Cryptocurrency with the best distribution?

[Marlo Stanfield]

What do you think makes for a good distribution of currency? And what currencies do you think have achieved a good distribution?

I can think of two main metrics that one might measure currency distribution in: percent of total currency held by individuals, and total number of individuals who hold said currency.

Another variable is time. And the speed at which the currency is dispersed through out a population.

How important is this to you? Is it an overrated factor, or is it something people underestimate the importance of.

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[devphp]

It's an overrated factor. Most of the money ends up in the hands of a few no matter what the initial distribution is. You won't find an example in the world contrary to this statement.

[Marlo Stanfield]

It's an overrated factor. Most of the money ends up in the hands of a few no matter what the initial distribution is. You won't find an example in the world contrary to this statement.

Over time this would seem to be the case in any capitalistic market. Money makes money.

[g3rszpi]

I think that coins like NemStake or Reserve Share made the most fair distributions. In these days i think the free distribution methods are the most trending, because it's easy to reach for everyone and by this way the cryptocurrencies can reach a wider range of people.
But also there's a problem with the lot of scammers and sockpuppets.

[visual111]

More merchant options might improve distribution

I don't think you can accurately measure the % of total currency held by individuals nor amount of individuals who hold currency. who knows how many wallets one user has their coins in. it's a false sense of an accurate measurement, in my opinion. best to just not use it.


i agree with devphp; i don't think distribution means much. it will always concentrate in the end


"fair" distribution is BS. it all depends on where you sit. if you got lucky and bought in early, distribution was fair. if you got in late, well then you might be crying "UNFAIR DISTRIBUTION!!" lots of people call NXT distribution "unfair", which is nonsense. anybody could have invested last year; only 73 did. i think that's as fair as it gets, though many would argue against what I'm saying.

[Nullu]

I would say, provided initial distribution isn't massively skewed towards a small few holding the majority of the total supply, then any new currency should be reasonably fair, but over time it matters less. The problem with initial bad distributions is the market instability they cause, and for new coins, that's quite a problem.

PreminePlus has two methods of distribution. One is buying PMC and burning it for PMP. The second is signing up for the giveaway, which when signed up for, you continually receive funds from each month there's another giveaway.

Services actually decrease distribution, but they also serve a purpose to increase it. Gambling sites, on the other hand, I would argue cause a much higher decrease in distribution, as you wouldn't generally buy a currency just to gamble it.

[CryptoCarmen]

What do you think makes for a good distribution of currency? And what currencies do you think have achieved a good distribution?

I can think of two main metrics that one might measure currency distribution in: percent of total currency held by individuals, and total number of individuals who hold said currency.

Another variable is time. And the speed at which the currency is dispersed through out a population.

How important is this to you? Is it an overrated factor, or is it something people underestimate the importance of.

Best distribution would be that it all gets handed to me as cheap as possible,

[jabo38]

I think NEM has by far done the best with distribution. 

Most PoW coins, were good ole boys clubs with not very many people mining at first and taking lots and lots.

[digitalindustry]

What do you think makes for a good distribution of currency? And what currencies do you think have achieved a good distribution?

I can think of two main metrics that one might measure currency distribution in: percent of total currency held by individuals, and total number of individuals who hold said currency.

Another variable is time. And the speed at which the currency is dispersed through out a population.

How important is this to you? Is it an overrated factor, or is it something people underestimate the importance of.

the Questions you ask is actually a fairly complex one, Quark achieved one of the best distributions in crypto existence,

you would have to go to my blog to fully understand : http://kolinevans.wordpress.com/ the reason i talk about it is because:

1. its important.
2. I'm pretty happy with how it turned out.  

but distribution is a simply a % numbers game, it is also very important if you only listen to one thing listen to this:

all crypto are very badly distributed in % terms  

the game is to make them look like they are not though, but the only ones you can know have any measure of distribution are PoW systems with certain parameters.

so there is a rule set, is what i'm telling you.

all PoS (only) i.e no or day PoW systems or IPO have near zero distribution in % terms so that is to say our friend there talking about NEM  the large % is probably held by 10 people.

now pause..

yes it's that bad.

it all depends on how genuine your question is and how much you want to learn.

you can learn a little or if you want you can learn a lot, but generally don't try to come to this forum for answers, unless the person answering has a large enumerate number of posts. (and even then)

Regarding Trading/investing

if you are serious about trading / investing and not losing money its very much in your interest to cut though the thick layer of bullshit that will be loaded onto your screen here and learn about distribution because it is over the medium to long term your bread and butter.

