitcoin with a
reduced block reward.
Alternatives
===
Instead of outright rejecting transactions (and the blocks that contain
them) that attempt to spend increased block rewards, treat them as no-ops.
--0000000000004315ef05c2f4d3d3
Content-Type: text/html; charset="UTF-8"
Content-Transfer-Encoding: quoted-printable
<div dir=3D"ltr"><div class=3D"gmail_default" style=3D"font-family:arial,he=
lvetica,sans-serif;font-size:small;color:#000000">Background</div><div clas=
s=3D"gmail_default" style=3D"font-family:arial,helvetica,sans-serif;font-si=
ze:small;color:#000000">=3D=3D=3D</div><div class=3D"gmail_default" style=
=3D"font-family:arial,helvetica,sans-serif;font-size:small;color:#000000">R=
educing the block reward reduces the incentive to mine. It reduces the maxi=
mum energy price at which mining is profitable, reducing the energy use.</d=
iv><div class=3D"gmail_default" style=3D"font-family:arial,helvetica,sans-s=
erif;font-size:small;color:#000000"><br></div><div class=3D"gmail_default" =
style=3D"font-family:arial,helvetica,sans-serif;font-size:small;color:#0000=
00">Bitcoins have value because they are accepted by full node users, from =
individual node operators, to exchanges and custodians like Coinbase. Anyth=
ing else and the Bitcoins don't exist and are worthless. Like all curre=
ncies, Bitcoin has value because others recognize that they have value.</di=
v><div class=3D"gmail_default" style=3D"font-family:arial,helvetica,sans-se=
rif;font-size:small;color:#000000"><br></div><div class=3D"gmail_default" s=
tyle=3D"font-family:arial,helvetica,sans-serif;font-size:small;color:#00000=
0"></div><div class=3D"gmail_default" style=3D"font-family:arial,helvetica,=
sans-serif;font-size:small;color:#000000">Idea</div><div class=3D"gmail_def=
ault" style=3D"font-family:arial,helvetica,sans-serif;font-size:small;color=
:#000000">=3D=3D=3D</div><div class=3D"gmail_default" style=3D"font-family:=
arial,helvetica,sans-serif;font-size:small;color:#000000">Reduce the block =
reward by adding fewer coins to the UTXO set per block. This should be done=
gradually<br></div><div class=3D"gmail_default" style=3D"font-family:arial=
,helvetica,sans-serif;font-size:small;color:#000000"><br></div><div class=
=3D"gmail_default" style=3D"font-family:arial,helvetica,sans-serif;font-siz=
e:small;color:#000000">Consensus layer</div><div class=3D"gmail_default" st=
yle=3D"font-family:arial,helvetica,sans-serif;font-size:small;color:#000000=
">=3D=3D=3D</div><div class=3D"gmail_default" style=3D"font-family:arial,he=
lvetica,sans-serif;font-size:small;color:#000000">This is a soft fork, beca=
use it tightens the=C2=A0</div><div class=3D"gmail_default" style=3D"font-f=
amily:arial,helvetica,sans-serif;font-size:small;color:#000000"><br></div><=
div class=3D"gmail_default" style=3D"font-family:arial,helvetica,sans-serif=
;font-size:small;color:#000000">Some Possible Weaknesses</div><div class=3D=
"gmail_default" style=3D"font-family:arial,helvetica,sans-serif;font-size:s=
mall;color:#000000">=3D=3D=3D</div><div class=3D"gmail_default" style=3D"fo=
nt-family:arial,helvetica,sans-serif;font-size:small;color:#000000">- It wi=
ll cost less than a nation-state of energy to reverse recent Bitcoin transa=
ctions.</div><div class=3D"gmail_default" style=3D"font-family:arial,helvet=
ica,sans-serif;font-size:small;color:#000000">- Some miners may protest and=
lobby exchanges.<br></div><div class=3D"gmail_default" style=3D"font-famil=
y:arial,helvetica,sans-serif;font-size:small;color:#000000">- By pushing mi=
ning towards the cheapest energy sources, centralization increases towards =
Chinese miners.</div><div class=3D"gmail_default" style=3D"font-family:aria=
l,helvetica,sans-serif;font-size:small;color:#000000">- The Bitcoin network=
may split if consensus is not built before flag day.</div><div class=3D"gm=
ail_default" style=3D"font-family:arial,helvetica,sans-serif;font-size:smal=
l;color:#000000"><br></div><div class=3D"gmail_default" style=3D"font-famil=
y:arial,helvetica,sans-serif;font-size:small;color:#000000">However, given =
the current political headwinds and widespread public discussion<span class=
=3D"gmail_default"> around Bitcoin's energy use</span>, it may be<span =
class=3D"gmail_default"> socially possible to ask individual users and majo=
r exchanges to install a version of Bitcoin with a reduced block reward.</s=
pan><br></div><div class=3D"gmail_default" style=3D"font-family:arial,helve=
tica,sans-serif;font-size:small;color:#000000"><br></div><div class=3D"gmai=
l_default" style=3D"font-family:arial,helvetica,sans-serif;font-size:small;=
color:#000000">Alternatives</div><div class=3D"gmail_default" style=3D"font=
-family:arial,helvetica,sans-serif;font-size:small;color:#000000">=3D=3D=3D=
</div><div class=3D"gmail_default" style=3D"font-family:arial,helvetica,san=
s-serif;font-size:small;color:#000000"><div class=3D"gmail_default"><div cl=
ass=3D"gmail_default">Instead of outright rejecting transactions (and the b=
locks that contain them) that attempt to spend increased block rewards, tre=
at them as no-ops.</div></div></div></div>
--0000000000004315ef05c2f4d3d3--
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