A proposed solution to adjust for lost Bitcoins: wallet 'heartbeats'

[DeathAndTaxes]

This is a good idea.

Let's look at a scenario where we've got 20 people, each with about 10k bitcoins they've acquired over 10 years. These 20 people all happened to die in the next few years (car accidents, heart attacks, cancer, whatever). That is 200k bitcoins that are instantly taken out of circulation. With a continuing trend, over enough years bitcoins will fade out and the whole communities dreams of bitcoins replacing our current currency is destroyed. At this point in time, sure.. 200k doesn't seem like a lot when there are plenty to go around because they're still being generated. Once 21m coins are reached, the amount of "lost" or forgotten bitcoins will start to add up quickly.

Entire world economy could function using a handful of Bitcoins. 

There aren't 21M coins.  There are  21 quadrillion finite units (each worth 1E-8 BTC)  that's 2,100,000,000,000,000.

Total global money supply is ~$60T.  If entire world used Bitcoin as a one world currency then each satoshi would be worth ~3 cents.  Under any more realistic scenario a satoshi is worth a tiny fraction of a penny.  Even a 99% loss of coins would make a Satoshi sub 1 cent.

If due to deflation 1 satoshi ever became larger than the min unit necessary for commerce (for many countries that is ~$0.10 or $0.05) the number of sub units could be increased.  i.e. instead of min unit of 1E-8 it would be min unit = 1E-9 or 1E-12.

There is absolutely no reason to seize coins which haven't been used in a "while".  It is theft.  Pure and simple and worse it isn't even necessary.

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[Dusty]

There is absolutely no reason to seize coins which haven't been used in a "while".  It is theft.  Pure and simple and worse it isn't even necessary.

While I agree completely on your position and explanation (every quantity of money is sufficient and perfectly functional for a good economy), I do not agree that this can be considered "theft":

- refresh the deposity every 10 years (or every 1 million blocks, or whatever it is) is simlple to do by hand and completely automatable, so without any risk of "theft"

- reclaim of lost bitcoins must be made from miners, and so it needs a lot of work for it, and this gives them incentive to mine. So this enables to have less transaction fees.

[DeathAndTaxes]

There is absolutely no reason to seize coins which haven't been used in a "while".  It is theft.  Pure and simple and worse it isn't even necessary.

While I agree completely on your position and explanation (every quantity of money is sufficient and perfectly functional for a good economy), I do not agree that this can be considered "theft":

- refresh the deposity every 10 years (or every 1 million blocks, or whatever it is) is simlple to do by hand and completely automatable, so without any risk of "theft"

- reclaim of lost bitcoins must be made from miners, and so it needs a lot of work for it, and this gives them incentive to mine. So this enables to have less transaction fees.

It doesn't matter how easy it is to avoid theft, taking/confiscating property without due process is theft.

You have no RIGHT to the property of others.  Period.  If someone makes a deterministic wallet based on a passphrase and then say gets sent to prison for 30 years you should have a right to their personal property because they didn't use it?

Confiscation of property without due process is theft.  I don't care if it is 1 year or 10,000 years.   Worse it is theft that isn't necessary.  Users should have confidence that coins they acquire are theirs and theirs alone without exception.

[Dusty]

If someone wants to make a deterministic wallet based on a passphrase and then say gets sent to prison for 30 years you believe you have a right to his/her property just because they didn't use those funds in last decade.

Ok, you make a point here.

I agree.

[Therilith]

I think the OP has a point. There might very well be a problem, and no matter how we end up solving it, we should have some solution ready.

(If you intend to post in this freshly resurrected thread, please read the whole thing first. The potential problem being discussed isn't entirely clear in the first few pages.)

IT IS THEFT.  PERIOD.   Confiscation of property without due process is theft.  I don't care if it is 1 year or 10,000 years.

Not if the currency is designed to work that way. It depends on how set in stone you think the Bitcoin rules are at this point. The answer, I'd imagine, is "very". Still, you can't just decide that the particular cryptographically secured tokens that make up this experimental new type of currency constitute property in the "You wouldn't steal a car" sense.

"Theft", by the way? By who? Is the open source accounting project governed by a group of software developers and majority consent that you decided to participate in knowing that that's how decisions were made robbing you?

If someone wants to make a deterministic wallet based on a passphrase and then say gets sent to prison for 30 years you believe you have a right to his/her property just because they didn't use those funds in last decade.

Prisoners don't have access to computers?



You mention "due process". Is Blizzard taking away my +5 Sword of Swordery because I forgot to anoint it with orc spleens last Thursday theft? Why not? Because of the EULA? What if Bitcoin had a similar "we are not responsible for whatever happens to your money as a result of changes to the protocol adopted by means of majority consent" agreement? Would that change your opinion (of the "theft" aspect, at least)?

If you want to get really technical, they're not taking your money. You are free to stay on the old chain with everybody else who thinks the new rules are bad.
Don't get me wrong, I think implementing some sort of stale coin expiration should be a last resort. A big, red "use only if absolutely necessary and with the consent of a significant majority (which is the only way it could possibly be implemented anyway)" button.
Would it be theft, though? Absolutely not. No more than the government reclaiming a plot of land from somebody who's been missing for the last 100 years.

