Removing old coin uncertainty

[Cubic Earth]

I think it could be helpful to remove some of the uncertainty around old coins, to see if they are truly lost or not.  This is an issue that is will never go away, and in fact will only grow more troubling as bitcoin grows in value.  My proposal is to pick a comfortably far off future date (maybe 1 year) and say that any coins on addresses that have been stagnant since some long-ago date (how about Jan. 1st, 2011?) would be removed from the money supply.

If you had coins on an old address, all you would need to do to protect your wealth would be to transfer them to a new address, or just send a single satoshi, before the future cut-off date.  This would be a one-time event that would require a hard fork and therefore a consensus of the community.

Every market thrives on information.  I would argue that large uncertainty about the amount of lost coins is hurting bitcoin adoption, especially its use as a store of value.  I think this proposal would help bitcoin adoption by providing a count of the number of controllable coins, and it would do so in a manner that would not unfairly penalize anyone. 

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[Liquid]

Not sure if i understand exactly what your saying but what if people want to leave there coins in a wallet for 10 years + without touching them, as a long term saving ? if you want to disturb or force peoples hands just because new comers are concerned about the subject this makes no sense to me, also the more coins that are "lost" increases Bitcoins value as there are less in circulation. 

[Cubic Earth]

In a sense this would force peoples hand to prove they were in control of their coins.  It would be an inconvenience, for myself included, but consider the 'newcomers' will 99.9% of the population.  If we make a reasonable concession to remove a large source of uncertainty about the bitcoin supply, it could actually benefit us early adopters more in the long run.

People could still have long term savings, but if those savings were older than month/day/year of the communities choosing, they would have to demonstrate they had control of that address.

I agree with you the more coins are lost, the higher bitcoin's value will be.  But currently there is no mechanism for knowing if coins have truly been lost or not unless they have been sent to the genesis block.  And I am not proposing a recurring process, but rather a one-time event that the community would agree to.  Of course it could happen again if in the future, if at any point the community reached consensus that it would be a good idea.

[Liquid]

I understand and agree to a degree on what you are saying, but IMO i don't think its a feasible/practical idea...

Its like this when a gold mine first opened up you had people mining like crazy all sorts of trouble and chaos people must have lost gold, moved on with it ect until one day only small amounts of gold were left, but still you had people going into the mine despite all the commotion and missing gold looking for anything they could salvage, I believe people will always come and join in no matter whats happened its never too late to join a party. The owners of the gold mine did not get together say OK all the people who mined from this mine we need proof that you own the gold and you are going to spend or trade it if you don't we will collect all the unclaimed / unspent gold and throw it back into the mine for other people to find. As you can see this is a pretty unrealistic foolish idea, there will always be uncertainty this is fact, but oh no lets reassess everything that happened and put it into some sort of recycled life cycle.

I think there are more pressing matters that need to be solved first.
 

[go1111111]

What about the guy who buys 10,000 bitcoins, goes off to live in a monastery in Tibet for a year, then comes back to find out that you destroyed all of his coins? 

Hard forks should in general make bitcoins less valuable because people will see that the community is overeager to change the rules on a whim.

[Stephen Gornick]

Every market thrives on information.  I would argue that large uncertainty about the amount of lost coins is hurting bitcoin adoption, especially its use as a store of value.

Is that really what your concern is?   Or is this the back-door you are looking at into allowing demurrage to get a foot in the door? (You wouldn't be the first).

[Birdy]

I can see your reasoning, but it could also destroy trust in the currency.
Aka "They have forced everyone to move their coins once, who is gonna say it won't happen again or that worse rules will be enforced in the future?"
Are the benefits worth it? I'm not so sure about that.

[CIYAM]

I think you'll find pretty much *no-one* is interested in this suggestion (it has been made *many* times before btw).

There are alt coins that behave exactly like this - I suggest you use one of those rather than try and convince everyone that something is wrong with BTC the way it was implemented.

[Abdussamad]

This has been proposed before and frankly it is stealing.

[Ekaros]

I'm not entirely sure, but I do feel that there would be some fear of someone hitting pot of 10k BTC in future.

Just think about how much that would mess up things in 100 years time or so...

I don't know if the situation is even fixable with bitcoin... Likely unless there is periodic resets it will always exist...

Either way, things don't look good from this perspective for bitcoin in very long run.

[Birdy]

I'm not entirely sure, but I do feel that there would be some fear of someone hitting pot of 10k BTC in future.

Just think about how much that would mess up things in 100 years time or so...

I don't know if the situation is even fixable with bitcoin... Likely unless there is periodic resets it will always exist...

Either way, things don't look good from this perspective for bitcoin in very long run.

If this is a bigger issue in 50 years, we could still do it then.
Atm it would most likely do more harm than good.

[Gabi]

NO

In case it is not clear: NO

That idiot idea has been "proposed" other times and everytime the answer is NO, it is a total idiocy.

Go and make CubicCoin and apply that "idea" there if you want.

[jubalix]

this really defeats the whole purpose of a store of value, you should be able to leave you coins anyway you want them for as long as you want. Anything less and you knock the foundation out of the whole thing.

[Abdussamad]

this really defeats the whole purpose of a store of value, you should be able to leave you coins anyway you want them for as long as you want. Anything less and you knock the foundation out of the whole thing.

Well yes and no. I don't agree with the OP's proposal but leaving your coins forever and ever is also not an option. At some point in time EC cryptography is going to be broken and then people will have to migrate their coins over to some thing else or loose them entirely.

[josephliton]

It is " The Uncertainty Principle".

[shuttleclock]

I don't think this is a good idea, and yea, frankly speaking, it means stealing people's money..

[DoomDumas]

No need to know how many coins have been lost.. What's the point ?  Why you think it's important to know about how many coins are lost/remaining ?

[Sukrim]

Because for example Satoshi holds more than ~10% of all Bitcoins. Or he has lost the keys already.

This is a large uncertainty factor, but on the other hand I think it would be far worse if someone could loose coins just because they did not read forums or log into the main client for a few years. There are coins out there that work just like Bitcoin with this "feature" added - if you think it is vital, please use these other currencies instead, they will over time overtake Bitcoin because they are superior because of that.

