Cryptoeconomics serving Sustainable Growth
Since 2008, many pages have been covered by articles about Cryptoeconomics’ usability and potential. Perhaps, the most influential definition has been given by the prodigy and founder of Ethereum, Vitalik Buterin:
“Cryptoeconomics is about trying to reduce social trust assumptions by creating systems where we introduce explicit economic incentives for good behavior and economic penalties for bad behavior.”
Buterin (2018)
But how Cryptoeconomics are connected with economic, social and environment sustainability? Here you can read some thoughts and learn about SocialPolis (SPL) Coin Project — the first cryptocurrency fully devoted to Social Economy and Sustainable Development.
Introduction
According to Ethereum wiki, Cryptoeconomics refer to the combination of cryptography, computer networks and game theory that provide secure system environments while exhibiting a set of economic dis/incentives.
Let’s decode a bit the above definition:
A student of Mathematics will meet incentives in the subject of Game Theory, while a student of Economics will do the same in Economics trying to configure human behavior towards common good. So simply, these two scientific fields meet as no other time in history. Cryptography, as a clearly mathematical scientific field, permits Blockchain concept to keep track of all transactions that happened in the past. For instance, digital signatures allow you to authorize message, hash chains let you prove one message came before another and zero-knowledge proofs privacy. Economics incentives, in contrast, guarantee that the desired properties of Blockchain will not unexpectedly vanish.
What makes sustainable growth achievable?
A token economy is a system of contingency management based on the systematic reinforcement of target behavior. It is considered to induce desirable behaviors by providing tokens, which can be converted into other items or privileges. The possibility of building a model with programmable incentives lies at the core of the token economy.
Sustainability, in all of its three dimensions (social, economic, and environmental) is frequently mentioned as an area where Blockchain technology pursues to address. By doing so, accurate and transparent incentives are offered to corporations or individuals inducing them to voluntary participate in activities that promote inclusive sustainability. While corporations and individuals act in their own interest, they can help in sustainability issues at the same time. To build such an ecosystem in a sustainable manner, the number of participants should be broad enough to create a network effect.
The business model of cryptocurrrencies and the token economy made possible the issuance and distribution of financial rewards to initial participants, allowing results of the growth of the ecosystem to be shared among participants. To make this work, a good understanding of economics of cryptocurrencies is essential. SocialPolis Coin is a unique case worth to elaborate.
SocialPolis Coin Project
SocialPolis Coin acts as an enabler for the sustainable development economy and satisfies the need for alternative methods in financing innovative projects, providing, at the same time, trust and transparency in sectors where these elements are of highest priority.
First, SocialPolis Coin runs on the Ethereum Blockchain. The ability of Ethereum Blockchain to support Social, Solidarity and sustainable development Economy makes it a platform of platforms or an ecosystem with its own sustainable economy, also called “tokenomics”
The first division of SPL Coins, as in all ICOs, will be performed as described below, given how the money someone gets from the Crowdsale rate is the same money that can be used in order to guarantee further development.
In SPL Coin’s case, an envision of 80% Crowdsale division will provide the necessary funds to allocate further development (75%), marketing activities (10%), R&D expenses (10%) and legal expenses (5%) as indicated below.
A percentage of 20% of the issued SPL Coins is going to be reserved from the SOCIALPOLIS fund and will be used to:
· Link and support other Social Economy cryptocoins that will follow.
· Invest in specific projects that aim to enhance environmental protection and sustainability following a well-defined set of selection criteria. The SOCIALPOLIS fund, as a coop and a member of the Social Economy, is going to re-invest 60% of the revenues created through such investments back to the SPL Coin ecosystem, offering a mutual rise to all holders’ SPL Coins.
Looking at business model examples like Steemit, it becomes obvious that they are those that secure the success in crypto world. SocialPolis Coin business plan seems more than credible.
To learn more about SocialPolis Coin Project, please visit the official website:
