Hourglass V2 Update

In the ongoing discussions among Bitcoin developers, there's a notable dialogue concerning the adaptation of Bitcoin's protocol to mitigate potential threats from quantum computing. Specifically, Jameson Lopp suggests modifying the reward system as a strategic move against quantum attackers, proposing a method akin to the Bitcoin halving concept. Lopp recommends starting with a maximum of either 1 or 2 BTC per block and then halving this amount following the existing 210,000 block schedule. An alternative suggestion involves doubling a very small initial number, like 1M Sats, over time. This approach aims to diminish early attackers' incentives while acknowledging that, in the future, quantum attackers will face massive competition and economic uncertainty. Despite Lopp's apprehension regarding property rights implications, he views this strategy as a feasible measure to delay attackers.

Isabel responds to Lopp's idea with concerns about user experience complexity. She underscores the importance of simplicity, suggesting that using a round figure like 1 BTC per block could enhance user comprehension and tracking abilities. Isabel hints at the potential for embedding such rules directly into Bitcoin's consensus mechanism, which could align with the Blockchain Improvement Proposal (BIP) rationale related to coin circulation and miner rewards. She elaborates that if restrictions were based solely on the base block reward, Pay-to-PubKey (P2PK) outputs would cease once all bitcoins are mined, given that no value can be less than zero satoshis. This scenario assumes that fees wouldn't play a role, although she cautions that large miners could exploit the system by converting their coins into fees to unlock more P2PK coins.

Lopp further explains Bitcoin as a rule-based system, emphasizing the community's capacity to enforce regulations to protect against unauthorized UTXO liquidations by malicious entities. He praises the Hourglass V2 proposal for its attempt to safeguard against quantum threats but criticizes the arbitrary nature of setting a limit of 1 BTC per block without considering historical P2PK UTXO spend volumes. Moreover, Lopp suggests that Hourglass V2 could complement his proposal for a Zero-Knowledge (ZK) quantum-safe spending option for users who haven't migrated their UTXOs to quantum-resistant scripts by a certain deadline. He raises concerns over implementing an in-protocol protection mechanism that restricts spending capabilities, advocating for the withdrawal of the proposal to preserve Bitcoin's integrity and utility as a peer-to-peer electronic cash system.