Where nodecoin becomes part of the fabric of NXT is if we as a community decides to offer it as an official ongoing reward to run a computer and support our network.
Once we do this, once we cross over this line, we can no longer call ourselves a pure Proof of Stake cryptocurrency.
I can see how this perception could arise - the mistake (i have made it too) is in referring to this as a poW coin - PoW is associated with miners competing with increasing computing power - this coin is a simple reward for doing work you were doing anyway so it does not affect the PoS of NXT and we should stop calling it PoW.
We will have changed the core definition of what NXT is if the NXT experience is expanded to include the awarding of nodecoin along with the forging of NXT.
It has been made plain in extensive posts that people WILL NOT be sufficiently rewarded by forging to justify running a NXT node and if the number of transactions arises and it starts to stress the home broadband quotas/bandwidths or the laptop performance etc people will keep turn their clients off. What will encourage people to keep their clients on?
Now, we are a very young cryptocurrency. We have to build a brand if we are to survive. Branding involves differentiating yourself from other brands; in our case, Bitcoin. Good branding also has to be clear and distinct and simple to understand on a gut or subconscious level without having to do a lot of reasoning or logic to figure out what the difference is with a competing brand.
The best branding NXT has come up with so far is that it is green. NXT uses far less electricity than PoW mining - megawatts less, and that's a hugely significant amount. A simple way of communicating this "green idea" is "They're PoW and use lots of power; we're PoS so we don't have to". Even at Texas Bitcoin Conference the Jane Sixpack who was sitting beside me in the panel got that idea when I expressed it and said it would resonate among the average public.
Again node coin is NOT PoW - I've run 50/100 copies of node coin on a single sore VPS server alongside NXT and cpu didnt go above 3% and it was 3% before with just NXT running.
Now I am afraid - I have fear without proof - that officially structuring our product to give out nodecoins as a created-out-of-thin air reward to our users will compromise our brand. This SOUNDS like Proof of Work. In fact it is not, since the person doing it hasn't done one single thing they would not have done if the reward was not given to them. They have done no extra computations. They have burned no extra electricity. Really they have just given to NXT Proof of Existence or Proof of Participation. It's like getting a Perfect Attendance award in elementary school - a piece of paper that makes you feel good for something you should do anyway.
But now if we do this we take away significant differences between us and our competition. Now NXT officially gives out "award coins" out of thin air, just like Bitcoin. Now we WANT people to think the award coins have speculative value and will rise in value on our AE through speculation and trading, just like Bitcoin. We have created a way for people to get-rich-quick on NXT, just like Bitcoin. So - how are we different from Bitcoin?
And if we do this we also have to add caveats to our story we tell to brand ourselves. NXT is green - but their Proof of Work coins are dirty and our Proof of Work coins are clean, because they have to burn megawatts of electricity and throw away literally 15 thousand million billion perfectly good cryptographic block candidates that don't have enough zeros on the front end to win a prize to get their next block and win extra prize coins, and we give our prize coins away at the next block for doing absolutely nothing extra at all. It makes us sound as crazy as Bitcoin.
Compare that to "They're PoW and use LOTS of power; we're PoS so we don't have to".
It's not nodecoins themselves I have a problem with. The ability to create new coins on top of the NXT blockchain is a brilliant piece of work, James. I can see where that is of interest to many people and will draw many people to NXT. It's the rationale that NXT has to give nodecoins away to help "secure the network" or "pay for the network" that I question. If people are creating their own coins and trading them on AE, won't they have their clients open and be supporting the NXT network during that time? As we become more successful and add the other services such as streaming quotes and AE candlestick charts and all the rest so AE looks more and more like an "official" exchange, isn't THIS going to keep people interested in keeping their clients open so they can follow the ever-growing action? Won't THIS support and secure the network?
I would go so far to say that instead of giving out free nodecoins on AE, we should cut NXT transaction fees to zero on AE. Won't THIS bring more people to AE - making it a TOTALLY FREE exchange with NO service fees or house cut AT ALL? Now THAT'S branding. THAT'S a product differentiator. That will bring people to NXT in droves: FREE FREE FREE. And it costs us nothing - it's just another feature in the client software, and a choice we make as a community on how to operate our coin, and an approach that DOES NOT COMPROMISE OUR STATUS AS A PURE PROOF OF STAKE COIN.
James, don't be discouraged. You have done a brilliant piece of work that will draw many people to NXT. As you say, though, this tech is so revolutionary and so disruptive that it has the potential to disrupt NXT itself. And something with that much power we have GOT to have open conversations about and decide if we want to do genetic engineering on ourselves and alter our very DNA and mutate into something new.
I say let everybody in the world create 1000 new coins and trade them with wild, crazy abandon on AE - but not NXT itself. In my opinion, NXT itself should not do this. Do not create a "special" extra NXT coin, and certainly not one that is then GIVEN AWAY. The casino runs the game, it doesn't play at the tables itself. Let the action generated by everybody else's coins being traded cause clients to be open and the NXT network supported. Don't try to generate this support by the emotional draw of a "free giveaway" that tries to pull people in by playing to their greed and raise in them hopes of get-rich-quick.
In this section its clear you understand what node coins are and that there is a branding and perception issue - so lets deal with it?
In this section you have a really good summary of how much FUD & misunderstanding has been created by not properly discussing a topic in this thread.
We also have to recognise that at the moment - without community good will and community direct funding we will lose nodes and network integrity because FORGING just isn't and never will be enough for the average person.
People will create scam coins on AE and we will get a bad name for it...
People will try to 'get rich quick' and maybe NXT AE will get a reputation for allowing this.
James work does not make that more or less likely.
FUD often causes communities to pillory ideas and reject them, we need to overcome that.
We need to rehabilitate the news around node coin..
We can simply say 'no official community funding or sponsorship for it' it is what it is and it will survive or die...
We still need a way of securing the network - that problem does not go away.
