Is there merit to a fixed supply increase rather than fixed supply cap?

[o_e_l_e_o]

-snip-

Your entire analogy is flawed because the banana is not being made bigger. It is the same size, but being cut in to smaller pieces. If you add three more decimals to bitcoin, you have not increased the cap by 1000x. The new smallest units are a thousand times smaller then the old smallest units. There is the exact same amount of bitcoin in circulation as there was before, regardless of whether you consider it as 21 million bitcoin, 2,100 trillion sats, or 2.1 million trillion millisats.

If you add more decimals, you are cutting up the same amount of bitcoin/banana in to smaller pieces. Only if you raise the marketcap is the bitcoin/banana being made bigger and less scarce.

Satoshi talked about even moving the decimal point, let alone just adding more decimal places:

If it gets tiresome working with small numbers, we could change where the display shows the decimal point.  Same amount of money, just different convention for where the ","'s and "."'s go.  e.g. moving the decimal place 3 places would mean if you had 1.00000 before, now it shows it as 1,000.00.

[BlackHatCoiner]

Could this system potentially over-incentivise saving?

Yep. Pretty cool, huh? No matter how damaging it is for the economy, we're fine, because it's benefiting us. Who cares about inflation when you can simply keep your currency and increase your future purchasing power!? Sorry for the irony, but that's Bitcoin. It skips some economic rules we were living by so far and incentivizes those who hold it, because it makes them richer.

At the moment you can't convince anyone to change Bitcoin; especially the market cap. You see, there are tons of users who have bought it to escape the arbitrary inflation of centrally managed currencies, as one had said.

[Ucy]

I actually prefer a flexible system that regulates supply based on current demand and supply. The system regulatory system has to be decentralized, trustless, permissionless, etc. Anyone can participate by having their reserved coins locked automatically when demand & price are low ...unlocked and sold to buyers when demand and price are too high. I actually agree that the price should increase/decrease moderately to prevent the extreme price volatility and make Bitcoin better MoE

[franky1]

-snip-

Your entire analogy is flawed because the banana is not being made bigger.

you really do not understand your own analogy.
remember in bitcoin base code, in raw data..
there is not btc.. no banana

when you finally admit or realise or remember that the actual unit of account at binary is

100101010000001011111001000000  ( you refer to it as 8decimal 6.25btc)
and you want to change that into
1001000110000100111001110010101000000000 (11 decimal 6.25btc)

you can clearly see the binary number(banana) is bigger(MORE significant figures)

just because you want to say the human converted basket term still says "6.25 bananas' does not mean the banana is the same size


it means there are more binary numbers to share
emphasis TO SHARE
emphasis SHARE
emphasis less scarce

yes imagine if they decided that a block using standard sats as primary base unit. but they want to increase how many btc is created at 8 decimal by 1000x btc..
guess what the binary unit will be
1001000110000100111001110010101000000000
..
yep
again
it doesnt matter your new prefered HUMAN converted basket term is
1001000110000100111001110010101000000000= (6.25btc of new format) 625000000000msat
or
1001000110000100111001110010101000000000=6250btc(625000000000sat)
its the same shareable units

which is different to the standard/current sharable units of
100101010000001011111001000000
..

can you see the difference in size??
100101010000001011111001000000
1001000110000100111001110010101000000000


you concentrating on "same bitcoin" is nonsense stupidity of misunderstanding because even you should know that at data level of shareable units from 2009 is not the same unit as the human GUI basket term

you can pretend that its the same banana/same size
but when changing
100101010000001011111001000000 to 1001000110000100111001110010101000000000
does then require
btc= 625000000/100,000,000
becoming
btc= 625000000000/100,000,000,000

[o_e_l_e_o]

What you saying would only make sense if the new smallest units (millisats) were worth the same as the old smallest units (sats), but they aren't.

If I split a gold ingot in to 1000 gold coins, there is the exact same amount of gold. I do not have any more to share than I did before, I have not increased the supply, and I have not made it less scarce.

If I split a bitcoin in to ten 0.1 outputs, one hundred 0.01 outputs, one million 100 sat outputs, one hundred million sats, or one hundred billion millisats, there is the exact same amount of bitcoin. I do not have any more to share than I did before, I have not increased the supply, and I have not made it less scarce.

Lightning already uses millisats. If people agreed with your point of view that this is equivalent to increasing the supply by 1000x, then the price should have tanked to $45 per BTC. This obviously hasn't happened, because dividing up sats in to millisats is not the same as raising the supply to 21 billion.