[tysat]

Rehash of a stupid idea... something like this will never go into effect.

[Nancarrow]

To the OP: as you surmised, this is a topic that comes up again and again. You can also see the reaction to it: a very few in favour, most opposed, with the opposition ranging from people who calmly state that it is not necessary, to people who shriek that you have an ulterior motive (or worse, quietly and slyly insinuate that you have an ulterior motive in the guise of 'just asking questions') or that you just want to steal bitcoins.

I'm one of the few who agree with you. Rather than repeat myself ad nauseam, I'll just link here: https://bitcointalk.org/index.php?topic=295011.

Short version: the only valid concern naysayers should have is that if such a change were adopted, some peeps might not get the memo, to which I have four responses:
1) Shouting about such a change from the rooftops, well in advance, big red letters on every piece of client software, and so on.
2) Recycling time should be sufficiently long that everyone has a chance to learn about it. But not long enough to forget all about it. Thinking 5-10 years is about right.
3) Wallet software can and probably should be made to generate new wallets and shovel the funds automatically.
4) If after all the above, somebody still manages to lose their coins through neglect... GOOD. That hypothetical person would be an imbecile.



ETA: and after reading the thread a bit more carefully, I see you're only proposing a one-time readjustment, not a continual reissue of the old coins. Well, so be it. I still agree with you, even though I now think you're not going far enough!

[Nancarrow]

No need to know how many coins have been lost.. What's the point ?  Why you think it's important to know about how many coins are lost/remaining ?

Every market thrives on information.  I would argue that large uncertainty about the amount of lost coins is hurting bitcoin adoption, especially its use as a store of value.  I think this proposal would help bitcoin adoption by providing a count of the number of controllable coins, and it would do so in a manner that would not unfairly penalize anyone.

[go1111111]

No need to know how many coins have been lost.. What's the point ?  Why you think it's important to know about how many coins are lost/remaining ?

Every market thrives on information.  I would argue that large uncertainty about the amount of lost coins is hurting bitcoin adoption, especially its use as a store of value.  I think this proposal would help bitcoin adoption by providing a count of the number of controllable coins, and it would do so in a manner that would not unfairly penalize anyone.

People who understand Bitcoin well enough to be uncertain about the lost coin situation aren't the type of people who are on the fence about adoption. Go ask 1000 people who haven't started using Bitcoin yet, and I bet no one will tell you that their sticking point is the lost coin issue. Either they won't know anything about Bitcoin, or they'll say "it's not backed by anything", "isn't that a pyramid scheme?", etc.

Restatement of the problem: Assume in the future lots of people hold a lot of their wealth in Bitcoin. Some previously inactive huge store of bitcoin comes onto the market, and the price of BTC falls 5%, hence the value of everyone's bitcoin holdings fall by 5%.

A couple reasons why this isn't a huge problem:

-Once bitcoin is mature, people will no longer need to hold large amounts of it for speculation purposes, the same way that wealthy people today don't generally hold huge amounts of cash. Anyone who has invested their wealth in stocks would be relatively protected. Bond contracts can be written so that payouts are inflation adjusted.

-If people are really concerned about this, companies will offer 'inflation insurance', removing your uncertainty about your own bitcoins value if new bitcoins come into the market. The price of this inflation insurance will reveal what the market thinks about this risk.

-As long as bitcoin is in its growth mode (i.e. until it takes over as the default world currency), any reduction in BTC value caused by coins that were assumed to be lost coming into the market will likely be negligible compared to forces stemming from speculation about Bitcoin's eventual level of success.

[alp]

Problem:  Coins are out of circulation.
Solution:  Remove those coins from circulation, along with anyone unfortunate enough not to move a wallet around.

Excellent proposal.

[zachcope]

I am usually quite polite but...

Fuck off with your stealing from the early adopters and miners.  

Seriously the whole point of bitcoin is that it is a neutral currency.

It doesn't care if it is sent from USA to Somalia; it doesn't care about bankrupt banks and governments wanting a bail out at the expense of pensioners; and it sure as he'll doesn't give a flying fuck about your opinions on the early adopters' coins.

If you want a currency that changes the rules frequently to suit those in power, or with the majority of power, there are a few hundred fiat currencies you can join.


/rant

OP - I am going to apologise in advance but feel it is would be useful for you to really consider the true advantages of bitcoin, then decide if you can support it. Many of the perceived disadvantages and inflexibilities are in fact it's greatest strengths.
 

[Buffer Overflow]

But currently there is no mechanism for knowing if coins have truly been lost or not unless they have been sent to the genesis block.

Coins sent to the genesis block are not lost. Only the 50BTC block reward from the first coinbase transaction cannot be spent.

[Syke]

I think it could be helpful to remove some of the uncertainty around old coins, to see if they are truly lost or not.

[go1111111]

-Once bitcoin is mature, people will no longer need to hold large amounts of it for speculation purposes, the same way that wealthy people today don't generally hold huge amounts of cash.

I realized I was wrong about this. If Bitcoin was the default world currency, holding large quantities of bitcoin would be similar to holding a fixed percentage of global wealth. It would basically be the simplest way to hold a "world wealth index fund." It's fundamentally different from holding cash in that respect, and therefore much more attractive than holding cash.

[theonewhowaskazu]

What does this have to do with anything?

If BTC goes up in value and old coins are removed from circulation then BTC goes up more. Problem? Not really.

[Cubic Earth]

Fuck off with your stealing from the early adopters and miners. 

Seriously the whole point of bitcoin is that it is a neutral currency.

It doesn't care if it is sent from USA to Somalia; it doesn't care about bankrupt banks and governments wanting a bail out at the expense of pensioners; and it sure as he'll doesn't give a flying fuck about your opinions on the early adopters' coins.

If you want a currency that changes the rules frequently to suit those in power, or with the majority of power, there are a few hundred fiat currencies you can join.

Bitcoin's rule have changed and will change again.  The only question is, what kind of client do YOU run?  Yep, it doesn't even take a majority, it just takes two computers to fork.  Even considering mainstream bitcoin and the supermajority of users, there have been and will be hard forks.

