Introduction to VIVA, part 2 : More Than Meets The Eye
If you haven't read part 1 of this series, please go read it now or none of this is going to make a lick of sense.
In the previous article, I explained the impetus and goals behind VIVA. Now we're going to discuss how it accomplishes these goals and we start by examining the components.
As I mentioned before, VIVA is an economic engine.
Our engine is comprised of 4 economic layers, 3 of which are cryptocurrencies and the 4th is an AI driven asset management pool.
The 3 cryptocurrencies are...
Crowns, these are a deflationary cryptocurrency that confer certain rights within the system including the right to control coin fundamentals, such as price, marketcap, supply distribution rates etc.
Only 42,000 of these will ever be mined. They are minted about once a week on average.VIVA, are the beating heart of our economic engine, all transactions occur in VIVA and all debts are settled with it.
VIVA supply is managed by Crown Holders with the assistance of the asset management pool.vX these are market pegged assets, guaranteed to always be worth X of VIVA. For example, 1 vUSD is always $1USD of viva. vX are created by individuals, but backed by the network. These are similar in many ways to bitUSD or SBD, but there is no bagholder risk and converting in or out is instantaneous. The X here is to be replaced with any of USD, EUR, JPY etc. Holding vX gains you a daily interest rate and vX are used as a fiat gateway instrument, but more on that later.
So here is how this works.
VIVA cannot be mined, it must be "minted"
In order to mint, you must hold a Treasury Right which is borrowed from a Crown Holder.
The amount of VIVA a mint can create in a given time frame is directly proportional to the percentage of the minting target under control of that Crown Holder.
Example if there are 100 crowns and you control 1 Treasury Right, you are able to mint up to 1% of all coins that are to be minted in that cycle.
You as a Crown Holder get a vote in the number of coins to be minted that week, and the amount to be minted is the mean average of all votes after lopping off the highest and lowest figures.
Minting must be attached to a business activity. The business can be anything except minting.
The mint is there to give the business owner access to affordable computing resources for their enterprise.
The mint pays its worker nodes.
Anyone can run a node and nodes are free to come and go as they please to any mint.
At this time, there are three kinds of worker nodes, Compute, Storage & Network, there will be others in the future.
For more details on that, check the white paper.
VIVA does not use DPOS or any sort of rotating structure or competitive block finding structure at all.
We use a graph based settlement mechanism where each mint is responsible for their chunk of the graph and up to 5 others called affiliates.
The ledger (our blockchain is a graphdb we call a ledger) can grow in multiple directions because all settlement is mint to mint. This means that forks are normal, natural and not a problem. Double spends just mean new coin entered circulation, but each mint is on the hook for each transaction it approves, not the receiver.
So here is how this is structured.
A new startup wants to run a business and needs infrastructure but doesn't want to rely on Amazon or similar services due to cost concerns.
For the cost of a good quality rack mounted server and colo agreement, they can spin up a business activity and attach to a mint. They acquire a Treasury Right, the mint attaches to the network and begins minting on their behalf. From here, the business proposition is that VIVA is infrastructure that pays you. In exchange, you accept viva as payment.
VIVA uses proof of stake as a way of controlling the supply.
Thus in order to mint, all mints borrow stake from the liquidity pool.
When they borrow stake, they pay an upfront "interest" cost and this cost varies depending on the current network variables.
These variables are set by Crown Holders and the liquidity pool all of whom are actively seeking to maintain price while increasing marketcap.
It is possible although unlikely for interest rates to exceed 100%, meaning it is possible for minters to mint a negative amount of coin and this is why they must have a Treasury Right in order to mint.
It's the Crown owner not the mint or the mint worker who is on the hook for periods of negative minting.
However this loss is socialized to all crown holders equally and it's possible they may actually want to do this from time to time in order to mop up excess liquidity. This can happen if business activity recently failed and decided to liquidate a large amount of coin.
It's an opportunity cost not a dollar cost.
In effect every Crown Holder has less coins, but each coin is worth more for everyone.
Of course, accidentally minting negative amounts of coin is a strong sign that the crown holders and the mint should pull their sell orders off the market for a bit and give the price a chance to breathe.
A mint would continue minting in the face of negative minting, because the benefits from finding a crown more than offset any losses from negative minting.
