Charging rent on the bitcoin network, is that a bad idea?

[larry_vw_1955]

Solana does it. Didn't know they did it when I first started using it:

https://docs.solana.com/implemented-proposals/rent

[garlonicon]

Short answer: we don't need it. But even if you want to do that on Bitcoin, you still can.

Since validators on the network need to maintain a working copy of this state in memory, the network charges a time-and-space based fee for this resource consumption, also known as Rent.

What is the purpose here? To have some data pushed to the blockchain? If so, then you can use OP_RETURN and pay for every pushed byte. You can also place your OP_RETURN in some unused TapScript branch, tweak your Taproot address, and then pay no fees, but keep the proof that your commitment is connected with your address.

There are two timings of collecting rent from accounts: (1) when referenced by a transaction, (2) periodically once an epoch.

It seems that case (2) can be handled by case (1) if you use Lightning Network, then things are much simpler. You can just create some channel and create channel closing transactions upfront, so that one side will get more and more coins, just by waiting and publishing a transaction with some higher locktime.

(2) exists to ensure to collect rents from stale accounts, which aren't referenced in recent epochs at all

No problem with that, the latest closing transaction can move all coins to the one party, then that person would "collect rents from stale accounts" (simply because another party did nothing for the whole time since channel creation to the locktime in the last channel closing transaction).

(2) requires the whole scan of accounts and is spread over an epoch based on account address prefix to avoid load spikes due to this rent collection

In Bitcoin, you don't need "the whole scan of accounts", you only need to check accounts that voluntarily joined your system, for example by forming channels with you (or joining your channel factory, N-of-N multisig with Taproot is cheaper than it was with other address types).

A percentage of the rent collected is destroyed.

Is it user-destroyed or miner-destroyed? Because using any user-destroyed method is going to leave a trace in the blockchain. On the other hand, miner-destroyed way is much cleaner, because then such miner is just taking less coinbase reward, so there is no additional UTXO at all (and this can be enforced in a no-fork way, where only a group of miners will burn their coins, while still being part of the network).

Finally, rent collection happens according to the protocol-level account updates like the rent distribution to validators, meaning there is no corresponding transaction for rent deductions.

Wait, there are "validators"? So why this altcoin is not directly connected with Bitcoin by a two-way peg-in? And why this altcoin needs any new coins at all and not reuse Bitcoins? If you have some fixed group of "validators" that are allowed to mine, then you don't need any new coins, you can run everything directly on Bitcoin blockchain, by creating a signet sidechain, pegged into the mainnet! Even more: if that group of "validators" can evolve over time (so that introducing new "validators" or changing existing ones is possible), then it can be easily handled, just by changing keys and signing that! So, that kind of staking model can be running on Bitcoin today, without any forks!

At that point, I stopped reading, because now I am convinced that this system can run directly on Bitcoin, so we don't need to change anything to allow rent.

[ABCbits]

I would say it's not good idea/not necessary for following reason,
1. Most people deemed current node amount is still sufficient. At time of writing this post, Bitnodes report there are 15113 reachable nodes[1] while Luke Jr stats (which include node which doesn't enable incoming connection) report there are about 50K nodes[2].
2. Increasing complexity of Bitcoin protocol.
3. Add more burden for Bitcoin contributor (whether it's on protocol or implementation level).

[1] https://bitnodes.io/dashboard/
[2] https://luke.dashjr.org/programs/bitcoin/files/charts/software.html

[BlackHatCoiner]

I'll skip my comments and focus on this:

Since validators on the network need to maintain a working copy of this state in memory, the network charges a time-and-space based fee for this resource consumption, also known as Rent.

Wait a sec, isn't this an absurd idea? Why should I require money to get self-sovereignty and privacy? Aren't those enough to cover my disk's and memory's expenditures? It sounds like they want to expand their network in the wrong way.

[larry_vw_1955]

I'll skip my comments and focus on this:

Since validators on the network need to maintain a working copy of this state in memory, the network charges a time-and-space based fee for this resource consumption, also known as Rent.

Wait a sec, isn't this an absurd idea? Why should I require money to get self-sovereignty and privacy? Aren't those enough to cover my disk's and memory's expenditures? It sounds like they want to expand their network in the wrong way.

I dont necessarily like the idea of paying an involuntary rent, but if your balance is over a certain amount it's "rent exempt" and that amount is not too large it didn't sound like. So basically what rent is doing is taking very small accounts and getting rid of them over time if they go unused and keep a small balance. What is troublesome is the fact that once an account would get to zero on solana i think they delete all the accounts data including any nfts that were owned. how to get those back? not sure if it is possible.

anyhow, for bitcoin, paying rent for small balances could provide an extra income to miners i suppose to help offset the decreasing block rewards. not saying i'm for it though.

