[POLL] The State of Altcoins (and A Proposed Development Funding Model)

[ExLibertas]

THE STATE OF ALTCOINS (AND A PROPOSED DEVELOPMENT FUNDING MODEL)

I've been a long-time lurker and created this account to open up for discussion the development of an alternative digital currency through a model that can fund its development. This is a proposal for a community project, and therefore thrives on your input. Please read through the somewhat lengthy proposal below and cast a vote if you're so inclined. There is an able and experienced developer available and interested in doing this work, so I put it to the community for consideration and discussion.

I. Introduction

I wanted to introduce for discussion the current state of alternative digital currencies to Bitcoin (or altcoins as we like to call them). With the exception of a few altcoins, most end up with a few changed parameters and very little technological innovation, when in fact, it stands to reason that altcoins serve as perfect candidates for economic, social, and technical experimentation. As a platform for ideas, where risk is a natural part of their existence, they're really good incubators for experimentation with such ideas, but we haven't seen all that much experimentation. It is this kind of experimentation that promotes a healthy ecosystem for all cryptocurrencies, and allows everyone to benefit from the research produced by their progress.

The biggest impediment to this kind of progress is development capacity. If you're a talented developer, it's unlikely that you're going to experiment all by yourself in a field full of altcoins that haven't shown all that much innovation. This is especially true if there is no guarantee for you to earn any kind of income doing that kind of experimental and often risky development (with no way of knowing how the technology will be received). As a digital currency, Bitcoin is a safe development haven, as it should be, but it doesn't mean altcoin development needs to stagnate.

We've seen that it's not at all hard for us to come together as a community and pool funds for this kind of thing. I would like to propose a cryptocurrency development funding model for your input that hopes to bring forth a project to do the aforementioned experimentation and create a platform for developers to have creative freedom and not worry about the logistical issues associated with bringing the community together.

II. Development and Features

The differentiation factor for the community project proposed here is that there is an experiened and longstanding member of the Bitcoin development community interested in doing this work if the community can come together for a cause like this. The developer would like to remain anonymous, but has actively contributed to many Bitcoin projects over the years.

Specifically, the core feature set proposed by this cryptocurrency is as follows, and represents the technological innovation to justify the development of an alternative to Bitcoin to experiment with (no sorted order):

• Merged Mining v2
• Overlapping Difficulty Adjustment Periods
• 100% Big Endian and Single varint Encoding
• Two-stage POW (Withholding-resistance)
• Anti-blind-pooling
• UTXO Proof in POW
• Adaptive Block Speed
• P2SH-only
• Enforce Address Single-use
• Signing Subset of Outputs
• Low-level (RISC) instead of High-level (CISC) scripting, enabling new transaction (not POW) crypto algorithms such as:
  
  • Ed25519
  • Lamport
  • Guy Fawkes
  • Chaum Token

• Atomic Cross-chain Exchange
• UTXO Expiration
• Semi-exponential Inflation (aiming to mimick adoption and eventually population growth)

After these core features have been implemented, and we can make a determination of whether the model is successful or not, other sets of features will be introduced in phases where supporters can vote on the development priority of features, which will then be implemented accordingly. Features to vote on in this way include (no sorted order):

• POS Block Size/sigop Limits
• UTXO Commitment
• Everything is CoinJoin
• Merkle-sum-tree for Outputs
• Pruned History
• Chain Folding
• MMR TXO
• Fractional Amounts
• Unchanging Transaction IDs
• Transaction Checkpoints
• AST P2SH ("Ultimate P2SH")
• Transaction Cost Prepayment
• Compact One Way Aggregate Signatures
• Fee-determinism without Input Background
• Transfer Possible Immediately
• Additional Inputs Acceptable
• Base32 or Base64 Address Encoding
• Addresses provide Pre-image Proof of being a Hash

The model should also support the creative freedom of the developer to become an enabling system as opposed to a controlling one. The developer should be free to enlist other developers at his or her own discretion for help with any task that relates to the features. An example of a task includes the lead developer paying another developer who specializes in a topic to audit and peer review an involved section of code to ensure its implementation is sound and works well in the overall system.

III. Funding

In order for the developer to implement the features described, the model would have to include some mechanism by which the community can pool funds to support the developer through an income. This income is necessary if serious development is expected, which is also a requirement to sustain development capacity until a feature set is completed. There are two options here:

The community pools funds through individual contributions, which are directed to the developer through some process, with:

• No return to contributors aside from the developed technology (OPTION A - CONTRIBUTION, NO RETURN).
  
• Those who contributed receive something in return, as
  
  • a number of coins proportional to the contribution in order to use the technology funders supported (OPTION B - CONTRIBUTION, COIN RETURN).
    
  • something other than coins (please specify in your post) (OPTION C - CONTRIBUTION, OTHER RETURN).
    

Given the scope of a project like this, it is unlikely that you would end up with a very big pool for development if there isn't something given to contributors in return. My personal view is that (OPTION A) becomes difficult if the project is large, but I leave it open for discussion. The reasoning for my personal belief is this:

If you support the development of a new technology through a contribution, you want to use that technology in some way. You cannot use a cryptocurrency without having any of the coins it represents. A logical "return" for (OPTION B) is a number of coins proportional to the funds contributed for development (within reason). If supporters aren't given some means to use the new technology, it is unfair to them as they could have spent those means on say, mining technology. Miners are able to mine the new technology when it is available, however, those who contributed to development are no better off in their desire to use the technology. There isn't an economic rationale for someone to spend their own funds on something they cannot use, if all they had to do was wait for someone else to contribute and then use the new technology. If everyone takes that approach, we end up with a very slow-moving altcoin development process, and the field stagnates (as is currently the case in my opinion). In this way, the funder secures the development of a new technology (such as an altcoin), much as what the miner does when he or she secures the technology once it has been developed.