I.e if you have an understanding of distribution and 2. know how to buy low, you won't lose money.

[tifozi]

[rpietila]

There is a natural distribution (nature/-al, found in nature, in similar phenomena eg. sizes of rocks, or population of cities under certain constraints) of money and it is observed in these projects as well. In presence of unhindered trading/liquidity, and unhindered fungibility, the distribution of any monetary coin tends to this model.

Power law + lognormal distribution

- Power law means that the nth position has approximately 1/n that many coins as the 1st position.
- Lognormal means that when we arrange the holders to logarithmically same size brackets, the distribution appears normal (ie. "bell curve").
- The point where lognormal changes to power law is approximately 3% from the top, so that power law applies to the top tail.
- Consider an example of a coin that only has 100 owners, and their ownership is distributed according to the model. I have taken the 3 whales each separately (in the purist example they own 1000, 500 and 333 coins respectively, but statistically we cannot conclude that with a high degree of confidence), and the rest form a lognormal distribution as follows (number of coins in brackets) number of owners in bold:


(256-1999) 3 <- the whales are here but there is no confidence how many coins they own, because of the small sample
(128-255) 5 <- the lognormal part begins here, with higher confidence when brackets become larger
(64-127) 11
(32-63) 20 <- average holding is 54 coins
(16-31) 23 <- this bracket forms the lognormal midpoint with highest point density (in log), and also hosts the median, 23 coins
(8-15) 20 <- the highest linear point density is here and below
(4-7) 11
(2-3) 5
(1) 2


This is the distribution that is reached when the market dynamics are lead to function. The actual scaling parameters of the normal distribution may vary.


Let's check how the coins are distributed in deciles (10%s) of people. (Total number of coins is 5404):
1st decile: 54.7%
2nd decile: 14.5%
3rd decile: 9.6%
4th decile: 6.7%
5th decile: 4.9%
6th decile: 3.7%
7th decile: 2.7%
8th decile: 1.9%
9th decile: 1.2%
10th decile: 0.6%.

I omit the details for now but I superimposed the distribution in an excel table and actually reconstructed all the 100 coins owners with their balances. Then it is easy to calculate who owns what.

Now, this is the natural distribution. Actually this is a quite nice, middle-class one, because everybody owned coins (nobody was in debt), and even the minimum coin holding was 1 coin, which is "only" 3 orders of magnitude smaller than the largest holding, 1000 coins. (In Bitcoin, a holding 3 orders of magnitude smaller than the largest one would still be considered very large).

From economic standpoint most of the wealth goes to the top holders always, and it is good, it is called "capital formation", without which there could be no initiatives except ones that require no capital. There is no coercion needed or hopefully allowed.

Almost 20% of the coins belonged to 1 person. If the economy is as small as 100 people, this is optimal economically. It is larger than 66% least-holding people combined.

If things need to get done, there needs to be different size stakeholders. One person cannot do all, and collective initiatives without stake leadership seldom succeed. If the top stake is much larger or much smaller, the economic incentives are probably not correct. (Too large a stake might discourage newcomers, too distributed holdings imply loss of leadership and invite attackers).

We could argue whether it is fairer to give money to people who, when left alone, exchange the money for something they need more. We can give money, but we cannot give wealth. If they are allowed to spend the money, they do. If they are prone to keeping the money, they are not subjects of this question at all.

This is getting long, hopefully the discussion can continue. In my next message I will try to expound the practical problems why money should not be generated out of nothing, the importance of inflation and how it should be done, and more.

[digitalindustry]

ahh poor Gary he ended up being the pawn on the chess table.


yeah the Soviet system was no different to the "Western" system of hypocrisy except now the Russian form of "e-democracy" is achieving things that  both systems couldn't do before.

at the heart of that is monetary reform in degrees of course.

[BitcoinNational]

fair distribution coins (with markets) ... That's the ticket!!!!



premine, comm, bct, bcc

want some ... no?  why not?

Fucking humans.  
Given them FREE and FAIR money ... "dump it mate as quick as you can" ... they trade it all in for a coin 95% controlled by 10 accounts.  

