Bitcoin Forum

A controversial long-form appeared on Bitcoin Magazine:


OPINION
BITCOIN HODLERS NEED TO PULL THEIR WEIGHT TOO (https://bitcoinmagazine.com/technical/bitcoin-hodlers-need-to-pull-their-weight-too)


It goes on:


This proposal is so wrong in so many ways I don't even know where to start.

I will just post a quote I heard in Milano a long time ago, in a bitcoin meet-up with Saifedean Ammous:

This proposal is so wrong: it messes with protocol in so many wrong ways:

• Economic incentives
• Privacy Incentives
• Operational Risks
• Changing the protocol hinders the "store of value" proposal, which would be hindered by a change in the monetary properties of bitcoin.

Bitcoin protocols work just fine. Meeting with such a stupid proposal can wreck things in many unforeseen ways.
The sole idea of drying out the "dormant "address sounds like a communist quantitative easing on Bitcoin. We already have an ECB

Clearly, an April's fools on a wrong date.

I saw this yesterday and the idea totally sucks. Sounds like some bull shit, socialist political party policy, some kind of unrealised gains tax.

Bitcoin Magazine probably have some failing mining farm or something. This idea is a total no goer, it’s disgraceful to be honest, zero chance this goes ahead.

Without getting into the proposal itself, I believe that the quote above does have some merit. People who hold bitcoins receive some benefit from the security that is paid for entirely by the people who transact (once the subsidy goes to 0). It seems reasonable to me for holders to pay for that benefit in some manner that has yet to be determined.

The byline simply says “Bob” as the name of the author. For all we know, some shitcoiner could have come up with this proposal.

Some of the arguments in favor of a hodl fee are not that bad. This could be a way to clean up dust and deal with dormant coins whose private keys have long been lost. The problem I see is that this won’t actually help with the security budget because you would be putting more coins in circulation, which would cause the price of Bitcoin to go down. Hodling is part of what gives Bitcoin value and this would discourage that.

People shouldn’t be charged fees against their will or be coerced into using Bitcoin any specific way. That is what this comes down to and why this will never succeed.

Currently, holders pay for the benefit to them through inflation. Personally, I believe that this is the best way to implement a fee for holding bitcoins because it is the simplest and it is effective. However, it is going away as the subsidy goes to 0.

So, my proposal would be to continue the subsidy forever -- a so-called tail emission.

I don't know what the right amount is, and I doubt there is a right amount, but I would do something like 0.025% of the total bitcoins per year. I picked that number because it is very small and insubstantial, but it is not 0.

I'm sure the inflation-is-evil crowd would strongly object because inflation is evil.


There is no problem with dust and dormant coins.

Hodling is using Bitcoin, as well as spending and replacing.
By no means should the protocol incentivise one against the other only to preserve the "goodwill of the community".
Also, messing with the monetary system of Bitcoin weakens it beyond any imaginable term.
The value of bitcoin is that the code is law, and intoducing such a distotive fee, could hinder the "immutability" of the digital gold.

Holders are helping Bitcoin indirectly, they're the one who make Bitcoin price can reach $73K.

Even Bitcoin has a maximum supply, but if there are no demands, maximum supply is pointless. It's true that Bitcoin have many utilities compared to other coins, but people will use Bitcoin just as a "tool", without thinking about the price and the maximum supply.

It seems like the miners still haven't move on from a lot money they make when ordinals were attacking the network.

Miners are free to create a hard fork in which unmoved funds are bit by bit moved into the block reward. Let's call it Bitcoin Mine Mine Mine.
They'll find out soon enough :P

Whenever you think you've read all the possible nonsense, a new one always appears. This reminded me of a proposal by an environmental activist a few years ago who stated that everyone who owns Bitcoin should pay taxes because they are responsible for polluting the environment ::)

Exactly. Hodling is a use of Bitcoin with the costs paid by someone else.


I don't really agree, but I also think it is unlikely that the economics of Bitcoin will ever change.


Price is irrelevant. Bitcoin functions the same whatever the price.

I find it similar to the idea of the "spend your money since it will help the economy" mantra by the government. No! People should be free to use the money in whatever they want, whether it be for saving, hodling, trading, etc. So hodlers don't need to feed the miners, and let them self-regulate between hash power and profitability, coins from the block reward (subsidy + tx) should be enough to keep them running. And don't forget that people can't just keep hodling forever, they will cash out at some point and pay the fees.

By socialist governments. As it's been said it's the same idea as unrealized capital gains tax and other stupid things like that. But this is what awaits us. The ECB already imposed in the last decade a negative interest rate on banks that wanted to keep deposits there and even some banks did the same for large deposits.

I think they will gladly implement this when CBDCs are widely adopted. Don't you spend your money? I charge you an interest/tax/whatever you want to call it.

That a socialist politician proposes it, I am not surprised even if I don't agree with it, but applied to Bitcoin it is a nonsense similar to proposing a Bitcoin redistribution.

It because those people always try to be relevant and what they think that they always create a good idea without even thinking that they are doing to much and they take out the privacy or the rights of people to decide for their own on those proposals they made.

So crazy to think that they come up with this idea then think that what they plan is really good. That's why its better for people seek the capabilities of the politician they vote since if they always choose base on popularity then what they could get are those politicians which serves only for their own interest and not for people who vote them.

Also maybe they see that there's a lot of money on bitcoin industry maybe they also think about that since they can exploit people and gather a lot of money from this industry if they successfully succeed on their proposal to be implemented.

I will "start that for you". I've missed that "opinion", but, while I can understand that it's probably a paid article and also one controversial which can bring audience, a newspaper calling itself "Bitcoin Magazine" should not have posted that, because imho it shows that they either misunderstood what is bitcoin about (and I mean here the entire philosophy and also the ecosystem), either don't care. In both cases it's bad advertising for them as newspaper.

This would affect collectibles big time, while all the rest would only have to move their coins around every year when the fees are very low.
Then, what about the holders with small amounts, i.e. the vast majority of bitcoiners? Will they just move to altcoins just to not erode their stash of sats?

On the other hand, I trust the devs are not idiots, hence will not implement/merge such a crappy idea. Again, a big -1 to Bitcoin Magazine for accepting to publish that.

If this kind of article came from a blog that's anti-Bitcoin, it would have been easy to depict the essence of painting this kind of narrative but when you're getting this from a supposed Bitcoin newspaper magazine that has been bullshit about Bitcoin in all of her posts, it just goes to show how far they've missed it at this point in attempting to render a sort of smart analysis that's not giving at all or this is probably a paid advert from an anti Bitcoin source that's aimed at creating negative ripples on people's view about the idea that Bitcoin HODLers contribute nothing to the ecosystem.

First off, HODLers aren't just people that buy Bitcoin at a time and then leave it for years hoping it gets to a particular price and will have to pay compensation for those that causes the price of Bitcoin to pump up. Most HODLers buy and keep on buying and might even sell along the way which comes with using some part of thier holding for transaction fees which also plays its own role with regards to how Bitcoin becomes bullish with time.  Bitcoin transaction fee is an issue for some and if it gets more complicated that they have to pay for holding thier Bitcoin and still pay transaction fees while they intend selling a fraction of it, what then is the difference between Bitcoin and the centralized banking system and how do we expect that it will create a bullish effect in Bitcoin level of global adoption?

Let's just call this a rash and not well thought out theory

They can't really accept the fact someone can use their money as they wish and these people are so used to control us all the time now pissed off about not having an opportunity to get their hands on it so they are just spitting out their hate towards the decentralisation indirectly by pointing the fingers towards the HODLers.

If miners are not making profits then they are free to leave at any moment but I guess they still make money that's why the hash rate is on the rise over the time.

I read that lousy lump of horseshit and knew intuitively that it's just idiotic, illogical thinking without having to make a list of all the reasons.  Plain and simple, bitcoin was created as a form of money not dependent on banks or governments, and nobody should be suggesting that people shouldn't just save it if they want to.  Any sort of call for a 'fee' for HODLing is simply a call for taxation, and that goes against everything bitcoin stands for.

Jesus.


That's the truth, brother.  I was thinking of buying a few issues of that magazine in print (and might yet), but I'm not sure if they're always this retarded or if this is a one-off kind of opinion.  Damned if I'd support a publication that suggested taxing bitcoin holders.  My head-with-tin-foil-hat-atop is screaming GOVERNMENT PLANT.  But that's just me; feel free to be as paranoid as you wish.

do you tip for good service? if so then think of it like a tip. if not then why would you expect people you don't even know to store all your bitcoin for you until you get around to using them? i understand people don't like to be taxed but taxes are one of those inevitable things in life it seems...

If the person in question stored his coin in an exchange and the exchange so desires to task him, it's quite understandable in the general sense, and for most banks that I'm conversant with, they even pay you an interest for keeping your money with them.

