From 280bb4a54bcdd4859533c474524a0440da9edb8d Mon Sep 17 00:00:00 2001 From: SuperMario Date: Sat, 19 Feb 2022 15:40:10 +0000 Subject: [PATCH] Update FairCoin2Whitepaper.tex --- FairCoin2Whitepaper.tex | 12 ++++-------- 1 file changed, 4 insertions(+), 8 deletions(-) diff --git a/FairCoin2Whitepaper.tex b/FairCoin2Whitepaper.tex index 4c0bd3a..073ea1d 100644 --- a/FairCoin2Whitepaper.tex +++ b/FairCoin2Whitepaper.tex @@ -46,22 +46,22 @@ White paper version 1.3 (February 2022)\linebreak \end{center} \section{Introduction} -FairCoin\footnote{ https://faircoin.world} has several faces. First of all, FairCoin is an implementation of an innovative and ecological blockchain mechanism based on the proof-of-cooperation algorithm. Secondly, by using FairCoin in various projects and markets, assets can be stored and be transferred. Thirdly, FairCoin is a tool for the FairCoop\footnote{ https://fair.coop} and several other communities to support a cooperative economy around the globe. In this paper, we will be focusing on the first aspect and will be explaining the technology and the governance model. \linebreak +FairCoin\footnote{ https://faircoin.world} has several faces. First of all, FairCoin is an implementation of an innovative and ecological blockchain mechanism based on the proof-of-cooperation algorithm. Secondly, by using FairCoin in various projects and markets, assets can be stored and be transferred. Thirdly, FairCoin is a tool for several communities to support a cooperative economy around the globe. In this paper, we will be focusing on the first aspect and will be explaining the technology and the governance model. \linebreak FairCoin v1, which was used from 2014 until mid 2017 relied on mining and minting to secure the blockchain. Both mechanisms are widely used, but consume a lot of energy and mechanisms such as proof-of-stake advantage the rich and thus can not be considered as fair.\\ The underlying blockchain mechanism was refurbished for version 2 to make it a fair, secure, resources-saving and decentralized block chain-based asset. It is based on cooperation between nodes and not on competition, which provides a much better efficiency. FairCoin v1 has been transferred on July 18th 2017 to FairCoin v2, which is a fork of the Bitcoin Core version 0.12\footnote{ https://bitcoin.org/en/bitcoin-core} with heavy modifications. The blockchain status has been analysed\footnote{Blocks, payloads and CVN statistics can be observed at block explorers such as https://chain.fair.to/} at the FairCoin wintercamp in January 2022 and can be considered in a healthy and secure state. \section{Economic Aspects} \label{sec:economic} Whilst FIAT money supply is controlled and flooded by central banks\footnote{ https://policyexchange.org.uk/an-overdue-political-debate-monetary-policy-and-the-role-of-central-banks/} and is being created out of thin air by banks when providing credit\footnote{ This is a controversial issue, as banks say they have the debt in their books. Fact is, that they can issue much more credit then they manage from savings, see e.g. https://www.youtube.com/watch?v=SA9UkHhFU6g}, and whilst most cryptocurrencies' number of coin grow with mining rewards, FairCoin does not create any new coins[\footnote{ The circulating supply has been frozen at 53.193.831 FairCoins when migrating from FairCoin v1 to FairCoin v2.}. CVN's do not need to create new coins in order to provide security to transactions. In the early days one fifth of the FairCoins have been frozen in funds to be used for social and ecological inovations: the Global South Fund, Commons Fund, Technological Infrastructure Fund and Refugees Fund. As of 2022, the governance of those funds shall be transferred from the non-formal FairCoop community to a formal organisation. \\ By fixing the supply, FairCoin becomes stronger at the level of store of value for the solidarity economy, cooperatives and regional initiatives. Through the FairCoin blockchain - besides being a currency in itself - FairCoin will be a perfectly adapted platform to be used also by social currencies worldwide with no obligation to abandon their own principles.\\ -With support of the FairCoop and other communities, FairCoin users find an environment of synergies at multiple levels, which allows them to advance their goals more rapidly. The FairCoop Circular Economy Group facilitates the use of P2P technologies\footnote{ https://p2pfoundation.net/infrastructure/our-guiding-principles}, which facilitates its daily use and its interoperability with other currencies and payment systems. This in turn, may form a part of a growing plural ecosystem consisting of a number of currencies and cooperative initiatives, eventually becoming capable of challenging the incumbent system. The FairCoin blockchain is also considered as a generic tool for managing common good assets.