Bitcoin Forum

This issue has probably been discussed before but I've been thinking about it for the last few weeks so I'll give it a go anyway.

There may be an issue with not knowing the total bitcoin supply that is currently available due to lost keys and from other factors. Would a solution to this issue be to destroy, or rather make coins that hasn't moved in a certain time period locked from further usage?

Since there are no way to tell the difference between coins that are locked due to lost keys and coins that hasn't moved for a time period, there are uncertainty to the total bitcoin supply that currently exists. This could be a potential problem if big amounts of coins are put back into circulation after being stale for a longer period.

Take for example the Satoshi addresses, which, afaik, are assumed to contain some 500 000 to one million coins. We will never be able to tell if these are taken out of circulation or just kept for usage further down the road, unless they start to move. This creates a big uncertainty and could potentially cause major effects if they start to be used after ten years or more. The same can of course be said about any of the top 100 addresses or any addresses with "stale" coins. If they where to be remained untouched for say 50 or 100 years and then suddenly start to move, the perceived available bitcoin supply would suddenly grow, potentially causing instability within the system.

Would a solution be to build into the protocol that coins that haven't moved for a given period, for example 20 years, become locked and thereby taken out of circulation? This would make it much easier to estimate the current coin supply and thereby making it easier to valuate a single bitcoin. This would also force entities to reveal their plan for addresses with large balances, point in case are the Satoshi addresses just mentioned.

Is this a problem or should we just always assume that there are (will be) 21 million coins available, disregarding how long coins have been sitting on a specific address?

It's a great idea, we should also break into people's houses and banks and burn any money / throw away gold, paintings, heirlooms, etc that they haven't used for awhile.

Yes.  Many, many, many, many, times.

The forums do have a search function.

Doesn't seem to be a good idea to lock unused Bitcoins. If someone is just saving it for some reason, they can lose them. And it doesn't solve the addresses with large amounts of Bitcoin. They can just move them every one or ten years to another address.
To determine the price of one BTC you don't have to know the total supply. It's always a matter of supply and demand.

lol. That is the problem with this solution; which has been discussed here for years now. It is simply not possible to determine which coins are lost. You would be awful pissed if you opened your retirement wallet and found it empty because someone thought you weren't using bitcoin enough. Besides, we don't need them. Even if only one bitcoin was left we could use smaller units.  

I suppose your analogy is suitable if there is one entity in the world that has been known to disappear with ten percent of the worlds collected wealth, never to be heard of again.

It is only January yet we already have a candidate for the stupidest thread award of 2014...

The idea of locking/stealing "dead" BTC will never happen so it is not really worth discussing, again.

No, because this very same idea has already been brought up and shot down several times this year!

cops took my 2800 btc?  unknnown who knoes?

That's the point. Forcing them to move them would produce proof that the coins are active. And I would argue that to make supply and demand work (correctly) you need to know the supply.

But I guess taking the chance in losing at least ten percent (at least, probably a lot more due to the uncertainty) of the total value of the rest of the coins when the Satoshi coins move are the preferred sentiment on this forum.

It is not just a sentiment.  The change you are proposing is not possible.  The Bitcoin protocol is designed to prevent these types of changes.  Since it is not possible to change Bitcoin in this way it is not really worth discussing.

Now, you could design a new coin, an alternate (alt) coin, that does exactly what you suggest - but it would not be Bitcoin.

Ok, thanks for the reply.

Maybe now you can understand why us cranky old timers get so tired of threads that start "Bitcoin is cool but it need to be changed to do _____", because one to the best things about the design of Bitcoin is that it is impossible to change it to suit the desires of the day.

I don't think your question is a dumb one. But it has been thought out before. The thing to consider is that it does not address a problem. There is no need to know the supply for the system to work. Kinda like gold. No one knows how much gold there is or how much has been lost. And we don't need to know. Bitcoin is a system that works best without central control.

Turns out removing the newbie restrictions WAS a good idea after all.
</sarcasm>

It gave people time to learn how to search and read a lot about bitcoin so they'd see a lot of topics have been discussed and then they can join in them if they wish.  ;-)  Preventing 1000s of duplicate threads.