IV. Escrow Review Panel

If the community decides on how development funding will work, the next problem arises when you have a pool of community funds and an anonymous developer. We already understand that altcoin development is risky in itself, and there are no guarantees. A few things that could go wrong, are things such as technical problems in implementing the features, or the developer could run into personal problems, all of which would have to be resolved.

To increase the chances of project success, a measure has been proposed for this model that involves the appointment of members to a review panel who will act as escrow to the funds. The purpose of these publicly appointed and named individuals (sourced from the community) would be to verify on a monthly basis that work has been completed by the developer. This does not involve an in-depth review of the code itself, but rather to quickly verify the work is being done before signing off on additional funds from the pool to the developer. A technical proposal is to do this through what BIP 0011 describes through M-of-N escrow transactions.

V. Disclaimer

Furthermore, the model would have to include a very big disclaimer. A project that pools community funds like this needs to explain very clearly what is required from developers, funders/contributors/supporters, and reviewers, and equally important, what the project requires them to understand. A very obvious point to understand is that coins returned to funders to use in the developed system have no inherent value and the project cannot guarantee that development will be successful at all. Any value anyone assigns to the technology the project creates is between those parties; the project explicitly does not guarantee any value associated with the coins. The usage of the coins by those who want to use the technology are necessary to generate the social, technical, and economic data to explore, research, and understand the developed technology for future development decisions.

VI. Conclusion

So there you have it. A very rough draft of a model that invites you to discuss and ultimately build a project from the ground up that could jump start something very exciting. To summarize, the objectives of the project are:

• Advance the cryptocurrency field through a model that promotes software development driven by anonymous economic, social, and technical usage data.
• Pool community funds to compensate software developers and attract future development potential to study, improve, and extend the technology.
• Distribute coins to supporters who pool funds to participate in the developed experimental system and use the technology to generate anonymous data for further research.

But let's discuss the last point first, and vote on it to get some measure of what the community thinks about funding development. All input is welcome, as it always will be. My personal intent is not to offend any ongoing projects, so please keep that in mind. I will try and moderate this discussion as best I can, but the key points are:

• This is about a model to fund developers to work on alternative digital currencies because they can be incubators for new ideas to experiment with and generate data for future decision-making, without risk to more established cryptocurrencies.
• The model proposed would include anonymous and/or public community funding, anonymous and/or public developers, a public escrow review panel, and clear explanation of is required from everyone involved and what everyone involved needs to understand so everyone is on the same page with the process regardless of the outcome.
• The model feeds into a community project proposal with a developer ready and able to work on the features listed for a new coin, which will serve as the first example to use the model.

Finally, the project would like to thank the following people for their work and contributions, big and small, that were added to the features (in alphabetical order): etotheipi, Gavin Andresen, gmaxwell, Luke-Jr, Meni Rosenfeld, retep (Peter Todd), and socrates1024 (the real amiller). A thank you also extends to anyone else missed who may have originally come up with ideas that indirectly made it to the developer.

Thank you for your time and I look forward to hearing your thoughts!

VII. Further Reading

• Hardfork Wishlist
• gmaxwell's Alt Ideas

Appendices
A. Poll

To view the results of the poll, you need to cast a vote. This is an attempt to eliminate social desirability bias from the data. However, please keep in mind that this is an unscientific survey to help the project better understand how the community views the question of development funding.

B. Heilmeier's Catechism

The project applies a set of questions known as Heilmeier's Catechism, suggested for use by cunicula, to give more insight into the overall project in general terms. See post #19 for the questions.

[1714777665]

1714777665

[1714777665]

1714777665

[1714777665]

1714777665

[lajz99]

Sounds innovative, BUT, an anonymous dev + OP with 0 posts = no financial support from me.

[Lauda]

Sounds innovative, BUT, an anonymous dev + OP with 0 posts = no financial support from me.

The post itself is impressive and shows signs of knowledge.
OP you should stay around here for a while.

[lajz99]

Sounds innovative, BUT, an anonymous dev + OP with 0 posts = no financial support from me.

The post itself is impressive and shows signs of knowledge.
OP you should stay around here for a while.

Agreed, but I wouldn't personally finance anyone with no reputation and an anonymous dev.  That's all, nothing personal.

[ExLibertas]

Sounds innovative, BUT, an anonymous dev + OP with 0 posts = no financial support from me.

I'm glad you decided to voice your opinion on what I put down. Anonymity is a conscious decision made and built into this model. Identity becomes an abstraction that clouds judgment far too often, when what we are interested in doing is look at the technology free from the biases identity brings with it. This is especially true if people are themselves already built into systems that have matured over time. My personal opinion is that we cannot allow identity to constrict new thought and more importantly, turning those thoughts into reality. We're smarter than that, and we can build better systems than that.

The discussion on anonymity is more important in our world today than ever before, so I'm glad you outlined it, especially if a consequence of such caution could imply that the able thinking man needs identity to create. An important social distinction to make here is that many of our current systems exclude new thinking, and cryptocurrencies are no exception, perhaps out of fear of reprisal. If anonymity is too idealistic and identity is a requirement, which isn't unreasonable in our current world, things are built into the system to give assurance, such as the proposal to include an escrow review panel of reputable members (for those who see anonymity as caution), which is publicly announced before any transactions. Anything less would be unethical.

As they say, the road to hell is paved with good intentions, which is why we have escrow.

[bybitcoin]

You included interesting and somewhat advanced features that makes it look innovative potentially, BUT that is not enough to say I ll create a coin that will have this item and that item, and also some optional from the menu if you are eager for more..
You should introduce a schematic model with a cryptographic rounding procedure that has the minimum consistency as a Turing machine and then show us that this model can accept and include those features natively, and this is what a whitepaper or a proof of concept is for. Though I read a bit fast and hastily, I didn't see such a thing being included in your proposal.
Reputation is of less importance because:
                         1- having a Hero status and 2000 post doesn't guarantee anything (sockpuppets)
                         2- If your idea become known to be innovative, a lot of people will trust you intuitively (scammers are not that innovative usually )  
                         3- Always there is a way of making a multisig wallet and a foundation controlling it to rule over the project development.  
SO YOU FIRST NEED TO REPRESENT A WHITEPAPER!            
 

