Please othe and guys, take the time to read this and if you feel the reasons are not enough, present more!Arguments for the MEW resolution recommending a change to the mining rewards.
This is a collection of arguments available. Even though I have been proponent of the change, it does not mean I personally support all these arguments. Also very harsh tone is used in debunking some arguments, developers or miners. It does not mean that I personally thought that way or especially had any grudge toward anyone I know or not know.
Preface: If it ain't broken, don't fix it.
During its short history, many issues about Monero have been fixed. Several of them have been so serious that without fixing them, it is not likely that Monero could live another year even technically, much less would anyone use it. Currently the issues hampering Monero's progress seriously, are lack of Database, lack of usable wallet, and dysfunctional emission. Of the first two, hardly anyone disagrees that it should be fixed. But their fixing is hard labor, which someone capable must do, and it takes time. The only one that could be fixed without effort, is the third one. Much time has passed that has proven that Monero is experiencing its moment of truth. Unless all the impediments to adoption are removed, the chances of success grow even slimmer. The market has already shown the distrust, and the value of XMR has shrank to so low that it is more than likely that the pillars of the economy just cannot find the time to support the coin any more, leading to its definite demise.
The core reason for supporting a change in emission is twofold - too high emission now punishes the community, enriching nobody. There is no economic justification for it, on the contrary it has already lead to the situation where Monero has dropped below the level of interest for investor-minded people. Since the community neither has grown during the time of uncertainty (to be fair - every coin is suffering, not Monero alone), all the emission is now burned with nothing in return. Not even the miners gain of the ongoing destruction of the value.
The first reason alone would hardly be legitimate for cutting the emission. The second, and more important reason is that fast mining leads to emitting most of the coins quickly. When the majority of coins are emitted, Monero needs to have established itself as the unquestionable leader in its market niche and have gained a general awareness and reasonable adoption in the people belonging to that niche. If Monero's market niche is privacy-conscious people and corporations, of which conservatively 10s of millions exist, the adoption in this segment needs to be a) much higher than competitors and b) large in absolute numbers, minimum 100,000s. If these targets are not met when the emission is 60-70% done, the risk for more resourceful parties taking all the hard labor of XMR/CN technology and forking the coin for their benefit is nearing certainty.
As a summary, NOT cutting the emission, risks the death of Monero in the short term, and (as a result of this) makes it weak to stand the challenge of the long term when "premined" coins are relegated in favor of new, "fair" ones, even using the same technology, again risking the death of Monero and total loss of value. BOTH of these can be mitigated by cutting the emission without delay, and the proposal is to cut it to 1/3. The future emission curve in this proposal would take exactly the same shape as if the block interval would be lengthened by a factor of 3. Exact table will follow.
The rest of the arguments are presented as debate against the prior published list of Arguments not in favor to the change:
Violation of social contract. Monero's social contract is not the same as Bitcoin's. Aminorex has bought into Monero, without knowing, and strongly opposing, perpetual emission. A possible contributor to the decline is that he and his investor circle have sold their holdings after by accident hearing that "there has always been the idea of have perpetual inflation", which has never part of their social contract or acceptable to them. The change now proposed is much less violation of any contract (not express nor implied), and it has been on the table constantly cince the takeover of Bitmonero. When Monero already existed, the then community voted about the emission, and the understanding (verified by many) is that CN people, miners and sockpuppets of the above won the poorly-organized popular vote against (nearly?) everyone then and still in the community, who presented the voice of reason, which would have saved us from the current contention. Namely: If the original voting could have probed the community's actual opinion, the emission would have been cut already. After such a history that Monero has in forks, takeovers and rigged votes on emission when it was already launched, any talk about "social contract" when the things are finally made how they should have been all the time, and no coin cap is touched, and nobody is put to suffer, is absurdly hypocritical.
Damage to the brand; retroactive instamine. Which would you rather have, a bad name, or a bad reality? Would you try to save your clear face now, just to be labelled premine later? If the community and the developers do not have the guts to change it now, as something can still be saved, what does it help to be "clean" in the graveyard of failed coins later? This is not table-talk, either the coin lives or not. Database, wallet and emission cut carry it to 2015. Our unison is required to make the emission change happen, and everyone who does not support it, should not continue badmouthing and just move on. As well as if the change does not happen, the losers move on. There is a demand for a fair cryptonote, possibly clean of the baggage of Monero. Nobody who is fair likes retroactive instamine, but if the alternative is a fork, I would choose retroactive instamine instead. It still seems more fair to the community.