When I learned about crypto as a starter, I was told that exchanges are almost the same as banks, and if that's the case,  if I decide to keep my Bitcoin in an exchange, it's supposed to yield interest which is what volatility has already offered. I get taxed when I move my money in and out of the bank and that is what I feel also happens when I store my Bitcoin in an exchange or a wallet and hold it for a given number of years. It's a two-sided privilege, even if it's through an exchange or cold storage that I keep my Bitcoin, both I and the exchange or storage also benefit from it uniquely. I benefit because I store my assets under an exchange or through a chosen wallet and they benefit because my presence as a major holder sends a strong validation about Bitcoin, the exchange, and or the wallet.

that's completely different than bitcoin though. the bank lends out your money and makes more of it. if they fail, you still get your money back. that's a fairy tale life. but when you get into something like bitcoin, no one is guaranteeing anything. except the blockchain. if you want your bitcoin maintained for you by the blockchain, but you don't want to pay anything for that. hmm. that's not going to end well.

Nothing is being "maintained" when you hold an old private key without moving any funds. If miners claim it's not worth mining anymore, they can quit. Others will gladly take their place. It's not as if there's shortage of miners.

Very ugly idea.

While the POS coins are going to reward its holders for staking their coins. The bank will share a bit of percentage of interest they earn from their depositors.

And bitcoin holders are going to be charged for a fee? If holders aren't working, the scarcity that holders provide is there which makes Bitcoin more valuable.

We've got fees for confirmation and they get it from mining, they're asking for more.  :-\

that type of mentality is probably not what bitcoin miners want to see. bitcoin miners would like to see people paying a periodic maintenance fee for storing their utxos. for example, every 5 years, you would need to pay a renewal fee for the utxo. or you could just spend the utxo. if someone is storing data on your behalf then they are doing some work for you whether you believe it or not.

it's a way to make bitcoin more sustainable. and more efficient. but of course, alot of people are the type who are always looking to time their transactions to pay the minimal possible fee. what do you think the chances are of someone like that being ok with having to pay anything extra ever?  :o

You do realize an UTXO with 546 sat takes up just as much mempool space as one with 100,000 Bitcoin, right?

Now tell me: what data are miners storing on my behalf? I can tell you: nothing! Miners don't store anything. All they get, is the next block from their pool. Maybe you should argue nodes should be paid, so I can spin up a million virtual nodes and get rich. No wait, I won't, because thousands of others will do the same.

Feel free to send all your Bitcoin to a new address on a regular basis, if that's what you think helps those poor miners (who earn $30 million per day).

if that's the case then bitcoin miners are missing out on a nice profit center. because someone sending a large amount of money really should be paying a larger transaction fee than someone sending a smaller amount. you could make the transaction fee a percentage of the amount being sent. one of those things that bitcoin got wrong...

i thought bitcoin miners were people who run nodes but also mine blocks. but if you're just running a node and not performing mining blocks then you're wasting your time and resources in my opinion. no one is paying you so why should you do it?

You're trolling again.

So you have no idea how a mining pool works.

nope not at all. look around you in the real world. money transfer services some of them do charge a percentage or they have a tiered structure where fees go up once you hit certain amounts. it makes sense that someone sending $1,000,000 can afford to pay more in a fee than someone only sending $100. that's what bitcoin miners are missing out on is that aspect of things. yes it should cost more to send more. simple as that.


maybe not. but i know how money transfer services work and how fees are levied. you are not going to send $10,000 with western union and pay the same fee as someone only sending $100. there's a good reason for that. the person sending $10,000 should and can be able to afford to pay more. it's common sense.

Bitcoin was created to break with the old financial world, not to reproduce it.

That's because there's a physical transaction involved. Securely shipping $10,000 to a remote location costs more than shipping $100. If you prefer to pay more for larger transactions, by all means, use Western Union.

yes but there are some financial principals that are best left intact. one of them being that the transaction fee needs to be based the value being transferred. Anything that ignores that is in trouble from the beginning. And it's just a matter of time...before problems pop up. That's my opinion anyhow.



it can be all electronic. but even in that case a larger transaction amount should pay more fees than a smaller one, in general. that is a solid design principal and any service that does not go by that rule is pretty much doomed to fail in one way or another. uniless it has some severe restrictions on usage.


imagine being a bitcoin miner and watching people send 10 bitcoins worth $600,000 and they only paid you a $5 fee. you're going to be thinking there is something that needs to be fixed so that you get paid more for processing these more important transactions. :o especially as your block reward keeps going down. either miners are the most noble people on the planet in that case or they are just dumb. or they have an opinion like mine.

I'll end this futile discussion by saying I trust Satoshi's vision a lot more than yours.

Imagine a Bitcoin miner mining empty blocks, and luckily someone wants to pay him $5. He'll take it. If he doesn't like it, he shouldn't be a Bitcoin miner. Just like you're not a Bitcoin miner.

This (crazy) idea is the opposite of PoS.

Who proposed this idea (anti-bitcoiners)  maybe he or she most have had a heavy hit on the head. Just as OP said lots of things are perceived wrongly and would be altered.

