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The Abe blockchain explorer provides statistics for percentage bitcoin days destroyed, using the generic term "% CoinDD". Currently Bitcoin is 36.1245%, Namecoin is 41.5547%, and SolidCoin is 47.0952%.

My guess is that the relatively high numbers for Namecoin and SolidCoin could indicate that people are cashing their mined coins in for other currencies or goods more regularly than people have historically done with Bitcoin. What is known about the Namecoin and SolidCoin transaction cultures?

But of course Bitcoin only became really active in recent months. It would be interesting to see comparisons of recent activity. Are regularly updated graphs over time available for these % CoinDD values?

  • To be fair, older coins will have a lower percentage of DD, all other things being equal. (Think about lost coins if nothing else.) – David Schwartz Sep 18 '11 at 4:47
  • @david I'm not following what you're saying. DD isn't about coins themselves, but about transactions on coins. – nealmcb Sep 18 '11 at 5:03
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    I'm saying that an older currency will have more lost coins. Obviously, there won't be transactions moving lost coins. So even if all other things are equal, the longer a currency has been around, the lower the % CoinDD. (Of course, all other things are not equal. % CoinDD for most currencies are going up because they're gaining traction. But lost coins puts a higher negative pressure on Bitcoins than other currencies.) – David Schwartz Sep 18 '11 at 5:19
  • @david Ahh - got it - thanks. I wonder what the percentage is of lost bitcoins - seems like that would be a second- or third- order effect. – nealmcb Sep 18 '11 at 16:34
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While Bitcoin DD% is lower it is a lower % on a larger base. Converted to a standard unit say USD Bitcoin transactions are a magnitude higher than other coins. The lower DD% doesn't tell us anything about the nominal amount of transactions but rather the relative days destroyed between currencies.

The lower DD% simply means that less of the older coins are moving in the bitcoin economy than other economies. Other economies are much newer thus they don't have very old coins which due to their extreme age can skew the stat donward. If the oldest SolidCoin miners simply mine and hold they at most can prevent a 14 days from being destroyed. For early bitcoin miners holding onto a single coin can prevent hundreds of days from being destroyed.

As for reason why older coins may not have the same velocity as newer coins. Some of that may be loss. For a long time bitcoin was worth less than a cent. Someone with 10,000 coins (a huge sum tody) may not have taken very many precautions against it and lost coins in data losses or system formats.

Some early miners may have done it simply for academic reasons rather than any investment and when they stopped they deleted (intentionally or accidentally) their wallets.

In the early years of bitcoin there wasn't much value or reason to quickly sell coins. Now the miner may no longer even be mining and just holding the coins as a speculative investment. Newer chains usually have an exchange open from day one. Checking the alternative cryptography forums and exchange chats will indicate a large number of miners aren't mining alt coins for long term appreciation (which would result in low DD%) but instead are quickly selling on exchanges for other currencies including fiat.

  • I agree with much of this. But you say Other economies are much newer thus they don't have very old coins which due to their extreme age can skew the stat donward. Since we're talking about DD%, not just DD, this is already taken care of. – nealmcb Oct 21 '11 at 20:22
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As we can't really know what the particular coins are doing in the network, we can't tell for sure whether they are being actively traded for other coins, or traded in another way.

As for what the percentage can tell us, is that Bitcoins are transferred less frequently, be it because they are hoarded, saved, lost, or otherwise not moved. For example, coins stored in BitBills will contribute to lowering the Days Destroyed, as they are not actively traded through the network. As Namecoins and SolidCoins are still young currencies, there are less means for those coins to be not moved (less people loose their wallets, store coins offline, etc.), and less people want to save in them to store value (if NC or SC are attacked and destroyed, BC will still be able to hold on on it's own relatively unharmed, if BC goes down, all the alternative coinages will probably go down as well, as people have less trust in them for now).

So in general, comparing Days Destroyed can show how many people move their coins, rather than storing them, but the details as to why that is so requires the knowledge of all the ways people use the given coinage.

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