[Lauda]

Or you could find some reputable member and work with him and let him publish it here 

[Gorgoy]

Sounds innovative, BUT, an anonymous dev + OP with 0 posts = no financial support from me.

The post itself is impressive and shows signs of knowledge.
OP you should stay around here for a while.

I agree, very well written, sounds interesting.

[digitalindustry]

I like the principles thanks for the informal contact, ill look over these things and hopefully can contribute : D

[markm]

It is a pity that DeVCoin does not seem yet to have taken hold or taken root as it was intended to, because the kind of useful, innovative new code proposed is just the kind of thing that DeVCoin was supposed to make possible.

Basically a coder such as the described anonymous developer, being a person who already naturally contributes good useful code to good useful projects, should be on the DeVCoin recipient list, receiving DeVCoins automagically so long as they continue their lifestyle of being a habitual lifestyle free open source code developer working on good useful free open source code.

Thus what was supposed to happen was people who want good free open source code such as the stuff in this shopping list of features to be develioped would be buying DeVCoins, which would make the DeVCoins all the lifestyle free open source developers automagically receive be worth more, which would enable and encourage them to spend more of their time working on free open source projects, hopefully resulting in a snowball so that this anonymous developer would have no need to go through this project proposal this thread is about because their steady stream of DeVCoins they would already be receiving due to their lifestyle of naturally contributing good work to good free open source projects would be going up and up in value as more and more good work such as that proposed in this thread was implemented by such "tenured developers"...

I hope that at least the anonymous developer referred to in this thread is already a "tenured developer" in the DeVCoin system if they are as it seems already a lifestyle contributor to worthwhile free open source projects...

In short, such developers should not have to come begging for financing of some specific project outlined in advance like this, instead they should already be well paid simply by the DeVCoins they naturally receive already anyway, having already been recognised to be a lifestyle free open source contributor that puts out good stuff. Putting out good stuff like the stuff proposed ought simply be the kind of thing such developers naturally do just because it is what they do,  without worry about money because they already get DeVCoins steadily and DeVCoins naturally keep going up and up in value as the community of such developers keeps putting out more and more good stuff thus motivating supporters of good free open source stuff to buy more and more DeVCoins thus motivating more and more lifestyle contributors to free open source projects...

Notice in the original post the implication that this stuff is stuff the developer wants to do. DeVCoin's idea is/was basically to provide stipends for such people just because they are such people and thus naturally produce such great stuff thus should be freed from needing to worry about how they will get paid to do such things so they can just go ahead and do them without wasting time energy effort worry etc etc on all this campaigning and politicking and such simply to be "permitted" to go about their lifestyle of freely contributing great free open source stuff to the world.

-MarkM-

[midnightmagic]

• Merged Mining v2
• Overlapping Difficulty Adjustment Periods
• 100% Big Endian and Single varint Encoding

I have a few thoughts; specifically, I think the easiest way to go about this in terms of anonymous development is to make the first step: create the fork, and add some incremental feature which doesn't require enormous input or modification to do. Then, for this feature, ransom it to the community. If nobody likes the direction, nobody ponies up. If everyone likes the direction of the project, then everybody ponies up. If you have a mechanism and public set of addresses corresponding to featuresets, you could even as time goes on, allow this to become a prioritize-by-money mechanism where direct bounties or ransoms (depending on the developers interests for example) based on developer estimation and performance in fulfilling past estimations becomes the primary driver of the project going forward.

In my experience with namecoin, watching the merged mining process have its impact on the namecoin project was astonishing--and virtually unpredictable. Without a significant proportion of the entire Bitcoin hashrate crushing along on the altcoin as well, it is wide open to another party majority-attacking it. But that's kind of the beauty of public valuation of worth: if people find the idea has merit and think it would be good to incubate it, the ones in charge of the truly overpowering hashrate will leave it alone, IMO, and adopt a wait-and-see attitude towards it.

• Adaptive Block Speed

This is a little worrisome. I disagree with this point insofar as the pressures to expand or contract the block finding target period could be unanchored to actual usability. That is, some amount of work has been done to simulate useful block convergence in Bitcoin, and it turns out (IIRC) that Bitcoin target speeds of 10 minutes is useful in terms of encompassing the Moon. It is an earth-moon compatible system, which makes sense since the planned block reward system is built with an eye towards another 100+ years or so of operation. That's plenty of time to get installations on the moon hashing away, or at least satellites.

• Low-level (RISC) instead of High-level (CISC) scripting, enabling new transaction (not POW) crypto algorithms such as:
  
  • Ed25519
  • Lamport
  • Guy Fawkes
  • Chaum Token

I really like the notion of semi-pluggable, user-controlled cryptographic primitives. At the moment, Bitcoin is a rigid, controlled mechanism which would need a hardfork in order to replace some of its cryptographic primitives with alternatives in the event of a break or catastrophe. Long-term, I think composable functions would be helpful in weathering catastrophic breaks in one or another form of crypto, regardless of the storage constraints involved, and while miners may not necessary be known for their cryptographic prowess, a consensus as to sanctioned cryptographic primitives would be an interesting way to form liquid network rules.

