Thoughts · Felix Elsner

Academic Sanctions Databases

2023-04-06T08:00:00+02:00

This is a comprehensive overview of sanctions databases and how to acquire them, aimed at researchers. Covered datasets: HSE (1985, 1990, 2009), TIES (2009, 2014), TSC (2018), GSDB (2020, 2021, 2022), EUSANCT (2022), IST (2022), GIGA (2012).

HSE (1985, 1990, 2009)

“HSE” stands for the initials of Hufbauer, Schott and Elliott (later “HSEO” with Oegg included).

Authors: Gary Clyde Hufbauer, Jeffrey J. Schott, Kimberly Ann Elliott and Barbara Oegg.

Releases: 1985 (1st edition), 1990 (2nd edition), 2009 (3rd edition). For an overview of all editions, see Google Books.

Book: Economic Sanctions Reconsidered, 3rd Edition, Paper and Economic Sanctions Reconsidered, 3rd edition, plus CD-ROM.

BibTeX:

@book{hufbauer_economic_1985,
  address = {Washington, D.C. : Cambridge, Mass},
  title = {Economic sanctions reconsidered: history and current policy},
  isbn = {978-0-88132-017-6 978-0-262-08139-9},
  shorttitle = {Economic sanctions reconsidered},
  publisher = {Institute for International Economics ; Distributed by MIT Press},
  author = {Hufbauer, Gary Clyde and Schott, Jeffrey J. and Elliott, Kimberly Ann},
  year = {1985},
}

Introduction chapter available as PDF; selected case studies available as PDF.

Dataset files: Not available on the internet, only via purchase of the CD-ROM.

Code: Code for deriving the conclusions does not seem to be available.

TIES (2009, 2014)

“TIES” stands for The Threat and Imposition of Economic Sanctions.

Authors: T. Clifton Morgan, Navin Bapat, and Valentin Krustev.

Releases: 2009 (covering 1971-200), 2014 (covering 1945-2005).

Papers: “The Threat and Imposition of Economic Sanctions, 1971–2000”, available from JSTOR; “Threat and imposition of economic sanctions 1945–2005: Updating the TIES dataset”, available from SAGEPub.

BibTeX (original paper:

@article{morgan_threat_2009,
  title = {The {Threat} and {Imposition} of {Economic} {Sanctions}, 1971–2000},
  volume = {26},
  issn = {0738-8942},
  url = {https://www.jstor.org/stable/26275122},
  number = {1},
  journal = {Conflict Management and Peace Science},
  author = {Morgan, T. Clifton and Bapat, Navin and Krustev, Valentin},
  year = {2009},
  note = {Publisher: Sage Publications, Ltd.},
  pages = {92--110},
}

BibTeX (updated paper:

@article{morgan_threat_2014,
  title = {Threat and imposition of economic sanctions 1945–2005: {Updating} the {TIES} dataset},
  volume = {31},
  issn = {0738-8942},
  shorttitle = {Threat and imposition of economic sanctions 1945–2005},
  url = {https://doi.org/10.1177/0738894213520379},
  doi = {10.1177/0738894213520379},
  language = {en},
  number = {5},
  journal = {Conflict Management and Peace Science},
  author = {Morgan, T. Clifton and Bapat, Navin and Kobayashi, Yoshiharu},
  month = nov,
  year = {2014},
  note = {Publisher: SAGE Publications Ltd},
  pages = {541--558},
}

Home page: Threat and Imposition of Economic Sanctions (TIES) Data at The University of North Carolina at Chapel Hill (UNC).

Dataset files: Available from the home page as TIES Version 4 (also 3.5) Excel files with a user manual (PDF).

Code: Code for deriving the conclusions does not seem to be available.

TSC (2018)

“TSC” stands for the UN Targeted Sanctions Consortium Database.

Authors: Thomas J Biersteker, Sue E Eckert, Marcos Tourinho, and Zuzana Hudáková.

Releases: 2018.

Paper: “UN targeted sanctions datasets (1991–2013)”, available via SAGEPub.

