Proposal to Address Dormant Bitcoin:Recycling Lost Coins into the Mining Process

[zeuner]

There is no way to distinguish permanently lost coins from those that just weren't moved for a longer time. If we confiscate old coins, who would still pay for digging up trash dumps?

[1714311333]

1714311333

[1714311333]

1714311333

[1714311333]

1714311333

[1714311333]

1714311333

[1714311333]

1714311333

[1714311333]

1714311333

[Flexystar]

As regular user or non technical user I think it will impact me very badly. They might just take away my Bitcoins because they might think my Bitcoin is dormant due to inactivity but in reality I would be holding them for long period of time. This need not to be implemented because it will also cause issues with market dilution. It will liquidate enormous amount of Bitcoin and thus devaluing it.

Even as Bitcoin surges to levels not seen in months, HODLing will never go out of style.
More than half of the coins in existence have not moved in over two years, according to recent figures—a new all-time high.

Blockchain data firm Glassnode told Decrypt that the amount of Bitcoin which last moved more than two years ago currently stands at 53.14%.
That means 10.2 million Bitcoin is sitting still—roughly $309 billion-worth of satoshis. A total of 19.3 million Bitcoins have been mined since the cryptocurrency came into existence

If you just check above stats then you will understand what I mean or others on the thread Are saying.

It’s superseded problem if we implement such algorithm. Half of the Bitcoin will be sucked into mining all the time if this happens. Crazy.


Reference for the Quote Here.

[internetional]

I'm saving bitcoin for retirement and will not move my coins for 20 years. You've just stolen my money.
I've timelocked some bitcoin for 21 years as an inheritance for a new family member. You've just stolen my money.
I'm a political dissident who has been detained without trial by a dictatorship for 15 years. You've just stolen my money.
I've been sent to jail for non-violent victimless crimes for 10 years. You've just stolen my money.
I've been working in another country for 10 years with some wallets safely stored at my parent's/other family member's house which I have not accessed. You've just stolen my money.
There are a hundred other reasons someone might not move their coins for 10 years. That does not give you the right to steal them.

And that's without even touching on the crazy idea of implementing a system which allows coins to be moved with providing a signature.

Initially, I also thought about all these cases (especially about political prisoners, since I'm from Russia, and my wife is from Belarus). But then I noticed that the 10-year timeframe is not the OP's fundamental stance but rather an illustrative example. So, let’s think about following questions:
1. What if miners start sabotaging block creation after 2140? Would introducing some coins that haven't moved since January 2009 help? (Similarly, in four years, in 2144, coins untouched since February 2009 could be put into circulation, and so on.)
2. Some say quantum computers could crack private keys of UTXOs created in Satoshi's time. By the time such computers exist, nobody will be using the old algorithms (the community will be forced to transition to something else). But would it be fair that the UTXOs from 2009 go to the quantum computer developer? Wouldn't it be better to change the consensus regarding UTXOs made with old algorithms when transitioning to new ones?

In general, I can imagine situations where the questions raised in this thread will become relevant. So, this topic doesn't necessarily revolve around theft.

[ripemdhash]

2. Some say quantum computers could crack private keys of UTXOs created in Satoshi's time. By the time such computers exist, nobody will be using the old algorithms (the community will be forced to transition to something else). But would it be fair that the UTXOs from 2009 go to the quantum computer developer? Wouldn't it be better to change the consensus regarding UTXOs made with old algorithms when transitioning to new ones?


answer:
First of all, these mythical quantum computers. They are not and will not be useful for such tasks. All those fancy scientific studies are tainted with elaborate theories. Notice that so far, they can only confirm algorithms that have already been devised. The states of the so-called qubits as 0, 1, or unknown, don't really matter. If it were otherwise, why would people keep creating new supercomputers when they could have a super quantum computer for half the cost? Please stop scaring people with these quantum computers and what they cannot do. If you had experience with such computers (and I do), you would know that it's a fairy tale, like something from moss and ferns.

[o_e_l_e_o]

1. What if miners start sabotaging block creation after 2140? Would introducing some coins that haven't moved since January 2009 help?

What would be the incentive for miners to start sabotaging block creation? Mining honestly would still net them transaction fees. Mining dishonestly just for the sake of it earns them nothing unless they control 51% of the network, which is incredibly unlikely.

Further, if you start unlocking unmoved coins, you create a huge incentive to mine dishonestly. If the total block reward is (for example) 0.5 BTC from fees, and you release 50 BTC, then there is a massive incentive for every individual miner to try to reorganize dozens of blocks to try to claim the 100x reward for themselves. This problem compounds the more additional coins you release.

Wouldn't it be better to change the consensus regarding UTXOs made with old algorithms when transitioning to new ones?

No. I think it is far preferable for some old coins to be stolen and reenter circulation by people who have sufficiently powerful quantum computers, than it would be for developers to overturn one of the key pillars of bitcoin and start deciding what happens to coins they don't control.

[Wind_FURY]

I'm not judging OP, and what I'm going to say is nothing against him nor am I trying to offend him. BUT, I'm starting to believe that laughable topics such this are mere 4D Chess moves made to start a debate and see if it catches many people's attention. Perhaps "some people" hope to see some gaslighting in the discussions to happen? Haha.

What recycling of "dormant coins" actually does is KILL Bitcoin's immutability. Moderators should probably lock the topic and stop the naivety of the proposal.

[ABCbits]

1. What if miners start sabotaging block creation after 2140? Would introducing some coins that haven't moved since January 2009 help? (Similarly, in four years, in 2144, coins untouched since February 2009 could be put into circulation, and so on.)

Could you provide example of sabotage? Invalid block or transaction would be rejected by other node (whether it's owned by pool, exchange or somebody else), so sabotage option would be very limited and probably lead to economical losses.

2. Some say quantum computers could crack private keys of UTXOs created in Satoshi's time. By the time such computers exist, nobody will be using the old algorithms (the community will be forced to transition to something else). But would it be fair that the UTXOs from 2009 go to the quantum computer developer? Wouldn't it be better to change the consensus regarding UTXOs made with old algorithms when transitioning to new ones?

Consensus for such thing probably never achieved (as in majority agree to specific action) due to opinion difference.

2. Some say quantum computers could crack private keys of UTXOs created in Satoshi's time. By the time such computers exist, nobody will be using the old algorithms (the community will be forced to transition to something else). But would it be fair that the UTXOs from 2009 go to the quantum computer developer? Wouldn't it be better to change the consensus regarding UTXOs made with old algorithms when transitioning to new ones?


answer:
First of all, these mythical quantum computers. They are not and will not be useful for such tasks. All those fancy scientific studies are tainted with elaborate theories. Notice that so far, they can only confirm algorithms that have already been devised. The states of the so-called qubits as 0, 1, or unknown, don't really matter. If it were otherwise, why would people keep creating new supercomputers when they could have a super quantum computer for half the cost? Please stop scaring people with these quantum computers and what they cannot do. If you had experience with such computers (and I do), you would know that it's a fairy tale, like something from moss and ferns.

Quantum computer isn't myth. The reason people create supercomputer rather than "super" quantum computer is nobody have ability to build large scale quantum computer (have many qubits) and i expect it won't happen anytime soon. And i'll reiterate that ECDSA is vulnerable to quantum computer.

[interiawp]

In summary, it is estimated that achieving a quantum computer with a million qubits is a task that would require decades of research, technological development, and investment. Whether this will happen in 2500 or later is difficult to predict.

So there is no scary:-)

[Cricktor]

Whether this will happen in 2500 or later is difficult to predict.

Did you mean rather 2050 than 2500? There's some hype around quantum computing and computers and as I've read somewhere too, as @ETFbitcoin says, ECDSA could be attacked with a sufficient quantum computer. OK, I'm no expert on this field. All I know, you would already need a lot of stable qubits or even way more less stable qubits to have error correction in place. You'd need numbers of qubits that are far from current possibilities even for multi-billion $$$ companies.

