[00:00.660 --> 00:06.240]  So I would like to introduce Francisco Cabanas, otherwise known as ArcticMine. He is on the
[00:06.240 --> 00:11.280]  Monero core team. He's going to be speaking with us about the economic impact of COVID-19
[00:11.280 --> 00:15.480]  and transaction capacity and fees in Monero. So I'm going to go ahead and pass that on over to
[00:15.480 --> 00:20.740]  him. ArcticMine, go ahead and take it away. Thank you. Thank you for the great introduction.
[00:21.020 --> 00:28.820]  So the topic that I'm going to be speaking today is about drastic external impacts
[00:28.820 --> 00:33.920]  on the Monero network, high response, and what kind of impacts they would have.
[00:34.160 --> 00:39.640]  Now, the initial scenario that I'm looking at, we're going to have a scenario,
[00:39.640 --> 00:45.400]  and then we're looking at the aftermath, what happens. So you throw a disruption, aftermath,
[00:45.400 --> 00:49.560]  what happens if you don't change the protocol, have a proposal, implications of the proposal,
[00:49.560 --> 00:57.920]  and then some questions and discussion. So what actually started the scenario was an issue raised
[00:57.920 --> 01:06.460]  by user Yukoi HB, and actually a very important issue. And I'm going to quote what he said,
[01:06.460 --> 01:11.080]  and this is quoting straight from the GitHub issue. Imagine adoption humming along and the
[01:11.080 --> 01:16.540]  long-term median gets really high, say 100 times the current default penalty-free zone.
[01:16.740 --> 01:23.200]  Suddenly, catastrophe hits, and several major sources of transaction volume are taken offline.
[01:23.200 --> 01:28.860]  Short-term transaction volume collapses to five times the default penalty-free zone,
[01:28.860 --> 01:35.000]  and nominal fees are practically 20 times higher. Now, the scenario we're talking about is about
[01:35.000 --> 01:44.720]  1,000 times of the transaction activity in Monero. This came up in February, just before the awareness
[01:44.720 --> 01:52.780]  of COVID-19. And then within a few days after the issue came, the start of the awareness of COVID-19,
[01:52.780 --> 01:58.300]  which is actually a perfect example for the issue. Pandemics was not referred in the particular
[01:58.300 --> 02:05.520]  issue, and I have a link below to GitHub for the research project issue, and I would suggest that
[02:05.520 --> 02:10.180]  there we could do a lot of also discussion on some of the technical solutions.
[02:12.100 --> 02:18.720]  Now, Monero has a long-term median, and it changes every... it's 100,000 blocks,
[02:18.720 --> 02:24.660]  so it changes up to 50,000 blocks, and that's around 69 days. It's about a couple of months
[02:24.660 --> 02:32.780]  and a week. And this is an important time frame to consider, because what's happening here is that
[02:34.720 --> 02:39.740]  at that point in time, it changes, and it's a scenario, and it has very significant impacts.
[02:39.880 --> 02:46.020]  And we're going to look at possible causes of an external disruption. Now, for example,
[02:46.020 --> 02:50.680]  one of the measures is a disruption of various Monero markets that believe in the issue. One
[02:50.680 --> 02:55.560]  of the issues that was mentioned was, for example, a closure of a very big
[02:56.320 --> 03:05.420]  DNN market, and what impact that would have on transactions. And then this category, I would say,
[03:05.420 --> 03:12.480]  is an impact that doesn't impact the traditional finance system. The second group that I'm
[03:12.480 --> 03:18.440]  including, which impacts on the international finance system, would be things like COVID-19,
[03:18.440 --> 03:22.280]  and the awareness that you have of the issue. The issue I should discuss, the possibility was
[03:22.280 --> 03:27.060]  of a limited nuclear war, and the kind of consequences of that, national disaster,
[03:27.060 --> 03:32.760]  major economic disruption. What we're talking about here is events, external events,
[03:32.760 --> 03:39.800]  that cause major economic disruption, and how that will impact the Monero network,
[03:39.800 --> 03:47.220]  and also, in particular, how will it impact the fee structure, and how we can respond to it,
[03:47.220 --> 03:53.800]  and some changes that are needed to do that. Now, the next slide is really interesting,
[03:55.360 --> 04:03.540]  because we are considering a very sizable series of scenarios. One thing I should mention in the
[04:03.540 --> 04:10.960]  previous slide, the numbers we're talking about will have a very high fee, sorry, a very high
[04:10.960 --> 04:17.260]  price on Monero. So there's no recovery, or a very long, slow recovery. So this is where
[04:17.820 --> 04:24.020]  you see the collapse in transaction rates, and it just sort of dies there, and nothing happens,
[04:24.020 --> 04:27.840]  and maybe a few years down the road starts to recover again. And the DNM market is a good
[04:27.840 --> 04:34.620]  example of that. And so in that case, you basically have, in that scenario,
[04:35.240 --> 04:38.380]  relatively little impact on the network, you do have the fee impact.
