Alright. The key factors of this BIP have been improved and finalized.

The frequency of change is Every Block.
The Change will occur on block 315000 (Block count starting at 0)
The approximate percent decrease: 0.00031746 %

Over 100 years, the original will have approximately injected a few bitcents more than the proposed improvement.
However, these small details will be worked out during the implementation of the code. What's important is the amount injected
is approximately the same or a few satoshis less than the original.


Total Sum
     

Injection Rate

Again, all comments are appreciated and so far I've observed a lot emotional response.
That's ok. It's all part of reveling what it will take to get a well crafted IMPROVEMENT
adopted by the majority.

Posting Items on Bitmit. Then I send links to other forums with people that may have interest in those items.
I'll let my stuff go for cheap.

It's a grassroots effort. Always do something.
Just buy and hold is boring.
Buy bitcoins and then sell the idea to others.

Appreciate everyone's comments even if they totally disagree. I would like to continue to push to get this published in the WIKI BIP. Doesn't mean it will be adopted. I just want to make it an official record of what is possible and not possible with Bitcoin.
Before doing so, I would like to kindly request that you humor me and this BIP "as if" it was going to be adopted and help me nail down all 3 variables and hold off from commenting on its feasibility.

Please comment on the following:
1)Frequency
2)Block # of implementation
3)Percent decrease.

Also, what if we rounded the block reward after each decrease to four significant digits? Any thoughts.

Other request for help:
       Graphs of Bitcoin curve over time compared to the original.
       Graphs of the injection rate over time compared to the original.
       Psuedo code for the implementation.

Thanks again.

  BIP: ??
  Title: Gradual Changing Block Rewards
  Author: Slim Pickens
  Status: Draft
  Type: Standards Track
  Created: ??-??-2012
  Post-History: ??-??-2012

Abstract
This BIP proposes for block rewards to decrease more frequently.

Motivation
Every four years the block reward for bitcoin is cut in half. There is much uncertainty surrounding bitcoin prices and total network hashing power before and after these reward reductions. This author feels very confident that bitcoin will traverse its first block decrease with success; however, months before and after will be full of large price swings with a potentially modest decrease in global hash rate. Stability has yet to be one of Bitcoin’s virtues; yet, many hope (including the author) that this will change over time. The goal of this BIP is to avoid the frenzy in price fluctuations and global hash rate during these rare events by making them much more frequent with smaller decreases.

Specification
Block rewards will begin decreasing every two weeks starting at the end of the second year of the 25 BTC block reward (What’s the specific block number?). (Note: How frequent the changes are and when it goes into effect are open for debate). Unfortunately, this author is not into coding Bitcoin so the details of this BIPs implementation will rely on feedback from experienced Bitcoin programmers.

Variables:
•   Frequency of bitcoin decreases (Initial proposal is for every two weeks)
•   Date, more specifically the Block #, at which these smaller more frequent decreases take effect. (Initial proposal is for this BIP to take effect at the end of the second year of 25 BTC rewards)
•   The Percent of the decrease. Need to find a percentage that will in effect release the same amount of coins over the long term as the original block reward system.

Rationale
Two weeks were chosen for the frequency of decreases because it coincides with the difficulty adjustment. Seems like a good idea to do them together. However, this is not critical for the success of this BIP. Depending on the general consensus from the Bitcoin community and the simplicity of coding implementation, this may change.

The date for the change is proposed at the end of the second year of the 25 BTC block rewards. This gives the community 6 months to observe the market behavior of the initial block decrease and have a software implementation 18 months prior to the change going into effect. Again, depending on the general consensus from the Bitcoin community and the simplicity of coding implementation, this may change.

Based on Moore’s law and the history of computing innovation, it is commonly quoted as 18 months for computing power to double. 18 months should be enough time for miners to adjust their capital strategy before this BIP goes into effect. It will also give the community plenty of time to adopt the new code.

The implementation of this BIP would be a huge win for the bitcoin community. There are many articles written why Bitcoin is “fatally flawed”. They gloss over the fact that the brilliance and innovation of this new currency is in its decentralization and the fact that it is democratically governed. This system doesn’t have the flaws of other democratically governed bodies because there are no laws in effect that force anyone to use it. It is simply by free choice; therefore, no one would advocate changes to favor a few because it would self-destruct the currency. The implementation of this BIP would be a shining example that when problems arise the community will deal with it in way that will cause the currency to continue to excel. In other words, all supposed fatal issues are really non-issues. When the timing is right, mass consensus will be reached and they will be fixed.

Edit: 03/22/2012 ~~~~~~~~~~~~~~~~~ Comment added below ~~~~~~~~~~~~~~~~~~~
Appreciate everyone's comments even if they totally disagree. I would like to continue to push to get this published in the WIKI BIP. Doesn't mean it will be adopted. I just want to make it an official record of what is possible and not possible with Bitcoin.
Before doing so, I would like to kindly request that you humor me and this BIP "as if" it was going to be adopted and help me nail down all 3 variables and hold off from commenting on its feasibility.

Please comment on the following:
1)Frequency
2)Block # of implementation
3)Percent decrease.

