In the main mastercoin thread, I had brought up the idea of charging a small fee for certain Mastercoin services (such as creating a smart property).
Before submitting any proposed spec changes (as I said I’d try to do), I’d like to bring this up as a separate topic and get people’s opinions of it, as it is a very important and major part of Mastercoin that can hugely affect Mastercoin adoption (or the lack of adoption). Given this, let’s have a discussion on:
- the pros and cons of fees
- what fees should be charged for
- how fees should be sized (e.g. constant, like with Peercoin, or variable)
- how fees should be paid (e.g. destroy the MSC, send to Exodus)
- and more…
As some background for this thread, here's relevant parts from my initial post (taken from
https://bitcointalk.org/index.php?topic=265488.msg3645360#msg3645360):
From the spec, it looks like the unique factor used to differentiate one property from another is the Property Name, in which one may put up to 21 characters, correct?
What’s to stop people from spamming new smart properties? This could be like the domain name system, without any pricing required to reserve a name. Someone could reserve a smart property like “dog”, or “House Deed”, in perpetuity. Is any MSC required to be consumed to create a property, or is it just the BTC transaction costs to send the transaction?
[..] If MSC is required (or you are considering this), you could have two options here: pay to the Exodus address (further enriching that, although I don’t know how necessary that is), or destroy the funds, similar to Peercoin transactions.
edit to the above: as I understand this more, I think I confused this string name with a currency ID. Am I right in saying that the currency ID (not the 21 byte string name), is what will need to be allocated and unique?? Whichever one it is, we still have necessary allocations among a finite resource, which is where a fee would make sense to prevent clutterJR’s response to this was:
Adding some sort of cost to reduce spam is a great idea. Thanks for bringing that up.
To which I responded:
Having a fee is about much more than just reducing system abuse. If done right, it can also be about encouraging the growth of MSC, by requiring people to trade and vest into MSC before using the features of the systems. Doing this I believe will have a huge impact on enlisting long term support of Mastercoin, because it makes anyone that wants to use Mastercoin features have to be vested into the system to some extent, even if it's only a bit, in order to consume finite platform resources (e.g. smart property namespace and currency IDs in this case). It's also an area where I wonder how Mastercoin clones (such as Mastercoin2, where no Exodus-style funding and no inherent coin worth) will handle. To deter namespace spamming, requiring something beyond the minimal BTC transaction value to be spent on a valuable service with finite addressing resources makes logical and economic sense, to me at least, and keeps the system un-bloated and useful. And it is also something to consider from a systems perspective...i.e. if Tachikoma or someone needs to implement a smart properties feature to the site, parsing out and caching each smart property for quick look-up takes time and memory space.
So that all being said, I agree with you on some kind of fee (which I think should be reasonable, able to adjust/change possibly, and made with the foremost intention of reducing spam while preserving usability and desirability of the feature-set). Also agree that it should not go to the Exodus address. It should be done in a way that doesn't bias one participant over another. However, the problem if we did that alone, is that Mastercoin would become a deflationary currency, possibly even more than bitcoin is (where supply slowly reduces due to constant max and people losing wallets, etc, but transaction fees do not destroy BTC). Not inherently a deal killer, but it would reduce the supply over time. Not entirely sure about what the exact consequences of this are, as the annualized deflation rate could become significant, depending on the exact fee structure and service use volume.
JR’s response to this, favored the deflationary approach:
Mastercoin has a fixed supply, and I'll gladly destroy them as an anti-spam feature. You'll notice that distributed e-commerce destroys MSC to avoid gaming the feedback system. I think it makes sense to destroy MSC to avoid spam feedback, and spam property creation, and spam anything else. Deflationary = Good Investment = Bigger Mastercoin Community = Faster progress = Even better investment
For instance, as a starting point, say we charged the following fees on the following services:
- Simple send, guardian address, rate limiting: No fee
- DEx operations: No fee
- Selling/buying MSC for other MSC currencies: No fee
- Registering a data stream: no fee
- Offering a bet: no fee
- Accepting a bet: 0.0025 MSC
- Creating a smart property: 0.01 MSC
- Paying dividends on a smart property: 0.0025 MSC
- Listing something for sale: 0.001 MSC
- Initiating a purchase, accepting a buyer, leaving feedback: Has its own proposed fees already it seems like
- Creating a new escrow-backed currency (is this different than creating a smart property?): 1 MSC
Is this absurd, or does it make sense? What does everyone think of these ideas, and these fees themselves? (Being constant, these fees above could be a problem if the value of MSC went up by a ton, or was very volatile... but say in Peercoins case, it has constant fees, but reserves the right to adjust the spec in the future to adjust the fee if needed.)