Loss of hash rate. This absolutely favors the cut. Currently, daily inflation is 0.43% and this value (EUR 8.5k) is spent on supporting the network. Unless the emission is cut, and supposing that the price per unit stays the same, the inflation after 2 years is 0.05% (EUR 3.1k). If the current inflation is perceived as important to secure the network, the emission should immediately be cut, otherwise the future inflation has no chance to secure it. In reality, the proposed 0.9% annual inflation to secure the network in perpetuity is only 0.0025% per day, which makes the discussion about the current inflation as means of securing the network totally pointless, by 2 orders of magnitude. Securing gold or silver costs 0.2%-0.5% per year. Therefore 0.9% per year should be enough if crypto wants to compete. 100++% per year (now) is definitely enough, and raising this argument reveals a serious lack of math and understanding.
Miners. They are seeking profit and have 500 coins to choose from, when conducting business most profitably. The influence miners should have when making the decisions about the coin's future should be limited. If the coin dies as a result of bad decisions, the owners suffer. If the decisions are good, the owners take profits also. Miners have invested in their equipment, and it is their duty to put them to the best use. Any consideration towards the miners from the part of owners (the MEW is the aggregate of the owners) is as misguided, as is the miners' consideration that "oh we pity the owners and don't want to dump, take the hit rather). It is important to be clear on this. Coins are hard-forking every week, there is no reason whatsoever to believe the miners would somehow boycott it, and even if they did, it would just mean that the EUR 8.5k per day would be there for other miners to take. The "special mining interests" do not exist, and this is a good opportunity to show it, to reclaim the legitimacy among the community who is not entirely confident of it given the new hashing function with room for optimization. Besides it is quite likely that cut of emission raises the price per unit.
Increase of inflation over time. Basically all that matters is the ratio of daily percentage growth of the userbase vs. daily percentage growth in emission. The matter is manifold. If the emission is larger than adoption growth, the price plummets. If they go hand-in-hand, it stays stable. If adoption grows faster than emission, the price may also increase. The problem comes when really high growth is sought. That does not even happen with a coin that does not have enough emission. The markets know where it is possible to grow, and no fastmined crypto has ever gained any popularity after becoming nearly fully mined. Even Bitcoin has got fat with early holders hoping that the price would go up one more time that they could sell. The main reason for cutting the emission is NOT avoiding the death that looms near, it is avoiding the legitimacy problem of being too much mined when it is time to hit mainstream. Inflation is a good thing. The opposite of inflation is called premine, or POS. The current course is destroying the price (and alongside, the community, and prospects) with needless inflation, and hoping that the coin would, after all these sacrifices, pick up when inflation abates. It is in the power of our community to give a signal that the fastmine is needless, and that Monero is actually designed for long-term adoption, by emitting the coins slowly over time.
"Therefore a faster curve makes sense now." There is no sense in any "faster curve", except the placating of scammers and developers who want to cash out at the first pump. Since Monero developers are not scammers, and the development is hard work and no pay, what we should do to show our gratitude to them is to propose the most reasonable long-term emission curve that would preserve the unique position that Monero has now, with the highest probability of success that the developers also would receive their honest rewards.
Position of MEW in recommending the change. The MEW has been inaugurated with great care to be the most legitimate possible way of making the voice of an anonymous cryptocurrency's owners heard in proportion to their influence. Officially, the MEW votes represent 15% of the owners, the real figure being much higher though. If the MEW was there in April, there would be no need to vote again about the matter that has been desired ever since. The decisions then were done in situation then available. Now we have a better structure for voting.
If the core team made this kind of change alone, without having a measurable community opinion behind it, I would probably object. Now the circumstances are such that the MEW is in position of giving an overriding vote of confidence to the original plan of the core team, for Monero, the plan that was foiled in the early days by people who are not around anymore, and who have leeched enough on the coin that is now ours. Monero has a great future. The enemies are constantly critizicing us for the lack of leadership. Now is our chance, a crucial one at that, to show that they are wrong. We are all in the same boat, and it is burning. How about doing what it takes now, so that we can continue to other things?