I don't know why you think this would be a change to 'suit those in power'.  Do you think I am in power?  But a rule change to suit the majority or super majority or bitcoin users?  Of course!  This is open software.

And, where did you see that I was interested in targeting early adopters?  The dates I gave were hypothetical.  My only target is coins that have been lost forever.  How can you steal something that belongs to no one?

What does this have to do with anything?

If BTC goes up in value and old coins are removed from circulation then BTC goes up more. Problem? Not really.

Several of you have asked this, or suggested that it is not my business. My answer is that the size of the money supply is everyones business.  There have been many threads on these forums that have touted bitcoins ability to survive deflation by pointing out that even just one coin would be sufficient to run the world economy thanks to the magic of moving the decimal place to the right.  Lets say in the future this is the case, that between the years 2140 and 2150, only one bitcoin in total is in active circulation.  It seems that the other 20,999,999 BTC have been lost.  Then all of a sudden, Satoshi's addresses become active, showing that the usable monetary base is 1,000,000x larger than people thought.

Well yes and no. I don't agree with the OP's proposal but leaving your coins forever and ever is also not an option. At some point in time EC cryptography is going to be broken and then people will have to migrate their coins over to some thing else or loose them entirely.

I think that people will always need to stay on the ball and keep up with the world if they want to preserve there wealth.  This includes knowing about laws, finance, wars, culture, technology, etc.  What if the cryptography gets broken?  Of course we can agree to add new encryption to bitcoin so that it remains usable, but what about the previously lost coins?  Will they just be open to plunder and reintroduced into the supply?  Or will the community make a decision to block all of the coins that have not migrated to the new crypto by a certain date?

I'm not entirely sure, but I do feel that there would be some fear of someone hitting pot of 10k BTC in future.

Just think about how much that would mess up things in 100 years time or so...

I don't know if the situation is even fixable with bitcoin... Likely unless there is periodic resets it will always exist...

Either way, things don't look good from this perspective for bitcoin in very long run.

If this is a bigger issue in 50 years, we could still do it then.
Atm it would most likely do more harm than good.

I am very sympathetic to idea that this may do more harm than good at the moment.  And yes, it could still be done at any point in the future.  Bitcoin can die either because it is not managed at all, or because it is managed poorly.  Some people think Bitcoin should never be managed and just left alone.  I can certainly see the appeal in this.  Good for those folks that they can keep running bitcoind 8.5 forever and it will never change.

The rest of the community will adopt sensible innovations and management as they see fit.  Bitcoin is powerful not because it will never change, but because the ability to make changes rest in the hands of its users.

[Sukrim]

Well, copyright laws for example deal with the idea that there is wealth in something immaterial that needs to be saved + preserved and can be inherited.

If you want a time frame after which it would be OK to either redistribute or invalidate coins, I'd recommend looking at the time frames a book is still protected under copyright, even if the author used a pseudonym or is otherwise unknown. This is not in the range of months or years, rather in decades!

Something like reclaiming coins after 100 years (or 25 block reward changes...) after their last move might be an option - you would not live to see it in action though. Anything below that is VERY short sighted and again there are alternative coins out there that do this and that you can use right now instead of Bitcoin.

[Syke]

Several of you have asked this, or suggested that it is not my business. My answer is that the size of the money supply is everyones business. 

Do you own my bitcoins or do I? What I do with my bitcoins is none of your business. If I want to have them sit untouched in a cold wallet for 40 years until my grandkids are old enough to manage them theirselves, then that's what I'll do and I'll fight you trying to steal them from me till the day I die.

[DeathAndTaxes]

No. Didn't your mom tell you stealing is wrong?

What part of don't violate the social contract is hard to understand?

If people like the OP had their way this would be a future ad for Bitcoin.

Bitcoin never worry about fraud again.  Transactions are irreversible*

*Except when we aribtarily and unilaterially decided to steal your coins.  We are in control of your money so you have no recourse

Maybe the "new-Bitcoin" slogan can be "Bitcoin because its worse than a bank".

[theonewhowaskazu]

@Op,

Looks like a job for timetostartyetanotherretardedaltcoin man!

[jl2012]

That would be okay if we started with this rule at the very beginning. You may start an alt-coin with this feature but that won't be bitcoin. We had rule changes in bitcoin, but only technical, not economical.

[theonewhowaskazu]

You may start an alt-coin with this feature but that won't be bitcoin. We had rule changes in bitcoin, but only technical, not economical.

Damn I can call this shit

[Trongersoll]

I think it would be better to leave Bitcoin just as it is and stop trying to come up with ways to steal from others.

[justusranvier]

I think it would be better to leave Bitcoin just as it is and stop trying to come up with ways to steal from others.

The wanna-be thieves will never give up.

This topic comes up about every six months, as soon as they think there are enough newbies around who they might fool this time around.

[Cubic Earth]

Do you all realize this idea would need a hard fork to implement?  Do realize that participation on a new fork is voluntary?  Do you therefore understand that no one can or will steal your bitcoins?  If you don't like a new fork (call it an alt-coin if you will), don't participate.

[theonewhowaskazu]

Do you all realize this idea would need a hard fork to implement?  Do realize that participation on a new fork is voluntary?  Do you therefore understand that no one can or will steal your bitcoins?  If you don't like a new fork (call it an alt-coin if you will), don't participate.

Stealing is stealing, even if it is by 'majority vote.' Hence why the Bitcoin protocol should never be changed to modify the owner/value of coins.

If 60% of the population voted to forcibly confiscate & redistribute the wealth of the other 40% of the population, you think that wouldn't be theft?

[Cubic Earth]

Stealing is stealing, even if it is by 'majority vote.' Hence why the Bitcoin protocol should never be changed to modify the owner/value of coins.

If 60% of the population voted to forcibly confiscate & redistribute the wealth of the other 40% of the population, you think that wouldn't be theft?

If you are using the current version of bitcoin, you can keep using it.  It wouldn't matter if 99% of people decided to use a different version, no one could or would steal your coins, no matter what changes the different version contained.