[04:39.080 --> 04:43.040]  The next one is a recovery within the long-term median, and that means that
[04:43.040 --> 04:51.040]  you drop, and then you come back up again within the 69-day time frame. And that means that the
[04:51.040 --> 04:55.660]  recovery level for transactions within the Monero network is really only five times,
[04:55.660 --> 05:01.120]  could be as high as five times. And then the third example is we start a long-term median,
[05:01.120 --> 05:05.320]  and it collapses completely, and then we are going back, we have to recover
[05:05.320 --> 05:10.640]  the full 20 times in the example, plus, say, an additional five times.
[05:10.680 --> 05:17.700]  The key to understand is this, an impact of the event on traditional finance. So if it impacts
[05:17.700 --> 05:22.180]  the banking system, if it impacts financial, can also have a significant impact on transaction
[05:22.180 --> 05:28.420]  demand, and this is going to show up in the recovery phase. So when we're trying to come out
[05:28.420 --> 05:32.480]  of this, all of a sudden everybody wants to use Monero because there's problems in the banking
[05:32.480 --> 05:38.480]  system. So not only do we have to deal how we get the median back up again to where we were,
[05:38.480 --> 05:42.620]  but now we have all this additional demand because the other guys are having problems.
[05:45.270 --> 05:47.030]  So let's look at the examples.
[05:49.170 --> 05:55.510]  Let's say that there's no impact on traditional finance. So in this example,
[05:55.510 --> 05:59.990]  this interruption of the Monero markets, the likely result is no recovery.
[06:01.150 --> 06:07.450]  So it's a long process. So basically, you have replacing markets come up, even a possible
[06:07.450 --> 06:13.350]  negative impact. You basically have a long recovery, and nothing particularly happens in
[06:13.350 --> 06:19.910]  this scenario that really requires a lot of impact on the protocol, except for the fee question.
[06:22.010 --> 06:26.370]  Let's look at the COVID-19 example. This is a great example of the external
[06:27.150 --> 06:32.930]  scenario. So what are we looking at here? Well, either it's going to recover right within the
[06:35.150 --> 06:40.070]  two months to 69 time frame, in which case, and then you get the demand,
[06:40.070 --> 06:49.710]  or maybe it's a bit delayed. And then you have the full collapse in the long-term medium,
[06:49.710 --> 06:55.470]  and this is critical. And then you have to make up not just 20 times the transaction, but maybe
[06:55.470 --> 07:01.110]  100 times. So you really have a big upswing afterwards. You suddenly have to ramp up the
[07:01.110 --> 07:06.110]  whole network, not just because of the impact, but now because everybody else wants to use Monero
[07:06.110 --> 07:10.290]  because there's a problem somewhere else. And that's the key distinction when you're impacting
[07:10.290 --> 07:19.770]  traditional finance. So the other two examples, the limited nuclear war or the... do parallel
[07:19.770 --> 07:25.470]  this in a similar way, or can parallel it, as it will be, say, a very disruptive volcanic eruption,
[07:25.470 --> 07:32.210]  this kind of things, can actually have a similar impact economically, and the parameters are
[07:32.210 --> 07:36.790]  comparable. I will focus primarily on COVID-19 simply because we're living right through it.
[07:36.790 --> 07:44.970]  This is a perfect example of the type of scenario. So we step back for a moment and ask the question,
[07:44.970 --> 07:51.390]  what exactly did COVID-19 do to the Monero network? Well, what did it have... did the
[07:51.390 --> 07:57.730]  standard Monero stop functioning? Well, no. Did the blocks stop being mined? No, the miners shut down.
[07:57.730 --> 08:03.170]  No. Did the developers shut down? Did the functionality of the community shut down?
[08:03.170 --> 08:07.870]  To most extent, no. The only thing, basically, we're seeing a significant impact is the fact that
[08:07.870 --> 08:12.510]  we're delivering these stocks virtually. We did have to cancel Confranco in Berlin.