• Atomic Cross-chain Exchange
• UTXO Expiration
• Semi-exponential Inflation (aiming to mimick adoption and eventually population growth)

The first one (cross-chain exchange) is pretty sexy. The exponential inflation is problematic in the sense that the planned deflation resulting from mass-adoption of Bitcoin has been one of the primary drivers of early exponential adoption. Get involved now, and first-mover advantage rewards you with growth in the future. It is almost a hack on the human psyche that this exists: if actual "return" (if you can even call it that) was purely a function of how much effort one put into it, rather than the seductiveness of tricking people into thinking they were clever enough to spot the potential early on and profiting thereby, then growth will probably be much fairer, but slower. On the other hand, it'll be much less scammy.

I think Bitcoin almost seems to have been designed to withstand early governmental pressure in the sense that it is not actually anonymous, but can be made much more anonymous by simple future tweaks in the client code.

I personally hope that these great ideas make it into any potential altcoin. I personally would not like to be involved in the development nor funding process, but I imagine if you made it semi-anonymous in terms of feature voting, or ransoming features, it would make participation in the process much more intriguing to Secret Santas.

[ExLibertas]

Quick note on the technical features. If you're interested in further information, or some background to what they represent, have a look at the Hardfork Wishlist and gmaxwell's Alt Ideas. I'll summarize and compile all of the notes made here about these features for easy access to take into account during the development phase. Thank you for taking the time, or if you plan to take the time, to comment on the technical details. It actually does make a difference and will feed into development.

[cunicula]

I would not fund this. There is no obvious value proposition for basic users.
It looks like a misallocation of effort to me.

[ExLibertas]

I would not fund this. There is no obvious value proposition for basic users.
It looks like a misallocation of effort to me.

There's the cunicula we know and love. There is no question about whether you would fund it or not. The question is directed at those who are interested in contributing to these types of projects. Your feedback is always welcome, but please at least try and put some thought into explaining what you say. I mean that in the most productive way possible.

[cunicula]

As director of ARPA in the 1970’s George H. Heilmeier developed a set of questions that he expected every proposal for a new research program to answer.  He referred to them as the "Heilmeier Catechism".  These questions still survive at DARPA and provide high level guidance for what information a proposal should provide.  It's important to answer these questions for any individual research project, both for yourself and for communicating to others what you hope to accomplish.  These questions are:

What are you trying to do? Articulate your objectives using absolutely no jargon.  What is the problem?  Why is it hard?
How is it done today, and what are the limits of current practice?
What's new in your approach and why do you think it will be successful?
Who cares?
If you're successful, what difference will it make?   What impact will success have?  How will it be measured?
What are the risks and the payoffs?
How much will it cost?
How long will it take?
What are the midterm and final "exams" to check for success?  How will progress be measured?

Aww...  

Apply the Heilmeier Catechism to your project and I may change my mind if you have persuasive answers.

[ExLibertas]

As director of ARPA in the 1970’s George H. Heilmeier developed a set of questions that he expected every proposal for a new research program to answer.  He referred to them as the "Heilmeier Catechism".  These questions still survive at DARPA and provide high level guidance for what information a proposal should provide.  It's important to answer these questions for any individual research project, both for yourself and for communicating to others what you hope to accomplish.  These questions are:

What are you trying to do? Articulate your objectives using absolutely no jargon.  What is the problem?  Why is it hard?
How is it done today, and what are the limits of current practice?
What's new in your approach and why do you think it will be successful?
Who cares?
If you're successful, what difference will it make?   What impact will success have?  How will it be measured?
What are the risks and the payoffs?
How much will it cost?
How long will it take?
What are the midterm and final "exams" to check for success?  How will progress be measured?

Aww...  

Apply the Heilmeier Catechism to your project and I may change my mind if you have persuasive answers.

That's actually really helpful. Some of the predictive questions would be more complex, but it is definitely not a bad approach for a more detailed examination of the project (even if it is anecdotal and would have to be tweaked a bit). I appreciate it! Thank you.

[cunicula]

Glad you like it. I'm really quite a tame rabbit if you treat me kindly.

[miffman]

Very interesting.

[ExLibertas]

Below is an application of Heilmeier's Catechism to the project, as suggested by cunicula, in an effort to give more general information and promote an understanding of what it proposes. Please note that this is a recursive process, and more information will be added where questions arise.

What are you trying to do? Articulate your objectives using absolutely no jargon. What is the problem? Why is it hard?

Bitcoin is the first in a completely new field of computer science. Over the years, there have been many shortcomings and possible improvements discovered in the field. Since Bitcoin is still young, there are only a few full-time developers working on it, who rightfully focus on solving immediate problems in deploying the existing system. This makes it difficult to focus development on forward improvement. Many of these improvements are further complicated because they require extensive research into areas that have not been studied extensively. Such study is necessary to get the algorithms behind the improvements to work well. Furthermore, there are many improvements that would benefit from implementation and research, that are not necessarily difficult, but do not on their own justify a "hardfork", or major deviation, in Bitcoin.

More detail than the aforementioned explanation of the project and objectives would require examination of specific features from the list. A detailed examination for a general audience is reserved for a later date, as this thread is about the viability of the proposed development funding model. If you're interested in a technical explanation, have a look at the "Hardfork Wishlist" and "gmaxwell's Alt Ideas" in Section VII. Further Reading in post #1.

How is it done today, and what are the limits of current practice?

As a general summary, some of the limitations of current practice in Bitcoin include:

• Should someone achieve 51%+ long enough (not as long as it was intended to be), Bitcoin can have its history rewritten.
• Pools can be cheated and forced to close by witholding valid blocks. It may be possible to determine a block's validity in part with coordination known only to the pool.
• Pools can (and often do) keep miners in the dark about what they are mining.
• Miners can be disinterested and mine blocks without keeping track of any transactions. The proof-of-work can require a proof-of-transaction-consideration.
• Addresses can be reused often without immediate harm to the re-users. This causes long-term harm to the whole network.
• CoinJoin requires additional coordination work, when it can be done without coordination.
• Should problems be found in Bitcoin's secp256k1 EC curve, it would require a hardfork to add support for new digital signature algorithms. The use of RISC scripting means a system can be generic enough to support many different algorithms from the start.
• Lost coins permanently bloat the UTXO set. They can require a 1-2 year refresh to avoid expiration.
• The fixed-supply, which helps adoption, also works as a disincentive for people to spend Bitcoins. The long-term use of spending is important because a fixed-supply makes it easy for wealth to accumulate in the current generation at the expense of future generations.

