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Author Topic: XCoin. The Inverse Brother  (Read 1900 times)
da2ce7
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October 15, 2010, 06:33:32 AM
 #1

Ok, I’m going to bite the bullet and explain what I have been thinking… To address, what I foresee as, a long-term weakness of the current bitcoin system.
Let me make this clear:
 “Monetary systems SHOULD be deflationary if the economy is growing.”
Now that is out of the way.  Kiss

I want to introduce a new coin.  I’ll call it an XCoin (or whatever), unlike bitcoins there is an infinite number of XCoins.  XCoin is the inverse brother to BitCoin.  For every block that is discovered, a XCoin is discovered.  Every time the rate of Bitcoins generated is halved, the number of XCoins generated per block is doubled. XCoins are very inflationary.
In 40 to 50 years the generation of bitcoins is going to become so slow, that compared to the entire worth of the currency, it is no longer going to be worth working hard for any coins.  Instead there needs to be other reasons to work for the next block... say, keeping the system alive and secure.  Currently there is no way to trade work done for the system (itself), this is what the XCoin dose, it allows people to both trade bitcoins, (that are deflationary) and xcoins (that are inflationary).  Because xcoins are inflationary, there is always going to be a preferred way of getting them… that is to generate more of them.
BitBanks, and investors, and everyone else can trade bitcoins can use xcoins to tell that who supports the bitcoin network.  This gives a value to keeping the network alive… and people can reward fairly based upon the work that is done.

This is no replacement to bitcoins, rather a useful currency that can be used to claim the ownership of work done to support the bitcoin network, a currency that always needs to be generated.
So in the future, you’ll have banks that will say, “To transfer X amount of bitcoins you must transfer Y amount of xcoins”

EDIT: Extra, I've explained it in relationship to transaction fees in post #4

EDIT2: I have had an idea extending the xcoin concept, to support untrusted transfers. http://bitcointalk.org/index.php?topic=1469.0

One off NP-Hard.
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FreeMoney
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October 15, 2010, 07:17:53 AM
 #2

The transaction fee takes care of it. Unless I'm missing your meaning.

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October 15, 2010, 09:46:18 AM
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That's a cute piece of lateral thinking there, da2ce7 :-)

It would be a good way to settle the "inflation vs. deflation" argument once and for all. Those who think monetary inflation is good and necessary are welcome to use XCoin. Those who want sound money will be happy to do without the inflation, and can use Bitcoin.
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October 15, 2010, 01:57:45 PM
 #4

Transaction frees and the so-called XCoin's would be complimentary, transaction fees take a small proportion of the transfer, and give it to the next included block.  This gives incentives to anyone who supports the network, providing the network is being used.  However they are one off and cannot be independently traded…

On the other hand, since an infinite amount of work will be done, coupled with that work recently done is more important that work done in the past, (question: is this correct?)  People who support the network will generate xcoin also, that will be available for trade (the transaction fees also for xcoin, directly proportional to the rate of xcoin generation), enables a mature market to put a (inflationary, on purpose), value on the work done.

So I think that both will be good, transaction fees, certainly serve a purpose and have a baseline incentive, however xcoins can make a market out of it.
For example, banks will be able to claim their support of the market, by showing how many xcoin’s they have… this is much harder to do with just won block count or transaction fees.

Question, what do you think? Is such a system superfluous, or could it hold a real purpose?

One off NP-Hard.
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