A mint can serve multiple businesses and has a great deal of leeway in what they are allowed to do. The consensus mechanism enforces individual balances, but accounts are settled mint to mint and each mint manages its own slice of the blockchain, so there is never a problem with forks.
All coins are valid because they are backed by the mint that made them and the network is designed to absorb the rare stray coin. This also means that all individual transactions default to private. Money is mixed inside the mint, so for Alice to send Bob $1vUSD, She sends it to the mint, with an encrypted note saying "give bob 1 vUSD", the vX she had is then destroyed by the mint and the mint creates a new vUSD crediting it to Bob. There is no link, it's total anonymity by default.
Alice and Bob can also optionally buy redemption codes at their respective mints and give that code to anyone, again no links.
The final piece of this puzzle is the liquidity pool.
Each person has both a wallet with funds for immediate spending and a liquidity pool account.
The liquidity pool is funded entirely by individuals and acts as the people's voice in the ecosystem.
All worker nodes receive their pay directly to their liquidity pool account, the liquidity pool is a lifetime retirement income account that pays daily dividends.
The liquidity pool maintains a spread between what it charges in interest and what it pays in dividends.
50% of the spread is immediately paid as a dividend to each person in the liquidity pool. If their account is in compounding mode, this is used to acquire more stake, otherwise it's credited directly to their wallet.
25% of the spread is awarded by an awards committee to individuals and causes who could benefit the most. The awards committee is voted on by everyone each year. There is one committee member for each crown. The award goes directly into the individual's pool account and like all pool funds, it pays dividends for life.
It could be life changing amounts of money. By crediting their pool account it gives them incentive to stay in the VIVA ecosystem.
25% is used to fund a subjective proof of work system similar in many ways to steemit's but with some important differences.
Each upvote is worth exactly $1 vUSD, no matter who is doing the voting or how much stake they have.
Stake in the pool is used to determine how many votes you get each day, it defaults to 1 vote per thousand viva you've deposited, starting with your first thousand. But this can fluctuate a bit since we need to regulate inflation from subjective proof of work systems.
Any vUSD earned from upvotes received, goes directly to the pool account of the recipient.
Voting is an important part of the ecosystem. When a vote occurs, the vote is for the person based on some content they created.
In the case of content, you can earn from it indefinitely, it never ages out of the system, people can vote the same content as many times as they care to.
But there is more than just content.
There are also actions that can be voted on.
For example if a storage worker node, served a file in less time than was allotted, then the $1vUSD upvote would be a tip for service. A system like that would be automated and part of the client.
Conversely you can downvote, but it goes against their rep, it doesn't take any money from them but it does effect their sort ordering in certain menus. Rep is a rolling window of 90 days and all reputations trend towards 0 with disuse.
This is all handled through a system of receipts that are generated by each activity.
Unused voting power is not wasted though.
In a rolling 7 day window, all excess, unused, votes are donated to the awards committee to increase the amount of their award.
The awards committee must award 100% of their funds each day. If they fail to do this, then the funds are destroyed and removed from the system. They can do this as a single award to a single person, or they can do it as 1% to 100 people (just an example, not a real limit), or anything in between. The point being to find the people who need it the most. However an individual can only receive a single award per year, no matter how large or small.
The awards committee is completely autonomous, but they are selected by vote of everyone in the pool each year. These members are each peers, there is no hierarchy and beyond "rules for awards", they have no authority within the system.
Now we've discussed each component of the system.
Next we'll talk about how these pieces come together to drive a solid economy.
https://steemit.com/basicincome/@williambanks/introduction-to-viva-part-3-how-does-it-work
I'm in!
What you have described is an elegant system with unbelievable potential. Crypto is truly evolving right before our eyes. Now get your hands off my Crowns!
Thank you! I'm glad you're enjoying it. Hope you'll keep reading there's 2 more sections to read.
This post has been ranked within the top 10 most undervalued posts in the first half of Nov 13. We estimate that this post is undervalued by $19.02 as compared to a scenario in which every voter had an equal say.
See the full rankings and details in The Daily Tribune: Nov 13 - Part I. You can also read about some of our methodology, data analysis and technical details in our initial post.
If you are the author and would prefer not to receive these comments, simply reply "Stop" to this comment.
Upvoted and resteemed. Going on to Part 3.