\\ -FairCoins have been heavily used in 2017 and 2018 by the FairCoop community in countries like Spain, Italy or Greece. Whilst following a strategy of de-listing FairCoin at crypto exchanges lead to the desired effect to stabilize the value for some projects like Comun in Catalonia or in Switzerland, the FairCoin wintercamp in 2022 is aiming again at listings\footnote{ FairCoin is listed again at CoinMarketCap since Feb 15 2022 and will be made available at the crypto exchange tulipex.io mid 2022}. +With support several communities, FairCoin users find an environment of synergies at multiple levels, which allows them to advance their goals more rapidly. The FairCoin Circular Economy Group facilitates the use of P2P technologies\footnote{ https://p2pfoundation.net/infrastructure/our-guiding-principles}, which facilitates its daily use and its interoperability with other currencies and payment systems. This in turn, may form a part of a growing plural ecosystem consisting of a number of currencies and cooperative initiatives, eventually becoming capable of challenging the incumbent system. The FairCoin blockchain is also considered as a generic tool for managing common good assets.\\ +FairCoins have been heavily used in 2017 and 2018 by the former FairCoop community in countries like Spain, Italy or Greece. Whilst FairCoin was de-listing from some crypto exchanges over the past years, the FairCoin wintercamp in 2022 is aiming again at to get FairCoin listed on more exchanges\footnote{ FairCoin will be made available at the crypto exchange tulipex.io mid 2022}. \section{Node Network} \label{sec:network} The blockchain network consists of full nodes and cooperatively validated nodes (CVN). All nodes secure the network by validating all the transactions in the network and put them into a transaction block chain. Blocks are created in a round-robin manner every three minutes\footnote{ The 180 seconds block time is an adjustable parameter.} by one of the CVN's. A CVN is a standard FairCoin core client, equipped with a hardware dongle (FASITO) and enabled as a CVN in a chain servant session. Every node is unique. \subsection{CVN Requirements} \label{subsec:network_requirements} -For the FairCoin main blockchain the operation of CVNs is fully decentralized. CVN operators are only known by their nicknames in chat groups. Candidates for running a CVN need to follow a combined p2p-consenus certification procedure. First of all, the candidate has to prove active involvement in one of the communities that is using FairCoin. Tasks like supporting a local node or contributing to a technical, management or communication issue is being reported by the candidate in an assembly and needs to be confirmed by at least two active members of the community. This is to ensure an alignment with cooperative and ecological values and a basic understanding of the technology. The open FairCoop chat assembly\footnote{ Since 2016 scheduled every 3rd Thursday of the month at 7 p.m. CET on Telegram and mirrored to https://fairchat.net/channel/faircoop-assemblies . Any frequency or date change would be agreed in the assembly and announced on various channels.} accepted applications by consensus. For 2022 it is proposed that two fixed dates per year will be set for accepting new CVN candidates. Furthermore, any CVN operator has to fulfil technical requirements\footnote{ For a detailed requirements list see https://github.com/faircoin/faircoin/blob/master/doc/CVN-operators-guide.md}: +For the FairCoin main blockchain the operation of CVNs is fully decentralized. CVN operators are only known by their nicknames in chat groups. Candidates for running a CVN need to follow a combined p2p-consenus certification procedure. First of all, the candidate has to prove active involvement in one of the communities that is using FairCoin. Tasks like supporting a local node or contributing to a technical, management or communication issue is being reported by the candidate in an assembly and needs to be confirmed by at least two active members of the community. This is to ensure an alignment with cooperative and ecological values and a basic understanding of the technology. For 2022 it is proposed that two