Bitcoin distribution

[N12]

I vote for option 2.

I don’t want to see all investments in Bitcoin (financial as well as psychological) vanish and would rather swallow having individuals with 375k BTC. Also, I would hate to see this thing happen every couple of years. You should be allowed to invest in Bitcoin as a store of value.

Perhaps a solution would be to make a Freicoin/Inflatacoin alternative and leave Bitcoin for savings/investments, much more like a commodity rather than a currency?

Anyway, my opinion is that it’s crazy to have 50% distributed in four years and 25% in two years, with only a very tiny fraction of humanity who has ever heard of the concept. The argument of an incentive is not valid, as 5% or even .5% promises the same riches if Bitcoin were to be successful – does it really matter if you have Billions or millions? I don’t think so.

http://upload.wikimedia.org/wikipedia/en/5/54/Total_bitcoins_over_time.png

[1714806458]

1714806458

[error]

I have no idea what you're even talking about.

[N12]

I’m talking about the allocation of Bitcoins over time: http://upload.wikimedia.org/wikipedia/en/5/54/Total_bitcoins_over_time.png

[Littleshop]

I’m talking about the allocation of Bitcoins over time: http://upload.wikimedia.org/wikipedia/en/5/54/Total_bitcoins_over_time.png

If you do not like bitcoin, do not use it!

[unfinishe]

As someone without a graphics card new enough to mine with or enough spare money to buy one, it can seem a little unfair. However, when I think about it, I can't think of any better way to distribute Bitcoin around that wouldn't be vulnerable to attack. Two thousand years ago, I could have complained that gold was unfairly distributed, but in the end, gold was secure and useful and that's what mattered. I use Bitcoins because they're secure and useful.

[N12]

I like Bitcoin in general, thank you. I even made a nice profit myself. Just trying to determine what the current Bitcoin userbase thinks of the curve of distribution.

However, when I think about it, I can't think of any better way to distribute Bitcoin around that wouldn't be vulnerable to attack.

You can easily choose another more flat curve though. I think the chosen one could turn out to be suboptimal if it hinders adoption.

Again, over 25% have been mined without any real media coverage. I feel this is orders of magnitudes too much for the needed incentive to bootstrap the economy with early adopters.

I understand why this has never really been discussed in 2008-2010 (who would say no?), but we’re seeing people questioning it now, even reputable members of this community who would profit from it.

[unfinishe]

You can easily choose another more flat curve though. I think the chosen one could turn out to be suboptimal if it hinders adoption.

That's true. I suppose the matter of the curve is a struggle to reach a balance between providing an crucial incentive for early adopters and keeping later adopters from being shut out of the market. As far as that goes, I hope that the curve won't discourage use (it certainly hasn't discouraged me), but I guess only time will tell.

Perhaps the fact that it is possible to trace the transaction history back will cause the disgruntled to value recently mined Bitcoins more than older ones...

[evoorhees]

There is absolutely nothing unfair, untoward, or unethical about any "unequal" distribution.

The idea of "distribution" in any free and voluntary market is irrelevant and frankly a silly topic of conversation.

Bitcoins are not "distributed," anyway. They are not allocated other than by completely voluntary production and trade. Producers are those who engage in processing and securing the Bitcoin network. Obviously, those who started doing so many months ago will have produced more than someone starting now. Should we also spend time discussing why it's unfair that water doesn't pump itself into our homes or that gravity adversely affects larger individuals?

IMHO - any talk of distribution in an open market environment is either borne of A) poor understanding of economic and natural principles, B) some collectivist notion of what constitutes "fairness for the hive" or C) thinly veiled jealousy. Usually it's a combination of the three.

[N12]

Then explain this. Further explain why so many people voted him up and agree. It is obvious that it is a barrier to people who would otherwise be interested in Bitcoin. I’m trying to find out how many and if it’s a real problem or not, but that’s not easy.

Bitcoin is the world’s first decentralized currency. 25% of its total supply has been mined without any mortal ever having heard about it. At least 1.8% of the total supply (375k BTC) is known to be in the hands of a single individual, and more of this kind are expected (Satoshi etc.). I fail to see an honest justification for this, fancy voluntaryist talk aside.

[unk]

The idea of "distribution" in any free and voluntary market is irrelevant and frankly a silly topic of conversation.

entering this debate against my better judgment, i'm compelled to ask: do you think everyone purchasing bitcoins is fully aware of the distribution of bitcoins and the potential effect of that distribution on their value? if not, is there a reason you don't care about that lack of knowledge, other than having accepted the circular abstraction that if someone makes a purchase they should be deemed to have acted on a full understanding of all the information available, even if it is unrealistic to assume they've accessed and processed that information?

in case a reality check is helpful, there's no body of contract law in the world that adopts such a strong notion of 'caveat emptor', and almost no businesspeople actually want a regime based on that notion, because it allows contracts that specifically violate their intent. i can't imagine most people expressing an extreme 'robber baron' or 'all sales must be deemed to be voluntary' view have any significant experience in business, negotiation, law, or anything else that involves pragmatic cost-benefit analyses rather than ideological derivation of political principles from outdated and hypothetical 'natural law'. anyone with any practical or academic experience with economics knows that perfect voluntariness is an untenable abstraction.