I would say it's not good idea/not necessary for following reason,
1. Most people deemed current node amount is still sufficient. At time of writing this post, Bitnodes report there are 15113 reachable nodes[1] while Luke Jr stats (which include node which doesn't enable incoming connection) report there are about 50K nodes[2].
2. Increasing complexity of Bitcoin protocol.
3. Add more burden for Bitcoin contributor (whether it's on protocol or implementation level).

#2 does seem like a reasonable objection. i just realized that implementing rent on a utxo based system like bitcoin is not so straightforward as it is in an account based model like solana because you don't know what addresses make up an account. so you would have to treat each address as its own account...but if you did that, it helps get rid of small utxos that take up the same space in the utxo set as larger utxos i guess it would encourage people to consolidate their utxos at the very least 

[odolvlobo]

There is no reason why nodes can't collect money in exchange for providing data to others. Furthermore, it can be done without any changes to consensus rules.

[pooya87]

There is no reason why nodes can't collect money in exchange for providing data to others.

It goes against the nature of the peer to peer network where everyone is a peer at equal level which means any money charged would be negated (peer A charges $1 to answer peer B and peer B charges $1 to respond).

[odolvlobo]

There is no reason why nodes can't collect money in exchange for providing data to others.

It goes against the nature of the peer to peer network where everyone is a peer at equal level which means any money charged would be negated (peer A charges $1 to answer peer B and peer B charges $1 to respond).

But, everyone is not an equal peer. Lite wallets, SPV wallets, and surveillance companies use the data that nodes provide, but contribute nothing.

And as you note, the charges would balance out anyway for those who are equal peers. Last month, my node downloaded 1GB but uploaded 10 GB.

[pooya87]

But, everyone is not an equal peer. Lite wallets, SPV wallets, and surveillance companies use the data that other nodes provide, but contribute nothing.

But we can't consider SPV clients part of the network in first place, the network consists of full nodes and everything else is a leach not a peer.

[odolvlobo]

But, everyone is not an equal peer. Lite wallets, SPV wallets, and surveillance companies use the data that nodes provide, but contribute nothing.

But we can't consider SPV clients part of the network in first place, the network consists of full nodes and everything else is a leach not a peer.

Exactly, and they would be the ones that pay for the data.

Anyway, I agree with you to some extent. The incredible bounty that has been provided to the world by open source software developers is greatly under-appreciated. But, where would we be if they had charged for their work?

But, the reality is that nobody can dictate how any issue will be resolved in a decentralized environment. So, fee or no fee -- we will just have to wait and see.

[garlonicon]

But, the reality is that nobody can dictate how any issue will be resolved in a decentralized environment. So, fee or no fee -- we will just have to wait and see.

When that runs out, the system can support transaction fees if needed.  It's based on open market competition, and there will probably always be nodes willing to process transactions for free.

Where are they?

[larry_vw_1955]

But, everyone is not an equal peer. Lite wallets, SPV wallets, and surveillance companies use the data that nodes provide, but contribute nothing.

Right?

And as you note, the charges would balance out anyway for those who are equal peers. Last month, my node downloaded 1GB but uploaded 10 GB.

then that means you're giving more than you're getting. seems like people (nodes) that are giving more than they are giving should receive compensation on their net contribution. [REALLY gets on soapbox] miners arent the only ones that contribute to the network being functional. but if something like that was implemented, it would have to be robust against people trying to game the system. but it seems like bitcoin only rewards miners and not nodes that don't mine but still have costs for helping the network. kind of unfair in my opinion but anyhow...

Exactly, and they would be the ones that pay for the data.

Imagine that! Users that contribute nothing being required to pay for something. Sounds about right.

But, the reality is that nobody can dictate how any issue will be resolved in a decentralized environment. So, fee or no fee -- we will just have to wait and see.

Maybe nodes could have the ability to tack on their own transaction fee...

[garlonicon]

but it seems like bitcoin only rewards miners and not nodes that don't mine but still have costs for helping the network

Since Lightning Network, it also rewards online nodes, willing to put their coins in channels to provide liquidity.

Imagine that! Users that contribute nothing being required to pay for something. Sounds about right.

I don't think so. They will just start running their own nodes (or fake nodes, just to get some reward). It will be the same case as with the Lightning Network: there are wallets charging more satoshis than people would pay on-chain. People will not pay high fees, people will optimize their costs by running their own nodes or switching to another, cheaper network for a while.

Maybe nodes could have the ability to tack on their own transaction fee...

Technically, they can. Practically, they have to do it in the right way, because in other case, people will react and optimize their costs. Also, if you have some Lightning Network wallet, like Phoenix, then they charge 3,000 satoshis for on-chain operations, just because they can. Also they charge 1% of coins. That simply means, after reaching 300,000 satoshis, it is more profitable to withdraw coins on-chain than to form a bigger channel. See? The problem is not technical, the problem is about total cost for the user, depending on what that user wants to do and how many payments there are.