[franky1]

you are again trying to assume the world works at bitcoin creation then split

get out of your delusion.

ask yourself at binary level of bitcoin
where today 6.25btc is shown and logged and fixed at
100101010000001011111001000000  

where as in a new world of millisats how would the millisat representation appear as?
hint: 1001000110000100111001110010101000000000

and then in another delusional world how a system producing 6250btc of 8 decimal would be represented?
hint: 1001000110000100111001110010101000000000

you soon realise both msat (6.25 11decimal) and 6250btc of (sat /100m(8decimal btc))
BOTH appear as
1001000110000100111001110010101000000000

do you get that yet!!!
more sharable binary digits.. or in the case of your new gold analogy.. more particles particles of gold

your trying to say that what was
625000000 nanograms of gold (human mathed at 0.65milligrams and then buzzworded as '6.25gold coin)
and then having
625000000000 nanograms of gold(human mathed at 625milligrams, but buzzworded as still '625 coin')

which is where you are not understanding the physics and the chemistry of sharable units from the nanogram level which in reality is a bigger lump of gold being pretended to be the same as the smaller lump before your delusion started

..

you are trying to confuse the issue with the banana split while avoiding the biology of cell multiplying
something i find strange from someone that is supposedly in the medical field

even you know that the block halving events is not technically btc/2 but binary -1bit

also..
saying that because another network has more decimals in its contracts has nothing to do with bitcoin.
bitcoin network is not the lightning network

if people on LN want to play with 11 decimals so be it. but stop thinking another network is a good excuse to mess with bitcoin

havnt you realised it yet
LN was not created to be compatible with bitcoin.. it was set to function with many coins
it is actually a fact that bitcoin is being changed to be more compatible with LN

if you want to change bitcoin to have more binary digits that can be shared. then that is breaking the 2009 scarcity promise rule

get out of your delusions of the human GUI display and understand the code rules


your top down delusions is just your avoidance tactic of not understanding/ignoring/dismissing the real rule of bitcoin

because bitcoins rule is bottom up not top down

so try to understand, conceive how things work from the binary/smallest unit measure prospective that is the real rule

[vapourminer]

even you know that the block halving events is not technically btc/2 but binary -1bit
[...]
your top down delusions is just your avoidance tactic of not understanding/ignoring/dismissing the real rule of bitcoin

the way i understand it the same bit would still be used (8th). (or whatever it is im not a programmer). not the NEW least significant bit, the OLD least significant bit would still be the one used for halving.

IOW you do count from the "top" (most significant bit) not the bottom (least significant bit). its just easier to use the LSB at the moment as its simpler to code in binary arithmetic (just a single opcode? pretty sure all CPUs have a "number=number-1 opcode).. the code would simply not use the LSB anymore and use the 8th MSB (or whatever the term is again not a programmer but the idea seems pretty simple).

[BlackHatCoiner]

I think that franky has confused scarcity with shareability. By definition, scarcity is the state of being in short supply. The supply remains the same; the thing that changes is the shareability. These two have nothing in common.

If I own 1 BTC and it can be divided into 100,000,000 people's wallets, but then they also cut each satoshi to 1,000 millisats, it doesn't make my Bitcoin more scarce than before. It just can be divided into more people's wallets. You can only make something scarcer if you change the supply and that is taken directly from its definition.

Just think it in another way. If Bitcoin could be divided into unlimited pieces; if it had not a specific number of decimal places, but could expand indefinitely, would it make it no scarce at all? Get real.

[franky1]

I think that franky has confused scarcity with shareability. By definition, scarcity is the state of being in short supply. The supply remains the same; the thing that changes is the shareability. These two have nothing in common.

if i had a 21 gold nuggets that had 100million nanograms in europe
and i had 21 gold nugget that had 100billion nanograms in america

you can pretend that its just 21 nuggets per country
but reality is europe can only share gold with upto 100million people
  -meaning not all europeans can get a bit of gold
but reality is america can share gold with upto 100billion people
  -meaning americans could get 3000 bits of gold each

so american gold is less scarce

even you know that the block halving events is not technically btc/2 but binary -1bit
[...]
your top down delusions is just your avoidance tactic of not understanding/ignoring/dismissing the real rule of bitcoin

the way i understand it the same bit would still be used (8th). (or whatever it is im not a programmer). not the NEW least significant bit, the OLD least significant bit would still be the one used for halving.

