Safecoin 4.3 Billion Cap Question

Autonomi Network Token (incl (e)MAID)
1

I’ve read through the safecoin doc http://maidsafe.net/docs/Safecoin.pdf

And I cannot help but to think why have a cap?

I have never understand that part of crypto currency because to me it seems like we are trying to predict the value which cannot be done unless it is artificially influenced and in fact in my opinion it entices artificial influence of the value by people who hoard the coin, pump it up and then dump it, bot traders, or traders in general that add no value to the coins market because they simply trade it with the goal of getting rich and the end result is some get rich while most become poor in trading.

Also there is all this talk about natural systems. I personally like modelling man made things off of natural systems. In a natural system everything is cyclical and recycled. So why not think a few steps ahead and have a deterioration/degeneration model? Maidsafe are calling it a demand generation cycle and are saying that

Page 5, 7 The Economics of Safecoin
[“The generation and
distribution of safecoins are entirely network-led,
i.e. safecoins are only created as the network
is used and data retrieved from network nodes.
This activity is in contrast to currencies like bitcoin,
whose coin distribution is arbitrarily set to
10 minute blocks. This means that if the SAFE
Network is in great demand a large volume of
safecoins will be created, while low demand will
lead to minimal coins being generated. This
demand generation cycle has a desirable e↵ect
in that it should ensure no over supply of safecoins,
which may potentially lead to a unit price
decrease.”][1]

So if there is a demand generation cycle and the generation and distribution is created by the network then why not complete the cycle to make it a full cycle like in a natural system?

If i’m living in the woods, I go out and put some time and energy into looking for some food to eat for me and my family. I find some berries and catch a rabbit. I go back to my cave, beat my chest proudly and show off my food and my catch. We eat the food, the food gives us energy, a day later we crap the food out and it goes back into the Earth for recycling and we repeat the process.

Why cant safecoin have a similar fully cyclical model of generation, distribution, purpose or usefulness and then degeneration/deterioration?

The way in which you would do this is you would add an expiry time date to each individual coin signature. The wallet will tell the user/owner of the coins when each individual coin will expire and then eventually if not used these coins will degenerate/deteriorate back into the network for new farmers to harvest and therefore complete their cycle.

Anytime the coins have exchanged hands for services or in trades their expiry date is reset. This will mean some users will attempt to game the system and create brand new wallets so that they can transfer their coins between their wallets but I am sure there would be a solution to this by requiring the receiving wallet to be on a completely separate node.

This will mean there is never a set cap and that the cap can never be 100% predictable and neither can the value.

As well as creating even further liquidity because coin owners will be prompted to make trades in the market place exchanges as well as use their coins in the app market of services instead of hoarding them or worse attempting to influence the overall value and basically stop people from getting rich and poor off of the trade market.

Thoughts?

EDIT/UPDATE

This idea is not completely thought out, feel free to add to it, or tear it apart.
[1]: http://maidsafe.net/docs/Safecoin.pdf

2

Safecoins are spent to purchase certain resources from the network itself, at which point those safecoins are retired and those specific coins become available to re-farm. So this is a cyclic flow, to a large degree.

There is a limit because otherwise it would be “whee!!” money eventually, with no limit, sort of like the US dollar which has lost over 98% of its value, mostly in the last 30 years do to inflation.

Retiring coins if not spent, to enforce spending, would be antithetical to the roots of the SAFE network architecture, which is constructed with freedom as its key design criterion. Enforcing that someone could not save the assets they have earned and decide when it was more advantageous to spend them than hold them is a very “know best” attitude. It would assume that the designers could know best what people should do with the resources that they have earned.

The network will balance the price of resources against availability/scarcity to incentivize contribution and ensure the network is sound. That’s the purpose of safecoin. If the network doesn’t provide a real store of value in safecoin, the motivation to get it, and thus contribute those resources, is diminished.

Well, that’s the ramblings I have to contribute at the moment. Making any sense?

7 Likes
3

Makes sense.

But what do you mean about the coins being retired? I think I am missing something.

And instead of forcing expiry/retirement of the coins, what about just promoting usage prior to expiry. So users can still in fact hoard their coins they really want to, they would just need to transfer them to a new wallet this way even if only 1% of users retire their coins, there is always 1% going back into the network as new coins.

Constantly creating new coins would not be a problem because you wouldn’t change anything to the current network generation side of things. You would set it at 4.3 billion as they have and allow for new coins to be minted by the network only after coins have been retired with expiry with a one for one basis. I would not suspect you would get many but you would get some and these would solve the problem of lost wallets, people who simply have forgotten about their precious treasure hidden away or people that really just dont care about their 3 safe coins sitting on their gaming rig.

4

When SafeCoins are used to PUT data on the network they are not transferred to any person/farmer, but they are destroyed instead. This frees up the ID’s of the SafeCoins in question to be re-created over time, since farmers have a chance on earning SafeCoin every GET data request. This process is usually referred to as recycling.

So you don’t pay farmers, you pay the network (coins get destroyed), and the network over time pays the farmers (coins get recreated). The ID size of a SafeCoin is 32 bit, so there can only ever be 2^32 = 4.295 billion SafeCoins ever, but we’ll most likely never reach that exactly, since the recycling process is continuous.

4 Likes
5

Ill have to read some more on this because I am still not entirely clued up. But that helps/ Thanks

EDIT/UPDATE

OK, have had a proper read now.

I think i’m now understanding the missing link to what I was not understanding. Can you confirm if I have this right; no one owns services on the network? The app developers build them and are rewarded, the users (who have acquired the coins from whatever way) pay the network to use the network service, those coins hat have been paid are retired and the network can then award new ones to the farmers?

6

Sounds like you’ve got it down now.

7

so who maintains the network and the services? And if its the app developers how will we know they are fairly rewarded?

8

Consensus groups maintain the network, so in a way everyone that participates.

9

With all that money going around it makes one wonder…

10

Makes one wonder what?

11

Dont mind me… im a cynical bastard

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12

That’s the beauty of an autonomous open source network. :slight_smile: You don’t believe what they say is happening is really what happening in the background? Check the source, compile yourself and check the results. You can be the most cynical person in the world (and in Crypto space, maybe rightly so) and your mind can be at ease.

1 Like
13

This is only true for Safecoin used to PUT coins and other inherently SAFE Network (as opposed to app based services). If I write an app that charges, I get all the revenue from the charges, but the network still gets PUT Safecoin revenue if using the App causes data to be uploaded to SAFE Network.

Summary

Any Safecoin earned by the network itself is recycled automatically (returned to the free pool that will be used to pay farmers, app devs etc.).

Any Safecoin charged by an app goes to the wallet address specified by the app developer.

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14

The network will come with a few services that no ones owns: storing data, sending a message, authentication, micro-transaction, etc. Those are the basic feature of the network and each node that participate in the network works together to realize them. Besides that, there is no other apps that runs on the network.

Any app created by third parties will use the basic feature of the network, but they don’t run on the network. In other words, the only difference between the app that you use on your computer right now and an app made for the Safe network is that it uses the features of the network to accomplish some task. You still need to download it and execute it. For now at least.

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