So let’s assume that starting from block 700,000 (better to take something related to mining or emission epochs, but okay for starters), emission reduction is done via following rules:
if block reward is not less than 24 ERG, send 21 ERG from it to the reemission contract
otherwise, block reward R is less than 24 ERG, send R - 3 ERG from it to the reemission contract
With following rules, starting from block # 1,562,400 , effective emission will be 3 ERG.
Total reemission fund then would be about 23,553,600 ERG.
Considering that re-emission contract will pay 3 ERG per block also (starting from 2,080,800) , thus creating a long tail starting from block # 1,562,400, we are getting ~29.88 more years of stable rewards (so ~38 years of emission in total, starting from mainnet launch), so before year 2057 miners will have stable part of income.
sounds good to me Kushti, healthy overall for both original supporters and longevity of mining. The current emmission was always scary in many ways, if it is changed to 30 years many objections towards the blockchain dissapear, also much more time to develope storage fee system.
How safe if this contract that will be holding a hefty sum of ERG from potential hacks?
I’m all for extending the mining timeline. Will help with the price I’d imagine.
However to propose the change, are you saying the storage rent is thought to no longer keep incentive high enough for miners to participate after all coins mined?
Rather than create a re-emission contract with it’s own token that is burned for ERG and requires a soft-fork, could a crowdfunded contract (or several) not be created?
Contracts could be programmed to airdrop donated rewards (Pure ERG ideally, rather than alternative tokens) via a set emission schedule.
In this way everything is consent driven and no soft-fork should be required.
dApps could even reward donators with some airdrops of their own tokens, (as they require the network to be secure to function, encouraging or requiring users to donate to network security is in everyone’s best interest.)
Would also pave the way for more mature iterations of SmartPools.
My question might be simple and stupid but I think many people can have it.
We need miners for the function of the network and also to secure the network, and also we need to reward miners for it.
Now the emission is very radical, and we want to expand the emission. This means that miners will get less ERG for their rewards.
At the current price of ERG, changing the emission means that the rewards will become less, and the profitability will fall. We need to keep the miners’ profitability high.
So my question is what will happen to profitability? I guess that it is expected that the ERG price will rise, but what will happen if this never happens? Shouldn’t the rewards be adapted to the profitability?
Yes, if block rewards were to be massively cut now and the token price also keep around its current level, then miners will leave the network.
This in turn would leave it more probable of a big share of hash hack maybe?
As a miner myself, I like ERG, so that’s why I mine it, making rewards along the way to help with energy costs and up keep of the hardware.
Do I like the idea of all this ERG being taken from the rewards and put into a contract somewhere that’s opens up potential of it being open to bad actors, then no, that makes me nervous.
Whilst I prefer that a change not be required, I can see the need for the emission proposal as the market conditions currently stand.
~50k ERG currently entering supply daily has a significant impact on price and mining profitability with current liquidity levels and adoption.
Its hard to predict what the future will hold. Many potential factors such as miner migration, dapp adoption, significant liquidity increase, proven storage rent modelling, side-chain mining incentives etc could all alleviate the need for this proposal though nothing is certain.
Due to this uncertainty, I believe ensuring the security of the protocol by retaining and increasing miner numbers is of upmost importance. If extending the emission schedule as proposed ensures at a minimum, miners will continue to be rewarded in future years, then it has my support.
Prolonging emissions for miners to continue to secure the protocol while the ecosystem matures and incentives are continuously added, whilst limiting the sell pressure of many coins coming into circulation every day and increasing liquidity and adoption, I think is a good compromise for miners and investors to both benefit.
I think the majority would agree to extending the tail however, I think extending it by ~30 years is a bit much. You’ll be having pretty much a halving of emissions come March and that could lead to problems in the short to mid term.
A shorter tail extension and a less severe reduction in the block rewards would be better.
I agree with kushti’s Emission Soft-Fork Proposal and I don’t see what could be done even better.
As another fundamentally important problem, It would be good to consider protection from 51% attacks that pose a great danger now that ethereum is moving to POS. Maybe something like Modified Exponential Subjective Scoring (MESS) could be implemented. 51% attacks can significantly damage the reputation of coin and the trust of users and investors.
I can see the benefits of the proposed changes and am happy to see some engagement and discussion on the matter. The long-term crypto economic security of the network needs to be taken into account.
The reduction proposed is aggressive and most likely needs to be met with an equally aggressive plan to increase market access to maintain profitability for miners if we roll over the adjustment cliff.
It does potentially solve the issue of over-aggressive emissions but could also potentially create a short-term challenge to support the cost adjustment needed to maintain miner profitability. I will do what I can to help offset that risk.
There seems to be a decent community consensus in support of this adjustment.
Probably the hot conversation about mining is the potential to change the adjustment period/epoch length.
I am curious how one change here could affect the other.
There has been discontent among smaller miners for difficulty/block time swings. I think it might be something to address or at least think about.
How could the proposed changes could potentially impact coin hopping and difficulty adjustments?
Kushti, what is your impression on how the proposed changes to emissions could impact the short-term profitability of mining ERG, and do you see any additional risk with the difficulty adjustment rotation we have been seeing?
Wanting to stay on the ergo network is admirable, but I guess it needs to be balanced with paying electric bills. I hope these will be growing pains that will stabilize as the network grows, and I would like to avoid a HF.
@kushti I think idea is good. It will help to become hodlers od Ergo more rich. Did You disscussed IT with miners on groups like Reddit? If You take from miners possibility to earn money like Ethereum Devs moving to PoS they would be very angry and may leave Ergo network.
As a miner I am also holder so from both perspective I think that You need to connect this lower emission rate with some big announcement.
You also need to think which time exactly You should lower emission. We may have eth difficulity bomb so it would be hard time for miners if You also cut revenues from mining Ergo at the same time…
So I don’t know if lowered emission should take place before Ethereum going to PoS or after.
Miner here, I contribute a small farm of 5 GH/s to the network. I’m a believer in this project and I am grateful to see how fair the distribution of ∑ has been so far.
I like the idea of being able to mine Ergo for the next 30 years but I’m concerned how this will collide with Eth moving to POS. I watched the impact of EIP-1559 on the ergo network, and while the short-term price action was great, the difficulty and block rewards were a bit painful. If the move to POS for Eth colides with the reduction of block rewards and doesn’t produce a sustainable price of Erg for miners it may be catastrophic to the network.
With no other real POW coin on the horizon, a mass influx of hash combined with a reduction of block rewards will push out all but the most effecient/industrial farms who have access to cheap electricity.
Is there perhaps a compromise of a shorter time period, say 10-15 years that has a smaller impact on block reward? Thanks for listening. -TC
How safe if this contract that will be holding a hefty sum of ERG from potential hacks?
Funds will be sent to re-emission contract, which is a simplified version of the current emission contract (emission in Ergo is made via a contract, so not hardcoded into the protocol).
However to propose the change, are you saying the storage rent is thought to no longer keep incentive high enough for miners to participate after all coins mined?
Storage rent will remain the same , however, we may consider smoothing rewards from it by requiring spending it fully or partially to a form re-emission contract . However, no rush here, investigation and modelling can be done later.
