Bitcoin Forum

As software that can be changed, someone controls bitcoin. I am interested to know who can change it.

In particular, I am interested in knowing if the 21 million can ever be changed? And if not, why?

I looked around Google for a while but didn't find anything that definitively answered those questions. I personally don't think the 21 million should ever be changed. And I would like the answer to be that it is impossible to change it, but I don't think that is the case.

You can change the software, you can even download the code, it is open source.

It is easy for someone to change the 21 million limit in their own software.  It is nearly impossible to convince EVERYONE else to use that modified software.

As soon as an individual's software starts transmitting blocks with extra bitcoins in them, all the connected peers running software that doesn't allow the extra bitcoins will simply ignore them.  They will essentially have created their own currency that they can only trade with others that they convince to run their software, and will be unable to receive bitcoins from anyone running the original software.

Right now, yes, it would be extremely difficult to get everyone to change. But what about in the future when the situation is different. Could a majority of bitcoin users/miners be convinced to change the 21 million cap? If the leaders of the bitcoin community all supported a change as the best solution to a serious problem that was haunting the currency/economy, is it still impossible that a majority would adopt the change?

The past shows that leaders are often able to sway the opinions of a majority. And with respect to all currencies, the majority always rules.

I am not trying to disagree or get in an argument with anyone. I am just trying to figure this out. I really like the idea of bitcoins, but I am trying to figure out what their long time viability is.

Lets compare to gold, one of the longest standing most globally accepted currencies in the history of mankind. People say that gold has intrinsic value. I think there is only 2 things in combination that give gold this supposed "intrinsic value".

1. True Scarcity
2. A majority that believes it is valuable

Bitcoins could be like gold. If the 21 million can indeed not be changed, then bitcoins have true scarcity. For the second point, bitcoins are on their way to a majority believing that they are valuable.

But, if the 21 million can be changed, then bitcoins are no different from any other fiat currency. Fiat currencies do not have true scarcity. They have artificial scarcity. The controllers of the currency get to control the scarcity.

Anyways, that is where I am coming from and why I asked those questions. I would love to hear the thoughts of others that think about this kind of stuff.

If in the future utopia of bitcoin land. If we needed to change the limit, we would.

However the first coins 0-21mill will be of higher value then coins created in the 21m+

But in this utopia, we will probably adopt alt currency to perform this same role, shifting BTC into long-term savings and bonds while the alt currency is of lower value and traded higher volumes.

Could that alt currency be Litecoin?  :o

If the dev team has some significantly good reasons that they should change the 21 million limit, then they might. Key thing is convincing the majority of the dev team to do so, and the reasons would have to be very good, as essentially the 21 million limit is almost a de facto promise.

I would recommend that they not do this, but have alternative currencies. The moment bitcoin becomes inflationary past the 21 million limit then the perception is that the promise has been broken, and is now just another centralized bank/Federal Reserve that can inflate at will.

Great info in this thread

If a significant majority felt such a change was in thier interest, then they culd make that change, aad everyone else would prett much just have to go along with it. It's easy to see this as a negative, but actually experienc shows it's a positive. If something turns out to be badly wrong with bitcoin, it can be fixed. And the vast majority of biotcoin users understand that being able to rely on the basic assumptions to say the same is necesxsary for a currency to have an yvalue.

The devs must first make the changes.  The users must then accept the changes.

In other words, everyone controls Bitcoin!  Your "vote" is whether or not you're accepting what the devs are doing.  If they do something you don't like, fork it, and voila, you got a new currency with your rules, usable with whoever agrees to those rules you're making.

MEE! I AND I ALONE CONTROL BITCOIN!

There need not be more than 21 million BTCs in circulation as "There are really 2,099,999,997,690,000 (just over 2 quadrillion) maximum possible atomic units in the bitcoin design." (pulled from https://en.bitcoin.it/wiki/Myths)

Once the value multiplies significantly, there will be adjustments to the fractions and we will see transactions that extend past the standard 8 decimal spaces.

Victoria Grant is Satoshi. She controls BitCoin, the planetary weather system, and she has a Starbuck's francise.

Honestly though, could anyone answer what sort of process goes on for any given change to the protocol?
https://en.bitcoin.it/wiki/Bitcoin_Improvement_Proposals
This wiki page states that the decision lies with the majority. Do I, as a participant with the clients, have to review every version change log and review the changes to decide whether I agree with that or not.

Raising the 21 million limit is against the interest of anyone who is holding coins as it would devalue the currency. So it's fairly unlikely that the majority would agree to do it I would guess. All miners MIGHT (although it seems unlikely) as they potentially stand to benefit, but they would still need to convince all the other regular non-miner users who would be hurt by the change. Seems pretty unlikely, unless there's mass centralisation of the system (ie. noone running full nodes, everyone using 3rd party wallet services, who could collude to make it happen).

It would be a pretty good idea.  But usually, if something's really bad, there will be an uproar.

Same problem any open source project suffers from, even if the project maintainers make a bad decision, the userbase can migrate away to a fork which doesn't have the perceived problem. By the same token everyone can move away to a superior tool if necessary.

I don't see the point of raising the number of coins, since they can essentially be infinitely divided, and if demand goes up, their value will go up. It's not a limit on the amount of value the market can sustain.

A lot of responses about changes seem to use the logic of "the majority will do or will not do this because they are driven by motives x, y & z"

But there is a couple of issues with this argument.

