Charlie Lee, founder of Litecoin (LTC), has proposed mining donations as a new funding method for developing cryptocurrencies.
“I think the best way to fund development is to voluntarily donate a portion of the block reward,” he told me in a tweet on January 24, adding:
What about Litecoin groups donating 1% (0.125 LTC) of LTCFoundation rewards? If every miner / collector did this, this donation would be roughly $ 1.5 million a year! ”
Lee assured Cointelegraph that with a recurring donation of 1%, Lee’s proposed solution would provide sufficient funding for Litecoin to operate on an ongoing basis.
“At the current LTC rate, the 1% block reward is about 7 times the annual costs of the Litecoin Foundation. While a small percentage of miners are generous enough to make donations, the foundation will be able to use them to fund developers working with Litecoin. Core, Mimble Wimble, LiteWallet, and LN Wallet, which host the annual Litecoin Summit, are lobbying for Litecoin’s acceptance by both merchants and users. ”
He also assured me that such donations are voluntary, adding: “It would not be true if they were not voluntary.”
Raising enough capital to run a business can be difficult. The situation becomes more complicated when a company or project seeks to decentralize.
At the end of 2019, there were rumors about the possible bankruptcy of the Litecoin Foundation, which Lee denied in a tweet on October 13. He told me: “Don’t listen to stupid lies and lies.” “We have enough money for two years.”
Lee’s offer of a 1% voluntary donation came after Bitcoin Cash (BCH) representatives Roger Ver and Jihan Wu proposed an “infrastructure financing scheme” that would require miners to pay 12.5% block reward to the Hong Kong process, Cointelegraph About This reports on January 24th. …
In response to 51% of its attack problems, Dogecoin merged its mining operations with Litecoin in 2014, allowing assets to be mined at the same time. In particular, this joint mining operation of Litecoin and Dogecoin is influencing Lee’s new concept of donating a mining pool.
Lee noted in another tweet, “Currently, when combining Dogecoin and other Scrypt currencies, miners receive 105% + block rewards.” “So 1% is a relatively small amount that needs to be returned to fund a public good.”
Finally, Lee also spoiled the idea of miners choosing which Litecoin venture to spend their money on and asked the community to share their thoughts on his ideas as a whole.
“It is important for miners to choose support from other Litecoin organizations,” he told Cointelegraph. “Miners should donate to organizations that want to help.”