Now, if you are complaining because 99% of people decide they don't want your coins, and hence, they become almost worthless, well I'm *not* going to let that bother me.

Stealing is one thing, and it is foul; accusing people of stealing (or wanting to steal) just for valuing an asset differently than you might is another, and, also foul.

*edited because I forgot the word *not*

[gmaxwell]

I agree that supply uncertainty is a concern and a mistake in the original system. It isn't clear to me that it can be resolved without causing greater damage, since the inviolability of our promises is even more important— if Bitcoin operates on mere popular whim it offers little more than the official currency of a democratic country.

What concerns me most in this space is the cryptographic break concern:  Lets imagine that at some point 90% of the coins are lost... no biggie, we just trade in smaller units. One small country costs 10 BTC, etc.  And then someone comes up with a way of breaking ECDSA and can suddenly recover hundreds of thousands of long lost coins and introduce them into circulation at will... perhaps many someones.

No cryptographer will claim that our current signature algorithm will be secure forever.  Bitcoin is forward adaptive and can gain new signature algorithims without a hard fork.  Non-lost coins should be migrated to new, more secure, signatures long before it's an issue.  But no one can move the lost coins so their reintroduction into circulation via cryptographic compromise could be uncontrolled and devastating to the Bitcoin economy.

The obvious fix for this is that any crypto upgrade would require coins to be moved after some suitable period... but as you've seen here, people are _very_ hostile to the idea.

I guess my thinking on this is that the idea that a system can be free from human intervention is a bit of an unrealistic fantasy, though one I frequently enjoy. A failure to intervene when doing so would be rational and necessary is also a kind of intervention, and the Bitcoin system may someday die from it. What does it matter if your coins are not "stolen" from you in the broadest possible sense if dogmatic adherence to that principle ultimately results in the coins being worthless?  Time will tell.

[Birdy]

@gmaxwell: another +1, well written
Reflex-screaming "thief!!" isn't a healthy discussion. There may be times when an intervention would be better than doing nothing. But it's not now.

[jratcliff63367]

I am of the opinion that a lot of the uncertainty can be resolved with statistical analysis of the blockchain.

It's a personal project I hope to spend more time on whenever I have some free time.

Here is what I would like to see.

A graph of stale coins that starts at 100% of all outstanding coins in January 1, 2013.  Then, each time coins associated with a particular address has any kind of a transaction then it is considered essentially 'alive' (no longer a zombie coin).  This graph would go down to land wherever we are at today (coins which haven't changed hands since prior to January 13, 2013).  It's important to note that if, say, a wallet address has a 1,000 coins in it then someone spends so much as 0.000001btc out of that wallet, it marks all 1,000 of those coins as 'alive'.  We are looking for wallet addresses which have been completely untouched since prior to January of this year.

You should then be able to do some statistics showing how many zombie wallets come to life over time and make some reasonable predictions about how many are likely to remain forever lost.

Are there lost/zombie coins after January 1 of this year?  Sure, some, but they are probably statistically insignificant compared to all of the lost coins back when they were essentially worthless and people didn't even bother keeping track of wallets.

My argument is this.  Any coins which existed prior to January 13, 2013 are potential zombie coins because they represent a massive multiplier value factor.  Most anyone who owned coins prior that date would have either sold them (to make a 10x profit) or possibly moved them to a newer wallet as a lot of wallet technology and discussion has evolved over this time period.

It would take an enormous amount of willpower not to sell coins which have become worth 10x or more what you originally paid for them or, at least, move them to a more secure wallet technology.

Realize too that I am not simply talking about coins which have been 'cashed out' for fiat; the simple act of moving coins from one wallet to another alone (even if it's a wallet owned by the same person) still shows that these coins are 'alive and well'.

Will we ever guess accurately what percentage of zombie coins are truly dead and which are just in deep storage waiting to come to life again?  I think using some statistical models showing how many come to life over time should allow us to make some informed speculation at least.  My personal guess is that majority of coins that have not changed wallets since prior to January 1, 2013 are likely completely dead/gone/lost destined never to come back to life.  By studying how many of them do rise from the dead, month to month, should give us a reasonable estimate of the rate at which zombie coins rise from the dead.

John

[Birdy]

Yes, a statistical analisys could probably give some insight.

Are there lost/zombie coins after January 1 of this year?  Sure, some, but they are probably statistically insignificant compared to all of the lost coins back when they were essentially worthless and people didn't even bother keeping track of wallets.

A lot of the bigger wallet addresses receive small amounts from other people (often with messages), guess you should try to filter that out.

[Cubic Earth]

Yes, a statistical analisys could probably give some insight.

Are there lost/zombie coins after January 1 of this year?  Sure, some, but they are probably statistically insignificant compared to all of the lost coins back when they were essentially worthless and people didn't even bother keeping track of wallets.

A lot of the bigger wallet addresses receive small amounts from other people (often with messages), guess you should try to filter that out.

Only when coins were *sent* from an address would that prove it was alive.  If significant amounts of coins were still being added to an address, that would suggest it was alive, and perhaps such variables could be included in the model.

John's idea is something I've had in mind as well.  The 10x increase is nothing though, we are already at 140,000x valuation increase from the penny days.

[jratcliff63367]

Yes, the cut-off date is somewhat arbitrary.  Once you have a script that can produce the graph you can try different cut-off dates easily enough.  Also, it's probably better to describe this as a search for dead wallets, not so much dead coins.  How many coins are in all of those wallets that have had zero transactions for a very, very, long time? Inquiring minds want to know.  The 'days destroyed' graph on blockchain really doesn't do much for me.

I just want to know how many dead wallets (and their sum-total coins) are still out there month to month and day to day.  That's a graph blockchain should have.

John

[theonewhowaskazu]

Stealing is stealing, even if it is by 'majority vote.' Hence why the Bitcoin protocol should never be changed to modify the owner/value of coins.

If 60% of the population voted to forcibly confiscate & redistribute the wealth of the other 40% of the population, you think that wouldn't be theft?

