Hourglass V2 Update

The concept of Hourglass as a flag day soft fork is introduced to address the potential issue concerning the movement of P2PK coins. The mechanism is designed to incentivize holders by allowing them to move their coins before a predetermined activation block height. This approach aims to distinguish between genuine holders and potential quantum attackers, based on the assumption that genuine holders would be motivated to transfer their assets in anticipation of the activation, thereby avoiding confiscation or loss.

The proposal underlines a key expectation that if less than 25% of P2PK coins are deemed lost, a significant portion of these coins would likely be transferred by their owners ahead of the soft fork's activation. Unlike traditional confiscation proposals, Hourglass offers an opportunity for coin holders to reclaim their assets post-activation, suggesting a novel approach to managing digital asset security without outright freezing or burning potentially at-risk coins.

Furthermore, the Hourglass concept posits that those who do not move their coins prior to the activation are likely individuals with an extremely low time preference, possibly indicating a lack of urgency or immediate need to access their digital assets. This behavior, it is argued, could serve as an indirect indicator to differentiate between original keyholders and quantum attackers, especially since those with lower time preferences might not actively contribute to fee inflation even in the face of a perceived quantum threat.

Finally, the proposal anticipates a period where original keyholders' activity of moving coins post-activation will eventually cease, leading to a noticeable decline in P2PK transactions. This anticipated reduction in activity is expected to encourage holders with previously undemonstrated urgency to finally move their assets, thereby potentially safeguarding the integrity of the blockchain against quantum vulnerabilities while accommodating the needs and strategies of long-term holders.