What's new in your approach and why do you think it will be successful?

Most all of these problems can be solved. If Bitcoin adopts some or all of the improvements developed and researched by the altcoin implementation, the project is a success. However, some of the changes Bitcoin cannot adopt, such as those proposed by the inflationary changes. Such changes may become important to the altcoin currency as a long-term outlook, and may therefore provide further justification for and potential success of the altcoin independent of Bitcoin.

Who cares?

That's the question this thread hopes to answer. Does the community care enough to advance such a proposal, which extends beyond an advanced technical system. The type of development funding model that is viable and supports what the community prefers is the first step.

If you're successful, what difference will it make? What impact will success have? How will it be measured?

At the very least, Bitcoin can be improved through the merging of successful changes. If the altcoin gains enough use, it may also be a viable alternative currency to Bitcoin. There is always the possibility that an altcoin can supersede Bitcoin as the preferable digital currency for trade, which takes into consideration the notion that people are inclined to hoard Bitcoin rather than trade.

What are the risks and the payoffs?

The main risk to the project is that the work will take a lot of time dedicated to research and development of the functionality. The benefits are distributed to a much wider community, but dependent on how the project is funded, there may be no direct benefit to contributors. In the scenario where development is funded through no return to contributors, a sole payoff is a better system for everyone.

If contributors show interest in funding the project through a direct return of coins proportional to what they donate to the project, the likely scenario is a much larger community pool of funds to implement the proposed features in an altcoin. A larger community pool of funds, controlled by escrow, and released to competent developers, such as the developer who will work on this project, means the payoff is direct for the contributors who support the project through their donation. A direct payoff in this way means they can use the new technology directly, which in turn generates the data necessary to examine the implemented features after real-world use. This examination feeds back into the merging of successful changes. Thus, an additional payoff in this option is also a better system for everyone, if a coin return is proportional and done fairly.

How much will it cost? How long will it take?

An exact prediction of how long new research and development will take is very difficult. To complete the entire list of features may require multiple years of work for a single developer. During this time, there would likely be prototype test networks (testnets) to experiment with, that would be reset when necessary to add new core functionality.

Implementation of the phase one core feature set has been selected in this way so that the bare minimum functionality required to start the permanent/live altcoin blockchain is possible in a timely fashion (See the "core feature set" in Section II. Development and Features in post #1).

It is possible to give some estimation of the minimum work required on a per feature basis for the developer of the project, which is open for further discussion after a determination can be made about what funding mechanism the community supports (to which the poll hopes to add some insight).

What are the midterm and final "exams" to check for success? How will progress be measured?

The current plan is to have a public escrow review panel check the developer's work every month. which requires input from the panel members, to decide whether to continue funding the project, refund investors, or perhaps hire another developer instead of the project's lead developer should the situation warrant change (e.g., a life emergency where the developer cannot continue development). Such changes will be put to the community and panel members will make decisions through the community's input and voting on these issues.

[behindtext]

anonymous developers create an accountability problem - just look at the TrueCrypt project, where neither of the lead developers are identified and whether the software actually encrypts properly is a legit question. when ppl are anonymous and in a position of responsibility, they are not incentivized to behave like normal people.

it is fair to point out that most altcoins have made limited variations on bitcoin. this is due to the amount of effort and energy it takes to make modifications to the codebase. funding is an issue in terms of making significant modifications happen, e.g. 1 man year of work from a very smart person would be sufficient for most of the previous altcoins happen. in terms of making more substantial modifications, i estimate it would require over USD 200K for any altcoin to have what most spectators consider "significant" changes. note that this assumes devs are being paid more-or-less market rates.

[vintagetrex]

there are some really good innovations out there that need funding!!

<https://bitcointalk.org/index.php?topic=252564.msg3531733#msg3531733>

Proof of Storage is the next great innovation in the crypto economy.  It is analogous to proof of work.  Consider how bitcoin unlocked your computer's processor as a money making device, but it left your hardware's potential locked up.  Proof of storage will allow for mass storage of information in a block chain that will become a "timeline of claims."  It will allow for the replacement of the USPTO the way bitcoin replaced the need for the Federal Reserve.  

Please consider funding this project.  

Nemesis is a crypto anarchist cipher-space hosting corporation.  It uses an algorithm to continuously generate and sell a fixed number of type A shares through a proof of work equilibrium.  Type B shares are continuously generated and sold via a proof of storage equilibrium. 

[ExLibertas]

anonymous developers create an accountability problem - just look at the TrueCrypt project, where neither of the lead developers are identified and whether the software actually encrypts properly is a legit question. when ppl are anonymous and in a position of responsibility, they are not incentivized to behave like normal people.

I should mention that this is a very valid point. The level of funding is likened to a dependent variable in a very anecdotal study in the context of this project. It's dependent on anonymity. Although we can't control for things like exposure, it would provide some data on anonymity outside of technical systems. Personally, I think that's interesting and important to look at. Who knows if one day you'd have the freedoms you enjoy today? Anonymity is part of the freedom family.

it is fair to point out that most altcoins have made limited variations on bitcoin. this is due to the amount of effort and energy it takes to make modifications to the codebase. funding is an issue in terms of making significant modifications happen, e.g. 1 man year of work from a very smart person would be sufficient for most of the previous altcoins happen. in terms of making more substantial modifications, i estimate it would require over USD 200K for any altcoin to have what most spectators consider "significant" changes. note that this assumes devs are being paid more-or-less market rates.