[08:12.690 --> 08:20.610]  So we had some impact, but relatively minor. The core components of the community,
[08:21.010 --> 08:26.190]  of the network, the clearance of transactions, all this happened, no problems.
[08:26.870 --> 08:33.870]  Now, compare that with the banking system. Bank hours were changed, bank branches were closed,
[08:33.870 --> 08:38.470]  lineups outside, people wearing masks, plexiglass screens on the tellers.
[08:38.770 --> 08:45.730]  When you look at the impact, they're way more significant. We take a look at payments. Well,
[08:45.730 --> 08:51.190]  the biggest one, actually, is that we've been in card payments, an increase from
[08:51.770 --> 08:57.330]  in card type and a drastic fall in chip and PIN. So there's been this movement in the type of
[08:57.330 --> 09:03.070]  credit card transaction. There's been some drop in cash. Part of the idea being is that certain
[09:03.070 --> 09:09.550]  types of payments are perceived to be propagating the COVID-19. And obviously, if you're sitting on
[09:09.910 --> 09:14.910]  a pin pad and inserting a card and fiddling with the terminal and touching all the absolute tips
[09:14.910 --> 09:19.790]  of your fingers, your chances of spreading the virus are much higher than if you just
[09:20.310 --> 09:26.270]  bring the card to the terminal and don't touch anything. And this is a so-called contactless
[09:26.270 --> 09:31.310]  card tap. The reality, however, is in a lot of card taps, there's still a lot of fiddling.
[09:31.750 --> 09:35.270]  And merchants expect you to touch buttons. And I have actually refused to do that. It's quite
[09:35.270 --> 09:40.990]  interesting. And so that's one element. Then there's cash, which is kind of in between,
[09:40.990 --> 09:48.490]  obviously better, worse than a totally contactless card tap, but far better than chip and PIN.
[09:49.250 --> 09:54.110]  And in this picture, you consider a cryptocurrency payment. Now cryptocurrency payment,
[09:54.110 --> 09:57.930]  in order to use it, you have to be contactless, because basically what you're doing is you're
[09:57.930 --> 10:01.030]  aligning QR codes. So you've got your phone, you're going to align the QR code, you're going
[10:01.030 --> 10:05.770]  to do it at a distance. It does not work if you touch it. So this is really interesting.
[10:05.770 --> 10:09.870]  If you want to pay with Monero, you can't propagate the virus. You have to go out of
[10:09.870 --> 10:17.720]  your way to do it. With the other payments, you can't. Well, the other ultimate best. Well,
[10:17.720 --> 10:22.680]  major unemployment, business failures. You walk around the city, all these businesses are
[10:22.680 --> 10:27.200]  closing. Massive increase in government debt. Governments have responded to the problem by
[10:27.200 --> 10:34.040]  going into debt and trying to mitigate the impacts. And a massive intervention by the
[10:34.040 --> 10:41.160]  central banks on increasing the money, the fiat money supply. This is mitigated. It's fine. It's
[10:41.160 --> 10:47.540]  mitigated to some degree, but it also has long-term implications. One major impact, obviously, is if
[10:47.540 --> 10:52.080]  you increase the number of unemployed people, you're going to disrupt car payments. And the
[10:52.080 --> 10:55.440]  reason you're going to do that is because people are going to suddenly lose their credit scores,
[10:55.440 --> 10:58.700]  and they're not going to be able to have credit cards, or they're going to be afraid that their
[10:58.700 --> 11:03.880]  debit account in the bank is going to be seized. So there's going to be a push towards cryptocurrencies
[11:03.880 --> 11:09.360]  just from this element. I don't even want to consider what could possibly happen if
[11:09.360 --> 11:13.480]  it's a major disruption of the banking system, and we still haven't got to that stage.
