@Peter Todd
> The fact of the matter is that the present amount of security is about 1.7% of
the total coin supply/year
That's on the order of what
I calculated: ~0.5%. I'm curious where the 1.7% number comes from. Perhaps much of the difference in our two numbers likely comes from me incorporating what I call the
"Economic Mining Monopoly Attack" which effectively cuts the security in half.
> There's zero reason to stress about finding an "optimal" amount. An amount low enough to be easily affordable, but non-zero, is fine.
That's fair. What I mean is that we should estimate an optimal value to some degree of accuracy. It doesn't have to be super accurate. But too low and we could have a bad time. Too high and its a deadweight cost forever (which increases fees, slows adoption, and causes an inflation-like devaluation force on bitcoin, which has all the familiar market distorting effects, albeit to a much smaller degree than we're used to). In any case, we need to come to an accurate enough estimate of how much is enough security so that we ensure we're above that amount.
> These are all amounts that are likely to be dwarfed by economic shifts.
Perhaps you're right. Regardless, its certainly an improvement to what we've had the last 100 years.
@Erik Voskuil
> You cannot support the blanket statement (and absent any assumption) that lower confirmation rates produce “much higher fees” or “better security”.
I can in fact support it. The theory of supply and demand supports it. Well, depending on what you mean by "fees". Reducing the block size will certainly increase average fees/vbyte. Whether it increases total fees collected by miners (and thus lead to "better security") is another story - a story that depends on the demand dynamics in the market. It could very well be that reducing the blocksize reduces the number of transactions by a higher proportion than fees go up. As we have seen in past periods of high traffic tho, total fees go up *quite* a lot. So it seems pretty clear to me that constraining the block size would very likely increase total fees collected by miners, at least for the near future.
@Carvalho
> I will reiterate. Proof of work and the difficulty adjustment scheme already solve all of these issues
You haven't addressed any of the comments that disagree with you above. You didn't address any of my comments originally. You are simply claiming things without any logical support. If you want to be a respectable part of this conversation, I'd recommend explaining yourself much more thoroughly.
> That restaurant is too popular, nobody goes there anymore.
If you could feed 100,000 people with 1 entire from a restaurant, your restaurant might not make enough money to survive despite feeding the entire country. That's what the lightning network does for/to bitcoin. We need to make sure the restaurant can afford to staff itself despite massive increases in food-use efficiency.