A new economic foundation for the future
I’ve been trying to describe a new blockchain and cryptocurrency system that integrates a lot of ideas from existing systems and could help drive future economies. I admit that my programming skills are subpar. The goal here is to explain my idea in order to hopefully have it adopted by a group of programmers who could bring my idea to fruition.
I’ve been wanted to develop a project using “agora” for a while. The word means “market” in Greek. However, the markets of the ancient world were far more than places to buy things. They were places where people came together to interact with one another, discuss various topics of the day, and so on. In fact, the word “forum” is simply the Latin word for a marketplace, an agora.
Universal Basic Income
If this coin is to act as a system to provide universal basic income, a few characteristics still need to be decided. First, how exactly should payments to the general population be made? Inflation does seem like the simple answer. Concerns have been raised about the willingness to adopt a currency that would be inherently inflationary. Why would anyone willingly give up wealth?
Given that the USD has lost 90% of its value since 1964, and people still often laugh when I point out how worthless the currency is, I don’t think that an inflationary coin is necessary going to be rejected. Moreover, people have contributed millions upon millions of dollars through crowd funding, without a problem, because people (1) are willing to support society, as we are social animals, (2) people recognize that helping society can help themselves, and (3) it ties in with our desire to be conspicuous spenders (The Consuming Instinct).
Besides, the coin doesn’t have to be zero sum let alone negative sum. As I’ve mentioned in Is Capitalism a Scam, the source of additional wealth and profits, and general growth, in markets, and the larger technosphere, is the energy that is drawn in from the external environment. As long as inflation is below that growth rate, the actual value of the currency can maintain constant, and people can even make a profit off of the interest.
Speaking of interest, the next question that I want to address is specifically how new tokens are to be doled out by this system. Once the optimal inflation rate is established, and this process may not be an easy one in and of itself, new tokens can be generated and doled out as follows:
Process: On a weekly basis, new tokens are generated at the desired inflation rate. 45% of those tokens are delivered equally to all wallets. Another 45% of the tokens are given as interest based on the locked amount in each wallet. The remaining 10% is used to fund the other objectives of the system, including building infrastructure.
Suppose that for a given week, the calculated inflation rate is 0.1% and the total number of coins generated so far is 100M, with a total number of wallets in existence totaling 10,000 and a total number of locked coins totaling 1M. Then 100,000 new coins would be generated. 10,000 would be stored in reserve, leaving 90,000 coins. 45,000 coins would be distributed to each wallet. So each week, an individual would receive 4.5 coins.
Now let’s say John has a wallet with 5,000 coins locked away. Since John holds 0.5% of all locked coins, he’d get 0.5% of the other 45,000 generated coins. That’s 225 coins. So John would see a significant interest rate. Of course, in this scenario, John has locked away a ton of coins, so the average investor wouldn’t receive this kind of interest, but it shows that a person can actually generate wealth, supposing that the growth in demand for the coin is able to prop up the increase in supply.
Contracts and Credit
I really covered this point in Lawyers of the Future. We need a proper framework for developing contracts, real contracts, between humans, as well as machines, that are fairly human readable, and which can be subject to proper arbitration when issues arise.
We also need a system of measuring credit worthiness, and the combination of the proof of lock system, which establishes a reserve escrow for loan collateral, and tracking of successful contract fulfillment, can provide an alternative to the closed system of credit monitoring offered by TransUnion, Equifax, et al.
The biggest hurdle is going to be proof of identity. The current attempt to establish UBI through blockchain requires submitting an ID to a centralized entity which then checks the validity of the ID. Given how sensitive people are about privacy, a lot of people aren’t willing to submit this information. That’s why we need a biometric lock that confirms identity, while maintaining privacy.
It would essentially be a one way hash, so people couldn’t reconstruct who is who just by looking at the lock, but it has to be fuzzy: biometrics isn’t exact. It’s not like a password that’s fixed. There’s variation and imperfection. So the system would have to be able to properly match biometric data with the lock, even if the information is imperfect or incomplete.
Luckily there’s some research being done on various biometric hash algorithms, including some that utilize handwriting, so I’m not too concerned about the ability to easily and privately validate that you are the one and only individual that is linked to a given wallet, all without having to provide some kind of government issued ID.
Foundation for a Social Future
I also think that Agora Coin, or whatever we want to call it, can be a foundation for a more social future. I want Topix (name subject to change as there’s already a project by that name) to be a social platform like no other, and I think it would be wonderful if it could be built on top of this new smart contract system.
But I also mentioned in my discussion about UBI that this coin could be used to fund infrastructure that helps connect the world, and helps share knowledge. And that will be the real power of this platform. Especially with 5G allowing for robust networks with low latency, we really could connect the world. There’s no need for anyone to be disconnected, unless they wish to be.
For the last 10,000 years or so, government has served a purpose. But it’s no longer needed. Now is the era of…medium.com