[11:14.720 --> 11:20.760]  Everything is kind of okay, maybe. The Federal Reserve and the European Central Bank,
[11:20.760 --> 11:25.920]  the Bank of England, the Bank of Canada, they're trying a very delicate job between hyperinflation
[11:25.920 --> 11:31.260]  on one side and collapse of financial institutions on the other. It's a delicate position. I honestly
[11:31.260 --> 11:36.180]  would not want to be in their shoes for what they're doing. It's a lot easier dealing with
[11:36.180 --> 11:44.080]  the Monero side of this. So one possible impact is a significant shift towards the use of
[11:44.080 --> 11:50.120]  cryptocurrency in payments. And this would be way greater in the original scenario, but could
[11:50.120 --> 11:55.280]  even occur in the current situation. So what you can see is that there's a demand on the Monero
[11:55.280 --> 12:02.020]  network, even as it is right now. And in many ways, this is a bit of a warning. And if something
[12:02.020 --> 12:07.580]  were to happen with the Federal Reserve and the banking system, something were to happen,
[12:07.580 --> 12:12.200]  even in a smaller country, we could suddenly face ourselves with significant demand on transaction.
[12:13.180 --> 12:18.920]  The story is not being ended on this. So we still have the possibility of the risk
[12:19.360 --> 12:23.200]  of having to deal. And that means at every level. Everything from helping newbies on how to
[12:23.200 --> 12:28.740]  set up their wallets, to making sure your notes are up to snuff, to cleaning,
[12:29.300 --> 12:35.680]  upgrading your internet connection. I mean, the reality is we could find ourselves having to roll
[12:35.680 --> 12:40.360]  up our sleeves at every level in the community. Just as the result is just because of these
[12:40.360 --> 12:47.440]  disruptions, there's suddenly a big demand on the network. So now let's take a look at what happens.
[12:48.140 --> 12:52.240]  No changes to the protocol. So we look at the protocol right now. First of all, in this scenario,
[12:52.240 --> 12:58.520]  and it's very important, we're doing a thousand times increase in the Monero transaction volume,
[12:58.520 --> 13:05.120]  because basically we are running right now about a tenth of the penalty free zone. So we're talking
[13:05.120 --> 13:13.170]  about basically 30 megabytes versus 30 kilobytes that we have today in transaction volume.
[13:14.300 --> 13:19.100]  One of the implications of this is if you look at the equation of exchange
[13:19.800 --> 13:23.750]  and you make some reasonable assumptions, and no change in velocity,
[13:25.790 --> 13:33.670]  and a constant, then we're talking about a potential price for Monero of around 100,000
[13:33.670 --> 13:38.650]  US dollars. This sounds significant, but if you're going to increase the transaction
[13:38.650 --> 13:46.650]  capacity demand of the Monero network by a factor of a thousand, and it's fair to realize that
[13:47.350 --> 13:52.750]  assuming the velocity doesn't change and it hasn't come from somewhere, and the distribution
[13:52.750 --> 13:59.990]  doesn't change, so obviously the only thing you can move is the price. So now if you increase Q
[13:59.990 --> 14:04.370]  by a factor of a thousand, you've got a decreased P by a factor of a thousand, which is the inverse.
[14:04.370 --> 14:09.010]  So effectively what we say instead of $100, it's $100,000. Now there's variability. It could be
[14:09.010 --> 14:14.630]  $10,000, it could be a million, but there is definitely a factor here. And quite honestly,
[14:14.630 --> 14:19.430]  I mean, if a whole bunch of people are transacting the Monero network to that level, then there's
[14:19.430 --> 14:23.990]  also be a lot of investors are suddenly going to be interested in this cryptocurrency that's
[14:23.990 --> 14:29.930]  actually working and that you can actually use. To put it in another way, you have a practical
[14:29.930 --> 14:35.930]  use scenario in place. The thing to understand is the fee in current terms will not change
[14:35.930 --> 14:43.090]  significantly. So our fees would be roughly a bit higher, and this is mainly due to the fact
[14:43.090 --> 14:49.130]  that we still have the ten-fold increase until we get to the penalty-free zone, which has an impact
[14:49.130 --> 14:55.190]  on fees. And it's counterbalanced by things such as a drop in the emission-cum-to-tail emission.
[14:55.510 --> 15:01.790]  And we're going down to also some of the improvements such as CLSAG and so on.
[15:02.330 --> 15:07.130]  So that's kind of what... so we're talking about $0.04 USD for two-in-two-out transaction,
[15:07.690 --> 15:11.570]  even though the price has gone up by a factor of a thousand. That's one of the beauties of the
[15:11.570 --> 15:18.230]  Monero protocol. As you increase the block size, the fee for transaction goes down. So if you have
[15:18.230 --> 15:22.310]  this assumption, you have essentially a constant fee, close to a constant fee, in terms of
[15:25.690 --> 15:30.490]  a sort of fixed USD. By the way, I'm talking about USD as of today, so you sort of factor
[15:30.490 --> 15:37.110]  in any changes in the inflation rate. So what happens if you don't change the protocol? Well,
[15:37.110 --> 15:41.550]  okay, so the 20% increase in fee, this really goes from, say, $0.04 or $0.80, you'll see.