Let's combine this thread with all the what happens when all the coins have been mined threads.  They can suggest that unused coins be paid as mining rewards.

I don't think it will be OK

Once coin blacklisting and address-2-identity correlation systems are ready to go I'd expect the issue to be re-visited.

I'll wager that a lot of people who were against the idea (forced spending) will suddenly realize that it is the greatest thing since sliced bread.  Particularly those with ties to the Bitcoin Foundation.

Simply not possible to know if coins are lost or being stored without removing all levels of anonomity and intruding on peoples personal lives to find out. Even then , good luck tracking down or getting a response from every single bitcoin user on weither or not they lost coins or are just holding onto them.

No, it is not a problem. The millions of bitcoins that are lost or in long-term storage support high prices. If someone who is sitting on a massive hoard wants to cash out a significant number of coins five years from now, he will most likely buy a skycraper, a company, or a private island, not dump on an exchange. At that time the majority of transactions will probably be conducted in bitcoin without converting to fiat.

please don't destroy my family's future

Exactly.

Nothing is gained by this except maybe 'knowing' how many Bitcoins are still usable. 

I say a little mystery makes Bitcoin more exciting. 

+1

In my country what they say are no use u lose

Extra amusing how all these people fall for the hard troll OP, while accusing HIM to have been very stupid... :-D

People are regularly forced to convert paper money to new notes or lose the value. It is the exact same principle.

Most countries also have principles to apply to abandon properties and accumulated wealth with no inheritor that in the end returns it to the state.

Are these also unfair practices?

Thanks for a sensible reply.

Since the issue as mentioned has been discussed several times before it's probably better to end it here and revisit in a few years.

If you like state-issued fiat money with state rules, stick with that. Why try to recreate a failed system?

As has been stated numerous times, this is a hard fork - so go ahead, make the changes you propose, release them, fork the blockchain, and see how many people follow you to your new alt-coin.

Many people are hoping someone someone actually follows through and does it instead of talking about it and doing nothing while expecting someone else to do the work for them.  The code is on github. If everyone follows you'll be a hero.

Not necessarily.  Forced activity could easily be implemented using coin blacklisting.  A blacklisting and registry authority could be completely stand-alone.  Such efforts could benefit by cooperation from the Bitcoin development team, but it is not really necessary.

What would you call a situation where part of the network (miners and clients) do not subscribe to the black lists and the other part of the network (miners and clients) do subscribe to the black lists?

The part that is ignoring the black lists will allow the black listed coins to be moved to new addresses.  These transactions will be put into blocks by the miners that are ignoring the black lists.

The blocks containing these black listed transactions will not be accepted by the part of the network that is a slave to the black list.  They will create their own chain of blocks without the blocks containing the black listed transactions.

How can you say this is not a hard fork?  It is the definition of a hard fork.

Sounds like Japan today:

Japan plans to raid dormant bank accounts to raise new revenue
Government resurrects proposal to help pay for welfare and education projects as the indebted country struggles to find new revenue

http://www.scmp.com/news/asia/article/1410614/japan-plans-raid-dormant-bank-accounts-raise-new-revenue

What a ridiculous idea.  

Yes, very unfair. Unless there is not any heir anymore

Why would someone want to duplicate the horror of escheatment on purpose?

A 'hard fork' implies a functional event in the Bitcoin network having to do with block linkage.  You are getting tunnel vision.  I'm saying that exercising control over Bitcoin (including forced spending) is better done in a different way.

When BTC is used by a certain percentage of the public and corporate entities accept BTC the 'solution' becomes simple"

 - Some 'terrorist' uses Bitcoin for something bad.

 - The government tells corporate entities to check against a blacklist (maintained by Mellon's company) before accepting payments.  (You can ask Yahoo!'s CEO what kind of pressure can be brought to bare to make national security things happen BTW.)