If you are using the current version of bitcoin, you can keep using it.  It wouldn't matter if 99% of people decided to use a different version, no one could or would steal your coins, no matter what changes the different version contained.

Now, if you are complaining because 99% of people decide they don't want your coins, and hence, they become almost worthless, well I'm *not* going to let that bother me.

Stealing is one thing, and it is foul; accusing people of stealing (or wanting to steal) just for valuing an asset differently than you might is another, and, also foul.

*edited because I forgot the word *not*

So, let me get this straight.

You're basically attempting to start some sort  of bizarre "movement" to try randomly get everybody to agree to not accept early adopter's coins? WTF? That's supposed to instill certainty? This has got to be the single dumbest thing I've heard on this forum ever. Period.

[justusranvier]

But no one can move the lost coins so their reintroduction into circulation via cryptographic compromise could be uncontrolled and devastating to the Bitcoin economy.

The effect will be underwhelming. The abandoned/lost bitcoins will not be found all at once and the miners who recover them aren't going to immediately turn around and spend the entire find the next day. By that time the economy will be large enough that it only causes a mild effect, if it's even noticeable at all.

Whether it's via some yet-unknown mathematical weakness or quantum computers that makes the private keys recoverable, it will only gradually become possible. So I imagine it will be done by investors combining their resources in order to build machines capable of doing it, much like present pool mining. Any old balances recovered this way will thus not go to a single entity but will get spread out among a large group of shareholders.

You still get too freaked out over the concept of a currency that nobody controls. It's not going to become a problem in practise - modern cryptographic algorithms don't go from no known weaknesses to being trivially broken overnight. There will be plenty of advance notice and bitcoin holders will adapt ahead of time. It will be priced in long before it happens.

[Syke]

I just want to know how many dead wallets (and their sum-total coins) are still out there month to month and day to day.  That's a graph blockchain should have.

It would be dead wrong. You might as well flip a coin to decide if a wallet is lost or not. It would probably be more accurate than using any sort of analysis you could come up with.

[BurtW]

Why another thread?  Why not just add on to one of the dozens and dozens of previous threads that have proposed exactly the same thing.

You can yammer about this all you want.  It is never going to happen.  Mostly because you are trying to fix something that is not broken.  There are many other more pressing real issues that are being worked on.

[Elwar]

I think it could be helpful to remove some of the uncertainty around old coins, to see if they are truly lost or not.  This is an issue that is will never go away, and in fact will only grow more troubling as bitcoin grows in value.  My proposal is to pick a comfortably far off future date (maybe 1 year) and say that any coins on addresses that have been stagnant since some long-ago date (how about Jan. 1st, 2011?) would be removed from the money supply.

If you had coins on an old address, all you would need to do to protect your wealth would be to transfer them to a new address, or just send a single satoshi, before the future cut-off date.  This would be a one-time event that would require a hard fork and therefore a consensus of the community.

Every market thrives on information.  I would argue that large uncertainty about the amount of lost coins is hurting bitcoin adoption, especially its use as a store of value.  I think this proposal would help bitcoin adoption by providing a count of the number of controllable coins, and it would do so in a manner that would not unfairly penalize anyone. 

Perhaps some therapy could help you with your old coin uncertainty.

[gmaxwell]

So, let me get this straight.
You're basically attempting to start some sort  of bizarre "movement" to try randomly get everybody to agree to not accept early adopter's coins? WTF? That's supposed to instill certainty? This has got to be the single dumbest thing I've heard on this forum ever. Period.

Shame on you.  Disagree, by all means— it's a controversial subject.  But at least understand what you're talking about. There is nothing about "early adopter's coins" in his commentary, he's suggesting a requirement that after a long notice period old coins need to move or will become unmovable. It has nothing to do with not accepting early adopter coins, though it would require people with those coins to move them once. If it was done the way he envisioned it working not a single person would lose access to their coins, though some people might be moderately inconvenienced. The effect of it is that ambiguity about how many actual coins exist would be substantially reduced. Maybe this is a terrible evil horrible idea, but at least complain about what he's actually suggesting and not some paranoid delusional parody of it.

But no one can move the lost coins so their reintroduction into circulation via cryptographic compromise could be uncontrolled and devastating to the Bitcoin economy.

The effect will be underwhelming. The abandoned/lost bitcoins will not be found all at once and the miners who recover them aren't going to immediately turn around and spend the entire find the next day. By that time the economy will be large enough that it only causes a mild effect, if it's even noticeable at all.

Whether it's via some yet-unknown mathematical weakness or quantum computers that makes the private keys recoverable, it will only gradually become possible.

Your speculation has higher entropy than my speculation.  Multi-collissions scale much much better than linearly. E.g. even with just the rho method only moderately more computation is required than the 2^128 operations expected to compromise a single ECDSA key to compromises almost all ECDSA keys on a particular curve.

Collision attacks (e.g. all known methods of discrete log solving) favor single large attackers, they are unlike mining is that the probability of success is not constant but goes up the more work they've done.

There will be plenty of advance notice and bitcoin holders will adapt ahead of time. It will be priced in long before it happens.

There will indeed be plenty of notice that a particular scheme is looking weak, and the non-lost coins will be moved... you could have easily been quoting me there on "modern cryptographic algorithms" but I think you're wrong when it comes to practical attacks: The reason we get advanced notice is generally from certificational weaknesses which don't translate into practical attacks. With MD5 collisions we went basically overnight from (I think) two known examples with sensible files existing in the world, to a tool that would produce them freely on my desktop— though we had many years of warning.  Bitcoin further complicates that with single coins being high value: How could an economy functioning on a few thousands BTC "price in" the sudden reintroduction of a single 111,000 BTC "lost coin"?

I don't see how any economy could price that in even if the reintroduction was relatively slow, whatever that would be it would constitute an enormous highly distorting value transfer from the entire economy to whomever operates those cracking devices.  I can't tell you exactly how people would deal with it— blacklisting those coins, or just abandoning Bitcoin— but I can pretty much promise that people will not just tolerate it if such a thing came to pass.