Some will even kill you for a few scam coins (or 'whale coins' if you prefer).  

This distribution phenomena is hated when seen in fiat$ and Bullion.  And it is universal in that realm.

Crypto was going to solve this problem with FREE and FAIR money.  Yeah, man.  

We could never really test it academically until now.  
Now you can earn a Ph.D researching what crypto has proven about money.

FREE and FAIR money ends up (very quickly) in the hands of just a few.
conclusion: Fucking humans  

MYTH BUSTED


_{Note :  I still advocate fair initial distribution, cuz gotta keep trying to live the dream.  Maybe someday we'll get it right.}  

[rpietila]

I believe in the right to save. So there shall be no rules that limit your buying more coins.

I believe in the right to spend. So there shall be no rules that prohibit you from dishoarding your coins.


If these rules are observed, the market tends towards the natural distribution found in my previous post. Most people find it expedient to have some money, a smaller fraction wants to have more, yet smaller yet more, and in the top are the businessmen. The cohort of needy people who would like to have more money but in practise spend it all, is also present.

Getting to such situation is, however not easy. Not at all.

There needs to be a mechanism to create money. Aside from physical mining, digital mining is now introduced. Money can also be created by fiat, out of thin air. Banking cartel uses debt money, which is only created when someone wants to be deeper indebted (typically governments, because businesses and people have for long understood the ploy, but the banksters control the governments).

Then there needs to be a mechanism for initial distribution. Mining distributes the currency to the miners. Mining is a competitive business, and economically it should be treated that miners always sell at the going price. If this does not happen, the reason is that the miner wants to keep the coins, so in this context he should be regarded as an investor and the coins as savings. Still, mining has an effect of distributing the coins much better than the alternative, IPO. IPO is in my opinion not valid for coins at all, because it forces later comers to buy from earlier investors, creating a pyramid scheme. Third possibility is to determine some criteria for people, who so become eligible to receive coins for free. This is a great idea.

We need economy. Basically the larger economy, consisting of all financial, trading, dealing activity, plus real world contracts, settlements, retail, commerce, whatever, the faster and better the dynamic optimal distribution is obtained. Size of economy is often quantified with # of transactions per day, which is however a lacking metric, because some transactions are economically much more valid (transfer of ownership, settlement of contract, payment) than others (mixing, gambling, internal, pool payments). With proper econometric research, we could quantify the economy better.

A special case of economy is coin exchange. Having much volume there can be achieved without much economy by tricks called hype, pump, fud, dump etc., but a low volume of coin exchange is a sure sign that there is not much economy either. The market cap is determined solely by the exchange, and not by the economy, so it is a misleading indicator of a coin's success if in a midst of a pump.

*-*

The Initial distribution produces coins either constantly (mining), once-for-all (IPO) or gradually (claimable coins). The work of the Coin economy designer is to think how the economy gets towards the Dynamic optimum state from the unoptimal Initial state.

[BitcoinNational]

@R pie

Dynamic optimum state: my gut says, We will know this ratio with even greater scientific understanding in less than 24months.  Applicable to nearly all human economies.  From the village to the whole planet.  

Dynamic optimum state = X

But I don't expect much more than a slight variation of the deciles model you're already presenting.

unoptimal Initial state:  hard to prove, doesn't matter.  In the case of Alt coins we see 'hidden'/'ninja'/'instantant' mining by the '3' whales -or- free-fair distro -or- anything in between.  All gravitate to this Dynamic optimum state.  But as a matter of principle and method of measurement -- I like -- distro determined by commonality criteria (your Third possibility).  Give the coin to certain communities/tribes.  Coins for boys.  Coins for girls.  Coins for fat people.  Coins for teenagers.  Coins for smart people.  Coins for dumb people.  Coins for robots/AI.  

Even a coins for all the people.    

again & again & again & again
we will observe

Dynamic optimum state = X

--
Now it is a semantics game.  

'optimum' can be replaced with 'natural tendency'.  Humans could change this behavior pattern.  How is simple.   An algo to manage and enforce a different Dynamic optimum state.  No thinking required the algo does the busy work.  Just change 'X'

I'd like to see this game be played a few times.  Just for fun to see what happens.

[rpietila]

In my example, the 1% largest owner = The One-Percent owned 19% of the coins and the 10% largest owners = 1st decile owned 55% of the coins.