[15:42.190 --> 15:47.970]  And the interesting thing there is, the issue can be really disruptive if you have
[15:48.830 --> 15:54.450]  multi-signature transactions that are created ahead of broadcast. So for example, you create
[15:54.530 --> 15:59.270]  a transaction, you have multiple signatures, you engage in some business arrangements,
[15:59.270 --> 16:03.610]  and then like three weeks later or five weeks later or something, you want to
[16:03.610 --> 16:08.090]  broadcast that transaction, and now the fees have changed on you. And that was one of the
[16:08.090 --> 16:11.370]  main factors in the protocol question. I mean, you know, how do we deal with these situations?
[16:11.370 --> 16:16.410]  And that's the fee impact question. So there's a real need for minimum fee predictability for
[16:16.490 --> 16:21.330]  a given period of time. And as I said, the free impact applies to all three recovery scenarios.
[16:23.270 --> 16:27.950]  So the white economy, where you have first number one, no recovery, very slow recovery,
[16:29.230 --> 16:32.570]  the recovery is fine. I mean, there's no real stress on the protocol,
[16:32.990 --> 16:38.210]  but the fee issue remains. We're just dropping it and we're not really suddenly putting more
[16:38.210 --> 16:43.430]  demands on the network. Now, in the second case, it starts to get a bit more interesting,
[16:43.430 --> 16:50.230]  because what happens there is you suddenly have a five times increase in demand scenario.
[16:52.090 --> 16:58.090]  So you're pushing your protocol. So you can kind of manage it, but it's far from ideal.
[16:58.090 --> 17:02.690]  You're pushing the limits of the growth rate of the long-term median, depending on the rate.
[17:02.970 --> 17:06.430]  So that's a bit tight, and you still have the fee issue.
[17:06.930 --> 17:10.410]  It's kind of possible, not ideal, but manageable.
[17:12.530 --> 17:19.670]  But the part serious problem is this one. What happens with the third example? Now you drop
[17:19.670 --> 17:27.530]  the long-term median by a factor of 20. So you drop down, and now to recover back again,
[17:28.090 --> 17:34.870]  you have to go into this two to three year period just to get back to where you were,
[17:34.870 --> 17:39.490]  and then also to then allow for the addition. It's just too slow to recover. So you don't have
[17:39.590 --> 17:45.330]  a recovery protocol. You drop, you can think of it as a big bang attack in reverse,
[17:45.330 --> 17:50.230]  where you actually suddenly drop the transaction, and it has real consequences.
[17:50.330 --> 17:55.910]  And this is actually a real serious problem that was identified in this issue indirectly,
[17:55.910 --> 18:02.330]  but definitely very good. So what are we going to do in the proposal? Well, number one,
[18:02.330 --> 18:08.070]  we increase the growth of the long-term median of 1.2x to 2x. That alone will address these kind
[18:08.070 --> 18:13.650]  of recovery issues to a significant degree. It's about 30 times versus five times in a year. So
[18:13.650 --> 18:17.530]  there's a real increase in the rate of growth, and that's important.
[18:18.310 --> 18:25.530]  It gives you that flexibility, that ability. Now there is a 50 plus factor in there for searching,
[18:25.530 --> 18:30.510]  but that's okay. B, and this is the critical part, you limit the decay of the long-term median to
[18:30.510 --> 18:37.310]  half. So what we say is, at the end of that 20-time drop, we don't drop the whole thing all
[18:37.310 --> 18:43.130]  down to 24, we just drop it to four. And then we wait another 69 days and drop it to four again,
[18:43.130 --> 18:52.030]  and so on. And then the third proposal was to set the penalty-free zone to the maximum, sorry,
[18:52.030 --> 18:59.990]  minimum to the maximum of the current 300,000 bytes and a quarter of the long-term median.
[18:59.990 --> 19:05.230]  Now, I have seen discussion of proposals that go higher than that, and they're quite interesting.
[19:05.450 --> 19:09.710]  In fact, one of the proposals, I think, has a similar implication to that.
[19:09.890 --> 19:12.450]  This should be discussed and looked at, because they're quite interesting.