I am not saying that we couldn't absorb the reintroduction of lost coins _today_, I am saying that it's possible that they won't become recoverable until Bitcoin had deflated past any reasonable prospect of being able to accommodate absorbing them.  We might disagree on where that boundary would be, but I don't think you can convince me there there isn't a degree of deflation under which a point recovery of a single gigantic coin is basically a currency extinction event if permitted.

People who understand Bitcoin well enough to be uncertain about the lost coin situation aren't the type of people who are on the fence about adoption. Go ask 1000 people who haven't started using Bitcoin yet, and I bet no one will tell you that their sticking point is the lost coin issue. Either they won't know anything about Bitcoin, or they'll say "it's not backed by anything", "isn't that a pyramid scheme?", etc.

Uh. Dunno who you're talking to, but one of the number one things people say to me is "What happens once all the coins are lost, without inflation you'll eventually run out of coins!"  and then I explain that people can just trade in smaller and smaller increments (adjusting units as they go— millibitcoin etc) and I think about 50% of the time they respond "Hm! interesting!" and about the other 50% of the time they say "whoa whoa! what happens when someone finds grandmas old coins, they'd rule the world!"

(Of course, if you've got someone actually concerned about that, I suppose that it means you've already convinced them that Bitcoin will rule the world, even if its a bad thing... which is perhaps what you meant?)

[theonewhowaskazu]

Shame on you.  Disagree, by all means— it's a controversial subject.  But at least understand what you're talking about. There is nothing about "early adopter's coins" in his commentary, he's suggesting a requirement that after a long notice period old coins need to move or will become unmovable. It has nothing to do with not accepting early adopter coins, though it would require with those coins to move them once.  Maybe this is a terrible evil horrible idea, but at least complain about what he's actually suggesting and not some paranoid delusional parody of it. 

Now, if you are complaining because 99% of people decide they don't want your coins, and hence, they become almost worthless, well I'm *not* going to let that bother me.

He literally just said in his previous post that he doesn't have a problem with trying to make "my" old coins "almost worthless". I have no idea where YOU get you're "paranoid delusional parody" because I'm literally describing EXACTLY what he is proposing.

He wants to convince, 99% of people, that "old" coins are worthless and should not be accepted, because if they were this might cause "uncertainty", presumably in the price. What he's proposing is basically the same style of "money printing" theft Bitcoin is trying to protect against, only in reverse. Rather than trying to devalue other's currency to give yourself more of it, you're trying to destroy other people's currency to increase the value of your own.

[justusranvier]

Bitcoin further complicates that with single coins being high value: How could an economy functioning on a few thousands BTC "price in" the sudden reintroduction of a single 111,000 BTC "lost coin"?

It depends on the velocity of money at the time and how quickly they are spent. If somebody cracks an ancient private key that's equal to a substantial fraction of the previously circulating BTC supply nothing happens right away. It's only when they spend it that anything changes.

Given the risk of somebody suddenly owning decades worth of world economic output all of a sudden, I'd expect that once ancient weak key cracking approached feasibility large numbers of people (millions) would form a pools to crack them that would distribute the recovered bitcoins as dividends.

If it ever turned out to be a huge threat, then the people alive at that time would have a huge incentive to solve the problem.

[tvbcof]

... If it was done the way he envisioned it working not a single person would lose access to their coins, though some people might be moderately inconvenienced. ...

It would be much more than a moderate inconvenience for me.  I always thought it was dumb to have more than a certain relatively small number of coins assigned to a certain address.  Further, I thought it was dumb to have said addresses either easily accessible or accessible in a group. (*)  Tracking down and dealing with my stash in it's totality would be time consuming and difficult, and my methods were designed under a specific understanding of how the system worked.

(*)  "Ever noticed how anyone who drives slower than you is a retard and everyone who drives faster is crazy?"  Computer security is a lot like this

[phillipsjk]

I have a dead wallet because I am more paranoid than average about my computer security.

I still have the private key. Once I set up a secure computer, I plan to move those coins. So far they have been not moving for about 2 months.

1 year's notice is not nearly enough. I *might* agree with a 5 year time-frame suggested by another poster.

Keep in mind that Bitcoin may be declared illegal in your jurisdiction for a period of 10-15 years. Would you really want to risk jail-time (or the death penalty) just to move coins around every year?

[Trongersoll]

Uncertainty is good. Nothing is certain in this world.

[drawingthesun]

Not sure if this has been suggested yet, but how about a system where old coins evaporate over immense periods of time?

So after 100 years 0.1% of the unmoved coins start to evaporate and becomes miners fee.

If you don't want evaporated coins, move them at least once every 100 years. This means over a long enough time line we stick with 21 million coins.

Peoples mistakes (lost coins) become another incentive to mine. Note that only large time scales will be fair, this system takes hundreds of years to erode away even a bit of value.

But taking old coins completely within 100 years? Pure theft, plain and simple.

And 1 year? Whoa that is madness, 1 year is nothing.

[Cubic Earth]

He literally just said in his previous post that he doesn't have a problem with trying to make "my" old coins "almost worthless". I have no idea where YOU get you're "paranoid delusional parody" because I'm literally describing EXACTLY what he is proposing.

He wants to convince, 99% of people, that "old" coins are worthless and should not be accepted, because if they were this might cause "uncertainty", presumably in the price. What he's proposing is basically the same style of "money printing" theft Bitcoin is trying to protect against, only in reverse. Rather than trying to devalue other's currency to give yourself more of it, you're trying to destroy other people's currency to increase the value of your own.

What do you think we are all hear doing?  We have created a currency - Bitcoin - that is devaluing other currencies, and almost every person on these forums hopes that will happen. This is a free market of ideas.  Are we stealing from holders of U.S. Dollars and every other fiat currency?  That would seem to be conclusion your logic leads to.  Nobody is going to want dollars anymore if our grandest bitcoin dreams come true.  Someone is going to left holding the bag.  So whatever you are accusing me of doing to you, you are most certainly doing the same thing to many others.

So again, do you think someone who is trying to design a better currency than ones currently in existence is a thief?  It almost sounds from the tone of your comment that you think you have a right to hold value in bitcoin.  I think you have a right to run whatever kind of software code you, including bitcoin, and a right to hold bitcoins, but the value is conferred by others, by their own free will.  Although perhaps you believe people should be forced into using bitcoin?  I would see that as a greater injustice than our current system.

