The Trust Machine — Part5: DLTs existential crisis, tokenomics and mana

Designing humanities trust layer for the digital world

Status Quo

while(true) {
doSomethingHeavy()
}

Note: I consider fee-based systems to be the optimal solution because they directly model market dynamics.

Understanding the problems of fee-based systems

Note: This is undesirable because we want to create a network with as little governance overhead as possible.

The biggest problem of DLTs

The DLT space is having an existential crisis when it comes to its perceived legitimacy.

The killer application for DLTs

Self-governed, long-living and sybil protected DIDs for web2 and the world to secure and harden our existing IT infrastructure and to simplify the interaction with the digital world.

Source: Web5 Deck

Mana

generatedMana = amountOfTokens * timeHeld

Note: If the network is uncongested then it is possible to use the network without any mana — we bootstrap the network with utility (entirely free transactions) instead of inflation.

Note: We should most probably create an enshrined output type that allows people to seamlessly perform these kind of transactions (buy unpledged mana) on-chain in the same way as people are able to directly buy gas from miners in ETH.

                    Old Mana      Income       Spent    New Mana 
Day1 (Alice / Bob): 0 / 0 1 / 3 (1) / 2 1 / 1
Day2 (Alice / Bob): 1 / 1 1 / 3 (2) / 3 2 / 1
Day3 (Alice / Bob): 2 / 1 1 / 3 (3) / 4 3 / 0
Day4 (Alice / Bob): 3 / 0 1 / 3 4 / (3) 0 / 3

Note: It is also possible to mine expensive identities with a certain hash.

Conclusion

Instead of tracking assets, the main role of DLTs will be to track self-governed identities, which interestingly resonates very well with the idea to use real world identities to secure the DLT (but more on that in a later blog post).

TLDR

Note: Anybody who is interested in the algorithms related to these ideas can check out the following branch where I started to implement the scheduler for this form of tokenomics which turns out to be very simple.

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I am a hacker, feminist, futurist and tech enthusiast working for IOTA and trying to make the world a better place (whatever that means) :P

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Hans Moog

I am a hacker, feminist, futurist and tech enthusiast working for IOTA and trying to make the world a better place (whatever that means) :P