[19:12.530 --> 19:17.030]  But this proposal basically involves a quarter of the long-term median.
[19:19.540 --> 19:24.740]  The next thing we do is we change the median and fee-for-no-relay. This is more of an anti-spam
[19:24.740 --> 19:34.140]  measure. The thing to bear in mind here is that if you have a series of transactions that are not
[19:34.140 --> 19:39.020]  minable, you can literally launch a DDoS attack against the network. So basically what you do
[19:39.020 --> 19:46.380]  is you flood the network with a mass of transactions which are under the not-going-to-get
[19:46.380 --> 19:51.360]  mind. And this is one of the reasons why you have a minimum fee. So that's the danger there. There
[19:51.360 --> 19:58.280]  is a potential attack in that, and that's the reason why you do that. You basically want to
[19:58.280 --> 20:04.080]  set that relay fee for the node so that there's a really good chance the transaction gets mined.
[20:04.080 --> 20:09.900]  Now, obviously, if you're sitting at one-tenth of the penalty-free zone, which we are right now,
[20:09.900 --> 20:19.740]  well, a fee of 20% of the reference transaction is going to get mined. So the attacker has a big risk.
[20:19.740 --> 20:25.620]  Once you go above it, it starts to get dicey, and you could get scenarios where this could actually
[20:25.620 --> 20:32.860]  happen. I should point out these attacks have actually occurred on Bitcoin. And if you run a
[20:32.860 --> 20:40.480]  full Bitcoin node, which I do, with the port open, and you suddenly see this massive surge in
[20:40.480 --> 20:44.860]  bandwidth, well, wait a minute, Bitcoin protocol is running at capacity. So why is this happening?
[20:44.860 --> 20:49.300]  These massive transactions that are being transmitted and distributed by the nodes
[20:49.300 --> 20:55.260]  which are not being mined because the fees are too small. And this type of attack could be done
[20:55.260 --> 21:01.540]  in Bitcoin to actually push up the fees. But it's exactly a similar kind of problem. So you do have,
[21:01.540 --> 21:05.760]  and it really has an impact on the node. Suddenly your bandwidth could increase by a factor of 10
[21:05.760 --> 21:10.900]  or something just as a result of these type of attacks. And I have seen, I've experienced it
[21:10.900 --> 21:15.640]  myself, I wash my bandwidth, I have unlimited bandwidth and it can get away. But still,
[21:15.640 --> 21:21.760]  I mean, this is not true. So that's one of the reasons for this type of protection.
[21:23.380 --> 21:28.860]  A few technical changes with respect to the wallet fees. One of the things that's not well
[21:28.860 --> 21:35.980]  known about the wallet fees in Monero is that there is an adjustment where we try to shift
[21:35.980 --> 21:40.540]  the median by 10 blocks. And the idea is to assume the worst possible scenario so that if you
[21:40.540 --> 21:44.480]  create a transaction, it doesn't change fast enough that you can't send it because the
[21:47.280 --> 21:51.260]  structure of the median has changed and the fees have gone up. And so this is one of the ideas.
[21:52.180 --> 21:58.260]  And basically we have a series of fee schedules in there where we would have each level of fee
[21:59.940 --> 22:05.660]  is protected against changing the median. So the principle here is you keep paying a higher fee,
[22:05.660 --> 22:09.960]  you get more blocks. If you go all the way, you get like 200,000 blocks of protection,
[22:09.960 --> 22:17.160]  essentially by paying a higher fee. And the concept is that, for example, you simply say,
[22:17.160 --> 22:22.240]  okay, if I want just to send my transaction right away within 10 minutes, okay, fine, I go with a
[22:22.240 --> 22:27.660]  normal fee, the lowest possible fee. And if on the other hand, I wanted to be good for at least
[22:27.660 --> 22:33.580]  the balance of the short-term median, sorry, long-term median, then I would pay the next one.
[22:33.580 --> 22:38.100]  I want more, you know, another 100,000 blocks and I keep going up the line.
[22:39.340 --> 22:43.080]  So the implications are fees are highly predictable. For example, a fee of four
[22:43.080 --> 22:46.320]  times will ensure the minimum fee is minimal until the drop in the long-term median.
[22:47.280 --> 22:50.660]  And then you can examine the long-term median and actually predict the worst-case scenario.