Furthermore, I knew I should have titled my post 'lost coin uncertainty', and if you had read my idea carefully, you have seen that is exactly what I am describing.  Old is the sense of 'not moved for a long time', not old in the sense of 'when were they mined'.

1 year's notice is not nearly enough. I *might* agree with a 5 year time-frame suggested by another poster.

As for the dates - I just made some up to illustrate my point.  Any timeframe the community could agree on would be fine.  The first date I picked, Jan 2011, had to do with how much the value has increased since then and hence the likely hood that a massive value of coins has been forgotten.  But that first date could be today, or next year.

If it ever turned out to be a huge threat, then the people alive at that time would have a huge incentive to solve the problem.

I agree with this.  But if people have a tendency to imagine threats long before they are real (as we are doing here), and let such knowledge influence their behavior ahead of time.  As time goes on, this problem that we are discussing now will only grow in severity.  It's clear from reading this thread that most of the current participants in the bitcoin community vehemently against this concept.  But I can guarantee you this will change, as new bitcoiners start asking questions about the money supply.  Lost coins aside, I think we all know there is a chance that people will move to a new currency that has less early adopter advantage.  In fact, I perceive that to be the single biggest risk to the value of my bitcoin holdings.  The network effect and the security of the miners is what keeps people in BTC.  Most newcomers certainly don't like the idea that some early folks have tens of thousands of coins that they got "for free".  Of course they weren't free, and they took a risk, saw the future, etc., I am not disputing that, but psychology is just as important as truth in a money system. 

If anything, this proposal seeks to alleviate those concerns of potential newcomers by demonstrating that there is not nearly as much money in the hands of the early adopters as they might fear, and it attempts to do so without depriving anyone of any coins that they control.

Honestly, if I had once had 50,000 coins, and I lost control of 45,000, I would be quite happy to see this idea implemented.  By proving that those 45,000 coins were in fact gone, I would increase the value of my remaining 5,000 coins be more than if people were just left guessing about the 45,000.

[giszmo]

Ok, as there is so much hatred towards the the OP:

I totally agree that unmoved coins should be removed. I disagree with the OP that this should be some singular event (I don't like singular or recurring events like the reward halfing) but it should be some rule like coins that did not move in 10 years are dead.

Yes, I gave bitcoins to friends and family and told them that they just should remember that it's called bitcoin and if in ten years they find the cd and have no clue what bitcoin is they should throw it away. Else, they would be rich. Well, guess what, they are all excited about their bitcoin holdings now and within 10 years they would not miss to move their coins, so I am not worried about people loosing their coins.
I think 10 years would be a reasonable amount of time and being introduced now, it shouldn't take effect before 2023 but I think we should do this because:

We will loose considerable mining capacities to people trying to crack those big addresses that don't move to the next more secure algorithm once the current ones become insecure.
The sins of the past where tons of dust is created will also get wiped out of the block chain once the nodes may forget about +10a transactions.
It is not stealing when people can at no costs keep their wealth as a client of that generation would automate the refresh and the transacitons would be for free as they would not be urgent and certainly qualify for zero fees. Miners not including those keep-alive transactions without a fee would be attacking bitcoin.

The down sides are:
Sending reduces the security by revealing the public key which is why you would better not continue using the address after refreshing it, which would be maybe sad for some vanity addresses that only collected and never spent coins but maybe a rule could be derived that would allow to keep addresses alive without revealing the public key.
Sending requires becoming active somehow and I guess this fact is what really pisses off people here. Hey, I bought a car and now you want to install a dead man switch that I have to press every minute? Yeah, I understand that but when the current algorithms become insecure it will become an issue and I am 100% sure that we will come to some such agreement at some point, so I would rather want it to be in place before it's urgent. Sure, if Satoshi is the GOV he will not want to move his coins never ever before the world agreed to use his coins but hey, in 10 years we most likely have ZeroCoin or something anonymous like that and even if not, it should be possible then to move the addresses without people knowing who did it.

[justusranvier]

If anything, this proposal seeks to alleviate those concerns of potential newcomers by demonstrating that there is not nearly as much money in the hands of the early adopters as they might fear, and it attempts to do so without depriving anyone of any coins that they control.

Bitcoin derives its value from the predetermined issuance rules, and the fact that possessing the appropriate private key is both necessary and sufficient to spend a UTXO.

Changing any of those things destroys the long term value of the currency.

[giszmo]

Honestly, if I had once had 50,000 coins, and I lost control of 45,000, I would be quite happy to see this idea implemented.  By proving that those 45,000 coins were in fact gone, I would increase the value of my remaining 5,000 coins be more than if people were just left guessing about the 45,000.

Hehe, I just defended your OP but I doubt this point a bit. People have bitcoins in truecrypt drives that they forgot the key for etc. and consider it extra save to care about recovering this data in some distant future when it became easy to recover passwords to a truecrypt drive but not easy to guess the private key to their bitcoins

[DeathAndTaxes]

If anything, this proposal seeks to alleviate those concerns of potential newcomers by demonstrating that there is not nearly as much money in the hands of the early adopters as they might fear, and it attempts to do so without depriving anyone of any coins that they control.

Bitcoin derives its value from the predetermined issuance rules, and the fact that possessing the appropriate private key is both necessary and sufficient to spend a UTXO.

Changing any of those things destroys the long term value of the currency.

This.  It is also why no major change will ever occur.

Bitcoin is a consensus system.  The certainty of the rules give it value.  You can call it faith if you want.  Someone buying a Bitcoin for $150 does so because they believe 1 BTC will be a better store of value then $150 will be.  If those rules are changed then Bitcoin will fail.   It doesn't matter that "10 years is long enough".  First of all according to who?   If it can be changed to 10 years it can be changed to 1 year, it can be changed to increase the money supply, it can be changed so governments can block unwanted transactions.

