From mboxrd@z Thu Jan 1 00:00:00 1970 Return-Path: Received: from smtp1.linuxfoundation.org (smtp1.linux-foundation.org [172.17.192.35]) by mail.linuxfoundation.org (Postfix) with ESMTPS id 8E6394D3 for ; Mon, 10 Aug 2015 21:14:21 +0000 (UTC) X-Greylist: whitelisted by SQLgrey-1.7.6 Received: from mail-pa0-f54.google.com (mail-pa0-f54.google.com [209.85.220.54]) by smtp1.linuxfoundation.org (Postfix) with ESMTPS id B935816F for ; Mon, 10 Aug 2015 21:14:20 +0000 (UTC) Received: by pabyb7 with SMTP id yb7so114092701pab.0 for ; Mon, 10 Aug 2015 14:14:20 -0700 (PDT) X-Google-DKIM-Signature: v=1; a=rsa-sha256; c=relaxed/relaxed; d=1e100.net; s=20130820; h=x-gm-message-state:message-id:date:from:user-agent:mime-version:to :subject:references:in-reply-to:content-type; bh=gv2doWDwwBscPtNma0OfVMzd3K+CufL41YdK3/s8QdU=; b=XhDzPGQTgcmyZUgfk042uZhkxLWxZY77+VxEZ/xmQETM4zSQSLtuf7rJ1vCllYqCvU xqRFqUQMvQYKzbZb1P71+OijgSlKIntBo41CNsDSAS9T7nlr4SmQNtORE5G2sS7TwHJd ms+YuFsoeUhdMV9olndLh2P975CcDBq7SbLXbY2I2e6yQ5kaFhwlmb9ZNqkuOYdPSEu9 SkfsI4CEbxPsWsYNncjwteJGoFHWnXdqFObKXw19WWF5sSL2TnOBrMvk9GUS4aWdCsMc Q0HvS+SL+tMJrpjak8Wtv1CopqCvRzO0rPE74BwziYDuvNatXU3o35EZ01XtyDJrPAy2 Zr/Q== X-Gm-Message-State: ALoCoQlAcAMh13TfsyaE9aRHEqrY4P9IzUhgGEazYwX/MU/3vuFYT833eMGDKH/YsyZp4+MjaFrd X-Received: by 10.66.197.234 with SMTP id ix10mr47808400pac.152.1439241260493; Mon, 10 Aug 2015 14:14:20 -0700 (PDT) Received: from [10.0.1.13] (c-73-225-134-208.hsd1.wa.comcast.net. [73.225.134.208]) by smtp.googlemail.com with ESMTPSA id rp12sm16870045pbb.65.2015.08.10.14.14.19 (version=TLSv1.2 cipher=ECDHE-RSA-AES128-GCM-SHA256 bits=128/128); Mon, 10 Aug 2015 14:14:19 -0700 (PDT) Message-ID: <55C913AC.7030607@voskuil.org> Date: Mon, 10 Aug 2015 14:12:12 -0700 From: Eric Voskuil User-Agent: Mozilla/5.0 (X11; Linux x86_64; rv:31.0) Gecko/20100101 Thunderbird/31.2.0 MIME-Version: 1.0 To: Anthony Towns , bitcoin-dev@lists.linuxfoundation.org References: <55C7D234.1040306@bitmarkets.net> <20150810185031.GA31610@navy> In-Reply-To: <20150810185031.GA31610@navy> Content-Type: multipart/signed; micalg=pgp-sha1; protocol="application/pgp-signature"; boundary="VjItdAxLj4KAqmBkN8TJc0kxp49I53dMD" X-Spam-Status: No, score=-2.6 required=5.0 tests=BAYES_00,LOTS_OF_MONEY, RCVD_IN_DNSWL_LOW autolearn=ham version=3.3.1 X-Spam-Checker-Version: SpamAssassin 3.3.1 (2010-03-16) on smtp1.linux-foundation.org Subject: Re: [bitcoin-dev] Off-chain transactions and miner fees X-BeenThere: bitcoin-dev@lists.linuxfoundation.org X-Mailman-Version: 2.1.12 Precedence: list List-Id: Bitcoin Development Discussion List-Unsubscribe: , List-Archive: List-Post: List-Help: List-Subscribe: , X-List-Received-Date: Mon, 10 Aug 2015 21:14:21 -0000 This is an OpenPGP/MIME signed message (RFC 4880 and 3156) --VjItdAxLj4KAqmBkN8TJc0kxp49I53dMD Content-Type: text/plain; charset=utf-8 Content-Transfer-Encoding: quoted-printable Hi Anthony, No belief can be shown to be universally held, and an appeal to authority is also a logical fallacy for good reason. The blog you quote is littered with flawed economic ideas. It's become a pet peeve of mine that people refer to mining (and/or validation) as a "tragedy of the commons" problem, or a "public good" subject to a "free rider" problem. This betrays a fundamental misunderstanding of both money and Bitcoin. I'm not commenting on the other merits of your argument or others in this thread, I mean just to dispute the validity of this particular reference. Even the portion you quoted is quite absurd: >> "We=E2=80=99re not spending so much on mining because we really need i= t. >> It=E2=80=99s because printing money distorts behaviour." We don't "really need" to prevent "printing money" - Bitcoin could somehow get by without that constraint? Preventing the printing of money is the only reason that Bitcoin