Another point I agree with. Relying on pure donation without any kind of return is unlikely to fund an experienced developer for very long, which is probably why a lot of altcoins are a bit watered down in relation to Bitcoin (no offense, but I'm drawing a comparison between net innovation in code bases). Even though the project can't make any claim as to the value people would assign to this "return" aside from assuming it has no inherent value (to do so would be unethical without real data), the fun part about all of this is getting some coins to use the features you want and support. That's what makes the whole thing exciting and moves development forward for everyone.

[cunicula]

I can see why you are doing this, but could not support it because it is all essentially orthogonal to the needs of every day users.
You seem to be optmimizing the back end. There is a time and a place for this type of stuff, but i think it makes more sense to devote resources to radical innovation. Cryptocurrency is too young for it too be worthwhile making many small optimizations in an altcoin.

[digitalmagus]

There is a time and a place for this type of stuff, but i think it makes more sense to devote resources to radical innovation. Cryptocurrency is too young for it too be worthwhile making many small optimizations in an altcoin.

Hi Cunicula,
First, I just wanted to say that I enjoy your posts. Personally, I'm willing to fund netcoin regardless because even if I don't believe it is perfect enough (see my wishlist below), these small optimizations/fixes/improvements are such that they could eventually be imported into an even better future utopian crypto coin and thus save everyone the development time in the future. As such, netcoin will get some of my donation $$.

On a slight tangent, I was wondering if you could possibly share with us your thoughts on which worthwhile "radical innovation(s)" that benefit end-users could be?

Here's my utopia list:

Price Stability - This is almost like asking to see God, but maybe there's a few clever economists out there that could help out with a short-long term strategy. Bitcoin severely lacks price stability, this makes it a very poor choice for the masses to use as a currency for daily transactions - Aside from it being too confusing for sub 100 IQ humans to understand and keep up with, imagine employers trying to figure out how much less you should be paid every 2 weeks than the previous 2 weeks, or how much less to pay their 3rd party suppliers. Further, as already witnessed with bitcoin, aggressive deflation is likely to cause extreme speculation which results in massive mis-allocation of capital (aka. bubbles) and excessive savings impacts spending, which impacts employment stability, which impacts technological innovation across all sectors. Possibly, the most important negative is that it would allow for a massive disparity in rich vs poor mid-long term, which is the trigger for many civil revolutions, or in this case migration to another coin. Thus, I do not think this would allow for a stable economy mid-long term. Deflation is a clever trick to attract a lot of users initially, and I am ok with that short-term, but not mid-long term. I'm thinking we need something along the lines of: first 2 years: medium aggressive deflation (1/3 of bitcoin aggressiveness? 50-100%), years 3-7: low deflation (target 5-15%), year 7-20 (1-2% deflation a la Fed, but with deflation not inflation). Starting year 7, deflation would be measured not against the USD but against an SDR-like basket of currencies: 20% EUR, 20% USD, 20% Gold 20% Silver, 20% G20 stock indexes (or some such variation). Some time after year 20 this new coin should have achieved global reserve currency status or at least very wide spread adoption (primary currency usage by many countries, at which point, the SDR-like measure could be dropped and a mathematical formula could be devised to attain near price stability  (0.5 deflation to + 0.5% inflation). In short, I'd like to see math replace biased central bank interest rate policy guidance to attain real (not CPI re-defined) price stability. From the average person's perspective, not only is price stability psychologically required, but it would hugely contribute to 'ease of use'. Systems that are simple to use are more widely adopted, faster.

Limited Government Taxation - I believe some capitalism is required for innovation to foster, but capitalism lacks a moral high ground like socialism or some other egalitarian political philosophies. Specifically, pure capitalism = full privatization of all sectors = rich get richer, poor get poorer. My point being, I don't believe everything should be privatized and I do believe there is a role for "government" to play, specifically in funding basic social services: Hospitals, Police, Fire Fighters, City infrastructure, Courts of law, Disaster Relief, Welfare, Waste Management, Defence and Policy makers (likely I missed a few here). Bitcoin can and will be used for tax avoidance by the citizenry. Governments today can enact laws to tax businesses using bitcoin, but taxing of clever individual citizens will be near impossible due to anonymous laundering systems. I see bitcoin laundering to eventually be automated with an app for every transaction, thus nearly all citizens would use it. As such, IMHO bitcoin will ultimately be crushed by government(s) before it gets too big. An utopian coin should use math to set aside a per transaction fee or some kind of yearly allotment that can only be collected by government officials of each nation. Further, dynamic math formulas built into the coin should be used to allocate budgetary capital for nearly all government departments as opposed to corporation lobbied/corrupt politicians allocating the capital. The justification to the solution that should be implemented for this is the stuff of not mere Phd thesis but likely voluminous books written by genius economic philosophers that ultimately will have to be translated to code. I'm thus officially naming the coin of my wishlist "utopia coin".

Balanced Mining - Assuming we can't come up with a more clever replacement for the concept of mining coins into existence, at present I see two possible extremes of which netcoin is one of them. Bitcoin allows for easy ASIC mining, thus in another year or two we'll end up with a dozen or less organizations that control 90% of all the mining, thus allowing for centralization of money creation. Netcoin might be going too far in the opposite direction by wanting to implement too many protocols to severely restrain ASIC mining. The problem created by severely restraining ASIC mining is that it will allow for a problem that is just as severe, the centralization of coin creation by use of botnets, which is worse since it is less energy efficient and illegally/immorally uses other people's computer resources without permission. So how do we achieve a balance here? I think the answer is something along the lines of use algos 1,2 & 3 for say 2 years, and then at the start of year 2, algo #1 gets replaced by new algo #4, such that now you have algo 4,2,3. Then in another 2 years, you replace 2 with 5. Whilst arguably environmentally wasteful from a PCB lifecycle perspective, this would severely restrain any one ASIC company from having long term coin creation control, as every 2 years the race begins anew. From a botnet perspective, botnet mining would be restricted to the time period from when the algo is reset to the time period that FPGA code could be implemented which would likely be a short window period of 2-6 months, which shortly after would be replaced by ASIC mining again until the next algo reset. Or probably even better would be an algo phase-in approach, such that hackers/botnets don't sit around waiting and slam the coin on X day of the reset.

