Handshake Distribution Quadrants
Understanding Handshake’s Asset Distribution
Handshake puts the world’s root zone on a blockchain, making it a public commons. And in order to bootstrap this commons into a valuable decentralized namespace, Handshake must seed ownership into the broadest and most intelligible stakeholder community it can. That’s why Handshake’s distribution was catalyzed by a series of gifts to various communities and stakeholders (more can be found in the Handshake whitepaper).
The best way to understand Handshake’s distribution is by asset and constituency. Consider a Cartesian coordinate system whose horizontal axis runs from new constituents to legacy constituents, and whose vertical axis runs from coins to names. The resulting four quadrants define four types of distribution: new constituent coins, legacy constituent coins, legacy constituent names, and new constituent names.
(1) New Constituent Coins: FOSS Community Airdrop
Two thirds of HNS were distributed via “airdrop allocations” (more info), the majority of which was airdropped to open source developers. Open source developers have created the fertile ground that has allowed for the Internet, crypto, and Handshake to exist. The airdrop is both a thank you to the open source community and a means to empower them to own a piece of the Handshake commons as it matures in price and usage. Putting HNS in the hands of open source developers is also an effective way to source and convert competent stewards of the protocol as it flourishes.
An airdrop of ~4,246 HNS was distributed to over 180k FOSS developers, or roughly ~70% of the genesis HNS supply (which you can verify at anytime under Consensus.js in the HSD codebase). GitHub user with 15+ followers as of Jan. 2019 had your github SSH & PGP keys included in the merkle tree.
Roughly 30,000 keys from the PGP WOT Strongset have also been included in the tree. Lastly, Hacker News accounts which were linked with Keybase accounts are included in the tree — provided they were ~1.5 years old before the crawl.
Further, certain open source projects, non-profits, and hackerspaces were identified and distributed a total of $10.2MM raised from project sponsors as an additional token of gratitude for FOSS contributions. Read more about the community grant here. Directions to claim you airdrop can be found here.
(2) Legacy Constituent Coins: Reserved HNS
Handshake does not replace existing DNS architecture, it extends it. The legacy internet infrastructure community is embraced not just in its architecture, but in its distribution as well. Putting HNS in the hands of existing DNS stakeholders is both a sign of good faith and an effort to build a diverse community of namespace advocates. Given an open mind to the innovations that Handshake offers, these constituents are uniquely positioned to understand the benefits of a decentralized namespace. In fact, several of these legacy registrars have begun to support HNS top-level domains.
Through the genesis “premine” (airdrops & name claims do not add to the total circulating supply until they are claimed on-chain, and their respective maturity period has ended), ten percent of HNS were distributed to these existing DNS stakeholders including Alexa Top 100,000 sites, legacy certificate authorities, and legacy name registrars. Directions to claim your coins can be found here.
(3) Legacy Constituent Names: Reserved TLDs
Removing the artificial constraints on top-level domains opens up all possible character combinations for use. But practically speaking, for Handshake to be an extension of the existing domain name system, it must consider the implications for legacy users here as well. Handshake reserves names for the Alexa Top 100k sites for their current owners: for example, google.com -> google. This means many major internet resource providers will have their own names. This scheme will also prevent names like “Google” from being used maliciously or squatted on. Note that this is an added bonus reserved for popular domains. All existing domains under .com, .net, .org and so on will continue to work normally on Handshake.
These entities can claim their legacy domain name on HNS in a process called a “reserved name claim” that requires a long DNSSEC proof of ownership formatted into a special transaction type and confirmed on the blockchain. This process is opt-in and many recipients may never claim their name. After four years, the names on the reserved list can be won in regular name auctions on the blockchain.
Directions to claim you names can be found here.
(4) New Constituent Names: Weekly Auctions
The set of all other available character combinations after existing TLDs and the 100k reserved names far outweighs what is now unavailable. The balance of names are released weekly over the first year after launch, managing the cadence at which desirable names become available for auction. In doing so, the supply of names can be more widely distributed beyond just the users aware of Handshake in its earliest days. This provides a best effort to allow many users to bid for names desirable to them, while releasing names into circulation in a reasonable amount of time.
Users may submit blinded bids anytime after a name is released for auction. Bidding is open to everyone for roughly 5 days after the reveal period, and have roughly 10 days to reveal their bid price. A winner is assigned the name and, as it is a Vickrey auction, pays the second highest bid at the end of the reveal period. The winning bid amount of HNS coins is burned and permanently removed from circulation. Losing bids are returned and not burned.
Search for your own top-level domain on Namebase.
For another breakdown of the Handshake’s protocol, see The Case for Handshake.