BibTeX:

@article{biersteker_targeted_2018,
  title = {{UN} targeted sanctions datasets (1991–2013)},
  volume = {55},
  issn = {0022-3433},
  url = {https://doi.org/10.1177/0022343317752539},
  doi = {10.1177/0022343317752539},
  language = {en},
  number = {3},
  journal = {Journal of Peace Research},
  author = {Biersteker, Thomas J and Eckert, Sue E and Tourinho, Marcos and Hudáková, Zuzana},
  month = may,
  year = {2018},
  note = {Publisher: SAGE Publications Ltd},
  pages = {404--412},
}

Home page: Targeted Sanctions Initiative at the Graduate Institute, Geneva.

Dataset files: Scroll down on the home page, where you will find Excel and SPSS formats, the database codebook (PDF) and the UN Targeted Sanctions qualitative database (PDF.

Code: Code for deriving the conclusions does not seem to be available.

Addendum: Mr. Biersteker has developed the TSC into the UN Sanctions App, available on the Web and for mobile devices.

GSDB (2020, 2021, 2022)

“GSDB” stands for The Global Sanctions Data Base.

Authors: Gabriel Felbermayr, Erdal Yalcin, Yoto Yotov, Aleksandra Kirilakha, and Constantinos Syropoulos.

Releases: 2020, 2021, 2022.

Papers:

“The Global Sanctions Data Base”, available via ResearchGate and ScienceDirect (paywalled).
“The Global Sanctions Data Base: An Update that Includes the Years of the Trump Presidency”, available via RePEc IDEAS
“The Global Sanctions Data Base – Release 3: COVID-19, Russia, and Multilateral Sanctions”, available from SSRN

BibTeX (2020):

@article{felbermayr_global_2020,
  title = {The {Global} {Sanctions} {Data} {Base}},
  volume = {forthcoming},
  doi = {10.1016/j.euroecorev.2020.103561},
  journal = {European Economic Review},
  author = {Felbermayr, Gabriel and Yalcin, Erdal and Yotov, Yoto and Kirilakha, Aleksandra and Syropoulos, Constantinos},
  month = may,
  year = {2020},
}

BibTeX (2021 update):

@techreport{kirilakha_global_2021,
  type = {School of {Economics} {Working} {Paper} {Series}},
  title = {The {Global} {Sanctions} {Data} {Base}: {An} {Update} that {Includes} the {Years} of the {Trump} {Presidency}},
  url = {https://ideas.repec.org/p/ris/drxlwp/2021_010.html},
  number = {2021-10},
  institution = {LeBow College of Business, Drexel University},
  author = {Kirilakha, Aleksandra and Felbermayr, Gabriel and Syropoulos, Constantinos and Yalcin, Erdal and Yotov, Yoto},
  month = feb,
  year = {2021},
}

BibTeX (2022 update):

@misc{syropoulos_global_2022,
  address = {Rochester, NY},
  type = {{SSRN} {Scholarly} {Paper}},
  title = {The {Global} {Sanctions} {Data} {Base} – {Release} 3: {COVID}-19, {Russia}, and {Multilateral} {Sanctions}},
  shorttitle = {The {Global} {Sanctions} {Data} {Base} – {Release} 3},
  url = {https://papers.ssrn.com/abstract=4291735},
  doi = {10.2139/ssrn.4291735},
  language = {en},
  author = {Syropoulos, Constantinos and Felbermayr, Gabriel J. and Kirilakha, Aleksandra and Yalcin, Erdal and Yotov, Yoto V.},
  year = {2022},
}

Home page: globalsanctionsdatabase.com and project page at the Kiel Institute for the World Economy.

Dataset files: Not directly available to download, but writing to the authors via the listed contact email gets a swift response within a few days.

The authors say this about the data:

The GSDB is freely available and we will be happy to share it with interested researchers, who can request it by e-mail at (address withheld).

In order to ensure the consistency of the GSDB data, we only make the GSDB data available from this webpage. Distribution of the GSDB data through other websites or institutions is not permitted. We kindly ask all users not to upload the data independently to another platform.

Code: Code for deriving the conclusions does not seem to be available.

EUSANCT (2022)

Authors: Patrick M Weber and Gerald Schneider.

Releases: 2022.

Paper: “Post-Cold War Sanctioning by the EU, the UN, and the US: Introducing the EUSANCT Dataset”, available via SAGEPub.