[22:50.800 --> 22:55.420]  Or you can choose a fee all the way. But in reality, there's no free lunch. I mean,
[22:55.420 --> 23:00.560]  the longer you want to protect this, the more fee you pay. And I should point out,
[23:00.560 --> 23:08.300]  even increasing this penalty-free zone to something as high as the long-term median,
[23:08.300 --> 23:12.440]  which I suspect is one of the ideas behind the proposals, will mitigate this even further.
[23:12.440 --> 23:18.040]  But you still have this principle that the longer you go, you want to go the higher the fee. So if
[23:18.040 --> 23:23.420]  you want your fee to be minable, like, say, three months down the road, you're going to pay, or four
[23:23.420 --> 23:26.840]  months down the road, you're going to pay a much higher fee than if you just want to create the
[23:26.840 --> 23:34.350]  transaction and just send it right to the network. This is the critical impact of the
[23:34.350 --> 23:37.990]  project. You remove this risk of a sudden collapse of the long-term median. And this is the biggest
[23:37.990 --> 23:43.470]  issue that I identified. And that is, what happens is, if you let it collapse, then bingo,
[23:44.410 --> 23:47.870]  you have this massive recovery. Because if you drop all the way down, it could take like two
[23:47.870 --> 23:51.550]  to three years to get up there. And all of a sudden, in a couple of months, it collapses.
[23:51.890 --> 23:57.430]  And this is why having this graduated decline in the long-term median is very critical.
[23:57.430 --> 24:02.270]  And it does allow... this is probably the most critical approach. You do not want that
[24:02.270 --> 24:06.430]  long-term median to suddenly drop all the way from the top to the bottom. You want it to
[24:06.430 --> 24:13.430]  go down in steps, the same way it grew up in steps. There's minimal action in the absence
[24:13.430 --> 24:16.670]  of a sudden drop in transaction. And of course, the reason for this is that the dynamic penalty
[24:16.670 --> 24:25.490]  fee, so essentially, doesn't even come into play. And another interesting thing is that
[24:25.490 --> 24:32.170]  you could actually increase the rate to look at transaction growth. And I have a link here,
[24:32.170 --> 24:35.510]  and this should work. I'm going to link it here, and I'm going to show you the site.
[24:36.530 --> 24:44.010]  And you should see... there we go. Okay, so if I go on the link here, and I'll see the
[24:45.530 --> 24:52.810]  site. And you should see the site here on the screen. And basically, if you look at transactions,
[24:53.730 --> 25:06.350]  you're going to see that there is a very significant trend on the screen here. And again,
[25:06.350 --> 25:13.930]  we will see what we're seeing in this scenario. So I will close this out right now. This is come up.
[25:15.550 --> 25:20.790]  Yes, it comes up here, and we will then go out again.
[25:23.010 --> 25:28.410]  Okay, and we will close these out.
[25:30.960 --> 25:36.220]  There, and we should see the proposal again. So again, if you click on the link,
[25:36.220 --> 25:45.160]  you will see the transaction rates. And this is actually a way to see what happens if you actually...
[25:47.360 --> 25:52.720]  you can actually look at the transactions, and you can see basically what the trends are.
[25:52.720 --> 25:57.000]  What you'll find is that some of the recent trends are very close to the maximum rate of the
[25:57.960 --> 26:06.660]  long-term median. Okay, so now we are going to look at some implications again.
[26:07.000 --> 26:12.320]  If we increase the minimum relay fee, this mitigates against flood XMR types of attacks.
[26:12.320 --> 26:17.820]  Now, I started a second here, and I would say that flood XMR is potentially the bigger threat
[26:17.820 --> 26:23.660]  than Big Bang, simply because it's a motivation. Now, also flood XMR is easiest to mitigate,
[26:23.660 --> 26:28.060]  because what you do is you simply increase the... if you increase the ring size, then you turn
[26:28.060 --> 26:33.720]  around and you increase the cost to the attacker, and essentially relative to the defense. And
[26:33.720 --> 26:41.940]  that's a factor of the attack. But we've got to bear in mind that this minimum relay fee also
[26:41.940 --> 26:47.160]  mitigates against these types of attacks. I've included a link to the proposal specification
[26:47.160 --> 26:50.920]  here. And again, you can go to the... and take a look at it there.
[26:53.440 --> 26:55.980]  And I've been looking for some questions and discussion.
[26:56.780 --> 27:01.720]  So I will turn it back to the moderator if there's any questions that I need to answer,
[27:01.720 --> 27:02.800]  or any discussion.