mimblewimble team mailing list archive

["Gellert Grindelwald" <grindelwald@xxxxxxxxxxx>]

> dear Gellert,
>
>>> If we were to limit ourselves to at most 6 halvings, i.e. a minimum
>>> tail
>>> reward of REWARD / 64, then with peaking set to occur after 4 years,
>>> this tail  won't
>>> be reached until 64*4 = 256 years into the future, at which point
>>> we're long dead. (In bitcoin it only takes 6*4 = 24 years to reach).
>>
>> Yeah it is definitely not something we would see in our lifetimes, but
>> if
>> mimblewimble ever did survive that long then having a defined tail
>> emission after 5-6 epochs may be worth considering. At the same time,
>> like
>> you say, it will take hundreds of years for that to ever occur so it may
>> not really matter.
>>
>>> I would be ok with saying that while the formula is beautiful in its
>>> simplicity
>>> as it stands, we fully expect it to be hardforked at some point in the
>>> future into whatever seems appropriate at that time, as long as block
>>> reward never exceeds peak REWARD.
>>
>> Hardforking would hopefully be the last resort for changing the monetary
>> policy. This epoch emission scheme looks very reasonable so I am not
>> super
>> concerned about that.
>>
>>> In fact the most radical choice is x=0, which simply keeps the reward
>>> at a constant REWARD after the initial ramp-up. And this would be a
>>> perfectly sensible choice; probably better than any other value of x
>>> stated at the outset.
>>
>> This was something I was thinking about as well, but the inflation stays
>> high for a much longer period of time than the proposed epoch idea which
>> may keep volatility too high from a user's perspective making
>> mimblewimble
>> wholly unusable as a stable currency for many years. Maybe I am wrong on
>> that though.
>
> If you want to reach minimal inflation sooner rather than later,
> then indeed the halvings help a lot. If peaking happens after P years,
> then it takes P*16 years to reach an inflation under 2%,
> whereas with constant tail reward, it takes P*51 years.
> For comparison, with bitcoin it only takes 4*6 years.
>
> From an inflation limiting approach, 6 halvings suffice to get it well
> under control.
>
>> Obviously inflation is to be expected, but it is important it goes down
>> in
>> a reasonable manner (hopefully) adhering to two desirable goals. First
>> the
>> emission being deemed 'fair' to latecomers because 99% of the
>> hypothetical
>> users will come after and if the coin emission overly compensates early
>> adopters then they may refuse to adopt mimblewimble due to 'missing
>> out'.
>
> The late-peak, on the order of years, takes care of that.
>
>> And b) that the inflation is both predictable and declines
>> conservatively.
>> The epoch scheme meets both conditions much better than Bitcoin's
>> halvings
>> every four years, so we are definitely on the right path.
>
> A revised exponential epochs emission proposal looks like:
>
> let epoch i range over blocks [ 2^i , 2^{i+1} )
> pick some maximum number of doublings, d, and halvings, h,
> and a peak epoch p. let the block reward be
> 0 for epochs < p-d
> REWARD / 2^{p-i} for epoch i in [p-d, p)
> REWARD / 2^{min(i-p,h)} for epoch i >= p
>
> regards,
> -John
>

For the sake of simplicity and keeping to the original epoch emission
proposal. The peak epoch could be tweaked to 2 years instead of 4 years
and keep doubling from there. In effect this keeps the emission
conservative allowing epochs to continue to grow exponentially, but the
yearly inflation after 14 years(the end of the third epoch) is 2%. Now
since this modification would make the emission run dry a lot faster than
the original proposal. What could be done to combat this is after epoch 4
ends the yearly inflation is about 0.8% emitting around 0.3 coins a block,
so this could be the tail emission that stays constant drawing the end of
anymore epochs. So after 30 years a tail emission would kick in and
inflation would go down from 0.8% to near-zero over the years. This
arguably would still remain fair even though the first epoch only lasts 2
years because of the constant tail emission that would stay in effect
forever.

Cheers,
Gellert Grindelwald