I look forward to reading the whitepaper (whitenovel) when it is complete. I have followed you to be sure and receive the link as soon as it is ready.
Thank you again.
Wow! Thank you ! I've followed you as well!
Do you have an ico date?
Interesting question and I'm coming to that in part 4.
VIVA the currency will not ICO because by nature it cannot be premined.
Instead there are three "Crown Offering" rounds.
Each round launches with the launch of each milestone, and buying a crown at each round is double the cost of the previous round. After that point, crowns will be found by mint workers at a rate of about 1 per week.
WOW! At first glance, it seems you have given this a lot of thought and have a detailed plan on how this would work. I will download and read the white paper if I can find a link to it!
Still being edited. I tend to be verbose, at the moment it's being called the "whitenovel".
This process of explaining it in a series of 4 blog postings is helping me cut out the redundancies and over-explanations.
Glad you enjoy it! It's been 4 years in the making, so yes a lot of thought has gone into it.
Popcorn is ready for the next part! :) Awesome!
Sounds really complicated. You might want to add explanations why you think each component of the system is necessary.
It's not as complicated as it sounds, but part 3 is coming shortly and I'll try to do a better job of explaining why each component is necessary.
Thanks for the feedback.
This post has been linked to from another place on Steem.
Learn more about and upvote to support linkback bot v0.5. Flag this comment if you don't want the bot to continue posting linkbacks for your posts.
Built by @ontofractal
I think the part where you have to pay an interest is wrong.
If we are in this mess it is because we have always an interest over an interest that make the public debt out of control. When you borrow VIVA, what it should be given it is just the amount taken and in this way the system would be stable.
Actually, we know many people go bankrupt because there is not enough money to pay the interests on the debt generate by this banking system. We know it is basically a swindle. We have to avoid VIVA to end in this mouse trap
It's a because you're not understanding what the interest is for, who's paying it or who's receiving it.
In VIVA new money isn't just printed out of thin air. It comes from somewhere.
Only mints can print viva, but they have to pay for the right to do this.
If you have enough money to run a mint on your own, then the money you pay for the exclusive right to mint this money is just a cost of doing business.
If it helps to think through this, then flip it on it's head and look at it this way.
100% of all future VIVA is owned by people in the future.
The mint operator which is always a business, is borrowing from VIVA holders (individuals like yourself).
The money they pay to do this is given to you the individual, with the catch that you use it help others.
This is because there is no way that you an individual sitting at home are going to be able to compete for long with a business who's purpose is to print cash. So we reduce the supply to keep the price of the coin higher and use that reduction in supply to give to you more in the future.
But you get this, slowly, over time, when you're ready to start receiving your daily dividend payment.
This is not at all the same thing as taking out a loan. For instance a mint doesn't pay this amount back directly and they aren't under any obligation to pay it back. Instead they are minting new money that feeds back into the system by paying worker nodes and subsidizing business activities.
Interest is used as a control mechanism to prevent currency supplies from spiraling out of control, by contracting i.e. reducing supplies.
We should create jobs not more system of crypto currency.
We need business or jobs capable to create a honest income not another crypto currency that I can not use to make a honest living.
That's correct. Jobs and an honest living are key. But you do need a system in place to take care of you when there are no more jobs. The key here is to make sure that pretty much everyone is engaged in entrepreneurial activities. That requires a new kind of economy and that new economy cannot run at the whim of the 1%-
I think that the distribution of the basic income should also come with the distribution of a basic knowledge, so that people can make the difference between their wills and their wants and how the wants are elaborated into their mind.
Money is a mean to reach goals, but how goals are set up ? How do you reach the conclusion that you need a wall between Mexico and USA ( to take a recent controversial example !) ?
How does community members communicate to reach goals. What is freedom ? If these problems are not solve in the mean time, then you nice new crypto can be destroy by a bunch of fundamentalist that will say for example : "basic income is against my religion". I would submit the distribution of the UBI to the fact that people have studied Marshall Rosenberg Non Violent Communication lecture.
Well , I don't completely disagree with that, and it's pretty central to the first posting I made on this topic...
https://steemit.com/vivacoin/@williambanks/introduction-to-viva-a-price-stable-crypto-currency-with-basic-income-that-s-not-hypothetical