Full Anonymity by default - Not just interacting/dependant on coinjoin, or use of Zerocoin with adverse/trade-off effects. I know, I'm a seemingly conflicted individual: I want some capitalism, some socialism and unquestionably some liberalism and *gasp* some anarchism. By solving the government taxation issue above, anonymity should be *less* of an issue for current elected government officials. Whilst terrorists, drug lords and pedophiles will be theoretically aided by this, one might argue that there should be less terrorists if every country on Earth were playing on an even economic playing field with a global crypto coins vs heavily manipulated fiat currencies. The major crux to implementing anonymity within the coin from day 1 is that it may actually prevent legal wide-spread adoption by brick and mortar merchants as governments would decree it illegal because "oh think of the children!". Without brick and mortar adoption, the coin could never reach wide-spread adoption. I'm thus conflicted at present as to how this dilemma can be resolved.

Network Security - I've said it before (NSA/Snowden issues), and I'll say it again: Whatever new utopian coin is created, it should have either embedded network security or a quick migration path to it after deployment. By this I mean, no reliance on a single TCP port 8333 that can be easily blocked by governments at Tier 1 ISPs. Further transaction security/encryption is required.

Global spot price - With the implementation of miraculous 'price stability', eventually and in theory we should be able to get closer to achieving a global spot price for utopia coin meaning that 1 utopia coin at an exchange in Russia has the same fiat currency / SDR-like value at any other exchange. Or do we still need some radical innovation to achieve global spot pricing. Can there be a peer to peer exchange protocol created such that it tracks the 'value' of all transactions and arrives at a dynamic average spot price that is periodically (1 min?) reported to all client/exchanges? Or should we just forget this idea and leave local supply/demand to determine utopian coin value?

Decimal points & Ease of use - How many decimal points most human brains can easily deal with is arguable. I believe we have all been taught/conditioned to handle 2 or max 3 with current currencies and the metric system. This is not to say in 2 or 3 generations from now, 8 decimal points for currency won't be easy to handle. Still, I believe simple is better. Utopia coin should include some kind of embedded code such that when the fiat or SDR-like value of the utopia point reaches a certain height, a currency conversion holiday occurs; meaning your 10.423 utopia coins are now 104.23 utopia coins. If this is done for all users or specifically across the entire public ledger, then nobody loses out and simplicity remains eternally. Tada! No more need to worry about dealing with 0.49258852 fractions of a coin. Arguably all external systems to the coin that track the coins value require Y2K like updates, unless they were coded to deal with this from day one - and they should be if this feature was included from day one.

Pool Voting Centralization Avoidance - I am not familiar enough with the under the hood workings of how BIPS feature voting in Bitcoin works, but I have read that pools essentially centralize voting power to the pool operators. If this is true, clearly this needs to be resolved.

[cunicula]

Gee thanks
Features for users
#1 stabilized units of value tracking major world currencies.
#2 temporary txn reversability (to allow retrieval of stolen funds in some theft scenarios)
#3 zero confirmation transactions (txns backed by security deposits against double spending)

Repeating this in txt form:
I envision a future where you can hold and pay in USDcoins in the US, EURcoins in the EU, YENcoins in Japan, and CNYcoins in China. The basic coins would be equity backing these stabilized currencies. The price of the basic coins would be volatile like a stock price, but offer higher expected returns for risk tolerant investors. I also see USDcoins earning some positive nominal interest while sitting in your wallet much like a corporate bond. I see people retrieving most stolen funds through self-initiated chargebacks. I also see a future where people can pay for groceries or a computer at a retail store without waiting or exposing the store owner to risk.

Anonymity is an excellent feature, but it is not nearly as important to joe average as 1) can I pay/receive USD instead of blow stamps? 2) can I protect myself from theft? 3) can I pay at the store without an awkward wait?

Back-end:
I think the backend needs to include a mixed proof of work / proof of stake system. However, I do not think people will buy into a coin because of an abstraction like this. They need to see modifications that promise to make their daily lives easier.
The goal of the backend is to allow for stability, speed, long-term sustainability, and scale. People can't see these thing directly. They aren't even necessary or worth offering until the coin has a chance of supplanting bitcoin. Do the sexy features you can put in advertisements and newspaper articles as a first step. Figure out how to keep the system from collapsing under its own weight as a second step.

Note: probably best not to reply to this unless you are the OP. It is his thread and a series of offtopic replies could easily derail it.

[Luckybit]

Sounds innovative, BUT, an anonymous dev + OP with 0 posts = no financial support from me.

The post itself is impressive and shows signs of knowledge.
OP you should stay around here for a while.

Agreed, but I wouldn't personally finance anyone with no reputation and an anonymous dev.  That's all, nothing personal.

I agree the dev should not be anonymous if they receive money. I wouldn't give money to any anonymous individual if I could avoid it. The risk of being scammed is too high.

I think in order for this to work the community who crowdfunds must receive some sort of long term share or stake in the idea they are backing with their funding. They are backing that idea with their money and in my opinion are owed a return which is worth potentially much more than they originally put into it because that is what attracts investment in the first place.

If they get exactly back what they put in then it's a no interest loan. If it's an investment then they should potentially get back much more than they put into it whether that be by dividends, or by getting a share of the profits generated, or by getting some of the coins.

My opinion is that every project which accepts crowd funding should treat the people who fund them as co-owners and shareholders in the idea itself. They should receive a founder badge and that badge should carry with them onto any derivative project as part of a social contract.

