@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz Thanks for the detailed example, I think I see the disagreement point. Give me a few hours for dinner & I will try to point it out.
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz Sorry for delay.
I think your conservation scenario assumes 2 unrealistic things:
- that you can always keep the same nominal BTC/BCH balance while consolidating, spending & receiving, while at the same time not trading;
- that not only you don't trade, but also nobody else does!
I think your conservation scenario assumes 2 unrealistic things:
- that you can always keep the same nominal BTC/BCH balance while consolidating, spending & receiving, while at the same time not trading;
- that not only you don't trade, but also nobody else does!
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz I try to generalize a little bit your scenario, to stay more compact in tweets. Initially, at t0, I have x% (in your example x=0.1) of the total value of bitcoin, V. The USD value of V depends on BTC/USD market rate, but we can ignore this here.
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz At t1, an altcoin is created (let's ignore the specific attempt at phishing/fraud of Bcash, let's assume it's an honest one), but instead of an arbitrary new distribution scheme (which I agree w/ you dilutes the value WAY MORE), the creator decides to airdrop the coins already...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...in existence to all BTC owners, based on a specific UTXO state (let's ignore the stupid way Bcash did this, keeping the previous history for no reason at all, let's assume it's done properly). Now I have the value x%*V+x'%*V', where x' is my % share of total BCH & V' is the...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...total value of BCH. Specifically x'=b*x, where b is the relative balance BCH/BTC you own, while V'=r*V, where r is the relative market rate BCH/BTC. As you correctly stated, r=r(t), but the point is that realistically also b=b(t), since even if I don't trade, I will have...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...to purchase/receive/mine/spend/consolidate my BTCs, unless we degenerate in the very special case in which my role as Bitcoin user is restricted at purchasing some at t<t1 & then stop using it as SoV or MoE forever (not my actual case, I would argue not the case for many)...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...keeping my b=1 (assuming inflation rate in BCH stays exactly the same of BTC forever, which is already a strong assumption). We could instead argue, since Bitcoin adoption right now is still very low, that at equilibrium, post-hyper-bitcoinization, the typical user will...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...have b=0, since he will start acquiring/saving Bitcoin in t>t1. The value owned by a generalized bitcoiner will be (x%*V)*(1+b(t)*r(t)), & his share of the total value V*(1+r(t)) will be x%*(1+b(t)*r(t))/(1+r(t)). Of course V itslef can vary in USD terms, both for demand...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...increase (going up) & for network effect breaking (going down), but let's not consider it now. If many of this altcoin airdrops happens, in an unpredictable way, the estimated value for an adopter becomes increasingly complex to calculate upfront. I guess you're right about...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...the fact that it's improper to call this stuff "dilution", just as in the case of non-airdrop-distributed altcoins. Let's say that a scenario where many altcoins are unpredictably created & airdrop, together w/ the cost of network effect loss (that, as you said, *could* in...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...theory be compensated by a "specialization" serving different market niches, while I find it very unlikely talking about money, & NOT the case for BCH for sure), & w/ the cost of increased complexity of the system (doubling software tools to maintain, double prices to list)...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...the user will also incur in the (non-trivial) cost of always keeping his b constant, to avoid losing (or gaining) unpredictably shares of total value. The more altcoins you create this way, the higher the cost. W/ all this I don't want to argue that airdrops aren't better...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz ...than newly mined (or even premined) coins. They are. If I had to imagine a functional/etical hierarchy of the ways of creating a new coin, it would be:
1) 2way-pegged side-chain
2) 1way-pegges Proof of Burn
3) UTXO-based airdrop
4) fair mining from scratch
5) premined/ICO
...
1) 2way-pegged side-chain
2) 1way-pegges Proof of Burn
3) UTXO-based airdrop
4) fair mining from scratch
5) premined/ICO
...
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz (this ignoring the possibility that the distribution strategy in 3 could be use for fraud/phishing attempts like Bcash).
My point is that strategy 3, while better than 4 or 5, isn't the best, nor neutral to btc users/investors in the long run. But "dilution" was oversimplifying.
My point is that strategy 3, while better than 4 or 5, isn't the best, nor neutral to btc users/investors in the long run. But "dilution" was oversimplifying.
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz Anyway, after this interesting exchange which forced me to formalize better my thoughts, I would never phrase the initial tweet like this: .
Not just oversimplified, but also overall misleading. Thank you @MeniRosenfeld for helping me clarifying.
Not just oversimplified, but also overall misleading. Thank you @MeniRosenfeld for helping me clarifying.
@MeniRosenfeld @_Kevin_Pham @francispouliot_ @VitalikButerin @TokenHash @StopAndDecrypt @adam3us @DanielKrawisz Specifically, for new users for which b=0, creation of (successful) airdrop-altcoins WOULD BE a net dilution (=x%/(1+r(t))). But for early adopters who never acquire anything after t1, it would actually be an "anti-dilution"!!! But one subject to 2 degrees of uncertainty (V&r).
