Proposal for a New Factom Token Model

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Why did the conversation about having a cap move from 16-20M cap to 50M cap ? We need to stop diluting investors, and manage our treasury better. 50M might as well call it uncapped. If we ever need this many coins it is because we failed hard. With the ability to reissue burned tokens, I don't see why we would need an extra 30M tokens.
 
I don't think we need to worry about a single entity controlling a large amount of tokens - there's nothing to stop this at 100 million tokens either. They can't force us to do anything with those tokens so we aren't reliant on their goodwill either - they can easily market sell all of them anytime they want.

Our token is nearly infinitely divisible, this in one of the clear benefits of cryptocurrency over fiat so it doesn't really matter how few tokens are being circulated because we can chop them into smaller and smaller pieces as needed.
 
First of all 50 million tokens is nonsense. That is something like 50 years from now in current model and seems to be driven by our low token price. It would mean massive dilution in a short time span and not something to really talk about seriously I hope.

21 million like bitcoin still is 15 years from now in current inflation model. I don't like all the "we try to be better than other blockchains". Nice slogan, we failed miserably till date. I rather see us being realistic and have that reflected in the tokenomics. If you just take into account current model and the fact it would take 15 years (haven't done the exact numbers). I think it would not be that strange to give us way less time than that. More something to the extent of 5 years max and some supply to get onto one or more notable exchanges, meaning you will probably end up even lower than what is currently proposed. IMO we should be realistic and we will either fail or succeed at this point even with the proposed changes implemented. Obviously max supply is not a standalone metric and decisions we take with regards to additional standing parties, staking/leasing, EC prices, exchange listing funds influence that. No matter what direction we take though, roughly 5 years should be a max. We have been at it for 2.5 years now, which would bring us at 33%.

Most people already believe the project has failed. I am not that worried to be honest (explained that several times), but we really cannot continue current trajectory next few years.

I will respond about the proposal itself in the weekend.
 
I don't think we need to worry about a single entity controlling a large amount of tokens - there's nothing to stop this at 100 million tokens either. They can't force us to do anything with those tokens so we aren't reliant on their goodwill either - they can easily market sell all of them anytime they want.
I concur. Still leaves an odd taste, but nothing to do about it.

As for the recent few comments, yes, the proposal says this for good reason: "Assumes Factom’s longterm commercial fate will largely be determined within this 4-year timeline"
 
I really only skimmed this thread. I did read the proposal in detail, and I want to thank Jason for responding to my suggestions.

I believe something in the neighborhood of 20 million is the right number. @Anton Ilzheev has a point with 50 million, but I think slowing the issuance would still leave 15 to 30 years for us to get it right.

This should be earlier in the roadmap then was suggested in the other thread, because it's potentially a big impact for very little coding. And it potentially enables quite a bit with staking and mining. It limits the Grant pool, and it limits the payments to ANOs. But it doesn't change the actual tokens issued for a little while.

I do think we're at a point where we need to pick off the things that are within our ability to do. And just do them.
 
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I like the model and, the feedback below notwithstanding, will be happy to proceed with it as it is. Thank you for putting it together.

My only criticism are the references to mystical systems of thought (numerology, divine numbers, etc) when explaining the supply cap. I understand why it was done, but I don't think it aligns with the message we'd like to send about the Factom blockchain. We can keep the number, but future proposals and any marketing surrounding the new supply cap should drop those references.

All in all, I think this is a solid proposal and am happy to throw my weight behind it.
 
The last thing I'm confused on is the inflation rate - I understand we're still figuring it out but I assume we'll build an algorithm that sets the inflation rate that will go into the proposal? Something like:

Inflation Rate = Monthly Rewards / Remaining Tokens
The base ANO reward can be found in the attached model:

base reward = 1123 * (19,888,021 - circulating supply) / 10,438,916

I believe that, or something like that, is the appropriate equation to add to a proposal, as it will be needed to derive inflation and to determine the block rewards. Inflation itself will not need to be included in the factomd codebase. If this proposal is implemented I will track inflation on factoshi.io.
 
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The base ANO reward can be found in the attached model:

base reward = 1123 * (19,888,021 - circulating supply) / 10,438,916

I believe that, or something like that, is the appropriate equation to add to a proposal, as it will be needed to derive inflation and to determine the block rewards. Inflation itself will not need to be included in the factomd codebase. If this proposal is implemented I will track inflation on factoshi.io.
take a look at the model and you’ll see how Auth server incentives are structured. To align incentives and good stewardship rewards are inversely proportion to the supply of tokens in circulation.
But it will be important for the community to decide if that baseline number includes or excludes the authorized number of tokens mintable towards road map execution and exchange listings as proposed.
 
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@Jason Gregoire I'm not sure if you're refuting or supporting my statement? The equation I outlined is the equation defined in the model.
Sorry for the confusion. It’s not an “agree or disagree” thing

The question the community will have to answer is if they want to
1) include or 2) exclude in the baseline the described limited token mint authority for road map execution & exchange listings (token # not yet determined, model suggested capped limit of 5mil).

So in staying with these numbers for example:

base reward = 1123 * (19,888,021 - circulating supply) / 10,438,916

or with the Auth token mint factored

base reward = 1123 * (19,888,021 - circulating supply) / (10,438,916 + 5 mil)

The later approach will decrease the sensitivity of standing party token payouts to large (but limited) expected token mints for road map Grants and exchange listings.

One is not inherently better than the other - but in the first method our anticipated large token mints will swiftly reduce standing party payouts, where with method number two, it will not.
 
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