Blockchain technologies will rapidly change how society engages with the world. Meanwhile, their evolution constantly generates new, more promising solutions, free of previous shortcomings. In the competitive race to improve blockchain technology the emphasis is on technical characteristics of the networks, but the architectural elements are also important, such as consensus algorithms and other mechanisms of blockchain governance*, and this fact is becoming quickly apparent not only for a narrow circle of specialists, but to society in general.
The development of blockchain technology has led to the emergence of new forms of social structures such as decentralized autonomous companies/organizations (DAC/DAO). As it turned out, issues pertaining to finding consensus between the participants became key to determining the viability of these organizations. One of the hallmarks of success for any holistic system is its ability to self-manage and self-improve, enabling it to adapt as changes in external conditions arise, while also allowing for its own goals to be determined so as to be achieved efficiently.
In centralized organizations, this is determined by the mind and will of the managers of governing bodies, to whom all other structures of the enterprise are subordinated. This gives rise to the main vulnerabilities of centralized organizations: the possibility of fatal mistakes made by the organization head, despotism in decision-making, and cases of suppressing the interests of some groups of employees. By contrast, decentralized organizations claim to be developing in the spirit of a true democracy, based on the collective will of its members. Algorithms that form this “collective will”, on the basis of the interests of each participant, establish the main principles that engender the viability of these communities. It is on the basis of the efficacy of these consensus algorithms that such organizations are able to effectively change in concurrence with external conditions, and to support the interests of all participants.
We present our contribution to the evolution of blockchain technology: Gravity Protocol — a Graphene based blockchain protocol built on Delegated Proof-of-Importance Consensus with dynamic emission, for human-centric economy data.
It seems that at the moment, the blockchain industry recognizes Proof-of-Stake as the optimal solution in terms of reliability and performance, as evidenced by the widespread support of this consensus algorithm by the majority of new generation projects. However, many debates** have popped up around issues of its scalability and sustainability, especially in terms of participation of witnesses in the strategic development. Crucially, PoS is far from ideal because it does not solve one of the central problems that faces blockchain network growth: PoS and DPoS algorithms do not motivate users to use the network. As a result, the strategy of most users is to accumulate and hold their tokens, resulting in stagnation and a decline in value of the blockchain as a whole.
The problem is that Delegated Proof-of-Stake (DPoS) considers only the size of the stake when calculating the impact of choosing a strategic direction for the development of a blockchain, and does not take any other real contributions into account, such as “activity”.
The opportunity to receive rewards for active engagement for activity on the platform leads to an increase the number of platform users and projects, and directly stimulating users to utilize the network. Only thanks to the real activity of these users, does the blockchain gain true value and a token gain actual demand, not merely speculative value.
To this end, Gravity Protocol has established as its foundation a Delegated-Proof-of-Importance (DPoI) consensus algorithm, which takes into account not only ownership stake, but also conducts measurement of activity, giving additional advantages to active users and nodes. To accomplish this, Gravity Protocol uses its own Gravity Index parameter. The Gravity Index is assigned both to the entire network and each individual user. It takes into account the activity of each participant and supports their active engagement by emitting tokens according to the user’s contributions. In turn, this stimulates users to utilize their tokens within the network, and discourages the passive holding of their assets.
This in turn will incentivize actual growth of the network and its value for participants, in correlation to the number of communications inside the network, according per Metcalfe’s law; that the value of a network is proportional to the square of the number of the network’s participants.
Simply put, the more coins held in one’s account and the more active the network user becomes, the higher one’s rank becomes in the voting system, and thus, the greater his or her reward. We believe that user activity is the greatest value of blockchain towards supporting its economic growth and should be fairly rewarded. Active users and nodes will receive additional bonuses to that ofpassive token holders. However, the later also recieve gains, as the overall growth of the ecosystem increases the value of all of the user’s investments.
Dynamic Emission of Gravity
One of the current problems with the implementation of blockchain technologies is the inconvenience of tokens as an ordinary means of payment, due to the highly volatile nature of cryptocurrencies. A business can have sudden gains, but also unexpected losses when selling goods or services using cryptocurrency.
One of the reasons for this is that the pre-defined emission size usually does not correlate with the actual needs of the tokens supply in a blockchain network. The rate increases with a deficit of tokens, and falls with an excess. And since the speculative component of the price of crypto assets often prevails over the market component, the only certainty is that the needs of the network will not correspond to the size of token emissions. This fact makes cryptocurrencies high-risk financial instruments and an unreliable form of payment.
To solve this problem, Gravity Protocol implements dynamic emission, based on equations for calculating the Gravity Index. Thus, network growth level is calculated, and core tokens are emited only if this level increases. The result is that emission occurs only when new tokens are required to meet the increased needs of the network. In perspective, this process leads to the reduction of the volatility levels of core tokens to that of fiat currencies when the system will stabilized, and making these tokens into a convenient means of payment.
Simply put, token owners will receive rewards based not on the deflationary increase of a tokens price but on the increase in the amount of tokens in their account, brought about as the result of the activation of dynamic emission distribution to all participants of the network, in accordance with the contribution and activity of each individual account.
Additionally, Gravity Protocol will provide supplemental motivation for creators of decentralized applications (d’apps) and business such e-commerce. When accepting payment in Gravity tokens, developers and users of such services will receive additional income, as generated by dynamic emission.
This architecture of the core of the protocol allows to give effective rewards each participant, truly contributing to the growth of the network and the healthy life of the ecosystem.
Gravity Protocol Foundation team will create a convenient portal for all management tasks and feedback, to provide a transparent environment for the development of the blockchain community based on Gravity Protocol. All governance tasks, such as voting and decision-making mechanisms, will be combined in a convenient interface based on our blockchain network. Such transparensy of management and accessibility of information for any member of the community, in our opinion, is in direct correlation to our main aim: creating a comfortable environment for the functioning of decentralized organizations and applications.
One of the most important governance functions necessary for comfortable DAC/DAO work is the opportunity to conveniently organize the necessary directions of development, such as designating tasks for performers, in order to choose the best of them and fairly reward them for the work done. This feature of the Gravity blockchain will function on the principles of Graphene-based workers and will operate within a single convenient e-government interface, allowing any Gravity based projects to easily and conveniently manage tasks and personnel.
Gravity Protocol uses only the most advanced blockchain solutions in our development. Gravity is based on the idea of open source/free software and the Graphene ecosystem (thanx for Daniel Larimer). Gravity will incorporate the best of blockchain technology developments and solutions to match the call of the time.
The Gravity Protocol Foundation team is made up of diverse backgrounds and skill sets: blockchain developers, active users, graphene project witnesses and businessmen, as well as data scientists responsible for developing and testing the entire algorithm.
We will not conduct any open token sales, and the majority of tokens will be distributed within the community to test, use, and perform active work on the network. Details regarding the initial distribution will be announced soon.
Gravity Protocol’s roadmap is presented on our website http://gravity.io. We will launch the public testnet on May 20, 2018, and all developers and graphene enthusiasts are invited to run our test nodes.
This is all a very simplistic explanation of what we are doing. Details can be read in the Blueprint of the project, to be found here.
Finally, we welcome you to sign up for our newsletter on our website to receive news about all significant events of the project. In due time, you will receive information on how to deploy nodes.
We will be back soon with more news and updates during the upcoming week, and will appreciate any feedback and input.
Telegram channel: https://t.me/gravityprotocol
Telegram dev chat: https://t.me/gravity_protocol
*Blockchain Governance: Programming Our Future:
**The Limits of Crypto-economic Governance: