I have been thinking quite a lot about the pros and cons of lost coin recirculation. I think this is a great opportunity to pioneer an important standard that (imo) is underdiscussed in the cybercoin mindsphere.
The basic idea is that coins that haven’t moved or proved their liveness should be reclaimed by the network and distributed either to miners or to holders proportional to their stake.
My Thoughts:
Pros:
Maintains long-term stability of monetary base = Very Good. It does seem very important that the supply of a dominant unit of account should be predictable.
Could provide miner rewards (or PoS-like rewards, proportional to everyone’s holdings?) after issuance is complete. Nobody knows how the fee market will work post-issuance, and it might be worthwhile to provide additional incentives to securing the network, especially if ZEC is still pure POW.
In the case of hypothetical PoS-like rewards:Rewards for all users relative to their holdings. This enriches users and founders alike. (this is a reason why I like PoS for the future of Zcash, but that’s for another thread)
Removes old UTXO’s - My understanding is that this matters on a technical level. I don’t really understand why, or how much it matters, but I think this is “technical debt”? Sorry if I’m using the term improperly.
Cons:
I expect the biggest objection to be philosophical. People can’t just sit on their private keys forever and forget about 'em while expecting the funds to still be there. This seems like an ideological problem more than anything (“cypherpunk ethos”), and personally, I’m not super worried about it. I think third parties (exchanges, hardware wallets, software wallets) could automate migration / remind you to move your coins before losing them.
-Long-term storate requires a trusted custodian/third party, unless you can shoulder the responsibility of proof-of-liveness (not sure if this is a con, but people will prolly view it as such)
-Adds mental overhead (I don’t think this is a huge deal, as cybercoins are already super hard to use, what’s 1 transaction on a (potentially) biannual basis?
Specifics to consider:
How often should proof-of-liveness be required? 2 years? 4 years? 10?
Please share any and all thoughts you have! If other people are discussing this, please share links!
Please keep an open mind! I also thought it was a terrible idea at first. Don’t be shy, I think it’s important that this forum becomes a productive place to brainstorm.
No, sorry. I carefully considered your post but disagree with the ‘use it or lose it’ idea when applied to money.
If I have something of value, for instance a gold brick, and choose to bury it for 100 years to benefit my decendants thats my choice. Why should crypto be different? Value belongs to the holder & that should not be messed with.
I get your idea, but the network effects of crypto have yet to be seen - it’ll happen, not soon, but when it does it’ll be amazing.
I think this is just a NO GO proposal for several reasons. While i’am myself a POS fan, like you, the idea in your post is against common sense, ethic, moral and even fairness.
Once a coin, in our case a ZEC has an owner it shouldn’t be concern nobody from here what why when how is done with it. As a holder it’s just my choice if i use it, leave it, hold it for 100 years or whatever. Nobody else even should think about it than just me, leave alone burning, re-mining or whatever.
This is a reason why i even hate these coin swaps that have a limited time framed windows for swapping, just as an example.
The argument “Lost coins = lost value to the network” doesn’t make sense for me. First of all the quantity of lost coins never will be known, so a mathematicall calculation isn’t possible. Second, normally they less coins the higher value the remaining ones have. Third, for a network to operate it needs nodes. I don’t think it matters if there is 1 node with 100 ZEC for example or 100 nodes with 1 ZEC. Actually the 100 nodes with 1 ZEC would be more secure and of value for the network in my opinion.
The argument of “Use it or lose it” is a deep intervention in my privacy, independence and could even violate several laws.
I feel you guys in your responses, and that was my first reaction as well. And you might be right!
My thoughts in response:
@ChileBob Bob: Yes crypto and gold are similar, but they don’t have to be. It’s a nice analogy, but it shouldn’t railroad our thinking. We have the opportunity to make something unique and new. I think we should! Analogies are great for explaining a new concept, but pretty bad for debate or as a design spec because with an analogy, you’re by definition taking about different things.
@boxalex Common sense is an illusion. Everyone thinks they have it, but they have different ideas of where it leads. “Fairness” is a concept invented so children can participate in debate. (Same with the word “Should”. It feels like it means something, but it doesn’t. Again, everyone has their own idea what “should” happen) We’re designing a protocol that people opt into with the software they run. Not sure how that could be considered unfair. I agree that CSW’s Lost coins = lost value argument doesn’t make much sense, but I’m open to the idea that I’m missing something.
Not sure If we can make any conclusions about the privacy implications without knowing how it would even be implemented.
Final provocative thought: are you guys against the turnstile? It looks like we may have to move coins every X years in order to use the newest pool. (Not even sure if “proof of liveness” would require funds to move)
Really appreciate both of you sharing your thoughts on this. Sorry for this unpolished reply, I gotta go to work atm. Would love to get someone smarter than me to weigh in on technical benefits (if any) and how important they are.
A further thought - ZEC has a maximum supply, making it a scarce commodity and defining its value. Lost coins reinforce that, its a good thing.
As for the turnstile, yup, think its a great idea. Its the only way to audit something that cannot otherwise be counted. There are ways to preserve privacy when moving funds through the turnstile & the official migration tool standardizes that.
Money is just an expression of confidence. Audits (ie: turnstile), fixed supply, reduced supply from lost coin, guaranteed ownership, etc increases confidence and in turn its value. Anything that might damage confidence is a ‘bad thing’.
: Salvage, fixing OP_False, and more | by Craig Wright (Bitcoin SV is Bitcoin.) | Medium <— The reasoning here (Lost coins = Lost value to the network) does not make sense to me, but i am open to an explanation!
Sorry for this unpolished reply, I gotta go to work atm. Would love to get someone smarter than me to weigh in on technical benefits (if any) and how important they are.