That Bitcoin magazine article that is calling for Bitcoin holders to pay a fee for holding Bitcoin is the reason why reading Hayek, Mises, Rothbard and Bastiat is important.
It will be incredibly useful to counter braindead, anti-capitalist, socialist ideas like that.
Libertarianism and Bitcoin go hand-in-hand. One cannot flourish without the other.
I haven’t read the article, so please forgive if my reply is redundant…
I can understand ETF holders to pay a fee. The fund is providing you the service of custodying your bitcoin.
But why would you pay a fee to simply hodl your Bitcoin? Sounds like nonsense. But I’d be curious to hear the author’s arguments. Will look for it later!
It comes from him making a base assumption that there is something called 'Bitcoin ethos', interpreting said imaginary ethos in his own way and opining that the code that everyone runs on their node should adhere to these ethos.
This stands contradictory to the fact that there is no 'official' reference implementation or spec that the Bitcoin network adheres to. (Something that Bcashers wanted if I remember correctly)
There is no such thing as 'Bitcoin ethos'. Just code, consensus rules and a database. If he wants to change any of this, he can indeed fork off, run his own version on his node and convince other people to run it.
I won't.
Just read the article
Tbh a “HODL tax” sounds like a joke to troll the overly serious or curmudgeonly bitcoiner.
If so…. He got me 😂
Just a couple of thoughts as to why bitcoin doesn’t need, shouldn’t attempt, and (LOL) will never see a HODL tax in consensus rules:
1) HODLing bitcoin, ie reducing the liquid supply, is arguably the main reason that Bitcoin’s purchasing power increases over time.
2) We don’t have a “security budget problem” — if Bitcoin doesn’t die (which it won’t), then it will become so widely adopted that miner revenue will not be a concern.
2b) Mining will eventually become so competitive that most “bitcoin mining companies” won’t be profitable on their own. Instead, the majority of companies in the world will also mine Bitcoin as a supplementary form of income, whether by using the heat for their operations such as in the case of drying lumber for paper mills or heating the pool at a local fitness club, or literally heating office spaces. Businesses will do business as usual to make an income, and their Bitcoin mining byproducts will offset the cost of regular business and therefore give them a competitive edge in their industry. It will be mind-boggling to witness, especially for those of us who anticipate it and see it coming.
3) Has the author thought about why Satoshi structured Bitcoin to be a perfect blend where self-interested action is synonymous with the greater good [of the network]? Why on earth would any node-runner choose to implement a rule that would directly reduce their own financial well-being (especially in the utter absence of completely overwhelming absence of any evidence that a hodl tax would be beneficial in reality)?
4) If he’s writing an opinion piece for Bitcoin Magazine, he must have spent at least a little time around the Austrian economic philosophy that many bitcoiners prefer. Yet he’s proposing a TAX…. Is he just trolling???
hodl tax is crazy. the experiment is that there is 21 million fixed supply, set distribution schedule, and a fee market for transactions. It either fails or succeeds. Plenty of other crypto projects out there with all this other bullshit.
You don't need to reach to philosophy to reject this. There was a deliberate decision early on to support the network via usage fees, not via holding fees: otherwise some non-zero inflation would have been the cleanest solution.
It does, of course, imply a third stage of Bitcoin's economic journey, which creates uncertainty. But you can't say people weren't warned!
https://rusty-lightning.medium.com/the-three-economic-eras-of-bitcoin-d43bf0cf058a
It is not a rejection based on a philosophical argument but an economic one.
An individual will not want to hold a monetary good that gets confiscated periodically in portions just because they are holding it. I can speak for myself with utmost confidence and say that I certainly will not want to.
It's a rejection based on examining my own incentives and preferences to stick to the current set of rules, after considering the risks and threats of doing so.
If someone else finds such a monetary good desirable, then they are free to run a version of Bitcoin that has those rules. I will not be running that version on my node and will instead stick to the version with the current rules that has no 'holding fees'.
I elaborated further in this note:
You assertions about what people will do is ungrounded: people do this currently. Notably, Bitcoin currently has inflation, so one could argue that the transition which will occur is the change!
I agree with you, but mainly because I believe changing would be unethical. But the that would also apply if the original design was the other way.
My assertion was related to 'holding fees', not inflation. It was as follows: I don't want what I hold to be confiscated periodically via a 'holding fees'. I am very confident about what I want.
I then made an extrapolation that it could then follow that other people will want what I want. Maybe it is ungrounded because there is no way for me to know other people's preferences. But the fact that there is no *voluntary* system in which people adhere to such rules is telling. If there was real demand for such rules, maybe there would've already been a fork with those rules. I wouldn't mind if there is a fork like that that exists. If people want to create a different version of Bitcoin with those rules and use it, they are free to do so. I will not use it. That much I know.
Even in the case of inflation, its *predictable* supply and issuance is one of the many crucial reasons I hold and use Bitcoin. This policy is disinflationary and has not been changed. It is my preference to want such a system. It has also been the preference of many others, clearly. If there is demand for one that has perpetual inflation (say for example one that doesn't have BIP42), I do not mind people forking off and using that version. I will not use it.
Regarding your article:
If it comes to a civil war related to supply inflation like you mentioned in the article which is certainly probable, I will side with those who don't want to change the existing rule set and keep the supply and issuance schedule intact. Some economists might suggest an inflation, but I reject their suggestion. Once again, they free to run a different version of Bitcoin and I will not force them to think the way I think or to run the code I run.
The network has hundreds of millions of participants now (will be billions in the future) so changes will entail far greater complexities than it used to during the early days when developers and miners had a lot more control. Hence, there will be an insane amount resistance to them based not on dogma or 'maximalism', but on elementary self-interest and self-preservation.
Coming to consensus for anything will become almost impossible. This is inevitable.
So not only will miners and businesses be very unhappy at some point in the future, so will the developers.