BibTeX:

@article{weber_post-cold_2022,
  title = {Post-{Cold} {War} sanctioning by the {EU}, the {UN}, and the {US}: {Introducing} the {EUSANCT} {Dataset}},
  volume = {39},
  issn = {0738-8942, 1549-9219},
  shorttitle = {Post-{Cold} {War} sanctioning by the {EU}, the {UN}, and the {US}},
  url = {http://journals.sagepub.com/doi/10.1177/0738894220948729},
  doi = {10.1177/0738894220948729},
  language = {en},
  number = {1},
  journal = {Conflict Management and Peace Science},
  author = {Weber, Patrick M and Schneider, Gerald},
  month = jan,
  year = {2022},
  pages = {97--114},
}

Home page: EUSANCT: Does Supranational Coercion Work? Onset, Impact and Effectiveness of EU Sanctions at the University of Konstanz.

Dataset files: On the home page, both the case-level and the dyadic datasets with their respective codebooks are available as Excel and (Stata) .dta files. The case summaries are available as PDF.

Code: Code for deriving the conclusions does not seem to be available.

IST (2022)

“IST” stands for the International Sanctions Termination Dataset.

Authors: Hana Attia, Julia Grauvogel, and Christian von Soest.

Releases: 2022.

Papers:

“The Termination of International Sanctions: Explaining Target Compliance and Sender Capitulation”, available from ResearchGate or ScienceDirect.
“How Do International Sanctions End? Towards a Process-Oriented, Relational, and Signalling Perspective”, available from JSTOR and from GIGA as a working paper (look for the Download GIGA WP 320 button under Ms. Attia’s name).
“International Sanctions Termination, 1990–2018: Introducing the IST dataset”, available from SAGEPub (Open Access) or ResearchGate.

BibTeX (European Economic Review):

@article{article,
  author = {Attia, Hana and Grauvogel, Julia and von Soest, Christian},
  year = {2020},
  month = {08},
  pages = {103565},
  title = {The Termination of International Sanctions: Explaining Target Compliance and Sender Capitulation},
  volume = {129},
  journal = {European Economic Review},
  doi = {10.1016/j.euroecorev.2020.103565}
}

BibTeX (2020 GIGA working paper):

@techreport{10.2307/resrep21217,
  URL = {http://www.jstor.org/stable/resrep21217},
  author = {Julia Grauvogel and Hana Attia},
  institution = {German Institute of Global and Area Studies (GIGA)},
  title = {How Do International Sanctions End?: Towards a Process-Oriented, Relational, and Signalling Perspective},
  year = {2020}
}

BibTeX (2022 Journal of Peace Research article):

@article{attia_international_2022,
  title = {International {Sanctions} {Termination}, 1990–2018: {Introducing} the {IST} dataset},
  issn = {0022-3433},
  shorttitle = {International {Sanctions} {Termination}, 1990–2018},
  url = {https://doi.org/10.1177/00223433221087080},
  doi = {10.1177/00223433221087080},
  language = {en},
  journal = {Journal of Peace Research},
  author = {Attia, Hana and Grauvogel, Julia},
  month = aug,
  year = {2022},
  note = {Publisher: SAGE Publications Ltd},
  pages = {00223433221087080},
}

Home page: The Termination of International Sanctions: Causes, Processes and Domestic Consequences at the German Institute for Global and Area Studies (GIGA) at the Leibniz-Institut für Globale und Regionale Studien.

Dataset files: The Excel spreadsheet and codebook as PDF are available from Harvard Dataverse, as linked to from here.

Code: Code for deriving the conclusions does not seem to be available.

GIGA (2012)

“GIGA” stands for German Institute for Global and Area Studies, the research body at the Leibniz-Institut für Globale und Regionale Studien that the authors are affiliated with.

Authors: Christian von Soest and Clara Portela.

Releases: 2012.

Various publications associated with this dataset.

BibTeX (as suggested by search.gesis.org):

@misc{SDN-10.7802-1346,
  author = "Portela, Clara and von Soest, Christian",
  title = "GIGA Sanctions Dataset",
  year = "2012",
  howpublished = "German Institute for Global and Area Studies (GIGA). Datenfile Version 1.0.0, https://doi.org/10.7802/1346",
  doi = "10.7802/1346",
}

Home page: GIGA Sanctions Dataset at the Leibniz-Institut für Globale und Regionale Studien; as part of wider research effort Ineffective Sanctions? External Sanctions and the Persistence of Autocratic Regimes.

Dataset files: From the GESIS archives, the Excel spreadsheet and the codebook are available (after checking the box agreeing to the terms of service).

Code: Code for deriving the conclusions does not seem to be available.