[larry_vw_1955]

but it seems like bitcoin only rewards miners and not nodes that don't mine but still have costs for helping the network

Since Lightning Network, it also rewards online nodes, willing to put their coins in channels to provide liquidity.

i would think the percentage of people running a full node that also run a lightning channel is not so large. maybe 5 or 10 percent if that. as well, LN is layer 2. i'm talking about layer 1. could the network function without full nodes that arent doing mining? if not then it's hard to see why they arent rewarded in some way. presumably they do it because the reward outweighs the associated costs but the reward is not on chain. it's something less tangible.

[BlackHatCoiner]

could the network function without full nodes that arent doing mining?

It would be much slower in terms of bandwidth. I suspect the mining nodes are very few if we compare them with the tens of thousands of full nodes[1]. Note that miners don't always run their own full nodes; this is a requirement of the pool. Those who participate just hash block headers.

if not then it's hard to see why they arent rewarded in some way.

Again, they are. They gain the ability to verify everything. They need none, which also enhances their privacy.


[1] https://bitnodes.io/dashboard/

[pooya87]

if not then it's hard to see why they arent rewarded in some way.

They are rewarded in many ways but they aren't getting paid if that's what you are looking for.
The reward is a higher security for both the person running the full node and by contributing to the network, more security to the only decentralized currency in existence...
It is is also the improved privacy that running SPV clients can't provide and obviously it doesn't even exist in any other client type.

[franky1]

And as you note, the charges would balance out anyway for those who are equal peers. Last month, my node downloaded 1GB but uploaded 10 GB.

a month is 4032 blocks (call it 5gb)
so you only downloaded 1gb

you should be downloading 1gb a week even from just 1 peer.
(1mb block*144 a day*7day=1008mb/1.008gb)

so your not even download all your blockdata.
heck i use 160gb a month just watching movies. and you worry about your litewallet/pruned/headers only data

why are people trying to make it sound like the bitcoin network is soo expensive when no one ever complains about youtube or netflix (1gb SD, 3gb HD, 7GB 4k.. for just 2 hours)

the reason why ethereum is moving forward and becoming more popular platform for multiple projects is because even though their blockchain is 1TB (3x bitcoin) they are not playing political games of pretending that blockchains are expensive/need compensating/dont work/shouldnt be used for daily use.. they are actually trying to make their network have more use

[larry_vw_1955]

They are rewarded in many ways but they aren't getting paid if that's what you are looking for.
The reward is a higher security for both the person running the full node and by contributing to the network, more security to the only decentralized currency in existence...

Yeah I guess more security but in reality, you can sign an offline transaction and broadcast it without needing to be a full node. Isn't that just as secure? Now about your statement that bitcoin is "the only decentralized currency in existence" that's a pretty big statement. I would be willing to grant that bitcoin is the biggest decentralized currency in existence but I'm not sure how one comes to the conclusion that it's the only one.

It is is also the improved privacy that running SPV clients can't provide and obviously it doesn't even exist in any other client type.

Once again, create an offline transaction, sign it, use a vpn or torr and broadcast it. How's that for privacy and all without the need to download the entire blockchain.

Oh, I know people might not look upon this type of behavior as being very "contributing to the network" and think of it as more of being a "leech" i get that because it is. So we do need people that stand for something out there running full nodes for sure.

[garlonicon]

Yeah I guess more security but in reality, you can sign an offline transaction and broadcast it without needing to be a full node. Isn't that just as secure?

And you sign that transaction based on... block explorers? Some data from SPV nodes? You fill your transaction inputs based on trust that those previous transaction outputs really exist. But in case of some attacks you could be convinced to sign coins that never existed at all.

[pooya87]

Yeah I guess more security but in reality, you can sign an offline transaction and broadcast it without needing to be a full node. Isn't that just as secure?

Security is not limited to whether or not you leak your private key.
For example without a full node you can not be sure if your unconfirmed transaction is really unconfirmed or the third parties you rely on are lying to you. Or you can't know if a confirmed received transaction is your tip is still confirmed or double spent while you are stuck on a stale chain. That's just two examples off the top of my head.

Now about your statement that bitcoin is "the only decentralized currency in existence" that's a pretty big statement. I would be willing to grant that bitcoin is the biggest decentralized currency in existence but I'm not sure how one comes to the conclusion that it's the only one.

I'd love it if you could show me another one!
The others are either centralized or semi centralized or simply they are not currencies.

Once again, create an offline transaction, sign it, use a vpn or torr and broadcast it. How's that for privacy and all without the need to download the entire blockchain.

Your wallet normally has more than one address in it whether it is HD or not. When you connect to a SPV server you are telling them all your addresses and whether your IP is real or not they still can link them all together.