I personally am as political as they come, but I'm not going to accept BTC which are on Mellon's list because I don't know if I can get rid of them without a loss.  I don't mind taking a loss on principle, but I want to know what the loss is going to be.  My point is that independently maintained blacklists will be very effective for reasons that have to do with generic economic principles.

Now that blacklists are implanted, it's just a matter of ratcheting up the things that trigger taint.

 - Starts with 'terrorism' and 'child exploitation.'  ('terrorism' includes Wikileaks of course.)

 - Next it's violent crime and drugs.

 - Next it's fraud.

 - etc.  I mean, who's going to stand up and say that fraud is OK?  It's a progressive 'frog in the pot' type operation.

Of course some people slip through the cracks, and that problem can be mitigated by using the sister 'identification authority' so blacklist any coins the don't have a known owner.

Now we get to the OP.  For legacy reason, older BTC stashes are not associated with an individual owner.  Solution is trivial:  Force a spend and blacklist BTC which don't move.

yeah, not the smartest idea here... it would be like breaking into a safe deposit box and stealing the contents if the owner hasn't signed in to check on them in a year.   As much as I get annoyed at the fact that 66% of bitcoins are held by 2% of the users, stealing the bitcoins from them would hurt crypto currencies as a whole... the solution will come from new currencies that are distributed more fairly with new technologies that I believe will eventually replace bitcoin or at least supplement bitcoin.

+1

I agree that fungibility is a huge issue (see my signature).  We must fight against anything that threatens the fungibility of Bitcoin otherwise Bitcoin will fail and another coin with built in mixing to taint all coins and make it impossible to even think about doing coin lists will prevail.

So I am going to suggest my own change/fork to Bitcoin:  automatic mixing of all coins in every block by protocol design change.  Then lists will not happen because lists will not work.

It's a very bad idea, but the problem of unused/lost coins IS a big problem. This just isn't a valid solution.


As someone said before, the price is a function of supply and demand. If the supply is unknown, price will be unknown and potentially volatile.

And as time goes on, more and more coins will be in that "unknown" state where we don't know if they are lost or just beings saved.

The more coins that are like that, the more uncertain what the real supply of bitcoin is.

And remember, eventually ALL bitcoins will be lost!

It's part of the design. This is stupid how everyone gives this discussion legitimacy when it's a total waste of space.

It's a good idea.  Our only hope, really, IMHO.  It would have to happen fairly soon though since the nature of the userbase is changing, and that rate of change could jump sharply.

For a variety of reasons, I'm actually not especially hopeful that this will happen, or happen quickly enough.  I'd planned to convert about half of my stash to some other asset at this juncture (based on my own profit level more than date) but the timings of my sales are associated with my level of pessimism regarding the evolutionary trajectory of Bitcoin.

The activities and methods of the Bitcoin Foundation have contributed significantly to my pessimism.

I agree.  Dark Wallet, coinjoin, zerocoin (perhaps), mixing services and other similar proposals will help.  The question though will become will any one be widely available before people start trying to blacklist in earnest.

The only problem is the active supply in use. Imagine that there was only one bitcoin actively traded, because all the rest of them were hoarded or lost. That one bitcoin would have long since been split into its basic satoshis, each of which would be worth a fortune. Perhaps some form of scripting would be applied to the clients that would make satoshi kids and grand-kids (dividing the satoshi), just so that there would be enough of that single bitcoin to go around the world.

Then, watch the bubble burst when 90% of the rest of the bitcoins come into action in one day. Never happen.

There is no problem with lost or hoarded bitcoins.

:)

I disagree.

1. Supply and demand works all by itself without intervention. In fact, intervention only creates problems. Just look at the dollar.

2. Knowing the number of spendable coins does not actually tell you enough about the supply. The "supply" is not a single value -- it is a curve, and knowing a single number doesn't tell you much about the curve.

3. We don't have a way to determine demand. Even if we did know the number of spendable coins, there is nothing we could do with that number.

You're just trying to increase your own value by decreasing others.  Why are you so selfish?

Good analogy. Please post it again when someone bring this topic up next time. :)

This issue has been discussed many times in the past.
But, I am sure, it will be brought up again and again :(

All you need to know for the 'supply' side of things, is to check the market depth on the exchanges. That is your 'supply'.

