Multiply or divide coins in blockchain

[TheWolf666]

I am in a project where at a specific block, all the coins will be divided by 2 or multiplied by 2 depending on the exact value of the coin at a very specific date and time.

For example people who have 100 xcoin will end up with 200 xcoin or 50 depending of the value of the coin at date D. That is just an example.

Note: it is not a ERC20 token, but a blockchain forked from Bitcoin.

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[ranochigo]

Its just unfeasible right off the bat.

Whilst your idea could be possible, it doesn't really make sense. By splitting the coin against its value, every single node of the network has to reach a consensus as to the value of the coin at the time and ensure that they are looking at the correct price index and split the coins exactly. Any disagreements will result in clients having different forks.

The fact that it relies on a third party also opens it to the possibility of market manipulation.

[TheWolf666]

I see, you mean that for each address I would have to create a transaction that x or div by 2 and this cannot happen simultaneously, which will end in different blockchain on different wallets. The blockchain would stop working or it would be huge mess right?

[bob123]

I see, you mean that for each address I would have to create a transaction that x or div by 2 and this cannot happen simultaneously, which will end in different blockchain on different wallets. The blockchain would stop working or it would be huge mess right?

No, he means that it won't be possible to agree on an exchange price upon block creation between multiple nodes simultaneously.
You would need one central source of data (exchange price). This would lead to easy manipulation, weakened security and complete centralization.

And in case of a fork it wouldn't just be a 'huge mess', it would create a second (or multiple) forkchains which would split the network into small pieces. Your network would effectively not be fully operational in that case.

[TheWolf666]

I understand, but then is it possible then to change the number of coins issued on certain dates, like bonuses given to the miners, without having any negative effect on the blockchain functioning?

[TheWolf666]

What if each Wallet at a specific block in time creates a transaction that will divide the value of this same wallet by 2. This will be broadcasted as a specific transaction and should be find a consensus like another other transaction?
The blockchain can detect if this transaction has been issued to avoid doing it 2 times, it could be saved as a special transaction that would be accepted by the blockchain without any centralization.
I am not talking about Bitcoin in my question, but about a fork of Bitcoin that would be modified to accept this type of transaction, and would issue the specific transaction at a specific block, one time only.
This would be a special blockchain having this type of functioning included in its code.

I see, you mean that for each address I would have to create a transaction that x or div by 2 and this cannot happen simultaneously, which will end in different blockchain on different wallets. The blockchain would stop working or it would be huge mess right?

No, he means that it won't be possible to agree on an exchange price upon block creation between multiple nodes simultaneously.
You would need one central source of data (exchange price). This would lead to easy manipulation, weakened security and complete centralization.

And in case of a fork it wouldn't just be a 'huge mess', it would create a second (or multiple) forkchains which would split the network into small pieces. Your network would effectively not be fully operational in that case.

[d5000]

When I read your posts, three old altcoin phenomenons came into my mind:

1) Freicoin - where at every block the balance of every coin holder decreases by a certain percentage
2) regarding to bonuses to miners: there was the "superblock" trend in 2013, where some altcoins had blocks with significantly higher rewards than others,
3) also, the Peercoin approach: depending on difficulty, the block reward is higher or lower.

So technically there are possibilities to manipulate holdings (Freicoin) or block rewards (Peercoin, superblocks). You can research on these topics.

Difficulty is an easily measurable indicator for all clients and thus is maybe better suited to determine the "multiplication" of the holdings than an "exchange price". As others have already written, the exchange price would have to be measured by a certain entity, an "oracle" (in the Ethereum community, there are multiple variants of this concept).

There is a decentralized concept called SchellingCoin where the goal is that all those nodes measuring the exchange rate converge at a Schelling Point representing the "real exchange rate", but I think it has never been implemented. There is another similar concept called TruthCoin (from Paul Sztorc).

You can also create a on-blockchain market("DEX"), where you can measure an exchange rate, but in this case you'll probably have to deal with IOUs (like Tether).

I also read, some years ago, about a concept of a currency where holdings are changed according to exchange rate, but I think it was also never implemented. I also don't remember the name

[TheWolf666]

Thanks for your feedback.  

The project is to re-create a currency that has been killed by the Euro. We would like to launch the wallet at the anniversary date of its removal, but limit the number of coin printed to the exact number that was printed at the time of its removal which will be done in 3 year period of time.
After, we would stop printing more coins and reward with proof of stake.

So the life of the coin would be:

1st January 2019 : launch

3 years -> printing about 6 Billions of coins which is what was the amount of cash available at the time the coin was removed.

1st January 2022: either the price of the coin is > of what it was compared to the Euro in 1999 and in that case, we x2 all the coins in the owners pockets, if it is < to the value it had in 1999 when replaced by Euro, then we divide all the coins by 2.

The general idea is to create a debate and an interest in wherever they should hold and support the coin so that it beats the Euro or not.