fixed dates per year will be set for accepting new CVN candidates. Furthermore, any CVN operator has to fulfil technical requirements\footnote{ For a detailed requirements list see https://github.com/faircoin/faircoin/blob/master/doc/CVN-operators-guide.md}: \begin{enumerate} \item The system must be connected to the internet and the TCP port 40404 must be reachable by all remote nodes from the internet at any time. \item The system must use a public NTP server\footnote{ e.g. pool.ntp.org} to synchronise its system time to. @@ -140,14 +140,10 @@ If it is decided to increase the coin supply all of the chain servants have to s To add or remove CVNs and chain servants or update the dynamic chain parameters at least the currently defined minimum number of chain servants have to sign the corresponding command which is then injected into the network via the wallets RPC interface. We would like to note, that those adjustments are not crucial for the PoC mechanism to continue, but it may run more sleek without the need to change the node software, especially if the number of transactions grows in future. \section{Conclusion} FairCoin is a socio-technical sculpture which has been implementing various innovations, both on social and technical levels. After more than four years of smooth operations\footnote{ All balances from the PoW/PoS FairCoin v1 to the new PoC FairCoin v2 blockchain have been transferred on 18th of July 2017.}, the PoC blockchain mechanism has proven to work in managing funds and for day-to-day transactions. Based on requirements of the various communities, additional features will be implemented or are already available as prototypes on the FairCoin testnet\footnote{ Any FairCoin node can be configured to work on the FairCoin testnet blockchain.}. -\subsection{Application areas} -FairCoin is the monetary base system for \emph{FairCoop} - The Earth Cooperative for a Fair Economy. FairCoop is a community to transfer knowledge and develop tools that enable everybody to participate in a fair global economy. FairCoin plays a central role within the FairCoop ecosystem with online markets and point of exchanges and sales in more than 50 local nodes worldwide\footnote{ numbers as of July 2018}. Some regions like in Catalonia hve set up their own cooperatives that use FairCoin for mutual goods and service exchange. \subsection{Micro payments} The high efficiency of the FairCoin network, trusted node relations, very low energy cost\footnote{ Most CVNs run on a RasperryPi consuming ~ 8 Watts each, some on more powerful hardware consuming ~ 30 Watts each. The total FairCoin blockchain network consumes only ~ 200 Watts or ~ 1,8 MWh per year. Solana requires 11 GWh per year and BitCoin 128 GWh per day.} and consequently low fees, nominates FairCoin as a candidate for micro payments. Usage scenarios are the gift economy, currency substitute in the global south or online remuneration systems. \subsection{Distributed sub chains and multi-currency} FairChains allows to create a token within the FairCoin main chain and runs alongside it. Smart contract rules expressed as OmniLayer functions provide a way to create chains with new properties. Such a sub-chain could implement a local currency based on a local network of nodes of the same region or city, or a thematic currency based on the same principles or a registry of commons goods. A smart contract could also define credit relations among several partners or put options when exchanging virtual currencies to FIAT money. -\subsection{Restraining Volatility} -FairCoin is not made for speculators, but for participants on markets to trade real goods and services. An official exchange value has been set in public assemblies\footnote{ https://fair-coin.org/en/create-value}. To escape pump and dump games, the FairCoin community has been rejecting listings on big exchanges, such as Bittrex \footnote{ https://fair-coin.org/en/bittrex-delisting}. Fiat money from FairCoin sales is being used to stabilise the value by buying FairCoins from people outside the FairCoop ecosystem. Various concepts for stabilizing the FairCoin currency are being discussed\footnote{ Stability discussion in chat https://fairchat.net/channel/faircoin-economy-strategies?msg=uXs3eDYu9kbP89NGv and pad https://board.net/p/r.1823fb01c762e7d402ae580993375548 as of July 2018 and in occasional summer- and wintercamps}. In 2022, a free floating strategy is being adapted and listings again accepted. \section{Sources} \subsection{Open Source Code} \begin{flushleft} -- GitLab