[DeathAndTaxes]

There might very well be a problem, and no matter how we end up solving it, we should have some solution ready.

It isn't a problem, it will never be a problem.  The entire global economy could function on 1 BTC.

Confiscating property is theft.  You don't own anything on Blizzard's servers.  Those conditions are made perfectly clear.  Anything you do on their servers remains their property.  If you don't agree then you can choose to not use Blizzard's products.

Not if the currency is designed to work that way. It depends on how set in stone you think the Bitcoin rules are at this point. The answer, I'd imagine, is "very"

But it wasn't designed to work that way.  Bitcoin was designed to be IRREVERSIBLE.  This isn't a minor protocol technicality it is a cornerstone of the entire social contract between participants.  Bitcoin tx can never be reversed.

To later change the rules and such a fundamental rule was irreversibility is immoral.   Taking the property of another is theft.  Now it may (and likely) isn't a crime but that would only be due to lack of legal precedent on Bitcoins.  We should be arguing for further reinforcement (Socially, politically, legally) that Bitcoins are property and subject to the same legal protections are other property.

If Bitcoins aren't property then Mt.Gox (or any other entity) has a right to simply take all the funds deposited with them without legal or financial consequence.  Is that the road you want to go down to "solve" a problem which has never and will never exist?

[DeepBit]

I think the OP has a point. There might very well be a problem, and no matter how we end up solving it, we should have some solution ready.

There are no problems with lost coins. And there will be no problems with it.

IT IS THEFT.  PERIOD.   Confiscation of property without due process is theft.  I don't care if it is 1 year or 10,000 years.

Not if the currency is designed to work that way

This currency is designed to work fine even if 90-99% of coins are lost.

If someone wants to make a deterministic wallet based on a passphrase and then say gets sent to prison for 30 years you believe you have a right to his/her property just because they didn't use those funds in last decade.

Prisoners don't have access to computers?

Looks like you are living in a very strange country :)
Average prisoner don't have even a phone, decent food or good healthcare.

You are free to stay on the old chain with everybody else who thinks the new rules are bad.

Yes, I hope this change will never win the "voting" :)

No more than the government reclaiming a plot of land from somebody who's been missing for the last 100 years.

In many parts of the world leaving "lost" land as is may me bad, but no one will be hurt by "lost" bitcoins.

[kjj]

This currency is designed to work fine even if 90-99.9999999999999999999999999999999% of coins are lost.

Fixed that for you.  If every single BTC already mined was lost today, the currency would still work just fine.  In 200 years, long after the subsidy was done, even if only a single satoshi remained, the currency would still work.

Bitcoin uses a scaled integer representation.  We can change the scale factor to renormalize, if needed.  We will almost certainly do it to match future CPUs many decades before we need to do it for economic reasons.

[RodeoX]

What difference does it make how many bitcoins there are or how many are lost? And as mentioned before what if the bitcoins are just offline?
The overwhelming majority of mine are NEVER online and may remain so for 20 years. I would be awful pissed if one day I cashed some out, only to find they have been given to someone else because it was thought they were lost. It would be like someone re-selling my certificated stocks or bearer  bonds because no one knew where they were.
No thank you, lost means lost.

[SgtSpike]

Another thought:  What about just increasing the mining reward based on coins that haven't moved, but without destroying those old coins either?

For each coin that hasn't moved in 10 years, generate a new coin with the next block for the miners.  Have it be a rolling 10 year period.  And to prevent inflation, if adding more coins would bring the total number of coins that HAVE been used in the last 10 years up above 21 million, then don't add more coins.

Example:
- Joe loses a 20 BTC wallet in 2012.
- Jan loses a 30 BTC wallet in 2012.
- Jack loses a 10 BTC wallet in 2013.
- 10 years later, in 2022, a block is generated, and the mining reward for that block is 20 + normal reward.
- A mining reward of 30 BTC is also generated in 2022 for Jan's lost wallet.
- In 2022, Jan finds an old backup of her 30 BTC wallet.  She spends the coins.
- In 2023, no additional mining reward is given for the lost 10 BTC wallet, since the current coins circulated in the last 10 years is more than 21M (well, this would be assuming that all 21M coins have been generated, but still, you get the point).

So, it wouldn't ever cause much inflation of BTC beyond 21M, but it would help prevent deflation from lost coins.  I know some of you don't think deflation is a bad thing, but I do.  An ideal currency would be neither deflationary nor inflationary.

[Therilith]

It isn't a problem, it will never be a problem.  The entire global economy could function on 1 BTC.

There are no problems with lost coins. And there will be no problems with it.

This currency is designed to work fine even if 90-99% of coins are lost.

Holy hell, did either of you actually read the rest of the thread?
To quote the wise and benevolent Therilith:

(If you intend to post in this freshly resurrected thread, please read the whole thing first. The potential problem being discussed isn't entirely clear in the first few pages.)

Say it with me:
THIS HAS NOTHING TO DO WITH LOST COINS CAUSING PROBLEMS SIMPLY BY BEING LOST. DIVISIBILITY DOES NOT SOLVE THE PROBLEM DISCUSSED IN THE JUNE 2011 PART OF THIS THREAD (y'know, the one I was referring to when I mentioned the OP)!