Supplement

Comparion of HSE, TIES and TSC datasets, as compiled by an article for TSC: Available from ResearchGate.

Minimalism is for suckers

2016-12-26T00:00:00+01:00

You can’t repair your shit because you lack the tools
You cannot help out your neighbours, teach your kids
You have to rely on external service providers for everything
You un-learn how to to things yourself
You are unprepared for emergencies
It fosters short-term thinking
You own stuff to use it. Not owning stuff means not being able to do stuff
You make spur-of-the-moment decisions and buy bad products because you have no experience with the tools you need
Division of labour is great and all; sometimes you have to take matters into your own hands

A bit of wisdom

2014-11-19T08:00:00+01:00

There is no truth, only observation and opinion. This holds true for many occasions, including but not limited to discussions, journalism and and progress.

Back in Germany

2014-09-14T18:34:00+02:00

The plane lands, the train takes you through familiar regions, and you expect to feel back “at home”. Life goes on, you are no longer the foreigner everyone looks at, you blend into the crowd, communication is effortless.

You revisit the places of your childhood. You try to form new habits, find a gym, familiarize yourself with the complexities of German bureaucracy, talk to strangers and wonder why everyone wants to keep to themselves.

Meeting with old friends, seeing how much you have grown apart from others, and realizing who you really care about.

There is just… something is missing. Money is tight, and there is this nine-to-five life, a rut settling in. The next three years are going to be tedious and laborious, all just in hopes of reaping some benefit from my education.

2014 Taiwan bike tour travel report

2014-09-13T19:16:00+02:00

It’s been a while since I finished this tour, but I still haven’t found time to write down the exact whereabouts, personal recommendations as well as most of my travel experiences.

Although the flight with Air China was booked way in advance, I still did not really know what I was getting myself into. Stepping out of the airport, the heat hit me and I was impressed by the politeness that I saw around me.

The first days after arrival I stayed in TaiwanMex in Taipei, bought a Lonely Planet and visited the sights of the city. Apart from the obligatory Taipei 101 and Chiang-Kai-Shek Memorial Hall, I stopped often and took a look at many of the curiosities the city had to offer. Sun-Yat-Sen Memorial Hall is quite nice at nighttime and lots of people gather for breakdance performances at the entrance to the building.

After I had found a bike shop willing to rent me a 2000$ bike for 5€ a day(get out at MRT stop Quilian, take exit 1 and after about 200m of walking on the road to the left of the metro, you should be able to see a carwash, continue and after a few meters you will find a small bike shop), I packed up and started riding. My first stop was the harbour city Keelung north-east of Taipei. The roads were congested and the heat made everyone nervous. I was so relieved to finally see the waves and followed the coastline to Fulong beach.
Along the way, I met many friendly cyclists from all over Asia, who followed the same route as me.

I slept at a small surf shack in Ciayi and took a surfing lesson the next day. The waves were ideal and everybody had a great time. You could already tell a typhoon was coming though.
After a night at a bar in Yilan I took my bike on the train to Hualien(Xin Zen). You should have somebody arrange it in advance for you or you might run into a conductor giving you trouble.
From there on my trusty bike had to endury the steep climbs of Taroko Gorge National Park. The first night was spent in Tianshiang at the Catholic Youth hostel. Not a single word of English was spoken, but luckily some friendly Malaysian guests there to save the day for all unsuspecting western travellers.
There is a beautiful trail called Luishui-Wenshan-trail near Tianshiang, crossing abandoned old bridges and going up and down the mountains. At this time of the year I had the trail all to myself.
Be sure to apply for a mountain permit beforehand.
The hot springs at the end are very convenient and I found them to be much more relaxing than the ones I found near Puli later on.

After getting some rest, I spent the next day struggling partly with the mountains, but mainly the worsening weather. Car drivers kept telling the storm was going to hit much earlier than expected.
The rain kept getting stronger and I was glad to finally arrive in Guanyun, having covered around 2000m of elevation and about 60km of serpentine after serpentine.
Back on the road after the typhoon, the streets were not as devastated as I would have expected them to be. The roadworkers, many of which came to the police station, the only building to have electricity and access to running water, did a great job during the night.