After that date, we would move in POS automatically, and reward the holders with new coins as a passive income (the more you have the more you get), while the miners will be rewarded by a % of the transactions, just as ETH.

The money would then be rebirth, and fully functional to be a replacement of the Euro "in case off" or just an investment like the Bitcoin.

Any though about this idea?

[d5000]

1st January 2022: either the price of the coin is > of what it was compared to the Euro in 1999 and in that case, we x2 all the coins in the owners pockets, if it is < to the value it had in 1999 when replaced by Euro, then we divide all the coins by 2.

I already suspected something like that.

But are you sure that coins holdings are multiplied if their price is higher, and not the other way around (in this case, it's similar to a "stablecoin")?

If what you wrote is correct then you're basically writing a blockchain-based lottery. However, the price of the coin would most certainly crash instantly after the duplication, as everybody will try to get the "free coinz" and then sell at least half of them, and re-acommodate at 50% of the old value - it's actually very similar to what happened with "forkcoins" like Bitcoin Cash.

[TheWolf666]

I though about it and to be honest I am not sure if we x10 or x2, and if multiply or divide when reaching the goal or not... we are experimenting all possibilities. And that's also the reason why I am posting about it.
There are pro and cons to each solution.

About the crash,  it is great, then we will re-buy the coins we used to liquify the coin during 3 years at a bargain price. And because of that we will also help the coin not crashing with the help of the investors waiting to re-buy at a very low price, which will make the thing even more interesting.
It is not a lottery, since investors can try to influence others to come on the boat to reach their goal, everything is planed in time and nothing is random. It is more about psychology. The more we will be approaching to the split, the more it will be entertaining to see what will do the investors, groups for the pump or advertise the dump?
They will have collectively the power to x or divide their coins.
Dividing is not that bad too, it would be a devaluation and give more value to each coin individually, then the coin distributed after the split will have more value theoretically because more rare. The Franc was devaluated (new Franc) and that's about what we will do in case of division.

Once the event is done, we switch in POS that mean no more superinflation. The coin should then gain value with a possibility of huge profits for the ones who took a position at the right time.

We try to make a coin that based on the genius Blockchain by Satoshi, using POW for 3 years so that we keep the blockchain secured by the work of the miners, and then, transform it in a POS coin that can really be traded an used like cash after it is totally rebirth.

Any idea suggesting or maybe we are doing a wrong thing?

1st January 2022: either the price of the coin is > of what it was compared to the Euro in 1999 and in that case, we x2 all the coins in the owners pockets, if it is < to the value it had in 1999 when replaced by Euro, then we divide all the coins by 2.

But are you sure that coins holdings are multiplied if their price is higher, and not the other way around (in this case, it's similar to a "stablecoin")?

If what you wrote is correct then you're basically writing a blockchain-based lottery. However, the price of the coin would most certainly crash instantly after the duplication, as everybody will try to get the "free coinz" and then sell at least half of them, and re-acommodate at 50% of the old value - it's actually very similar to what happened with "forkcoins" like Bitcoin Cash.

[d5000]

About the crash,  it is great, then we will re-buy the coins we used to liquify the coin during 3 years at a bargain price. And because of that we will also help the coin not crashing with the help of the investors waiting to re-buy at a very low price, which will make the thing even more interesting.

I think you are too optimist here. Scarcity is an important part of the "value proposal" of cryptocurrencies. If everybody gets multiplied his coins x2, then the "new amount" of the cryptocurrency would be equivalent in "market cap" to the "old amount" in no time.

You can obviously try to stabilize the coin, but you would need a strong ecosystem for that.

It is not a lottery, since investors can try to influence others to come on the boat to reach their goal, everything is planed in time and nothing is random. It is more about psychology. The more we will be approaching to the split, the more it will be entertaining to see what will do the investors, groups for the pump or advertise the dump?
They will have collectively the power to x or divide their coins.

You're right, lottery was the wrong word. It's however a currency with characteristics of a game. That might be problematic if you want it to become a real currency. Price swings may be more volatile than with Bitcoin. And if it becomes clear that the goal is unreachable, it may simply "fade away".

Once the event is done, we switch in POS that mean no more superinflation. The coin should then gain value with a possibility of huge profits for the ones who took a position at the right time.

Don't be so sure. There are many coins with "no inflation" that are in a steady bear market. NXT is one example.

Again, you need a strong ecosystem - your coin must be actually used, it must be possible to purchase real goods with it - then your plan could work.

[TheWolf666]

Thanks d5000, your advice are very useful. After the announcement we will listen the community and adjust the coin accordingly.

Do you think that doing just a normal blockchain with no fancy entertaining event would work better? We would print in 3 years the amount of what the currency will be worth to match the 20 years of its removal, and just that.

The problem is that there are too many coins right now, my partner specifically who is more into business is afraid that we will be just another coin if we do not have something specific and entertaining. He is afraid that investors will not be excited otherwise.

Also the altcoin are only following the Bitcoin, something has to be done to our coin to have its own life and not be just a bitcoin follower.