Also, what if we rounded the block reward after each decrease to four significant digits? Any thoughts.

Other request for help:
       Graphs of Bitcoin curve over time compared to the original.
       Graphs of the injection rate over time compared to the original.
       Psuedo code for the implementation.

Thanks again.

Edit: 04/02/2012 ~~~~~~~~~~~~~~~~~ Comment added below ~~~~~~~~~~~~~~~~~~~

Alright. The key factors of this BIP have been improved and finalized.

The frequency of change is Every Block.
The Change will occur on block 315000 (Block count starting at 0)
The approximate percent decrease: 0.00031746 %

Over 100 years, the original will have approximately injected a few bitcents more than the proposed improvement.
However, these small details will be worked out during the implementation of the code. What's important is the amount injected
is approximately the same or a few satoshis less than the original.


Total Sum
     

Injection Rate

Again, all comments are appreciated and so far I've observed a lot emotional response.
That's ok. It's all part of reveling what it will take to get a well crafted IMPROVEMENT
adopted by the majority.

Still waiting for my single.
Get that delivered then lets talk.

For the rig box, I've been waiting to buy a 1/4 of one with another miner(s).
That's where I see it going for many.

How do you print the public key on the sticker?
Can each sticker be customized as to guarantee the customer where it came from?

For example, Let's say I made my own paper currency and used these stickers to secure the private keys.
Then my currency takes off because everyone trust that I, the issuer, is honest and will not still still
any bit coins; however, the con on the internet sees an opportunity to steal some coins and duplicates my stickers and currency.

Do these holographic stickers have a solution to this?
Maybe the only way is to spend the money to buy my very own stickers like casascius did.

I am interested to put $500 dollars towards the project to help get it off the ground.

My Offer still stands and I'm motivated.
"You can't sell trust" - How true that is. No way around it.
Would you continue the service for a time and allow all clients to decide if they want to trust the new owner or not?
That would also give me time to post about myself and what my plans are...assuming I'm the buyer.

My initial plans are to leave everything the same and simply work on security.
I want it to become one of the safest, securest, most trustworthy places on the NET where users can store bitcoins.
Once that is in place we'll see where we go from there.... I've got big dreams.

I'll go $1500. Can't say I have a solid reputation. I'm not one who likes to post that often, but I would be willing to post an entire profile of myself.

And yeah.... why would you shut down?

All the miners and those that hold bitcoins have a vested interest in making Bitcoin successful.
If this really is an issue, I believe it will become apparent to all before hitting a critical point of failure.
In that atmosphere, a general consensus on a good way to go will be reached.....and we'll move on.

There have been so many proposals for different peer-to-peer currencies and p2p currency improvements, but I believe Bitcoin already has all the best ingenuity that any system of this nature could ever have: it's decentralized and changes are made in democratic way. Everyone has their vote with fiat, bitcoins, and/or mining power. There will be issues, and when they arise then the time will be right for a fix and I believe a consensus will be reached rather quickly.

Bitcoin is successful now and I'm very confident in its future.
It may still be a niche currency, but it will still function as it was designed too... as a currency.

So, you bail if someone will not accept your tainted coins... or worse, they wait 'till  you send them before informing you the product or service you purchased will not be honored.
Now, on the flip side, would you accept bitcoins in payment if you clearly knew they were stolen?

This is nothing more than a new dynamic most of us have not thought through. Let's look at it in a positive way.
Sounds like a new service is needed where the community can watch where these coins go.
What someone or some service does with this information is entirely up to them.

how would you react if...
          you received 100% tainted coins from the source?
          or 100% tainted coins but jumped through a few addresses?
          50% tainted?
          10% tainted?
          <1% tainted?


Me personally, I wouldn't care the slightest once my coins are tainted less than 10%.

So, in real simple terms, what is the motive to create a P2P exchange?
The biggest bottlenecks right now are banks and payment processor. Recent events are good evidence of that (paxum, tradehill getting ripped off, banks freezing accounts without notice). If we rely on Dwolla, then there is still a central point of failure and it may reverse transactions (See there TOS).

I appreciate your work and your thoughts, but in my opinion, it appears to me you are trying to cut out the wrong man first (the exchange).
Figure out a way to do away with the banks and then you are talking seriously cool disruptive technology.

Thanks for the post. Couldn't agree more.
Its events like these that just confirms that Bitcoin technology is everything we ever dreamed it to be.

Thanks Inaba for the report!

I'll take a ghetto miner today over a pretty box tomorrow any day!
If it hashes and power is somewhat on target, there will be no complaining here.

I've been doing merged mining for some time and every 100 NMC I mine I change for BTC for the very reason of the OP.

If someone starts an official thread, I will commit some BTC as a bounty for the successful solution/implementation to this problem.

Interesting Thread. I find many perspectives very beneficial.

I'm very optimistic for the future of Bitcoin even with these sometimes undesired (but necessary) debates that could easily turn into mud slinging.
kudos to all that that have kept their cool and have genuinely sought the best actions for the future improvements.
Hope Luke and Gavin can find common ground in other areas of future Bitcoin improvements and move forward.