The reality in real life and in coins is actually even more pronounced. The research I have made with XMR distribution have lead me to conclude that the One-Percent owns minimum 35% and up to 55% of coins, and the 1st decile naturally even more.

And guess what - I believe that in other altcoins the situation is yet more concentrated, with very few large stashes owning most of the coins. This is due to the imperfect initial distribution (IPO, for example), and insufficient time in the exchange to build the "middle class". These coins may also lack the reason to buy it in the first place.

In theory the matter could be unoptimal to the other side also. If we assumed a coin that was strictly only distributed to people in a certain area, for example, and did not have any mining or anything, then the deciles would not form properly and in the beginning there was no economy, and the coin would likely die, but if it magically stayed alive, it would likely be very concentrated. Making a DOA unpumpable coin is not in anybody's interest, however.

[coins101]

Darkcoin

A significant number of whales that have skewed the wealth distribution purchased their coins in April & May, then again in August when people were giving everything away throughout alt-coin land.

Top 300 Wallets: total held in all wallets by month they were created, and still in existence:

*Jan-14: 146,000 DRK (DRK launched 18-Jan-14)
*Feb-14: 175,000 DRK
*Mar-14: 315,300 DRK
*Apr-14: 524,200 DRK
*May-14: 522,500 DRK
*Jun-14: 332,900 DRK
*JUL-14: 96,300 DRK
*Aug-14:713,855 DRK
*Sep-14: 125,624 DRK

Total: 2.94m DRK [~63%]

Outside of the top 300, 900,000 DRK (~20%) is held across 900 Master Nodes to prove they are not an army of men in the middle (financial barrier).

* top 300 wallets 63%
* Master nodes 20%

Compared:

DRK


LTC


BTC



Detailed review of DRK distribution

https://bitcointalk.org/index.php?topic=778616.msg8776081#msg8776081

[digitalindustry]

fair distribution coins (with markets) ... That's the ticket!!!!



premine, comm, bct, bcc

want some ... no?  why not?

Fucking humans.  
Given them FREE and FAIR money ... "dump it mate as quick as you can" ... they trade it all in for a coin 95% controlled by 10 accounts.  

Some will even kill you for a few scam coins (or 'whale coins' if you prefer).  

This distribution phenomena is hated when seen in fiat$ and Bullion.  And it is universal in that realm.

Crypto was going to solve this problem with FREE and FAIR money.  Yeah, man.  

We could never really test it academically until now.  
Now you can earn a Ph.D researching what crypto has proven about money.

FREE and FAIR money ends up (very quickly) in the hands of just a few.
conclusion: Fucking humans  

MYTH BUSTED


_{Note :  I still advocate fair initial distribution, cuz gotta keep trying to live the dream.  Maybe someday we'll get it right.}  

actually quark essentially solved the problem by having a fairly short (or reasonable) PoW period + a PoW that can't be monopolized this all equals an effective market price as each "human" does not trust the other.

so the base price is found, this i say is a very basic principal, most people would understand this, its just that here the "IQ" bar is very  "low", for such things.

[MaxDZ8]

What do you think of MYR richlist?
I'm personally fairly impressed I could probably get in the 1000 richest addresses, and I currently hold only 4740!

[rpietila]

In my example, the 1% largest owner = The One-Percent owned 19% of the coins and the 10% largest owners = 1st decile owned 55% of the coins.

The reality in real life and in coins is actually even more pronounced. The research I have made with XMR distribution have lead me to conclude that the One-Percent owns minimum 35% and up to 55% of coins, and the 1st decile naturally even more.

And guess what - I believe that in other altcoins the situation is yet more concentrated, with very few large stashes owning most of the coins. This is due to the imperfect initial distribution (IPO, for example), and insufficient time in the exchange to build the "middle class". These coins may also lack the reason to buy it in the first place.

In theory the matter could be unoptimal to the other side also. If we assumed a coin that was strictly only distributed to people in a certain area, for example, and did not have any mining or anything, then the deciles would not form properly and in the beginning there was no economy, and the coin would likely die, but if it magically stayed alive, it would likely be very concentrated. Making a DOA unpumpable coin is not in anybody's interest, however.

The sale of GE coins is an imperial offense (see http://rgeo5wj7gneidzh3.onion/policy/decree/); therefore, they are legally un-pumpable.

send me a functioning link, please.