FUTR: Use of Phi Algorithm to Simulate PoW Mining Effect
Synthchain WP (6)
The Fibonacci sequence is a numerical order based on the algebraic function Phifirst discovered by Leonardo Pisano and published the Italian mathematician’s 1202 book Liber Abacci.
The sequence was first postulated by Pisano as a means to understanding the potential infinite increase of rabbit populations in rural areas, and it is today used to underpin many of the world’s most sophisticated financial markets trading algorithms.
The ratio comprises a mathematical formula whereby the previous two numbers in the sequence combine to give the result of the subsequent answer to the equation ad infinitum:
1 + 1 = 2
1 + 2 = 3
2 + 3 = 5
3 + 5 = 8
5 + 8 = 13
8+ 13 = 21
13 + 21 = 34
21 + 34 = 55
34 + 55 = 89
55 + 89 = 114
etc.
A wide number of professional Crypto traders also rely heavily and in some cases exclusively on Fibonacci-regressive technical analysis today to formulate alpha-generating trading ideas and approaches. Futereum Smart Contracts must contain two apparently contradictory functions which must be equally satisfied in order to justify the utility of the tokens that are purchased in the form of Futereum Utility Tokens. Those functions are the ones as set out as a paradoxical equation:
Function 1 = The smart contract results in a more equitable distribution of Ether than before it was employed by the user
Function 2 = Initial miners and high-frequency miners of Futereum Smart Contract tokens should stand to benefit more from this equitable distribution
The paradox is resolved by means of employing a Fibonacci equation inside the mining algorithm of the Futereum Smart Contract. In the event of the Futereum Smart Contract for Ether (FUTR), we employed the equation as an expression of the amount of FUTR an ETH receives in the process of mining the smart contract. We achieved this by progressively decreasing the amount of FUTR mined per ETH sent to the smart contract as the mining level is increased.
In the example below, which represents the actual number of Ether employed in the mining of the FUTR smart contract, 1 million FUTR initially distributed across a range of miners who collectively contribute 8,772 ETH; subsequently, 990,000 FUTR are mined by a total of 11, 124 ETH etc. Naturally, the progressive difficulty (cost) of the mining process is only compounded by any price increase in ETH.
In this way, the Fibonacci equation driving the FUTR mining algorithm of this Futereum Smart Contract creates an identical mining effect to Proof-of-Work (PoW)mining, where difficulty of a coin’s mining is subject to two factors, those being the cost of the unit of value being mined and the relative age of the Blockchain at the point of mining.
To date, we have not been able to discover a more efficient mining protocol type than PoW. PoW is such an effective method of digital currency mining precisely because over time it forces the miners into higher cost-per-unit mining equations, resulting in an intrinsicallyhigher cost (price) per coin. Economically this process produces a greater expansion of the network underlying the mining process. This POW-likeness of the FUTR does not in itself result in a more equitable distribution of Ether to the FUTR miners however.
To achieve this using the Fibonacci sequence we employed in the smart contract development, we embedded an exchange function at the end of a fixed period in time after the last mining of the smart contract took place.
If all the FUTR produced by the smart contract is mined in under a 12-month period, then at the end of month 13 a temporary function is enabled in the smart contract whereby a FUTR holder is given a brief period of time to exchange the amount of FUTR held for a percentile-wise equivalent amount of ETH held in the smart contract since the point when the FUTR was mined.
This percentage-equitable exchange of FUTR with ETH held in the smart contract, when combined with the Fibonacci equation that is the basis of our mining algorithm, results in simultaneous equitable distribution of Ether to FUTR holders as well as preferential treatment of early and regular FUTR miners, since those who mined FUTR in the initial period of the smart contract and those who mined FUTR when ETH was relatively cheaper in value and who are thereby likely to be the most active miners gain more than late-stage one-off miners of FUTR.