The last bit to the top of Highway 14 is just excruciating, in turn the descent is even more rewarding. The night was spent in Puli Guest House, the owner, a Japanese expatriate, was quite helpful in planning the next steps of my journey.
Sun-Moon-Lake kind of failed to impress me, so I continued without staying there too long. Lukang was nice, but the rest of Changhua couny and around just seemed boring and the infrastructure seemed to consist of long strips of indistinguishable roads and car shops.
The bus back to Taipei was on time, comfortable, allowed me to take my bike without a hassle, arrived quickly and made me wonder why transportation at home still does not work that seamless at all.

After returning the bike, getting some chores done and exploring Taipei, a bus took me to Kaohsiung and the night was spent at the interesting, albeit slightly touristy nightmarket.

To be continued.

Changhua county

2014-08-06T06:20:00+02:00

Most of the west coast is not really worth a visit.

Another long day on the road

2014-07-24T13:21:00+02:00

Starting out in Guanyun, my trusty bicyle had to endure Highway 14 all the way to the peak at 3275m.
From there on it was heaven on two wheels. Barely able to contain my excitement, it was overtaking 4WDs all day long. I have never pushed a bike that hard before, arriving in Wushe my hands needed a break from gripping the brakes.

Puli is just as you would expect a city in the west to be: Dirty, loud, chaotic and filled with cheesy Matsu temples.
Heading out tonight was a good idea; Amongst other things, I witnessed some Tai-chi groups practising and a Taiwanese orchestra performing classical native music.

Waiting out typhoon Matmo

2014-07-22T09:28:00+02:00

This afternoon I arrived in Guanyun, hoping to avoid the typhoon heading towards Taiwan.

Even at 2370 meters of elevation the winds are going strong and there does not seem to be an end to the huge amounts of rain pouring from the misty skies.

By the way: Today, yours truly rode more than 1500 meters of elevation and about 35km from Tienxiang to the middle of nowhere.

While I enjoy a warm shower and my clothes dry slowly, the TV shows concerned-looking anchormen commenting on events I presume will unfold into a third intifada.

What a mad world. At least I cannot complain about a lack of excitement at the moment.

First days in Taipei

2014-07-17T15:08:00+02:00

Kindness, discipline, order, commodity and convenience: Those are the words that came to my mind after roaming the various districts of Taiwan’s capital.

Going to Taiwan

2014-07-13T17:56:00+02:00

Bye, loopy middle east, hello beautiful Formosa!

Jordan

2014-07-13T02:08:00+02:00

I’ve travelled to Jordan recently. My first impressions were formed by passing dozens of villages and small towns in the north. It seems like a very underdeveloped and rural country, but there are good universities and international schools located in Amman. Apart from the usual suspects trying to rip off foreigners, most people are friendly and helpful. Syrian refugees mingle with Kuwaitis, Lebanese and Jordanians and returning exile-Jordanians.

Cryptocurrencies

2014-07-13T00:04:00+02:00

In search of the perfect cryptocurrency design
Problems and worries:
Decentralized
Involving centralization
Design papers
Recommended reading

This stuff is old. I was quite young and dumb when I wrote this.

In search of the perfect cryptocurrency design

Cryptocurrencies might not be such a hot topic any more, but this has been in my head for a while and I have finally collected the patience to write it down.

With the rise of the Bitcoin network, decentralized cryptocurrencies became more widely known. A great excitement about not having to rely on central authorities providing the money and controlling the flow of it was among small but growing groups of hackers and tinkerers, libertarians and activists. No one would have to put up with the evil banks any more. At first, the great mass of the people remained skeptic, with many calling this Bitcoin thing a pyramid-, a pump-and-dump scheme. The public who looked at bitcoin rather as an investment opportunity or storage of value was merely convinced by asseverations of network safety or anonymity.

It did not help either that Bitcoin sparked multitudes of alternative cryptocurrencies, “altcoins”, most of them just slightly modified forks. What twitter bootstrap seemed to be for websites, the Bitcoin protocol was for altcoins. In fact, many bitcoin-related sites, such as the troubled bitcoin-central.net, seem to have been hastily build using exactly that software.

Freedom of choice on a diverse market of cryptocurrencies can be a great thing, but most altcoins could now really be called pyramid schemes. Looking at the sheer numbers¹ of those different altcoin protocols, one might not be compelled to believe that every one of them was developed for the good of humanity.