IOW you do count from the "top" (most significant bit) not the bottom (least significant bit). its just easier to use the LSB at the moment as its simpler to code in binary arithmetic (just a single opcode? pretty sure all CPUs have a "number=number-1 opcode).. the code would simply not use the LSB anymore and use the 8th MSB (or whatever the term is again not a programmer but the idea seems pretty simple).

the funny part is when validating a transaction value in a raw tx data
a value from a 2015 transaction of 6.25btc is
100101010000001011111001000000  /100,000,000

but if you put that same /100,000,000 to the deluded 6.25 of the millisat
1001000110000100111001110010101000000000 /100,000,000
you would get 6250btc

think about it. if you change the /100,000,000 to /100,000,000,000
you also break the old transactions by making 6.25 become 0.00625

so the code has to be ripped apart and changed and then using different cludgy math to try to not cause a bug where 6250btc is created when it should be 6.25btc
or avoid a bug where 6.25 old tx is then deemed 0.00625

[BlackHatCoiner]

so american gold is less scarce shareable

FTFY.

[franky1]

so american gold is less scarce shareable

FTFY.

if each american can have 3000bits of gold
and each european cant all have a single bit of gold

then the american gold is less scarce

.
look i knew you lot are part of the LN fangirl club and you are willing to break anything and try anything to make bitcoin more LN compatible. but all your really doing is showing that you do not care about bitcoin at all. you dont care about scarcity or the bitcoin rules. all you want is to make your other network more compatible so that you can make your other network try to function better so that you can try to pull people off the bitcoin network and into your other network

how about just be honest with yourself

[vapourminer]

the funny part is when validating a transaction value in a raw tx data
a value from a 2015 transaction of 6.25btc is
100101010000001011111001000000  /100,000,000

but if you put that same /100,000,000 to the deluded 6.25 of the millisat
1001000110000100111001110010101000000000 /100,000,000
you would get 6250btc

think about it. if you change the /100,000,000 to /100,000,000,000
you also break the old transactions by making 6.25 become 0.00625

so the code has to be ripped apart and changed and then using different cludgy math to try to not cause a bug where 6250btc is created when it should be 6.25btc
or avoid a bug where 6.25 old tx is then deemed 0.00625

seriously? THATS your argument?

preeeety sure the devs can handle that. maybe base the tx validation code on something to do with blockhight the tx is in if/when this is implemented.

however you slice (hehe) it adding more bits would require a hard fork (or would it?) so the code would be changed and tested anyway. just like any other new version.

[franky1]

seriously? THATS your argument?

preeeety sure the devs can handle that. maybe base it on something to do with blockhight or whatever.

wow
so not only do you not care about bitcoin rules
so not only do you not care about scarcity of bitcoin
so not only do you not care about the philosophy of bitcoins reason for creation

but you are willing to also not care about the auditability or the bug risks..
all so that you can get your other network to be more compatible..

dang..
here is a solution for you
mess around with LN. make LN bitcoin compatible. make LN fit the bitcoin rules
LN has no consensus. so LN can be changed easily to fit. so go change LN to match the bitcoin rules
stop trying to change bitcoin to meet LN's flimsy unstructured rule

[BlackHatCoiner]

I honestly don't know if the above, franky's, post about Bitcoin's bugging risks deserves to be replied.

then the american gold is less scarce

You fail to understand that if we cut a nugget to 100 million pieces and each American can't have a bit of gold it doesn't make it less scarce, but less shareable. That's all it does. If 1,000 of American bits are equal with 1 Europian bit, then they all have the same amount of gold; the ownership of gold in America is just a thousand times cheaper.

[kryptqnick]

Given how 1 Bitcoin is 100,000,000 satoshis, it's not a problem that the population is growing or that the demand for Bitcoin is rising. We can simply move to thinking about BTC in terms of mBTC or even satoshis when the time comes that it's distributed among that many people that it makes sense. A big problem is transaction fees, but if that's somehow solved, there's enough BTC for everyone. As for 1% yearly increase, it sounds reasonable to me in the long-term perspective, but I agree with DooMAD that not everyone supports such an idea, so it would only create another coin. As for why it was created like this in the first place, the limited supply makes Bitcoin starkingly different from fiat.