Current qubits seem the have an error corrected lifespan of only a few milliseconds[1]. That's not much and their total numbers in current quantum computers are still rather low. Yes, technology and research will prosper but it will take time and I assume still a whole lot of time to be scary for Bitcoin's security or attacks on RSA (efficient factorization of huge prime number products).

I don't expect major breakthroughs happening in short time periods. It likely will happen gradually so that there should be enough time to adapt. I hope that's not too off-topic now.
[1] https://www.sciencealert.com/physicists-extend-qubit-lifespan-in-pivotal-validation-of-quantum-computing

[internetional]

Could you provide example of sabotage?

Let's imagine a situation. The year is 2140. No one is using the first layer for transactions anymore. All transactions are conducted on something like Ark protocol. There are 100 Ark service providers collectively generating 100 transactions in each block. They set a fee of 1.20 satoshis per vByte in their transactions. Miners go out of business and stop producing blocks. Network difficulty drops dramatically, and Bitcoin ceases to be a reliable store of value. Wouldn't it be better to take unused coins and use them to incentivize miners to continue their business?

[pooya87]

Let's imagine a situation. The year is 2140.

We can not even begin to imagine what the situation is going to be like 100 years from now.

Wouldn't it be better to take unused coins and use them to incentivize miners to continue their business?

And what would we do when we run out of such coins to "steal" and pay miners? It is a finite number after all.

[o_e_l_e_o]

Whether this will happen in 2500 or later is difficult to predict.

Meaningful quantum computers are a long way away, and we do not need to start building quantum proof bitcoin just yet, but I don't think they are 500 years away.

-snip-

Even if everyone was using second or third layer solutions rather than the base chain, you still need to use the base chain to enter those layers. With Lightning as it stands now, even just to get everyone in the world to open a single channel would provide decades of on chain transactions and fees for miners. But with things like taproot and channel factories, that becomes more efficient. What other layer 2 or 3 solutions will we have in 100 years? And then there are things like merged mining, which already happens. We simply have no idea what the ecosystem will look like in 100 years.

As pooya87 points out, taking coins which haven't moved in x number of years gives rapidly diminishing returns. You'll potentially get millions in the first year which will cause absolute havoc for miners trying to reorg the chain to claim the rewards themselves, and then that will rapidly fall off and you'll be left in the situation you were in before.

[NotATether]

So, this is a thread describing a proposal, without the actual proposal text inside. Is this topic written by ChatGPT? 

Wouldn't it be better to take unused coins and use them to incentivize miners to continue their business?

And what would we do when we run out of such coins to "steal" and pay miners? It is a finite number after all.

It'll fall flat just like the 2140 block reward exhaustion.

I don't really see a point to giving miners a temporary incentive to continue mining when it's literally no better than a block reward (at best - if implemented poorly, it can be used by the first miners to defraud the other miners).

[internetional]

And what would we do when we run out of such coins to "steal" and pay miners? It is a finite number after all.

In the year 2140 we start stealing the coins which have been not moved since January 2009.
In the year 2144 we start stealing the coins which have been not moved since February 2009.
...
In the year 8428 we start stealing the coins which have been not moved since January 2140.
...

[BlackHatCoiner]

The year is 2140. No one is using the first layer for transactions anymore.

This means Bitcoin is already dead. No point in discussing about coin recycling.

Wouldn't it be better to take unused coins and use them to incentivize miners to continue their business?

Would it be better to take someone else coins to incentivize the miners? Obviously not. Would it be better to take lost coins? Maybe. Is there any way to determine if a coin is still owned by someone? No. So you can't take unused coins without confiscating some coins in the process.

Besides that, if we have to rely on "unused" coins to incentivize the mining process, then the Bitcoin network would be dead sooner or later.

In the year 2140 we start stealing the coins which have been not moved since January 2009.
In the year 2144 we start stealing the coins which have been not moved since February 2009.
...
In the year 8428 we start stealing the coins which have been not moved since January 2140.
...