Prisoners don't have access to computers?

Looks like you are living in a very strange country
Average prisoner don't have even a phone, decent food or good healthcare.

And I'm the one living in a strange country?

No more than the government reclaiming a plot of land from somebody who's been missing for the last 100 years.

In many parts of the world leaving "lost" land as is may me bad, but no one will be hurt by "lost" bitcoins.

Or will they? Find out in the first part of this thread. The answer may surprise you.



Let's make sure we're on the same page here:
If you disagree with me, please describe the problem you think I'm talking about.
I'm not asking for a detailed analysis, just a few sentences describing it.

[Realpra]

Ok so the problem with instability in case a wallet is found:

My theory goes like this; if some number of BTC are in circulation, some percentage will be lost due to various human and software errors.

If the value of BTC go down, more coins will be lost as people become more careless with them.


If we set the block reward to a certain amount forever, then the value would eventually stabilize; if it drops in value more are lost and if it rises less is lost and thus more accumulated - assuming steady state economy; the value may stay high in a growing economy.

Of course this poses a problem in that many like BTC specifically because it will never inflate:
Even if people loose coins, if you keep creating them people will at some point begin to generate lost addresses with coins on them.


There is also another point to consider: How to distinguish between "treasure" addresses and a rich guy? Impossible.

A final thing; the dump may not be as catastrophic as could be feared - while it may pose a big chunk of total value it may not be a big chunk of the total transaction volume.


Anyway if it becomes a problem I think future users should solve it, not us - likely by raising the block reward to a permanent 1 satoshi.

[DeepBit]

Prisoners don't have access to computers?

Looks like you are living in a very strange country :)
Average prisoner don't have even a phone, decent food or good healthcare.

And I'm the one living in a strange country?

Yes. I'm talking about average prisoners. This may be not a good thing, but that's how it works now. SOME may have it, but most don't.
And remember that it's a punishment, not a vacation.

Let's make sure we're on the same page here:
If you disagree with me, please describe the problem you think I'm talking about.
I'm not asking for a detailed analysis, just a few sentences describing it.

You are possibly talking about the situation when lost wallet is found when BTC price become many times higher.

[Therilith]

Let's make sure we're on the same page here:
If you disagree with me, please describe the problem you think I'm talking about.
I'm not asking for a detailed analysis, just a few sentences describing it.

You are possibly talking about the situation when lost wallet is found when BTC price become many times higher.

Pretty much. Or, to be more specific, a situation where the entire economy (pretty unlikely, but the problem would still be there with less than 100% adoption) is running on some relatively small part of the "original" 21m BTC (let's say 100,000) and somebody finds an old wallet containing 50,000 BTC from the olden days.
This would not only cause a huge mess if it happened, the very fact that it might happen could prevent Bitcoin from catching on.

You haven't really addressed that specific problem.

And remember that it's a punishment, not a vacation.

Decent healthcare and some contact with the outside world would hardly make it a vacation.

[cunicula]

Pretty much. Or, to be more specific, a situation where the entire economy (pretty unlikely, but the problem would still be there with less than 100% adoption) is running on some relatively small part of the "original" 21m BTC (let's say 100,000) and somebody finds an old wallet containing 50,000 BTC from the olden days.
This would not only cause a huge mess if it happened, the very fact that it might happen could prevent Bitcoin from catching on.

你开玩笑吧。这样很黄很暴力的笑话是不应该的。

[Therilith]

你开玩笑吧。这样很黄很暴力的笑话是不应该的。

Nyyn iv onea v Ohyyreola ine rgg Vyyhzvangvrkcrevzrag.

[cunicula]

你开玩笑吧。这样很黄很暴力的笑话是不应该的。

Nyyn iv onea v Ohyyreola

Sorry, I don't understand 'Scandanavian'.  I wrote "you must be joking. This type of very pornographic and very violent joke should not be made." I assumed that you would understand Chinese based on the "very pornographic very violent" next to your name. More seriously, making these points...., you must be joking, right?

[Therilith]

I assumed that you would understand Chinese based on the "very pornographic very violent" next to your name.

Nah, it became a pretty famous internet meme a few years ago.

More seriously, making these points...., you must be joking, right?

Do you have an objection to the points I've made? If so, feel free to post it.
Keep in mind though that the numbers in my post were just examples.

[cunicula]

I assumed that you would understand Chinese based on the "very pornographic very violent" next to your name.

Nah, it became a pretty famous internet meme a few years ago.

More seriously, making these points...., you must be joking, right?

Do you have an objection to the points I've made? If so, feel free to post it.
Keep in mind though that the numbers in my post were just examples.

I have no objection. It is certainly possible (though highly improbable) for the scenario you describe to occur.
It just seems to me to be a very strange thing to be worried about, so I wanted to know if you were joking or not. Now I know.

[Gabi]

Voting no at all.

Seriously people, stop trying to mess with people savings. We want bitcoin because it give us sovereignty on money, and you propose to happily remove that exact thing? No.