Sorry for bumping the thread after almost two mounths, but you know that I want to participate in all demurrage related threads (there aren't that many).
@ chodpaba and relative
Although miners could agree and make it happen (like they're going to do in namecoin soon to allow merged mining), a change in the protocol (not only the official client) would be needed.
built-in devaluation as is proposed here is just an "honest" form of inflation, i.e. you don't see the value of your money decrease, but you actually see your money decrease.
there isnt much difference, acceptance-wise.
Yes there is, because people know that this currency will lost value if they hold it so they will just drop it until nobody accepts it. The only way for an inflationary currency to work is impose it using violence. But please, start your own currency and prove me wrong.
There's difference or not between demurrage and inflation?
Your claim would be more accurate if you say "The only way a medium of exchange that doesn't perform well the storage of wealth function can be accepted is to be enforced legal tender". Because demurrage and inflation are not the same thing and you want to include both.
There's many proofs of the falseness of this claim working today as medium of exchange. You didn't proved wrong even the goldsmith counter-example.
And just out of curiosity, if the bitcoin protocol changed to include demurrage, would you sell your coins back for your national currency or would you prefer to exchange if for good and services?
If you had an internet business would you reject freicoins even if some service like bit-pay can turn them into bitcoins for you?
OK, so I'll generate a new receiving address every day. You don't know the age of my wallet, all you can know is the age of the receiving addresses. You don't even have any idea what receiving addresses belong to my wallet. And even if you did know the age of my wallet and all of the receiving addresses inside of it, I can always just generate a brand new wallet whenever I wanted.
The balance of an address is calculated adding the amount of each output sent to that address. To apply demurrage, you just need to substract the storage fee from each output since the block number they appear in the chain.
@Sukrim and Vladimir
With merged mining there's no point in a 50/50 battle. If the majority of bitcoin miners want the change it will be done, if not, I new chain must be started.
I personally find much easier and likely the later option.
By the time anyone implements this xenon481 will likely have enough hashing power to confirm his own transactions if he chooses to wait for them. The system you propose ensures there will be an elite that will not have to pay the demurrage that everyone else pays, in fact, they will probably agree to mutually exclude themselves from the tax.
Miners can't avoid demurrage. It's in the protocol, their blocks would be rejected just like if a miner tries to send 60 btc from a 50 btc balance public key.
Why hold bitcons when they devalue in time, when you can hold gold or silver. Its fucking retarded.
To exchange with them?
They can still hoard the gold to store value.
However, I always believe that a non-deflationary currency will always be at an economic disadvantage to the deflationary one. As the deflationary currency will be more attractive. Upon market saturation... the change of the fixed amount currencies value will be in DIRECT RELATIONSHIP with the change of the total economy size... This is extremely healthy, as only very profitable ventures will get money.
Yes, with deflation only the very most profitable business will be funded, but that's beyond competition, that's elitism.
With stable prices some more business with lower profitability (but still with profits) can operate.
With lower interest rates (yes, I know how bad this sound here) even more investments can take place.
Inflation based currencies (esp debt based ones), create an artificial demand for growth. Causing most of the world's problems... unsustainable growth is unsustainable. Only linear growth can be sustainable. Exponential growth, will always end in disaster.
The proposed currency is neither inflationary nor based on debt. It's pure cash like bitcoin because it is scarce.
I must say have nothing against credit based moneys. In fact I advocate for LETS and Ripple.
But they lack the quality of our financial system that makes the growth of debt unavoidable, which is interest.
Interest is what Gesell wanted to eliminate in the first place (no, not risk premium).
Now you will say "low interest are bad, that's what Bernanke does, it leads to miss-allocation of capital".
But are low interests the problem or the means to achieve those low interest?
Do low interests lead to malinvestments without inflation?
Sure we should start a new chain, but let's just use praxeology to prove Gesell's theory on interest right or wrong.