[Braden]

IMHO - any talk of distribution in an open market environment is either borne of A) poor understanding of economic and natural principles, B) some collectivist notion of what constitutes "fairness for the hive" or C) thinly veiled jealousy. Usually it's a combination of the three.

All that an open market ensures is a Pareto optimal resource allocation. To state that all Pareto optimal allocations are fair or ethical is an absurd assertion. As an example, a system in which everyone in the world worked as a slave for the benefit of one person could well be a Pareto optimal allocation.

[N12]

perfect voluntariness is an untenable abstraction.

Thanks, I fully agree with this.

As it stands, 50% of the world’s first decentralized currency will have been mined by the end of 2012. You may be happy as long as it’s all voluntary, but there might be lots of people who are struggling with the adoption of such a system. That’s why I ask. I want to know if this could turn out to be a problem in hindsight.

I take the current poll result as an indication that there is a broad consensus in this community, so perhaps I’m worrying too much.

[unk]

I take the current poll result as an indication that there is a broad consensus in this community, so perhaps I’m worrying too much.

we already knew that bitcoin was readily adopted by people in this forum, though!

(for what it's worth, the group of people here is as unrepresentative of humanity as any i've seen in any large message board anywhere.)

[phillipsjk]

I also voted for option 2.

Blitzboom, you are not really thinking long-term here. The slightly skewed initial distribution is probably not the only problem with Bitcoin. IMO, we should wait for Bitcoin to fail on its own before starting Bitcoin 2.0. The distribution of bitcoin is still in its early stages. less than 1/3 of the total number of bitcoins have been "mined".

Myself, I would make Bitcoin less deflationary by not tapering off the allotment to cap the number of bitcoins. To see the effect of dropping the number of coins generated per block, we have to wait a least until the first drop within about 2 more years.

In my opinion, Bitcoin will fail because computers are not secure enough to handle a crypto-currency yet. However, when that happens, there will be a demand for a better replacement. I think crypto-currency is a good, but revolutionary idea. If we wait for Bitcoin to be in crisis before deciding what to do for Bitcoin 2.0, we can learn from the mistakes of the first Bitcoin. With Bitcoin value dropping or non-existent, you will get a lot of buy-in from organizations experienced in mining; assuming everyone can agree on prudent improvements to the protocol/allotment.

Keep in mind that no matter what you do, the early adopters will still have an advantage, even in "Bitcoin 2.0".

[Horkabork]

I think the bitcoin distribution is all wrong and is patently unfair. Mainly, I am upset that I don't own more bitcoins, and so I'm blaming earlier adopters for having made bitcoins when they were easier to make, even if they were equivalently worth less US dollars when they earned them. I am enraged that I don't own a larger piece of the pie and that early adopters aren't freely giving me large amounts of their bitcoins.

I am blaming the system, even though the very thing that makes bitcoins hold value and be secure is what lead to this unfair distribution. To be more definitive: any distribution that does not specify me and people like me as the largest benefactors is an unfair distribution.

However, since I got into bitcoins before some other people, I think that the door of opportunity should be shut right after me and the value of bitcoins should inflate substantially right after I have decided to stop mining and buying bitcoins. I should get mine before these newer jackasses have a chance to earn them at any reasonable rate. That way, they'll have to buy bitcoins rather than easily earn them, making mine more valuable.

In short, the best distribution is one which rewards mainly me, and wealth should be distributed right around the timing of my own entry and my mining and investing habits so that I get the maximum possible piece of the pie, for no particular reason other than that I like myself better than anyone else and would really enjoy being rich, even at the detriment of others.

[casascius]

I voted for #1, because I meanwhile proposed what I think is a viable "Bitcoin 2.0" that respects the Bitcoins in "Bitcoin 1.0" and allows them to continue to circulate freely but allows users to voluntarily choose not to accept all of those easily-mined difficulty-one Bitcoins as being on par with ones that are mined today at difficulty 433000+.  And if that's not what the market wants, then at least gives an enhancement to the Bitcoins we know today.

http://forum.bitcoin.org/index.php?topic=10755

[Alex Beckenham]

I think the bitcoin distribution is all wrong...

Haha that's great horkabork, well worth the 30 millies I just sent you.

[unk]

In short, the best distribution is one which rewards mainly me, and wealth should be distributed right around the timing of my own entry and my mining and investing habits so that I get the maximum possible piece of the pie, for no particular reason other than that I like myself better than anyone else and would really enjoy being rich, even at the detriment of others.

when you assume that all action is selfish, you shouldn't be surprised that particular results follow 'logically'. but it doesn't mean they're correct.

i recently decided to disclose in another discussion that i mined 12000 early bitcoins and have not sold them. (there are various reasons for that that are not germane here.) indeed, i have never bought or sold a bitcoin in the current block chain. but i would vote #1 here given my view of what's best for the technology and, overall, for society. it is not out of a desire to be richer. so if nothing else, i'm a counterexample to your suggestion that the only motivation for alternative block chains is selfishness.

[error]

Oh, THIS again?

No, it's not fair. Life isn't fair. Get used to it.

[casascius]

Oh, THIS again?

No, it's not fair. Life isn't fair. Get used to it.

Hey, at least the community at large can do something to correct the injustice.  "Bitcoin 2.0" just might not suck after all.