Consensus was that the first investors would receive too much reward simply for believing in the currency, and the early miners would earn a fortune simply by turning their small contribution to network stability in the beginning into vast amounts of money in the times when the currency’s value would show exponential growth. Bitcoin had been designed to make the early adopters rich, while making the late birds buying into it pay for their hesitation. It was almost like investing into a small silicon valley startup in 1998; with substantial increases of shareholder value.

Yet despite its critical (to me) problems and many voicing their skepticism broadly, Bitcoin seems to miraculously have come into wide circulation, and even in times of worldwide trouble, its value has stayed relatively stable. It has demonstrated that a cryptocurrency can be bootstrapped and grow far beyond the point of gaining critical mass.

To my knowledge, none of the more popular forks did solve a problem that most people did not seem to care for much: The problem of unfair distribution. It was not even fixed in freicoin, whose developers claimed they developed it with good intentions. Even the ppcoin protocol, which is very advanced in design and code, does not adequately address the distribution problem.

So, how can cryptocurrencies be fixed? Do they even need to be?

Here are my thoughts on this.

Some aspects to keep in mind when designing a cryptocurrency:

distribution of the currency and the clients
security & integrity of the network
anonymity and decentralization
compliance with the law
accessibility/usability
public image and representation
resource preservation

Problems and worries:

Bitcoin

A “kill switch”, as described by Loper OS²
In the near future, mining - the rewards consisting of ever decreasing bitcoin quantities and the costs rising rapidly - will not be profitable any more.
This means that malicious entities would have far less competition in the mining process. Single home users with affordable equipment will become increasingly insignificant, while ASIC producers would get pressured into exclusive contracts with big organizations, maybe even governments.
While some possible 51% situations in the past seem to have been harmless, mining in the future would not be a matter of profits, but rather a matter of control,
so the focus would greatly shift towards unprofitable investments that nonprofits are too poor for and only entities with malicious intent could afford to make, destabilizing and possibly shutting down the entire system.
Confirmations taking too long
Dedicated hardware, high power consumption, miners generate data clutter that is not usable outside the network, e.g. for scientific purposes
Till early April 2013, Bitcoin had been in a constantly high deflation³. This discourages investments and encourages hoarding of coins. Since a short steep inflation around May 2013 ended, the deflation has continued and not stopped as of writing this article.

freicoin

Unpopular with many people because of the built-in demurrage
Not truly decentralized since about 80% of the mined coins go to a foundation

ppcoin

1% inflation per year is not enough to compensate for the advantage the early miners gained
Sunny King as a Benevolent Dictator for Life of the project, and he seems to have shifted his focus unto primecoin⁴

Cryptocurrencies in general

Legal issues: - Money laundering - Tax evasion - Smuggling and black markets - (Secret) messages stored in the blockchain, for example the recent chipo discussion or the wikileaks cables
The system being gamed(no mistakes software-side): - Manipulation of exchange prices - Investors utilizing ddos attacks for quick profits in a matter of days - Manipulation of trade volume and price by traders trading with themselves - Early adopters trying to create the impression that the currency is in circulation while in fact they just move it across their accounts - Not knowing how much of the currency is abandoned (sleeper problem) - The blockchain being spammed with micro-transactions
Bugs in the code not being publicly disclosed and used for personal gain / untrustworthy developers
The amount of peers does not equal the amount of actual users. therefore, it is difficult to enforce democratic processes, since one could just fire up some hundred VMs to gain voting power. I am interested in how future conflicts about transaction fees will evolve.
The blockchain getting too big, making it nearly impossible to use heavy clients for users that are not well endowed
A fundamental mistake in planning is almost impossible to fix in a running system. Even as a developer, you do not have the power to get rid of the ghosts you called.
Transaction fees getting too high
Possibly significant fluctuations in value, since it is not controlled by a central authority
Misunderstandings and false expectations
The system being too complex to use, let alone fully understand to most users

Ideas on how to solve some of the aforementioned problems:

Decentralized

Merging of coins

As the coins are split into smaller fragments, the blockchain gets bigger. To address this issue, clients merge all fragments of a wallet together, creating a coin that is worth the sum of the small ones altogether. The old fragments of coins are “molten” and made worthless; the new coin(with the value of the sum of fragments) is treated like a newly minted one; the changes are distributed into the network as a patch. The network still knows where the coin came from, since the fragments that are put into the coin are part of the blockchain, but it does not transmit a new transaction as a sum of tiny blobs in masses of a few satoshis, but rather as one big blob. In order for this to succeed, the client has to invalidate the old fragments, while at the same time proving to the network that his new minted coin is valid. I am not sure how to integrate such a behavior into the network’s hash chain mechanism.

