Hi Odinn,

I think trying to incentivise nodes with money is tricky: it makes intuitive sense but right now the market is flooded with supply relative to demand. Yes, we worry about the falling number of nodes, but that's for reasons that aren't really economic: the more nodes we have, the bigger and more grassroots the project seems to the outside world, plus the cheaper it gets for everyone as the biggest cost (chain upload bandwidth) is spread over multiple people.

Also there's research showing that when you have people volunteering, introducing money can ruin the motivation of the volunteers, so the transition to a pay-for-node-services world could be quite painful and difficult.

Right now rather than microdonations to all nodes, IMO the lowest hanging fruit is to move chain upload onto specialised "archival nodes" which can potentially charge for their services. I prototyped this here

https://github.com/mikehearn/PayFile

but never finished it.


On Mon, Jun 16, 2014 at 10:12 AM, Odinn Cyberguerrilla <odinn.cyberguerrilla@riseup.net> wrote:
I have been noticing for some time the problem which Mike H. identified as
how we are bleeding nodes ~ losing nodes over time.

This link was referenced in the coindesk article of May 9, 2014:

http://sourceforge.net/p/bitcoin/mailman/bitcoin-development/thread/CANEZrP2rgiQHpekEpFviJ22QsiV%2Bs-F2pqosaZOA5WrRtJx5pg%40mail.gmail.com/#msg32196023

(coindesk article for reference: http://www.coindesk.com/bitcoin-nodes-need/)

The proposed solution is noted here as a portion of an issue at:
 https://github.com/bitcoin/bitcoin/issues/4079

Essentially that part which has to do with helping reduce
the loss of nodes is as follows:

"a feature similar to that suggested by @gmaxwell that would process small
change and tiny txouts to user specified donation targets, in an
incentivized process. Those running full nodes (Bitcoin Core all the
time), processing their change and txouts through Core, would be provided
incentives in the form of a 'decentralizing lottery' such that all
participants who are running nodes and donating no matter how infrequently
(and no matter who they donate to) will be entered in the 'decentralizing
lottery,' the 'award amounts' (which would be distinct from 'block
rewards' for any mining) would vary from small to large bitcoin amounts
depending on how many participants are involved in the donations process.
This would help incentivize individuals to run full nodes as well as
encouraging giving and microdonations. The option could be expressed in
the transactions area to contribute to help bitcoin core development for
those that are setting up change and txouts for donations, regarding the
microdonation portion (which has also has been expressed conceptually at
abis.io"

This addresses the issue of how to incentivize more
interested individuals to run full nodes (Bitcoin Core).  The lottery
concept (which would be applicable to anyone running the full node
regardless of whether or not they are mining) is attractive from the point
of view that it will complement the block reward concept already in place
which serves those who mine, but more attractive to the individual who
doesn't feel the urge to mine, but would like to have the chance of being
compensated for the effort they put into the system.

I hope that this leads to additional development discussion on these
concepts regarding incentivizing giving. This may also involve a process
BIP.  I look forward to your remarks.

Respect,

Odinn


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