1. Don't trust the majority, even if you think you understand their motivation. The majority can be wrong, and they can be manipulated. Take US politics for example: The majority vote for more and more deficit spending even though it is not good for the country in the long run. The majority have gotten the US into an unsurmountable amount of debt. Likewise, the majority of bitcoin users could be fooled into accepting a change that would hurt the currency in the long run. (Like eliminating the true scarcity by removing the 21 million cap)

2. Correct me if I am wrong, but it is not the majority of bitcoin users that need to except the changes. Rather, a majority of miners. If bitcoin grows to be a commonly used currency, the miners will make up a small fraction of the total users. So when we are talking about the majority, we really mean the majority of a small subset. The problem with this is that the miners may have a different perspective on certain proposed changes. For example, it is reasonable that many of the miners would support fixing the solution reward at some number of bitcoins instead of having it trail off to zero. This would be more profitable for the miners. Logically, the normal users would be against this, but reference point one above. The normal users could be convinced through misinformation that this is a good solution.  Those that stand to benefit could argue that the supply of bitcoins needs to increase to help the economy move along, or to make transactions easier, or any other lie they can come up with to convince the majority. This is not unprecedented in history.

Take for example the countless countries that have moved their currencies off the gold standard. In this example, the politicians are the miners and the citizens are the normal bitcoin users. A majority of the politicians get to determine the outcome. And moving off the gold standard is analogous to eliminating the 21 million cap. The politicians stand to benefit because they get to delay dealing with a problem. The politicians convince a large subset of the citizens that this is the right move to make so that the citizens don't start and uprising. See how this is the same?

A majority of users would have to upgrade the software for the cap to be changed.  Even if 99% of mining power moved to the new cap, the old software would not be compatible with the new fork.  It would split the network in two, since users of the old version would see a block that includes a subsidy larger than what is allowed, thus considered an invalid block.

Interesting.

Here's an interesting selection, in my view anyways, if you haven't read the book it is: The Theory of Money and Credit, written by Ludwig von Mises.

A quote (in RE: the Gold Standard, or any 'standard')

" "The gold standard did not collapse. Governments abolished it in order to pave the way for inflation. The whole grim apparatus of oppression and coercion, policemen, customs guards, penal courts, prisons, in some countries even executioners, had to be put into action in order to destroy the gold standard. (The Theory of Money and Credit, p. 461)." "

To let the masses 'have wealth' would indeed be a disruption of what wealth 'is'; which would lead to renovating the constructs of power; it "this 'money/currency' must be 'hoarded' it must be 'controlled and dispersed'? Is this not the reign that steers the population? How can we imprison a thief, if first we do not create him/her? Must they not have something to steal? Yes, something worth something, something that has 'ascribed value' (we say it is valuable therefore it is) not 'intrinsic value'; for if this person were allowed to trade their time, trade the wheat they grew, trade the bead work they made, would this not be allowing them to 'have power' and 'trade freely amongst themselves or with whom they desired' without need of interference by 3rd parties, gov't, legal, regulatory, or otherwise? But then how to fill the government coffers? Make government more efficient? Nay. That would be much too practical and too many highfalutin bantering monkeys would fall from the tree and slip on the banana peels under their feet, instead of flinging monkey dung at the passers by whislt they eat their sweet bananas and scratch their A$$e$.

Is money not akin to a handcuff? Bitcoin is a great key to the handcuffs, and has provided temporary relief, but that does not mean there will not be a new handcuff. This is the illusion of freedom, no?

Just a passing thought.

(emphasis added by me)

You are wrong.

Every full node peer on the network verifies every block they receive before relaying them and adding them to the blockchain. If 99% of the miners are publishing blocks that have a larger reward than the peers allow, those blocks will be relayed among those miners, but will never make it to the users or the miners that don't accept that rule.  They will essentially have created their own cryptocurrency separate from bitcoin (though they may try to call it bitcoin as well).

Now if the majority of users decide to go along as well, then you will have something that can actually be used/exchanged with others, and those who stick with the old software could find themselves with something that nobody else accepts and quickly loses value.

As you can see, it requires the majority of peers, not miners.

Maybe Aliens do..

The 99% of the miners would devote 2% of their mining power to ensuring that no transactions ever survived in the longest chain in the fork they consider illegitimate. 51% of the mining, if sufficiently organized, can enforce whatever rules it wants. They get to decide what chain is usable.

So, is this where the other cryptocurrencies all originated? From people switching the rules a bit and then agreeing, based on peer exchange?

YUP.

The more I look into it, the more I love the concept.  :D

The mass, because if everyone is using the same protocol there isn't any room for manipulation (in theory, you can never be 100% sure).

Mr. Satoshi controls it of course :)

So what would the economic impact be of this sort of split? Imagine a 49/51 split for a protocol change, many of the 49% may suddenly dump and sell off their BTC. Or maybe this sort of thing is just as common in fiat currency like the Cyprus banks changing the rules?

The 2 largest mining pools already control 53% of the nodes: http://blockchain.info/pools

So for a change to be accepted by "the majority", only 2 pools need to accept it.

This is the current weakness and vulnerability (and potential downfall?) of the Bitcoin system.

Of course if those two pools tried to make a change, there'd be a significant probability that miners would move to a different pool and they'd quickly lose their 51%+ status.

Thanks for all of the informed responses guys. I think I am going to have to read the bitcoin research paper published by Satoshi to find the real answer. I am sure I will be back with more things to talk about.