Supply isn't all of the coin that exists, it is all of the coin that people have put up to sell.

Exchange rate also isn't determined by how many coin are in existence.

=squeak=

So how much is your BTC there?

At the moment? around $780/coin, since that is where it is trading at, at the exchange I use.

=squeak=

This.
I moved my coins less than 10 times in a 12 month period. I have a lot of valuables in my house sitting there doing nothing, come destroy them too?

??? I don't understand this comment.

Eventually maybe in a thousand years. What he means is bitcoins get locked in certain scenarios. Here is an example or two:
1) Someone mistakenly sends his bitcoins to an unused address.
2) You forget your wallet password.
3) You lose your wallet.dat file.

and the list goes on..

I doubt all Bitcoins can be lost, because I dont believe Bitcoins can be here hundred years. Technology is going forward and Bitcoin is just start for decentralized cryptocurrency. For the same reason I dont believe microsoft OS will be here hundred years from now

The curve will approach a value well off of the 'ALL' line, and approach it in an asymptotic manner.

The eco-system will weed out people who should not be screwing with BTC through a process of 'survival of the fittest'.  I'm cool with that.  It was part of what appealed to me when I entered into it.

The more focus put on trying to hand-hold those who are not up to the task of owning BTC, the less is available for hardening the solution against attack.  Not only that but there is a correlation between the caliber of people who will throw their BTC out with an unwanted HDD and those who will throw them away using some on-line dice game or send them to TradeFortress.  That is, in fact, probably the biggest incentive to try to suck fools into the ecosystem in the first place.

Take a look at Freicoin ( http://freico.in/ ). Inactive coins are slowly flushed out. As are all others, which is probably not what you want, but it you might think it is a good idea after reading the Freicoin material.

A neat pair of advantages of Freicoin is that since all coins "rot" at the same rate, mining is always relevant even with the currency having a fixed supply cap, and also the blockchain can be pruned (i.e. it doesn't have to "grow forever" for most "full node" clients).

My opinion: NO

in case it is not clear: NO

What good is having a currency with its own time bomb attached to it?

=squeak=

I should point out that this idea, destroying old Bitcoins and creating new ones through mining, rewards and subsidizes those who are most able to sow destruction and maintain centralized control, ie. exactly our current banking system.

So basicly, what your sayin is that i can't invest into Bitcoin and keep it for my old age as retirement? You would just destroy it?!

+1  :D

Got to start early to get that early momentum going to carry you through to the awards show. :D

=squeak=

Does it matter if there are X or Y bitcoins in circulation

lol :P

and who's definition of "fairness" do you suggest it gets modelled by?

=squeak=

WHAT ??? if you dont use your bitcoins they will be destroyed ?! omg tell everybody!

OMG how can people get this wrong collectively. The suggestion would only require to confirm ownership every some years, not to spend them. This would be anonymous and will come anyway in a sense as soon as the current algos become unsafe.

Great.  Problem solved.  So can we stop worrying about it and move on to real problems now?

How can bitcoin be destroy ?

They aren't getting it wrong, they are just trying to concern troll their way towards a pump of some inflationary scamcoin-of-the-week.

i'm a frickin noob, and i can tell without a shadow of a doubt THAT DESTROYING COINS NOT IN USE is the dumbest answer possible.

i feel troll'd even responding to this.  >:(

yeah if everyone gets together and detroy there coins then is possible but since we know and feel like its gold that wont happen

When a coin is unused or lost it is not in circulation and therefore will increase the value of the rest of the coins due to scarcity.

I've wondered that too. What happens when people lose their passwords, their hard drives crash, etc? Bitcoins inevitably will be lost, and when that happens they can never be recovered right? Eventually, a large portion of the bitcoin blockchain could become unusable?

unneeded complication. the vitality of economy consists of whatever coin IS in use, thereby regulating itself.

That would a bad idea for some. How would feel if u just found ur lost btc keys only to find u cant use ur btc.