@Bux Thanks for the walk-through of the whitepaper yesterday. Interesting to hear about some of the changes, and Iâm looking forward to reading through the paper once itâs released. I would tag Jae, but donât know his forum username.
My only concern relates to the emissions. Without the whitepaper in hand, I donât yet know how the emissions are planned to be distributed, but Iâll outline my concerns / ideas concisely.
A brief summary of my thinking could be: âIt seems hugely wasteful to create tens/hundreds of millions of dollars worth of tokens for little economic benefit to the Autonomi ecosystem. Is it possible to use emissions in a way that creates far more value for everyone than the current proposal will?â.
More detailed thoughts and discussions were had in this thread:
Why itâs important
Token emissions will represent 39% of the token supply. If itâs still planned to release 10% of this in the first year & the rest at a reducing rate, thatâs 58.5 million tokens in year one. If tokens were worth $1, thatâs $58.5m of value, if tokens were $10, thatâs $585m of value.
What happens with emissions is important because itâs likely to represent a lot of value, and I feel the current plan to distribute to node operators is a waste of this valuable resource.
The economic waste of emissions
My basic reasoning for emissions being economically wasteful is that node operators donât need them; the incentives they need will come from the demand side of the market for resources. Emissions donât solve any problems in Autonomiâs proposed market for resources.
Not only this, but distributing emissions to node operators wonât benefit them hugely; the emissions inflate the token supply while performing no value-adding economic function. This gives node operators more tokens, but reduces the value of their holdings of tokens they previously earned, and future emissions will reduce the future value of the tokens they are currently earning.
Redistribution
While wasteful, emissions arenât useless; they provide a redistribution of the total âwealthâ of the network towards node operators over time.
I agree that a redistribution to favour ecosystem participants vs early token holders over time is a good thing.
But, are there ways of releasing this 39% of the supply that can do a lot more to add value to the network and ecosystem than the current proposal for distributing to nodes?
Ideas of how to create more value with emissions
Idea 1: Tweak emissions to only kick-in above a certain store cost threshold, so that it enhances the networkâs responsiveness to demand increases only when the supply is lagging, and wonât interfere in the market for resources when supply is sufficient.
This would still not represent a big âvalue addâ to the ecosystem in return for the dilution, but would at least enhance market dynamics in some way.
More details on this idea here:
Idea 2: Keep emissions to node operators as planned, but instead of the emissions being plain network token (ANT), they would be provided as a locked âEcosystem tokenâ, which can be âunlockedâ to ANT only by ecosystem enhancing projects that have been approved by a foundation controlled smart contract, or a future decentralised way of achieving the same.
Node operators would participate in âcrowd fundingâ of projects that they think will add the most value to the ecosystem by directing their earned âEcosystem tokensâ where they decide. For anyone who didnât want to participate for any reason, an option could be selected to send the tokens directly to the foundation to allocate as they wish.
(To avoid any confusion; nodes would still receive payment from those uploading in Network Token as planned. Only the emissions would be in the âEcosystem tokenâ)
Here are some potential benefits of this concept;
- Emissions going to projects that are building on the network will add real economic value and utility. Tens or hundreds of millions of dollars worth of tokens boosting value-adding projects will likely grow the total value of the ecosystem far more than a dilution that will redistribute, but not create value. And itâd be âfreeâ!
- By adding value to the ecosystem, these emissions should boost the value of node operatorâs past earnings rather than diluting them, as currently proposed emissions would.
- Node operators could potentially be rewarded by projects they donate to with any utility / other project tokens that could end up being worth more to them vs receiving more ANT with no corresponding value-add.
- Node operators gain more ownership of the ecosystem vs just earning ANT. They can help direct the future of the network by allocating their âecosystem tokensâ toward projects they think will add the most value⌠like a governance token of sorts.
The above is just a concept of how the massive value represented by emissions could be directed to achieve a lot for the Autonomi ecosystem at the same time as providing the desired redistribution.
To not utilise this huge resource for greater benefit seems like a monumental waste.
The only reasons I could see for not doing more with emissions are A) if itâs not possible to do anything more productive with them, or B) distributing them to node operators as planned is hugely productive in a way I have missed.
Itâd be great to hear if anyone else has ideas of how the emissions could be used to add more value than the current proposal would, or hear why people think it will add significant value as-is.
Announcement: White Paper Walk-Through Session 
Join the session on Zoom
(and White Paper will shine a light also I would think/hope!)
Surely you could think of some projects worth developing on Autonomi?
I hardly sleep enough anyway - sorry but wonât do research on this 