[vapourminer]

seriously? THATS your argument?

preeeety sure the devs can handle that. maybe base it on something to do with blockhight or whatever.

wow
so not only do you not care about bitcoin rules
so not only do you not care about scarcity of bitcoin
so not only do you not care about the philosophy of bitcoins reason for creation

but you are willing to also not care about the auditability or the bug risks..
all so that you can get your other network to be more compatible..

dang..
here is a solution for you
mess around with LN. make LN bitcoin compatible. make LN fit the bitcoin rules
LN has no consensus. so LN can be changed easily to fit. so go change LN to match the bitcoin rules
stop trying to change bitcoin to meet LN's flimsy unstructured rule

seems the same rules to me. and most everyone else gets this. it would be extensively tested and being open source anyone can audit it.

originally i didnt trust segwit either so i kinda know where youre coming from. the if it works dont mess with it till its absolutely necessary mentality. so its likely 2nd layer will be the thing as time passes.

i dont do lightening atm. ill wait for moar testing, just like i did with segwit.

anyhow peace out  im done.

edit: btw we are talking about just adding "decimal places" not increasing the supply now. i FIRMLY oppose that. that would NOT be bitcoin and i would bail if that happened.

[Darker45]

Most of the responses in this thread seem to boil down to "that's how it was from the start, so that's how it should be". I'm keen to understand why it was like this from the start. Did Satoshi (and other developers) not consider the impacts of lost coins and population growth?

I guess it was plainly out of the simple fact that Satoshi wanted to create a currency which is not inflationary. The creation of Bitcoin was a reaction to the failed features of fiat, one of which is its infinite supply, which causes its never-ending devaluation. Bitcoin was designed to gain value over time, not to lose it. Increase in users as well as lost coins must have already been looked forward to by Satoshi and they should have been treated as contributories to the intention of Bitcoin having an appreciating rather than depreciating value.

[DooMAD]

wow
so not only do you not care about bitcoin rules
so not only do you not care about scarcity of bitcoin
so not only do you not care about the philosophy of bitcoins reason for creation

Everyone is allowed to have their own red lines on what rules they wouldn't support changing.  You are clearly stating your aversion to more decimal places and you are entitled to that opinion.  We are allowed to have the opinion that more decimal placed would be perfectly acceptable (likely due to the fact that we're not harbouring petty grudges that cloud our judgement).  One day this debate may end up a matter for consensus.  Until then, it's a largely unfruitful line of discussion.

Also, leave your high and mighty tone out of it.  No one sees you as a "moral compass" sort of figure.  Quite the opposite, in fact.

[o_e_l_e_o]

if i had a 21 gold nuggets that had 100million nanograms in europe
and i had 21 gold nugget that had 100billion nanograms in america

Again, your analogy is flawed because, as I stated above, the new smallest units and the old smallest units are not the same.

In your analogy I have quoted, the American gold had a larger supply and is less scarce than the European gold, sure. This would be the same as changing from 100 million sats per bitcoin to 100 billion sats per bitcoin. That would absolutely increase the supply and decrease the scarcity of bitcoin.

This is not what anyone is proposing. Creating more decimal points creates new, smaller units, (millisats) which may indeed be more shareable, but do not decrease the scarcity, as BlackHatCoiner has pointed out. It is analogous to comparing 100 million nanograms with 100 billion picograms.

[DarkDays]

Could this system potentially over-incentivise saving?

Yep. Pretty cool, huh? No matter how damaging it is for the economy, we're fine, because it's benefiting us. Who cares about inflation when you can simply keep your currency and increase your future purchasing power!? Sorry for the irony, but that's Bitcoin. It skips some economic rules we were living by so far and incentivizes those who hold it, because it makes them richer.

At the moment you can't convince anyone to change Bitcoin; especially the market cap. You see, there are tons of users who have bought it to escape the arbitrary inflation of centrally managed currencies, as one had said.

Precisely! Bitcoin as it is now is the best method to hedge against inflation. This is why proposed structural changes that deviate from it will, in my view, not attain the needed support required to see that change.

The idea of dividing the coin by introducing more decimals is one way of bringing Bitcoin towards a deflationary system but whether that'll be supported or not is up to the community and because most people in the community want wealth preservation I doubt anything will change.

People like to have an advantage, and apply ways (not others will) to maintain their wealth - that's Bitcoin (and it's likelihood to resist any other changes).

Bottomline, yeah, good idea but it's not going to happen!!!