exists. The tragedy of the commons scenario properly applies only to property controlled by the state. In the quoted blog the analogy is so misapplied that it fundamentally misrepresents the forces at work in Bitcoin. Bitcoin is not at all "like a lighthouse". State run lighthouses are financed via taxation. That may be taxation of anything, whether or not related to the shipping the lighthouse purports to protect. It may in fact protect no shipping at all, since payment is generally completely divorced from benefit, and the benefits may be completely divorced from shipping. For example, preservation of jobs for lighthouse keepers and the Coast Guard, or even nostalgia. Just as with a private grazing field, a truly private lighthouse would not have a "commons problem" at a= ll. Bitcoin mining is financed by a fixed schedule of inflation and transaction fees. State inflation is a tax on all holders of currency and a form of default on state debt. This and other taxes fund lighthouses. A tax is the seizure of someone else's property through force. Bitcoin inflation is predictable, so the inflation cost is factored in to its value before it is acquired, according to the depreciation schedule, just like bond valuation for example. This means it is NOT a tax, is merely a cost that is paid to miners for use of their security services. Bitcoin transaction "fees" are not fees in the state use-fee (taxation) sense, since the fees are priced based on voluntary trade. The blog misinterprets who is paying the cost of securing a transaction when it claims, "it's the sender who pays." Both parties to a transaction bear the cost of using any given medium of exchange. If the receiver is concerned about double spending risk, it's the sender who will have to compensate with time and/or money. But this is just as much a cost to the receiver as it has raised the effective price of his sales with the difference in money accruing to the third party. Finally, transaction fees *are* mining contracts. Creating *another* system of mining contracts initiated by a receiver would do nothing to change the economics, but it would significantly complicate the implementation (raising costs generally). The cost of paying a mining contract would of course be paid by the sender, in terms of increased price charged by the receiver. I believe that a fundamental misunderstanding of the important distinction between voluntary trade and state-controlled trade is underpinning a lot of confusion and misunderstanding with respect to the block size debate. Bitcoin does not have a commons problem specifically because it's designed to resist state control. It's only in the loss of that independence that such a problem would arise (and effectively kill Bitcoin altogether). Ironically the desire to fix a non-existent commons problem in Bitcoin seems to be a driving force behind what may in fact weaken its only defence against eventually becoming a commons. e On 08/10/2015 11:50 AM, Anthony Towns via bitcoin-dev wrote: > On Mon, Aug 10, 2015 at 12:20:36AM +0200, info--- via bitcoin-dev wrote= : >> one argument I often read on this mailing list is that it's essential = to >> reward miners with transaction fees at some point to secure the networ= k. >=20 > That's not a universally held belief. See for example: >=20 > https://en.bitcoin.it/wiki/Funding_network_security#Alternatives > https://bitcointalk.org/index.php?topic=3D157141.0 >=20 > It's also not clear to me what amount of security people actually "want= ". > In late May, Mike Hearn wrote: >=20 >> "Currently the Bitcoin community is being effectively taxed about >> $832,000 per day ... just to support mining! [...] >>=20 >> We=E2=80=99re not spending so much on mining because we really need = it. 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