EPoSe (Egalitarian Proof of Service), Rewards for EPoW(Egalitarian Proof of Work)

As of February 24th, 2020, Qwertycoin core team has begun testing a new reward algorithm as a part of achieving EPoW.

This reward algorithm has several different parts to the original reward schedule CryptoNote uses.

Before we begin to discuss the details of this change, I would like to clarify our philosophy and intention behind this change. The word ‘egalitarian’ stands for the following;

“Egalitarianism, or equalitarianism, is a school of thought within political philosophy that prioritizes equality for all people. Egalitarian doctrines are generally characterized by the idea that all humans are equal in fundamental worth or moral status.”-from Wikipedia

“ Egalitarianism is a trend of thought in political philosophy. An egalitarian favors equality of some sort: People should get the same, or be treated the same, or be treated as equals, in some respect. ”- Stanford Encyclopedia of Philosophy

The original developers sought to achieve such egalitarianism in mining by the following text;

“ …we propose and ground the new proof-of-work algorithm. Our primary goal is to close the gap between CPU (majority) and GPU/FPGA/ASIC (minority) miners. It is appropriate that some users can have a certain advantage over others, but their investments should grow at least linearly with power. More generally, producing special-purpose devices has to be as less profitable as possible.” — from CrypoNote White Paper V2.0 Section 5

The current mining scene for CryptoNight including Qwertycoin is dominated by ASICs leaving CPU and GPU mining unattractive. Even among ASIC miners, the inequality of rewards distribution was observed.

Making the first part, ‘close the gap between CPU (majority) and GPU/FPGA/ASIC (minority) miners’ is related to mining algorithm and the majority of CryptoNote based coins including Monero has switched over to other algorithms to reduce the impact of ASICs in play.

This can be achieved by changing mining algorithm. It is currently Cryptonight and we will implement the best algorithm for security and egalitarianism.

This EPoW rewards algorithm is not about favoring specific equipment but rather rewarding miners equally based on the amount of work they claim they have done to solve a block.

[Figure 1] CryptoNote Block Reward Calculation per block

Figure 1 shows how CryptoNote block rewards schedule(not worth classifying it as an algorithm). This amount per block is designed to be reduced by a certain amount per block and the calculation method is included in the code. Anyone who is willing and can understand the amount of coin can calculate the next block rewards or the block rewards of previous/future blocks.

Excel Example:

Between each block, there is a time gap to allow miners to solve for the block and when they solve it, they get block rewards in coins. The amount of work per block provides security of any types of PoW cryptocurrencies.

This time gap multiplied by the current mining power(expressed in hash rate) is called difficulty. Difficulty algorithm is a function that should make miners submit enough work to solve a block. It is designed to fluctuate and yet to forecast appropriate difficulty for the future blocks reflecting the ‘reported’ amount of mining power that miners provide to the network.

Difficulty rises when miners solve the block quicker than the time gap and vice versa. This algorithm relies on the reported block solvetime from miners.

The downside of this is that there can be (and are) malicious miners who do less work and still get a full block reward because they found a way to cheat difficulty. By leaving this door open, large miners can mine blocks quicker and leave the minority miners with a smaller hashrate in the dust without rewards for a long time.

Also in case that a block solvetime must increase beyond time gap, miners are not compensated for extra effort or loyalty they provided to the network.

So now, after a long preparation, QWC will take a stance and change it.

[Figure 2] Qwertycoin EPoW Block Reward Calculation based on Time

Figure 2 shows how QWC EPoW block rewards algorithm changes it.

In the CryptoNote original reward is a straight line within one block, which means it always provides the same block rewards. By cheating the difficulty algorithm, malicious miners can get full block rewards in a short time. This type of abuse results in the form of penalty to honest miners because they did not get enough time to solve a block.

The simple summary of EPoW is that, instead of changing the entire CryptoNote block rewards schedule per block, we decided to alter the number of block rewards within each block based on solvetime miners report.

Under EPoW the miners who post short solvetime, by luck or abuse, will get less coins than block rewards schedule either and who does more work after time gap will get more rewards. The penalized number of coins is not emitted and returns back for the next calculation of block rewards.

The algorithm is designed such that even dishonest miners are better off posting an exact time gap from the last block solvetime to get the maximum reward/time. As a result, the honest miners will get more time(opportunity, chance) to solve blocks.

Happy mining!