Author: vjudeu at gazeta.pl 2022-07-06 11:10:27
Published on: 2022-07-06T11:10:27+00:00
Haddad, a user on the bitcoin-dev forum, stated that Bitcoin's finite supply is the main argument for people investing in it. However, a finite supply alone is not enough to give something value; it must also be useful in some way. In the case of Bitcoin, various forms of cryptographic security must all work - and work together - to make Bitcoin useful. If the only realistic way to pay for Bitcoin's security was by having some inflation scheme that violated the 21 million cap, then agreeing to break the limit would probably be what makes sense, and in the economic interest of its users and holders.There will always be competitive pressures with respect to efficiency, and both being over-secured and under-secured would be economically inefficient for a crypto currency, and thereby laving room for a more optimally-secured competitor to gain ground. Currently, there is zero feedback in the Bitcoin system between what we might think is the optimum amount of security and what actually exists. Another option, if we were to decide we are over-secured in the short term, would be to soft-fork in a reduction in the current and near-future mining rewards, by somehow locking the coins in a contract that deprived the miner of the full reward, and then using that contract to pay the rewards out far in the future, should at some point we feel the security budget was insufficient.Paul Sztorc presented three options to pay for Bitcoin's security: Enormous Block Size Increases, Violate 21M Coin Limit, or >50% Miner Fee-Revenues Come From Merged Mining. Using Merged Mining is considered the best option. It is possible to create a soft-fork for reducing the current and near-future mining rewards, but it is uncertain whether miners will agree to send some coinbase reward to "OP_CHECKLOCKTIMEVERIFY OP_DROP OP_TRUE". There is no agreement on how much security would constitute an optimum amount, and a market mechanism to answer that question will be an important project.
Updated on: 2023-06-15T21:22:36.882826+00:00