The predefined way

In this model, the distribution of coins is controlled both in time and in volume. At first, only very small amounts are paid to the miners, thus keeping the total circulation of the cryptocurrency in an assessable amount. This way, the currency can prosper sustainable growth and spread of the currency. Parallel to the advancement of time, the rewards paid to miners rise (linear growth). This way, the early adopters can help spread the currency but the profit is limited. The rewards would rise for about half a year, then stagnate, and after a year, halve every x discovery blocks.

The ever increasing inflation way

Mining stays rewarding. The rewards of the miners are not ever changed, guaranteeing a steady influx of new coins, while simultaneously creating inflation.

Artificial scarcity

Coins lose their value over time, becoming worthless compared to freshly mined coins. This idea is already implemented in freicoin, but not satisfactory(to me) since the demurrage fee is too low in the early phase, not compensating for high demand and little supply. A fixed demurrage rate or a fixed inflation like in ppcoin is not optimal, the inflation should follow a predefined curve: first a high inflation rate; after about a year it is lowered.

Involving centralization

The donation way

This is a specifically weak idea, but it may be worth thinking about. In order to obtain money/coins/credits/… in the cryptocurrency’s “system”, one must donate “real” money outside the system to a charitable organization or one that defends hacker ethics, as chosen by the network. The transactions’ values are then converted into a stable currency (maybe the Yen or something similar) and the user receives the converted amount in in-system-currency. The exchange rates would have to be set static. This idea defies the whole purpose of decentralized currencies, but could eventually be implemented in a decentralized way, relying on votes of relayers to verify organizations and absolute transparency of transactions.

The ripple way

Opencoin, the company behind the ripple system, has taken another approach at cryptocurrencies. Its IOU system goes back to the roots of money, when it was publicly recognized as a proof of being owed goods, whereas now money has become more abstract, being used as value storage. The ripple system relies on users repaying their debt in the real world via a predefined currency. The only way for users to convert their issues of debt into real goods, as it seems to me, is to use a gateway.

The dynamic way

By binding the cryptocurrency to real world value (or the median of a variety of currencies on earth), the currency would be very stable, and investors would have little incentive to gamble on the system, while people who do not trust the banking systems would have an opportunity to deposit their savings into a stable environment. This system would be extremely vulnerable to manipulation of the data input on values of currency. It would need trusted sources of data, and trusted platforms are not such a good idea.

Freezing before launch

To prevent early adopters and developers from gaining profits in the non-competitive environment that is the early phase of the launch of the cryptocurrency, the source code is released a significant time before the network launches and the genesis block is mined.

Earlier I mentioned that the current cryptocurrencies may not need fixing. Bitcoin has succeed as a payments system; enough people accept it as a valid currency to trade with others. While this is a great accomplishment, there should be viable alternatives, preferably without kill switches. So far, a fair distribution model that fulfills the needs of both active (miners & exchanges) and passive (client users who view the system as a payments system) network participants seems out of reach to me.

At least designing a nearly perfect cryptocurrency is something we should strive for.

Sadly, my knowledge on this topic is fairly limited and I have not yet fully read and understood most design papers; the ideas proposed and addressed by me all have major flaws. It might be more interesting to spend some time on reading and understanding the articles linked in the “recommended reading” section.

Thoughts · Felix Elsner

Academic Sanctions Databases

HSE (1985, 1990, 2009)

TIES (2009, 2014)

TSC (2018)

GSDB (2020, 2021, 2022)

EUSANCT (2022)

IST (2022)

GIGA (2012)

Supplement

Minimalism is for suckers

A bit of wisdom

Back in Germany

2014 Taiwan bike tour travel report

Changhua county

Another long day on the road

Waiting out typhoon Matmo

First days in Taipei

Going to Taiwan

Jordan

Cryptocurrencies

In search of the perfect cryptocurrency design

Problems and worries:

Bitcoin

freicoin

ppcoin

Cryptocurrencies in general

Decentralized

Merging of coins

The predefined way

The ever increasing inflation way

Artificial scarcity

Involving centralization

The donation way

The ripple way

The dynamic way

Freezing before launch

Design papers

Recommended reading