It means if you were a founder (crowd funder) of a very genius idea which turns out to be a brilliant paradigm shifting then that badge should carry a lot of weight in the community. Over time there will be individuals in the community who will have a lot of these badges and these people should be the first people to be hired for jobs, these people should be the first people contacted to invest in new ideas, these people people should have shares reserved for them in derivative ideas.

I think the model that protoshares is following with their DACs which spawn DACs is the right way to go about it. If you invest in protoshares then you'll have a 1:1 stake in anything that the DAC idea itself produces in the future. If you believed in the idea of a decentralized autonomous corporation enough to risk your Bitcoins to fund the idea then if the idea is successful you should benefit from all future iterations upon that idea.

This allows the community to collectively claim ownership of an idea without having a patent system. If you think of protoshares as the root node in the tree then from protoshares you can get Bitshares, DomainShares, and a bunch of other *Shares. The amount you get in these future products is based on the amount of protoshares you have. There are 2 million protoshares in total. This seems to be working as a proof of concept for Invictus Innovations.

I think we should extend upon this proof of concept and take it even further. If someone has an idea and has assembled developers then they should follow a similar model as with protoshares. (Idea)Shares can be mined or purchased, can be treated as a currency, can be used as a mechanism of buying and selling ownership of the idea itself and can replace the patent system by allowing people who have a good idea and developers to actually give the idea to the community where it can be turned into an altcoin which can have a mission and purpose.

This will allow the community members to choose the ideas they feel have the most promise and potentially get rich if they choose the right idea. This will create a market where anyone who has a very good idea and developers will be able to get funded if and only if they back their idea with some goods and services which bring the inherent value to the (Idea)Shares.

So if we have for example the idea to create a decentralized exchange and let's call it the Bitshares idea, we first propose that idea by developing a whitepaper. Once the world knows about the idea and is excited about it then create a prototype idea coin which allows anyone to mine or buy that coin while the Bitshares idea is developed into a product or service. Anyone brave enough to buy or mine that coin will own portions of the Bitshares in 1:1 proportion to what they owned in the prototype idea coin. Now if something branches from Bitshares then again you can transfer ownership 1:1 from the owners of Bitshares to whatever came from it. This basically would reward the developers, founders, funders and innovators together.

In my opinion the key to making this work is to treat the developers, founders, funders and innovators as the creative class and do everything we can to come up with reward mechanisms and incentives to attract funding to that class. We should take concepts which work well in the real world like shares, dividends, profit sharing, and adapt those incentives to a decentralized pseudo-anonymous environment.

We should include reputation by having badges. If a particular person has a lot of badges to their name then they are either a great developer, a great investor, a great creator of something, but you wont get a badge if you won't take a chance. You cannot be great if you don't take a chance on a moonshot idea which becomes great.  But we should do everything we can to reward the people who do take a chance on the moonshot idea, and reward the people who dream up these new ideas as well by giving them the recognition of having thought it up. Developers who have worked on various successful projects should also be known and receive recognition whether their contributions are perceived as large or small.

Then as a community we should give special status and rewards to these individuals. Discounts, prizes, status, privileges, dividends, points or whatever you can come up with to make people want that special status.

Anonymity is a conscious decision made and built into this model. Identity becomes an abstraction that clouds judgment far too often, when what we are interested in doing is look at the technology free from the biases identity brings with it.

I'm okay with developers being pseudo-anonymous but they need an identity so we know their reputation and can develop trust. If we don't trust the developers then we don't even know whether or not the code has something in it. I'd prefer developers who give their names and addresses for accountability but in the situation where they cannot do this then they should at least have a persistent pseudo identity which we can confirm is them by digital signature. I think Keyhotee might offer the solution to the identity problem but also the Bitcoin identity protocol can do it. Basically there should be a way for a third party to be able to confirm that the developer we are dealing with is a trustworthy and legitimate person. The community does not have to know the real life identity of that developer but some third party we trust has to know their identity and vouch for them. If no one knows who they are then no one can vet them, and if no one can vet them then no one can trust them enough to run their compiled binaries or even trust that there wont be backdoors in their code. For situations where money and investment is on the line I would not advise anyone to give money to any anonymous person.

Haven't we seen what happened with Labcoin and other scams to know why this is a problem?

This is especially true if people are themselves already built into systems that have matured over time. My personal opinion is that we cannot allow identity to constrict new thought and more importantly, turning those thoughts into reality. We're smarter than that, and we can build better systems than that.

I propose pseudo-anonymity. I'm going to take a stance against complete anonymity. Pseudo-anonymity would mean you can come up with any alias, screen name or pseudonym you like. That pseudonym is like a currency in itself, it has to be backed by something or it's worthless. If you have no one who I know who is willing to vouch for you and say you're legit then I will not trust you. In order for this to work there must be a way for a third party to do vetting of developers in a decentralized way.

Here is one way it could be done. Every developer should have to be a real life person who goes through an in person vetting process. If they pass that process then they'll receive a key known only to them and no one else. After receiving that key then they are a developer trusted by the community.

The reason I think vetting is necessary is because anyone who is in a position to write code to manage other people's money should not be trusted by default. They can be anonymous to the wider community and use only a pseudonym but someone or some protocol has to be set up so that someone knows their real identity.

If there are anonymous developers involved then if they do work on writing code I would say you'd need several trusted developers who can look after them and audit the code that they write. Ultimately we will require trusted developers to develop anything truly important so any plans on making things anonymous also have to solve the problem of trust, reputation, and accountability. Mask your email address, mask your identity from the community, but someone has to be capable of unmasking you and locating you in person so basically we'd need a trusted middle man person who would speak on your behalf and say we can trust this anonymous developer, that the anonymous developer is our friend, and that I know the identity of this person and you can hold me responsible for any damages caused by this anonymous person.