In theory, it doesn't go to a small group of people, instead anybody who is doing open source development can get a share.

In practice, however, you might be right.

According to current rules, ~80% is supposed to go to projects which add value to DVC, and 10% to free form bounties.

I've asked about more concrete rules (like who is eligible) but got no answer.

Doesn't namecoin solve this problem?

Let's think about it...

On the one hand, some bad guys might be theoretically profit of LTC.

On the other hand, an average Joe with a GPU knows that LTC can be mined by average Joes like him, however BTC requires some expensive, highly specialized devices.

Won't Joe perceive LTC as a more democratic, open currency?

Note that Joe might not fully understand how ASICs work, he only knows that some highly specialized devices he doesn't understand are used to secure the network, and they are produced only by a handful of specialized companies. What if government is in this and it wants to control the currency?

I bet Joe would rather trust his GPU...

It is different from miner compensation point of view.


Early adopter incentive isn't that much different at start. For example, after 12 years we talk about 18.37M Bitcoins vs 31.5M "inflatacoins", so Bitcoins are only 71% more valuable.

After 20 years Bitcoins are 2.6 times more valuable.

If we are talking about return on investment with many zeros in it (e.g. buying bitcoins in October 2009 would give you ~16000 ROI now), 2x difference does not mean anything.

So I'd say early adopters would get absolutely insane profit in any case, it's just that finite money supply has religious meaning for some people.

(OK, we might say that with finite money supply "early adopter" period lasts longer. But we cannot really estimate it.)

There is a thing called "destructive fees", i.e. fees do not go to miners, they simply disappear. Destruction should cancel generation in theory.

How is it better then? It's more flexible. Miners do not have to charge fees to earn their living, instead they can affect activity. E.g. too many transactions -> larger fees -> more money is lost -> cost of money goes up -> overheating of economy is cancelled.


Bitcoin volatility is caused by investors who buy bitcoins believing that they are going to appreciate in future.

This simply wouldn't be the case with inflationary currency, people will only buy it to use it.


For example: Colored coins allow private companies to make their private currencies and peg them via open market operations. Of course, such currency is as reliable as backing company.

LOL, no. I mean that if I'll ever going to start an alt-chain, it will likely have constant generation or something like that.

I already mentioned all the desired features.


Largely inertia. People do not want to lose their savings due to new features being implemented.

But also constant generation can subsidize transaction costs.


Sure, but we just need reasonably stable value, not constantly increasing one.

My observations say otherwise.


Time haven't come yet, my friend. Also it needs features which Bitcoin doesn't have, not just another generation parameters.

Also Devcoin is more-or-less alive, so it can work, apparently.

Well, currently get-rich-quick is the strongest motivation.

But perhaps a bit later people will care more about other features.

Obviously it takes more than releasing another shitbrix currency, there needs to be a real innovation.

Also, devcoin is more-or-less alive even though it uses constant generation.

LTC still uses SHA-256 even though proof-of-work is based on scrypt:

 * transaction hashes are double SHA-256
 * scrypt itself uses SHA-256 on some steps

Yes, it's much more attractive to Austrian/libertarian types who cannot do the math.

However, I think that that community is relevant only for bootstrapping. Once people will get familiar with cryptocurrency concept it will be adopted by people who really don't give a fuck, they just want reasonable stable exchange rate.

And at that point things like security, scalability, cost of transactions, exchange rate stability and features would matter more than pseudo-Austrian appeal. In theory, at least.

So I believe other currencies do have a chance. Bitcoin is great for long-term store of value, but people might choose something else for day-to-day transactions.

Constant generation rate means that:

• there is less speculation; get-rich-quick and early-adopter bonus largely do not work in this case
• fees can be close to zero because miners are paid out of generation
• there is no reward-halving shock and uncertainty
• no theoretic woes like accidentally discovered wallet makes you richest person on planet

So I'd rather bet on it.

Yes. With colored coins you can create, say, 10000 tokens, e.g. FOO-USD or XYZ-SHARES, sell some of them on market, then buy them back etc.

We simply use Bitcoin ledger system for accounting of our tokens.


It is a problem only if you want to make self-regulating, decentralized mining system. There is no mining with colored coins, we simply use already existing coins.

There is, however, some research on making value of currency roughly matching energy costs of mining. (See Eltase2's Decrits and Encoin. I admit I don't quite understand how it is supposed to work...)



Well, current capitalization of devcoin is around $70,000, that's quite a bit above zero.


This is exactly how devcoin currently works: they are paying bounties mostly to projects which are supposed to increase price of devcoins.

The difference is that devcoin is more-or-less democratic and open.



Acceptable.

Here's your homework: suppose 50 coins are mined each block, forever.

What is inflation for year x?

Devcoin works exactly like Bitcoin except that miners have to send 90% of mining award to certain addresses.

Those addresses belong to people who do some important development and are chosen by devcoin community. So effectively people are paid for open source development out of miners' profit.

Since it can be merged mined miners are fine with that. The only problem is that somebody has to buy these coins on exchange to make them valuable.

So you expect many talented developers to jump onto your idea, but the thing is they are either working on their own ideas, or they work for $$$$$$.


This is what "colored coins" do (see my signature), and they work on top of any existing chain, no fork is required.

(Although we are contemplating "ripplecoin" which would be a perfect host of colored-coin-like thing.)

x) They know that design is half-assed, but it sort of works for now so they just don't care, hoping that in future problem will be solved.

Sunny King has no problems with communications and PR, he simply does not give a fuck.

Multi-signature is supported on protocol level for quite a while (from start?).

However, it is unusable without proper user interface and features supporting it.

I guess the main problem now is lack of transport: without signature transport we cannot make it work "automagically", and if it doesn't work automagically then neither merchants nor users want to use it.

I currently work on p2p exchange, and it requires pretty much same transport as needed for convenient mutlisig, so I'm going to implement it. Then it can be reused to make automagic, convenient multisig.

But first and foremost interest should come from merchant, service providers etc. If they want it to work then developers will add this feature to clients.

Otherwise we'll have this half-assed development where seemingly trivial feature is being developed for 1.5 years and is still not quite here.

OK, why the fuck it went from 0.06 to 0.08 recently?

He wants to hire programmers to make a cryptocurrency with some unusual features, likely more centralized and "faith-based".

I doubt that it will work since he is going to pay developers with this very currency. (Maybe like in devcoin?)

As far as I know only PPCoin is considerably different from Bitcoin, and Sunny King claims that development costs $100,000. So, good luck

Actually from what he wrote in edit it is apparent that he wants to make a separate currency "initialized" from bitcoin.

Difference between a fork and a separate currency is that spending money in fork will also spend it on bitcoin network, however spending separate currency won't affect your bitcoin wallet.