An interesting proposal has surfaced on Reddit, detailing how Bitcoin should be used as it was originally designed and envisioned by Satoshi Nakamoto. That in itself is nothing new, but the idea of crowdfunding Bitcoin Classic miners for every block they mine on the network is something else entirely. If this concept came to fruition, there would be a big incentive for miners to switch to Bitcoin Classic mining pools.
Incentivizing Bitcoin Classic Mining
It does not make much difference for miners to stick with a traditional mining pool, or switch to one supporting the Bitcoin Classic implementation. That is unless the miner is very passionate about what this alternative development branch aims to bring to the digital currency table in the coming months.
A new initiative is currently in the concept stage, which will bring crowdfunding to the Bitcoin mining landscape. A Reddit post mentions how Bitcoin Classic supporters could set up a fund, held in multi-signature wallets, to convince more people to mine Bitcoin Classic blocks on the network. At the time of publication, only three of those blocks had been mined, which is a drop of water on a boiling plate.
By setting up a crowdfunding effort, Bitcoin Classic miners would be paid out a small portion of the total fund for every block they mine on the network. Every Bitcoin Classic block brings the development solution closer to activation, even though there is still a very long way to go in that regard. It is important to keep in mind the payout will only occur 28 days after the Bitcoin Classic 2MB blockchain has been successfully activated.
All in all, this new incentive to mine on Bitcoin Classic pools could help sway the mind of several miners in the future. However, this idea is still in the concept phase, and there is no “fund” to speak of yet. Transparency will be of the utmost importance to make this project succeed.
Crowdfunding: is it Feasible?
Assuming Bitcoin Classic will ever go into effect, the miners who have contributed to mining blocks on pools supporting this solution will be rewarded based on how much effort they put into the activation process. On paper, the concept sounds very solid, but there are still some kinks to work out.
Creating an additional incentive for miners to switch to Bitcoin Classic pools is a promising concept, but the funds need to be stored in a multi-signature wallet. The question then becomes as to who will control the keys to this wallet? Is this up to the Bitcoin Classic developers, supporters, or the people responsible for coming up with the crowdfunding idea?
Secondly, what if the Bitcoin Classic solution never reaches its threshold, and fails to activate? Refunding those who contributed financially seems to be the proper course of action, but it will require multi-signature holders to sign off on these transactions. If no majority consensus can be reached, the funds will remain locked forever. Smart contracts may offer a helping hand to prevent this scenario from taking place. There are still plenty of details to work out regarding the crowdfunding of Bitcoin Classic miners, but incentivization as a whole is certainly an option that should be considered for growing a cryptocurrency network.
What are your thoughts on this crowdfunding idea? Will it be beneficial to Bitcoin Classic or have an adverse effect? Let us know in the comments below!
Images courtesy of Shutterstock, Bitcoin Classic