The first core change is likely the beginning of the end for Bitcoin.  There is a social contract.  The social contract is a promise to past and future users that things like "transactions are irreversible" will be honored.  The VALUE of Bitcoin comes from the contract and the faith users have in it.   Stealing coins after the fact violates that contract.  If you make an alt-coin which incorporates these ideas from day 1 it is one thing.  To do a bait and switch and change the rules after the fact is immoral and it will kill Bitcoin.  Luckily there will never be the widespead consensus to make such changes a reality.

[gmaxwell]

It would be much more than a moderate inconvenience for me.

Personally I think 1 year is insane.  5 or 10 and perhaps thats something which would be reasonable for some cryptocurrency to implement. I wasnt attempting to give the impression that I thought 1 year was a good trade-off.  Just trying to point out that the OP's motivation wasn't to take coins from anyone, his definition of sufficient time and notice being crazy is another matter.  

For better or worse I think we've already signed the suicide pact on this one. The gut reaction people have is just too violently negative and no amount of reason will get people through it... so even if you could prove that Bitcoin will die without such a fix (and its not clear that this is the case) then you'll only succeed in proving Bitcoin will die.

The first core change is likely the beginning of the end for Bitcoin.  There is a social contract.  The social contract is a promise to past and future users that things like "transactions are irreversible" will be honored.  The VALUE of Bitcoin comes from the contract and the faith users have in it.   Stealing coins after the fact violates that contract.  If you make an alt-coin which incorporates these ideas from day 1 it is one thing.  To do a bait and switch and change the rules after the fact is immoral and it will kill Bitcoin.  Luckily there will never be the widespead consensus to make such changes a reality.

As a high preacher of the philosophical school of thou-shall-not-fuxor-the-contract and the view that Bitcoin's existence as a mathmatical object as outside the influence of popular opinion as possible is what makes it worth having, I still do feel the urge to suggest a little caution with the width of your statements here.

Bitcoin in its exact form, as originally released, was worthless. Anyone could spend anyones coin. Anyone could pick an arbitrary block and slay it so that new nodes would ignore it and split the consensus. Anyone could crash all the nodes (in a dozen different ways). Anyone could create a block 1/32nd the size of the system maximum and cause the system to fragment. Anyone could create unbounded amounts of additional coin. All these flaws and more were in the original software, coded into the rules of the system.

If changing the software, at all, was Bitcoins death then Bitcoin never really existed. ... But clearly it does exist. These things were fixed, in 2010, 2011, 2012, and 2013.  I hope that this list never grows, but perhaps it will.  Will we put Bitcoin down and walk away because the software is a suicide pact which can never be changed at all. No.

Should our moral responsibility be to uphold the Bitcoin contract? Absolutely. Does that contract include every flaw and mistaken in the software? Clearly not— mankind simply does not have the engineering tools and talent to build it another way.  Where is the line?  Unclear. Reasonable people can disagree, and thus the taint of the influence of man.

I hope for Bitcoin's sake that serious life or death flaws will remain uncontroversial fixes... and that Bitcoin can survive a few changes here and there, as required, by a true consensus.  If it turns out that can't work, I have noting to offer as an alternative: a tyranny of a majority is certainly not what we signed up for.

If that is the case I think it will be truly sad, because I think such a failure of Bitcoin would salt the earth for a generation for the idea of a system whos trust is in math rather than man... but perhaps it will be. Time will tell.

[tvbcof]

It would be much more than a moderate inconvenience for me.

Personally I think 1 year is insane.  5 or 10 and perhaps thats something which would be reasonable for some cryptocurrency to implement. I wasnt attempting to give the impression that I thought 1 year was a good trade-off.  Just trying to point out that the OP's motivation wasn't to take coins from anyone, his definition of sufficient time and notice being crazy is another matter.  

For better or worse I think we've already signed the suicide pact on this one. The gut reaction people have is just too violently negative and no amount of reason will get people through it... so even if you could prove that Bitcoin will die without such a fix (and its not clear that this is the case) then you'll only succeed in proving Bitcoin will die.

Why the 'know the circulation with precision' itch makes people scratch is beyond me.  It does not seem to me to amount to much in the scheme of things.

OTOH, robbing minor values from addresses which hold tiny fractions for the purposes of re-basing and optimizing the block-chain (and that for the purposes of making full nodes more widely possible) seems like something I would favor.  I am sure that this would be seen (rightly) as an even more abusive violation of 'contract' or whatever.  Although it is an itch which makes me scratch myself raw I could not propose it.  I must lamentably accept that it is a fundamental operational feature which was not part of the original design so I'll resign myself to simply wishing it were.

Sure would be cool if Merkle pruning come into existence someday before the earth stops cooling though.  Some notion of that was in the whitepaper and was a sales pitch which worked on me to the extent that I understood it's goal.

[gmaxwell]

Why the 'know the circulation with precision' itch makes people scratch is beyond me.  It does not seem to me to amount to much in the scheme of things.

I think people are imagining just different scales of things.  Perhaps you think about the problem and imagine something like a 20% uncertainty in the true medium/long term supply of coins.  Someone else, looking at the same trends and facts may be imagining a world where there is a 99.99% uncertainty in the medium/long term supply of coins.

I hope that most people would find a lot more agreement if not for the speculation on what the future would look like... and if so, then should one of those futures come true deciding what (if anything) should be done about it would be easier.  Hope hope hope.

Sure would be cool if

We actually have something much more effective than whats described in the paper in Bitcoin-QT already. This is part of why 0.8 was so much faster than prior versions— it changed to doing all the validation against a separate maximally pruned data structure.  Some additional work is needed to make sure nodes can still be bootstrapped— that there still exist ample distributed copies of the historical data and that new nodes can find them— in a world where a lot of nodes are pruned... but the pruning itself is all there. You can, quite literally, go and delete all the old block files (past 288 blocks or so) and your node will run fine until a peer tries to bootstrap from you and fetches an old block (and then it will crash. ).

[Littleshop]

Funny how the topic is "Removing old  coin uncertainty" yet by these proposals we are doing just the opposite.

If you leave them alone (which we will) you are creating certainty. If you store your coins properly they will be safe and untouched for when you need them and outside forces will not change this.