Factom's use of the word "federated" is deceiving. Their mining process should be called "centralized".
It will consist of 8 Factom exclusive centralized servers which will mine 50% of all total coins.
Uh... No.
We have three milestones. The First milestone launches the genesis block, and it is now live, running on one server. This establishes the API, the data structures, and makes Factoids usable to create entry credits and write data into Factom.
The second milestone implements the decentralized servers, and is (as you say) targeting 8 servers.
The third milestone requires 32 servers plus 32 audit servers to run and maintain the protocol, and the election process for maintaining the servers.
Until the third milestone three NO additional factoids are issued to anyone. 50% of the tokens were issued through the crowdsale. Factom will be completely deflationary until the complete algorithm is launched.
In the end, this "crowd sale" only sold the public 25% of all coins. 25% of the coins go to early investors who bought in way cheaper than the public (such a scam). This whole project is a joke and nothing useful for the bitcoin community. All they did was create an altcoin with exclusive mining priviledges that hashes data and stores it on the bitcoin blockchain.
If only 25% of coins are crowd sale they shouldn't be using the term crowd sale. They should call this traditional pre-2009 style investing where scammers get in early and hype up the project to sell it at a higher price to other people.
50% of the tokens were sold in the crowd sale. 20% went to early token purchasers (and they paid more for theirs than people that purchased with the crowd sale). 30% went to people who have been contributing their time and effort, and to developers, and business development people. That 50% balances the 20%+30% of the effort to get to the point of the crowd sale.
One last point. We have to reach all three milestones to access the crowdsale money. A third is released with each milestone. So far we have not touched any of it.
I hope this helps. We have been very open with everyone involved. We are attempting to create a very significant technology that makes the Proof of Work of Bitcoin applicable to many, many applications. It isn't an easy problem to solve, but with milestone 1 behind us, we are significantly further to realizing Factom's potential.
