Hello everyone!
First, I love English but I'm not English; so forgive my messy sentences.
Second, sorry if this is too long... But I made images and a
tl;dr below!
And third, sorry if this is no white paper but I am not Satoshi or a PhD.
I am an ex-hikikomori who can only loosely hand-wave my way around.
Take this with a grain of salt. It's surely stupid nonsense, inapplicable.
Especially since I know little of the tech. Please ignore once that is settled.
You know I have to share just in case. Alright! It is an idea in 2 or 3 parts.
The first part I'd like people to consider is about stabilizing price per coin:
If demand (~price) changes by X% beyond volatility, we change the number of coins (~supply) by X%.
And we do that
directly in the wallets, through the ledger.
This stabilizes price per coin.
(Just knowing it can happen, greed acts as a stabilizer!)
I think it can be done as wallets hold keys to access coins from the network, not the coins themselves.
Number of coins is in the ledger, it is distributed, so we have control of supply as long as nodes agree. Don't we?
Imagine there were only 3 gold nuggets in the world, worth $100 each.
If you destroy one then they'd be around ~$150 each, as it becomes more rare for the same demand.
And if you create gold, then value decreases. Except we can't create gold as it has intrinsic value (it'd be creating value out of thin air).
But the value of Bitcoin is not in the coins, it's in the block chain and the nodes supporting it. We can create and remove coins as we please, and we can do it fairly.
It does mean removing the 21M supply cap; the elephant in the room holding Bitcoin back.
As there is more stuff to buy, we need more currency... For a stable price. It can't be helped!
Bitcoin can be volatile and scarce virtual gold,
or the stable currency of the world; not both.
Even the Nobel Prize says so. Bitcoin is valuable as it is,
but it could be even more valuable.
Well, it can have fixed supply, if it's not the currency but the 2nd block chain of what I'll explain.
Because we need a fixed supply for the 2nd block chain, as we'll see. But
not for the currency.
So the first point was turning price volatility into supply volatility... But there's a second point!
Don't do this for all wallets, as non-investing people would get upset when coins are removed, and there'd still be global hoarding.
We need the number of coins to add/remove to be proportional to your share of another block chain, and not proportional to the amount of currency you own; this kills hoarding.
Also, it makes sense that if the whole currency loses value,
someone has to take
some loss.
But we can give
liquidity to that risk... Through the owning of shares of that 2nd block chain.
By owning X% of it, X% of the generation/destruction required to stabilize goes through your wallet.
The money of normal people is then beyond a safety buffer: the money of investors.
They feel better about buying coins, or accepting it as payment.
Because as the 2nd ledger is public, and links stock-wallet to currency-wallet, they can know exactly by how much value they are protected.
Here are three use cases to explain my view, and for people to discuss and surely disagree:
A) Current Crypto system:"
I want to buy X, but if coin value increases by 2%, I could buy more later..."
I may buy but the probability I do is lowered by greed --slow economy.
B) Hypothetical supply-adjusting currency without the 2nd network: "
If I have 1000 and I expect a 2% increase in value, I should postpone buying til I get 20 generated currency. "
Not good --currency stagnates uselessly. This is not
saving to afford X. This is waiting for others to buy coins before using yours.
C) Now with this dual system:"
If I expect a 2% value increase, I buy shares if the price is worth the generated coins, or too bad / too late, I buy other stuff instead."
You see how that person decided to use currency even though he knew people will be buying coins soon... This is added value.
It happens because a rise of currency value is transferred to the stock coin's value, you don't benefit from owning the currency.
If you buy shares, then the person you traded with needed currency, unless trader; normal circulating money; it is not hoarding.
In the end: "
How much currency I have, had or will have is irrelevant... Might as well buy right now if I want to."
Basically, we split value in two parts: crypto-currency and "crypto-stock".
There is a lower bound of value at which investors go bankrupt and the currency loses stabilization mechanism.
But this can't be helped! There is no magic. I still think a currency with this stabilization would be very valuable. Don't you agree?
The core of the idea is: We have 2 block chains. We transfer value of one into the other.
We can because enough people own both. Total amount of value is the same.
But one part is stable, and the other acts like a stock with dividends.
We can imagine multiple coins linked to the stock thing one day, as something expensive is resilient to stabilizing something cheap.
The weak point is whether reducing supply would have a strong enough impact to raise the price properly. I don't know.
We will need owners of stock to correlate strongly with people selling currency on exchange.
But I think they would, as they are the source of supply.
Also the amount of value lost/created with coins has to be equal to the amount of value actually entering/leaving the market, to limit manipulation. It wouldn't be just about price but volume and all, or decided by economists maybe one day.
[Suggestions for the dry technical part: I wonder if we could fork the current block chain, give it a new name; it'd have same wallet addresses and keys but different client, and it'd evolve or be traded separately.
Then the nodes of the currency block chain would use price trackers, bitcoin-stock, and some smoothing formula to update currency wallets every X block appropriately.
At first, everyone would have as much share in both network, so they'd gain/lose value as usual. But then, they'd start trading their shares.
If an investor goes bankrupt (lacking the appropriate currency to destroy), he'd have to sell his shares, or he starts losing %.
Also a wallet created in one fork has to be created with the same address in the other, or it would be a mess.
Either that or we need to be able to store data in both ledger (address of corresponding wallet).
If we can do this fork thing, then current Bitcoin block chain would be bitcoin-stock.
Ideally we make a new client so there's no more mining Bitcoins, it's all fees.
If I own X%, it stays the same %... So I get back my loss if it rises from a dip.
And we multiply wallets to be at 21M already or a factor of 10 for easy math.
Multiplying would be a kind of transaction with no input/output, just amount.
While nodes verify the block is correct, they check transactions --this one too.]
Here are two pictures I made to better understand the general idea:
https://i.imgur.com/aC0u6xn.pngBut it is not enough to do that, you can't just give the option to be an investor freely, or they'd all flee when the price falls.
Being an investor has to be a real investment, which comes at a price. A price on the free market... Through a second coin.
https://i.imgur.com/IerJvk0.pngtl;dr:
Merchants and cautious people buy the currency not the share.
Investors/owners of shares win or lose currency appropriately.
But hoarding of the currency is useless, and the price is stable.
Well, stable as long as the investors can support it... No magic!
That's it. I'm guessing this is flawed, as there are many intelligent people/professional developers in the BTC community, I'm unlikely to be first to propose a good idea.
Sorry to be so lame, but as a lower class, lifelong social recluse, BTC donations are appreciated if (and only) this turns out to be more than nonsense and help crypto:
1thxd4KJLhBMcfCYaVKYMA8Atv3Dfx9hb
But I have a feeling it's a stupid idea and doesn't work, or it'd have already been done... I felt *eureka* when I had the idea but it'd be too simple if it was just that.
Sorry if I waste people's time... I'll delete and take the shame, but I have to share. I'm hoping that at least there are interesting bits to inspire more polished ideas.
There must be ways to work on the idea where we don't get value proportionally to the amount of current currency... It'd help, I think. Or maybe not, I don't know.
In any case, I encourage people to think about improvements!Because we are all the engineers of the future... Haha
Well... We try!
So please don't be mockful of my efforts... It's surely ridiculously wrong to some, but to me, it is the best of me. Took me loads of time, and I should be sleeping.
But what's important is that
we beat on, boats against the current... And try as we can (yes I did read it in English! Haha).
Thank you for your time, attention and consideration.
Goodbye!
