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Author Topic: flat demurrage fees to avoid some technical problems  (Read 1361 times)
jtimon
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May 24, 2011, 08:03:21 AM
 #1

We are discussing some technical storage problems in these thread:

http://forum.bitcoin.org/index.php?topic=9295.0

The proposed solution would solve problems like:

-Lack of direct compensation to miners for storage (with the current model they would be compensated through transaction fees).
-Everlasting free storage for other applications by "burning" bitcoins.
-Storage of "lost wallets". Also potential economic problems (if any) also derived from wallet losses.

Also another question has arose:

Can miners prune "old accounts" that are not empty?
What prevents/discourage them to do that?

Creighto even doubts the feasibility of his own proposal. It would be interesting to have some developers there.
Please don't confuse creighto's proposal for flat demurrage fees after a certain time in the  block chain with mine for a demurrage rate for holding money. They seek different ends.
No one seems to like my proposal, so I think we should discuss creighto's proposal and leave mine (freicoin) to other threads.
If you're concern with the some evil financial effects from proportional (to the quantity hold) demurrage, we can discuss it there too.
Creighto's proposal doesn't have financial effects because bitcoin owners can avoid these fees by moving their bitcoins from time to time.

2 different forms of free-money: Freicoin (free of basic interest because it's perishable), Mutual credit (no interest because it's abundant)
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Andris
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May 24, 2011, 08:55:54 AM
 #2

The only reason I don't like your proposal is that it continues this awkward focus on finding magical strings that have pretty hash values. See my reply to BCEmporium's post here:
http://forum.bitcoin.org/index.php?topic=9150.msg132381#msg132381

We need more focus on rewarding people directly for contributing to the integrity and robustness to the network.

Starting a Freicoin blockchain has several issues
1) You inherit all of Bitcoin's technical weaknesses, you should strive to expand it further from the beginning. Abandoning the IRC bootstrap, for example, would be a fairly simple starting point.
2) You are competing with Bitcoin's CPU power. You'd have mine, and a number of other people who think Austrian economists are the ones drinking the kool-aid, to be sure, as well as those that get frustrated with seeing accounts of hundreds of thousands of bitcoins while they play around with bitcents. But for the most part you will have to do recruiting elsewhere.

On the other hand, by removing the CPU war from the equation, or by making it a much smaller part, you open up the opportunity for us to actually conduct an experiment on what makes an ideal currency policy.
FreeMoney
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May 24, 2011, 09:21:02 AM
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The only reason I don't like your proposal is that it continues this awkward focus on finding magical strings that have pretty hash values. See my reply to BCEmporium's post here:
http://forum.bitcoin.org/index.php?topic=9150.msg132381#msg132381

We need more focus on rewarding people directly for contributing to the integrity and robustness to the network.
 

What are you talking about? Do you know some way to have a distributed currency without all this hashing business?

Play Bitcoin Poker at sealswithclubs.eu. We're active and open to everyone.
jtimon
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May 24, 2011, 10:01:52 AM
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2) You are competing with Bitcoin's CPU power. You'd have mine, and a number of other people who think Austrian economists are the ones drinking the kool-aid, to be sure, as well as those that get frustrated with seeing accounts of hundreds of thousands of bitcoins while they play around with bitcents. But for the most part you will have to do recruiting elsewhere.

It seems clear that this forum is not the right place to find Gesell advocates. I still find interesting to discuss it here since I would love to synthesize austrian economics with Gesell's theory on of interest. Anyway, the proposal that I link to doesn't try to remove or reduce interest.

Quote from: Andris
On the other hand, by removing the CPU war from the equation, or by making it a much smaller part, you open up the opportunity for us to actually conduct an experiment on what makes an ideal currency policy.

If anyone has a proposal for a decentralized issuing cryptocurrency without the need of the block chain, I'm sure we all want to hear it.
I'll take I deeper look to the thread you link.

2 different forms of free-money: Freicoin (free of basic interest because it's perishable), Mutual credit (no interest because it's abundant)
Andris
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May 24, 2011, 05:09:06 PM
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What are you talking about? Do you know some way to have a distributed currency without all this hashing business?

See my proposal in the thread above. There are various ways to do it, but essentially, every IP address belongs to one or more ISPs, which is given by an ASN. You can divide the input equally between ASNs, and divide them between 'halfs' of the IP space from there. Or some known combination - it could be handled semi-manually i.e. not every ASN necessarily deserves a full share or whatever.

Whatever is verified as active during a time unit, by whatever means, would get its commiserate share. If it's not active, the share either goes to the other people on their network, or if they were the only one on their ASN, gets divided between other networks entirely.

In my proposal this is done basically by having them handle transactions and getting the transaction fees - those that miss it don't get in, so it's basically uptime related. The bootstrap nodes are given the initial seed currency which can only engage in self-transactions down to a certain point. But this isn't necessarily the only way. My method necessitates a small transaction fee on all transactions from the start, to actually reward being a part of the network and verify that each component is working.
jtimon
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May 24, 2011, 05:32:53 PM
 #6

Quote from: Andris
...My method necessitates a small transaction fee on all transactions from the start...

How is the currency issued?

2 different forms of free-money: Freicoin (free of basic interest because it's perishable), Mutual credit (no interest because it's abundant)
Andris
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May 24, 2011, 06:09:31 PM
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How is the currency issued?

In the proposal in thread, seed currency is divided between the bootstrap nodes (in the same manner as transaction payments are done in general) that can only be used on self transactions down to a certain defined point. But other methods are possible.
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