Let us reach year 2140 without sustainability issues, and our great-grandchildren can continue this discussion, because I'm afraid there are a lot of obstacles until that year.

[pooya87]

And what would we do when we run out of such coins to "steal" and pay miners? It is a finite number after all.

In the year 2140 we start stealing the coins which have been not moved since January 2009.
In the year 2144 we start stealing the coins which have been not moved since February 2009.
...
In the year 8428 we start stealing the coins which have been not moved since January 2140.
...

The same problems apply here.
We can't decide what people should do in a hundred years from now when we aren't even around.
You also significantly decreased the incentive and also re-introduced a decreasing reward since the amount of coins "lost" or amount that hasn't moved in a long time is decreasing per year as price goes up and more people get in. That means after a couple of "periods" we could theoretically end up with a fraction of bitcoin as the total amount "lost", which is like halving all over again.

At some point as you keep increasing the complexity of this idea, it raises the question of why not just increase the supply in the year 2140?

[o_e_l_e_o]

In the year 2140 we start stealing the coins which have been not moved since January 2009.
In the year 2144 we start stealing the coins which have been not moved since February 2009.

So at an average rate of 4,320 blocks per month, this means you would release coins at a rate of 3 blocks per day every 4 year period. So that first day will see (we assume) 150 BTC released. Now, let's say the total block reward from fees alone is 0.5 BTC, which is probably a high estimate. This means 72 BTC a day from fees, and 150 BTC a day from releasing old coins. Every large miner is therefore incentivized to ignore blocks from other miners claiming the old coins, and instead continue to mine blocks on their own chain claiming the old coins for themselves.

Also, the very fact you use the word "stealing" explains it all, really. At no point should the protocol ever steal coins from other people. There is a huge difference between a random malicious actor with a quantum computer stealing coins, and baking stealing coins in to the bitcoin protocol.

In the year 8428 we start stealing the coins which have been not moved since January 2140

What happens when bitcoin has become so valuable that the total amount of coins not moved since January 2140 is a few hundred sats at most? The whole system collapses and you are back to only relying on the fees.

This is not a solution - only a delaying tactic - and one which would fundamentally alter the entire concept of bitcoin.

[un_rank]

1. What if miners start sabotaging block creation after 2140? Would introducing some coins that haven't moved since January 2009 help? (Similarly, in four years, in 2144, coins untouched since February 2009 could be put into circulation, and so on.)
2. Some say quantum computers could crack private keys of UTXOs created in Satoshi's time. By the time such computers exist, nobody will be using the old algorithms (the community will be forced to transition to something else). But would it be fair that the UTXOs from 2009 go to the quantum computer developer? Wouldn't it be better to change the consensus regarding UTXOs made with old algorithms when transitioning to new ones?

1. There is nothing to suggest that miners will sabotage the network after a certain date nor do I understand what you mean by sabotage.
Forcefully accessing coins that are stored securely in wallets is not a long term solution to any issue Bitcoin has or might have in the future, but it is a short term way to break trust people have in the network.

2. If there is a network transition, it affects all bitcoins stored on it.
except in cases where vulnerabilities are discovered on individual wallets used to access the private keys.

In the year 2140 we start stealing the coins which have been not moved since January 2009.
In the year 2144 we start stealing the coins which have been not moved since February 2009.
...
In the year 8428 we start stealing the coins which have been not moved since January 2140.
...

If the network has survived a hundred years without those coins moving, it is not necessary for the future of bitcoin. There is no upside to a decision like this and it not a problem we will have to face in our lifetime.

- Jay -

[GR Sasa]

Guys question, there are an couple of addresses from 2010 that holds more than 100,000BTC

What would happen if the owners recovered it's private key now or in the next years and suddenly woke up and moved some of its coins?   Perhaps it would be Satoshi?

[BlackHatCoiner]

What would happen if the owners recovered it's private key now or in the next years and suddenly woke up and moved some of its coins?

I guess they would spend them. What's the problem?