How to destroy Bitcoins?
medium.com
medium.com
Anyway, it's not the "good" OP_RETURN method, but to send your coins from any altcoin to a provably impossible address I made a utility and print out of addresses for sending to "an address owned by the public key hash of 0" http://earlz.net/view/2014/10/22/0340/provably-spendable-alt...
Who would use such a service?
So yea, people used it because they didn't know better.. And because of how backwards the altcoin community is, most of the time it's the inexperienced people asking other inexperienced people for help.. so bad habits spread very quickly and pervasively
The whole situation you described is completely ridiculous though, because instead of 'destroying' coins the developers could have distributed their own coins to all other addresses proportionately based on balance.
The whole thing is an obvious scam from top to bottom, but I'm not surprised any more that some people would take the bait.
since the popularity and value of these things are very correlated, it makes way more sense to destroy. Who is going to spend real currency on a coin that is losing value day 1 because everyone has coins to sell?
Kind of like if I decided to use pine cones as a new currency, I could try to convince you by literally burning dollar bills and telling you their value had moved into those pine cones.
That's how I'm reading it at least.
Satoshi did this but I don't think any of his BTC has ever been moved from his wallet.
;-)
So the seller if the insurance tries to not pay on the extremely unlikely event, then even they don't get the money. Nobody does. But if they do agree to pay out the insurance, then they get to keep a portion of the money that was in the wallet. It's a way of ensuring honesty if even a small number of people are honest.
If the 'coins' were made of metal, paper, food, etc, than the "only to an economist" thought experiment would apply, as "only an economist" would think of value existing in confined economic constraints.
If I destroy them, your bitcoins will not instantly
appreciate because my bitcoins were not actively marketed.
A major premise of the 'Bitcoin economy' involves the stipulation that the 'BTC economy' is hard limited to "21,000,000" coins and dividable only down to .00000001
These rules are part of what has attracted people to apply real world value to an otherwise simple piece of accounting software. If someone proved they destroyed 20 million bitcoins somehow, or if there were a hard fork consensus among all major miners to nullify the last 10 million coins from being minable, thus limiting the BTC network to 11,000,000 full coins (1,100,000,000,000,000.0 total accountable units), than the perception of value relative to Euros or Dollars would, in what I would compare to the perceived value of limited edition toys like Beanie Babies, Magic the Gathering Cards, or Happy Meal toys. Only instead of a mass produced toy, it is a digital point system where people have used computer hardware to 'mine' BTC points.
If the Genesis coins started moving, one might assume the price of BTC to fluctuate as a result of peoples perception on the 'supply' of this digital currency.
If another cryptocoin is created with a design that agreeably surpasses that of the BTC protocol, than one might assume a migration of users from BTC to the presumably better protocol.
Though, the Genesis coins moving might also increase the price. Satoshi moving their coins would be a very monumental event---it's hard to predict how people would interpret in aggregate.
Coin that is contractually unspendable is sent to the lottery script as a non-playing donation. The eventual jackpot winner gets an unexpected windfall from someone else's failed dispute.
A lottery is literally one of the example applications (#8) on the Bitcoin Wiki "Contract" page.
Only issue I can see is divisibility: this would inevitably result in some addresses deserving <1 satoshi, leading to discrepancies when rounding.
(The distinction is relevant because I can imagine wanting to visibly destroy bitcoins that were e.g. proceeds of crime)
The recipe is this: Create a transaction with a transaction fee corresponding to the amount of BTC you want to destroy, and reveal this transaction only to the cooperating miner. The miner agrees to include the transaction without claiming the included fee.
Admittedly it's a bit pointless given that a better approach exists (OP_RETURN, as mentioned in the article).
It was already plenty easy to convert data to a multisig transaction. OP_RETURN doesn't add to the UTXO, while multisig transactions do, so OP_RETURN is less harmful.
This wasn't introduced to make it saving data to the blockchain easier, it was introduced to decrease the harm caused by spammers. It is more like a needle exchange.
Granted we are living in a very different technological age by then.
It seems that just removing them from circulation by any means would have the same result as "destroying" them.
But you can't prove that you did that to anyone else.
I did well on investments and earnings from late 2012 through late 2013. And I managed to invest much of it in co-located servers. But it was nothing like $500K. So it goes.