Topic: [ANN] Webcash: A new Proof-of-Work digital currency based on e-cash (Read 1078 times)

When webcash got started the mining schedule was largely taken from bitcoin, but accelerated. There are a couple of good reasons for doing this: get the currency out faster so that inflation factors don’t dominate, get excitement around halving events, and get people using the currency as quickly as possible with meaningful amounts of currency dolled out every 10 seconds. On all of these factors I think that the inflation schedule was, and continues to be largely a success. The fast inflation schedule certainly pushed me in the early days to work on webminer and get it out fast so that people had fair access to mining before the first halving events. About 9 months later there are around ~400 people on this discord, and I still feel there is a fair amount of excitement around this project, even though we are nearing the 1-year anniversary. I think the right choice was made.

Of course the downside of the fast subsidy schedule is that it plays out more quickly, and this has the potential to harm the continuing adoption of webcash. Exponentials decay rapidly, and already the subsidy is 6.25% what it was at the beginning of the year. I have noticed that a lot of people coming to the project for the first time are discouraged, and perhaps reasonably so. The subsidy was meant to play out over 3 years, but the exponential decay means that the vast majority of total webcash has already been issued.

This is what I suggest: starting on January 8th, 2023 (the first anniversary of the project launch), a new subsidy schedule will be started, in addition to the existing initial issuance payout, of 16625 webcash every 10 seconds, with a halving every 12 epochs (= 2 years), for 30 years. This will double the total issuance from 210 billion to 420 billion (haha!) webcash, over a long enough period of time to ensure project adoption. The hard cut-off after 30 years, at which point the reward will be about 0.5 webcash, prevents having to continue to support proof-of-work issuance mechanisms on extremely long timescales.

Compared to other possible corrective mechanisms the minting of new webcash is preferred because it has the smallest impact on existing software. The mining software gets the amount of webcash it is allowed to generate from the webcash server, which has technical freedom to adjust how this value is calculated. No other software needs to be updated other than the webcash server.

The downside is that this will essentially dilute everyone’s webcash holdings by 50%, as the money supply is doubled over the next 30 years, an unplanned-for alteration of the expectations set by the project. In my opinion it is an absolutely obvious choice to make: adoption hurdles can create conditions of dying interest which could become an existential risk to webcash, and in that circumstance any existing holder of webcash ought to prefer to have 50% of something than 100% of nothing. Still, this proposal could never get adopted if it did not have the support of a large contingent of existing webcash users.

Ultimately this is kanzure’s project, and as the owner/operator of Webcash LLC it is his decision. But I hope that people who feel strongly about this make their voices known.