Based on Developer votes, BIP 16 looks like the leader so that is what I will support as a non developer.
As much as Luke dislikes BIP 16, I would hope he could endure whatever it is he finds objectionable and help make BIP 16 successful.

I really appreciated the thread Gavin started called "BIP 16/17 in laymen's terms"
Would someone please consider starting a thread that describes in laymen terms all the steps required to migrate the bitcoin community to a BIP 16 improved client?
I don't want to be left in the Dark - it would make me feel powerless to wake up one day and be told bitcoin is already bip 16 ready. In other words, where do I fit in as a non developer for this migration?

My other major concern is that BIP 16 has not been adequately tested. What is the game plan to put BIP 16 technology into action before the migration? It would be nice to experience its use for a period of time and know that many more programmers and developers had examined/improved the code.
It would be a huge black eye for a few core developers to rush a migration on something they "feel" is ready for prime time only to be followed with "let's revert back" and/or "here's an emergency fix" followed by "here's yet another emergency fix". Solidcoin anyone?

I'm more than willing to donate hashing power on a temporary bitcoin fork for testing purposes.

"You might be thinking of alt/scam coins, which can and do coexist"
Well, That's not they way I would personally say it, but ok.

Your post and interlagos are simply pointing out some of the technicals and obstacles that must be considered to make a fork possible and coexist - overcoming these are just a small part of what I was implying when I said "make Bitcoin fork friendly". Some things would need to be changed just like things need to be changed to utilize multi-signatures.

BTW, A fork is very similar to an "alt/scam" chain with one key difference: The coin holder before the fork will automatically own the same amount of coins in both chains.

Like I said before, a fork will happen. Don't know when - might be a decade, but it will happen.
Let's embrace and make it Fork friendly.

The intention of my post here in the BIP 16 / BIP 17 thread was to throw out some ideas and hopefully persuade a few bitcoin programmers to take up this crusade. No one interested? OK, moving on.

.......... Back to BIP 16 / BIP 17.
I don't have a problem supporting either one. Please make it happen. If there's a bug or problem down the road.. well, I'm confident it will be dealt with properly.

I understand what you are saying, but a fork in the Bitcoin chain is already in its future.
No matter how much complaining you or anyone else does, it's gonna happen.
My suggestion is that we should embrace it and help it, sure the learning curve on an already very difficult system to understand get a little higher, but the users will manage.

"Do you accept my bitcoins?  Oh, no, you accept the OTHER bitcoins?" and this is a problem because? This is where individuals have the opportunity to influence each other to support the best, most efficient system.

Lots of fear with my suggestion; do you really have a problem empowering people to make a different choice?

Just to be clear; I also have skin in the game. I mining on the bitcoin chain. I buy a few dollars of bitcoins everyday; yet, I'm not scared one bit!

This thread has been great. It appears that too many are trying to avoid the inevitable - that is, the forking of the bitcoin chain. When there's difference in opinion, well fork that chain please!

Gavin mentioned that the number 1 road block to alternate crypto-currencies being more successful was that of infrastructure (i.e. exchanges, block explorers, etc.).

It's my opinion that we should not be scared of competing currencies (also bitcoin forks) and that we should embrace it and hope for it.
Bitcoin is not just about decentralization, it is also about freedom. If we embrace freedom, this project will excel faster than anyone can imagine IMHO. Many of the fears for going this route stem from selfishness and greed, but also consider that there might be many newcomers to this technology that would not have done so otherwise.

So, the challenge would be to make bitcoin more fork friendly at all levels (exchanges, mining pools, clients, etc). That would be the first great step in Bitcoin's improvement and then all the other potentially great ideas out there would come into these crypto currencies at a much faster pace and I'd bet you would all be more the wealthier. Also, the  BIP 16 vs BIP 17 would quickly become a non-issue in my opionion.

Well. I have some skin in the game. I have two BFL singles ordered.
I also got overly ambitious and put a descent deposit towards a rig; however,
after coming to my senses (that was just too much of my investment money to put in all this bitcoin fun), I had second thoughts and kindly asked Sonny for a refund.
Well, my refund arrived today.

Just wanted to let the community know.
I understand the frustration with all their PR blunders and misrepresentations, but I wish them success and hope they learn from their mistakes.


Can't wait 'till these singles get here!

Gavin,
    This sounds like a nice feature. Thanks for your effort.
Will the fee structure change at all with a multi-sig transaction?
I'm hoping in the future the client will also support many different types of transactions that would appeal to other services than just money transactions. However, this would go beyond what Bitcoin's original intent was and will faten the block chain at a faster pace.
There are so many potential uses for a highly secure distributed database that's open to all -- it's amazing; however, these other services (transaction types) should have a steeper fee structure in my opionion (i.e. x10 the regular transaction fee cost for the last two weeks).

also, it would be nice if some of the fee was sent to a "black hole" (a dummy address); these bitcoins could give the programmers some breathing room if the time ever comes to restructure miner rewards after all the bitcoins are mined.

thanks for your consideration.