Crypto: My Part in Its Downfall (opens in new tab)

I found the full technical report describing the LOCKSS forerunner to bitcoin available for downloaded at [1]. Interestingly, LOCKSS used a memory bound Proof-of-Work, where both prover and verifier perform a random walk in a 1GB table. But the prover had to do this many times, to obtain some final hash with many leading zeroes. This was before the invention of asymmetric PoW systems like Cuckoo Cycle [2] where the PoW can be verified with no memory use.

> Nakamoto's scheme motivated early adoption by rapidly inflating the currency with large block rewards, then exponentially decreasing them, so he could claim the currency was non-inflationary (eventually). The result was that early adopters accumulated large numbers of Bitcoin, and the Gini coefficients of cryptocurrencies became extreme.

Technically, exponentially decreasing rewards is not necessary for a finite cap on supply. Anything reduction factor of at least n * logn * loglogn * logloglogn * ... * 2 would do, e.g. Initial_Reward / epoch^2. That would also reduce the advantage of early adopters.

Nearly all cryptocurrencies, even ones with uncapped supply, suffer from outsized rewards for early miners/adopters.

[1] https://www.researchgate.net/publication/31869581_Preserving...

[2] https://github.com/tromp/cuckoo

This is one of the best recent articles on the cryptocurrency topic, and some of its supporting mechanisms.