LoyceV also has a good thought there, if it would be possible to tax hodlers but that is still going to affect the bitcoin protocol.

Now it's balance  ;D

I guess half bread is better than none?

Wtf am i getting this right? I thought they were proposing a reward for the holders?

Is it the opposite?

Do the author want to tax the holders? Is he mad?

Anyway, we have survived Craig Wright, this retard is nothing compared to him.

It sounds just like someone wanting their 15 minutes of fame. And it's working.

that's not going to last though. in 25 years, the block reward goes down to 0.0476875 BTC. if bitcoin was $100,000 that would be $4768. not very much. so are you saying that if someone isn't ok with such a small amount then they shouldn't be a bitcoin miner? in order to have the same reward as they do today, bitcoin would have to shoot up in price to $3,200,000.

Actually, I thought it was some kind of Aprils fool article come to life out of season or bumped for some reason.

The most controversial thing I see about this so-called "proposal" is how it goes against some of the most basic definitions of what a coin or asset is. Regardless of the coin and asset, each individual is supposed to have the option to "save" in such asset.
Nobody is getting asked fees for keeping gold coins in their home or for having some money in their bank accounts. To me, it would seems this article was written by someone who genuinely feels Bitcoin is supposed to be moving in a different direction, like going to some kind of PoS, like Ethereum did, even though it has been already proven it would not be a popular change within the community. instead of trying to fix what is not broken, he should move onto a chain which satisfies his expectations on fees and "taxing".

there IS no analogy to that in bitcoin. not a perfect one. because people are having to store records about all your utxos and all their transaction histories too.  gold doesn't place any obligation on anyone else to store records if you "keep it at home".

bad analogy too. bank accounts go dormant after a certain period of time in which case they may begin charging fees and eventually deleting the entire bank account.

I have always stated that I prefer the money to be in circulation because if we hold money, nothing will be created. So I'm advocating for active Bitcoin usage instead of HODLing but I can't agree with the HODL fee proposal, that's simply stupid.

First of all, the HODL fee is against freedom and self-ownership. Even banks pay you % if you hold money, you get a reward by stacking ETH and why on earth should I pay a fee to hold Bitcoins? I think that by holding Bitcoins and not moving them constantly, I'm creating more space for those who are in a hurry to make a Bitcoin transaction and keep fees low. I think things have recently got too much miner-oriented and less user-oriented.

Also, if such a dramatic change is made, it means that Bitcoin is censored. It's curious that instead of increasing the block size, people think about charging people for holding Bitcoins.

Cant be too surprised at the suggestion because its quite close to the current ideas in the mainstream economy.  Obviously saving is greatly discouraged by current policies of the majority of central banks to target inflation at 2%.  If they had been able to stay at 2% it might be slightly more credible but its also true many countries had 10% inflation recently, its clear the policy is to constantly depreciate those holding or being paid in cash.

I dont think its a joke, they are probably serious in thinking the idea would raise monetary velocity in BTC and so the total net worth is likely to increase.   The problem is we already have instability in currency worldwide, bringing BTC in line with that is not going to be a positive.   I also hope for more active usage of BTC but I see that coming from natural growth in the population while also increasing the ease at which it can be used.  I think the idea also goes against how Satoshi setup BTC originally.

Bitcoin being in circulation instead of being held is fine, but we should also realize that it is not just "money" anymore, a lot of people think of it as asset as well. So the currency aspect of it makes it a lot more important to use it as a money that you need to earn by working (or doing a business) and spend it, whereas the asset aspect of it makes it valuable to keep on holding.

ach side has some good and bad parts, like for example if you spend it then circulation means adoption will increase a lot more, but it would also mean a lot of people will regret not holding whereas if you keep it then adoption will be very low but many people who hold it will get richer. There isn't really a right or wrong with this question.

This will just cause people to dump Bitcoin onto exchanges and send Bitcoin into a downward price spiral. In order for people to preserve their net worth in some other crypto. As HODLers will sell their coins to avoid the tax, exchanges too (and they will close down), businesses will stop supporting BTC because of this reason, even the tax that is paid to miners or whoever will be deprecated as a result and they will eventually quit.

So it's a terrible idea. Nobody likes paying any kind of tax, whether to the IRS or to random people.

Aside from the controversy, the article should remove the "technical" tag. Miner can't collect the HODL fee without destroying existing UTXO and creating new UTXO. But to spend the UTXO, you need to know the private key or spend script.


FWIW, all nodes also store all UTXO and some/all blockchain data, but they never got paid. And in practice, mining pool is the one who run full node and store all UTXO rather than miner.