Satoshi Core Chain digest – Part 2, written by Blaq50 – a community mod on the official Discord channel. We found this educative and worth publishing.
2.1 billion is the total number of CORE tokens to be mined globally over a period of 81 years. In reality however, this precise number will never be achieved because a portion of all CORE block rewards and transaction fees will be burned. In crypto, to “burn” a token means to permanently remove from circulation.
This mechanism is primarily effected to increase scarcity and value of the token, as in Economics; high scarcity equates higher value. Hence, this hard cap of 2.1 billion tokens will be approached asymptotically. Asymptotic means: to approach a value closely but never actually touch/reach the exact value.
This makes CORE currency not prone to sudden depreciation or appreciation in value: stable money specifically to fit Bitcoin’s sound money model. However, unlike Bitcoin block distribution with halving mechanism every 4 years, CORE blocks reward distribution will NOT go through halving. Rather, engage in a similar model to Ethereum’s called “Ultra Sound Money” encoded with burning mechanism briefly explained above. Going forward, the exact percentage to be burned will be determined by the DAO.
Before MainNet, the only way for anyone to obtain CORE is through the Core Mining App on android devices. This mobile APP mining is an innovative/ creative way to airdrop. Effectively, the CORE block rewards we receive is actually an airdrop simulating an actual blockchain mining. A ordinary android phone cannot mine (or dig) those blocks because it lacks the specialized chip used in Bitcoin ASIC machines to solve those highly complex cryptography puzzles, through Proof of Work algorithm(PoW). PoW requires high electrical energy, highly resourced hardware and computational power in block production.
Moreover, specialized knowledge is required in order to engage. Here, all these complexities are made simplified for ordinary people to conveniently mine CORE blocks through the ingeniously designed mobile app; indeed “A Mysterious APP”.
The ingenuity of this Mysterious APP requires miners to put in effort in building their hashrate(mining speed), through Gift Cards unique code sharing, Hash Cards exchange with other miners, Miner referrals, TestNet transactions engagement, etc.. Also note, the miner referral feature in gaining Contributed Hash also serves as Awareness Creation (marketing) by miners who are rewarded with Bitcoin through the BTC Giveaway(now halted in preps towards MainNet launch).
All these gifts without a single advertisement ever on the APP platform from its inception. All operational costs in maintaining the super servers hosting the APP and our login credentials amidst security configurations; team of experts behind the scenes working consistently; Human Resource management; periodic Blockchain System Auditing cost; 2 years of BTC Giveaways; amount of money invested in Research & Development (R&D) 3 years before mining begun, 2 years during mining, and actively throughout MainNet; other miscellaneous expenses, etc..
Touching briefly on R&D, any business establishment seeking longevity(long life) must invest actively in that department to thrive competitively. Even more especially in blockchain industry, where technology is ever evolving and malicious players like black-hat hackers persistently looking for system vulnerabilities to exploit, it’s highly crucial for chain developers/ programmers to always be a step or two ahead. This R&D commitment is not an option, it’s MANDATORY and the lifeblood to stay in game. Even Core DAO made mention of this fact in the Technical White Paper(TWP): The future of scaling is bright, and we plan to incorporate the best technologies from other chains as research matures.
From this excerpt, it is obvious that R&D is a perpetual(forever) commitment for as long as Core Chain exist. The point here is that Blockchain development is no child’s play, we’re talking about millions of dollars investment to set things rolling.
Now Core Chain have sufficiently resolved the issue of free, fairness and incentives by widely distribution of CORE tokens among users globally, FREELY at NO COST on miners. This expansive rewards distribution has resolved the issue of “whales” with commanding amount of tokens able to swing market trends to their favour. There’s considerably more crypto awareness now than in the early days of Bitcoin, whereby only few tech industry players and visionaries believed and bought into the Bitcoin White Paper. In the literal sense, there’s no room for “whales dictatorship”.
Mathematically, Core Chain will fairly distribute 525.6 million CORE coins to global users. This mobile APP distribution begun in December 2020 and will last for 2 years, until 12th December 2022. This amount of 525.6 million represents 25% of total CORE supply(2.1 billion) to be distributed through Mobile APP. The remaining 1.574 billion CORE tokens representing 75% will be mined through On-Chain Decentralized Node Mining over a period of 81 year. Here we see the selflessness of CoreDAO in generously gifting us 25% within a shorter period of 2 years, and spreading out the remaining 75% over 81 year period. According to the TWP, this longer period increases the likelihood of the success of the chain by fully incentivizing all network participants before transitioning to compensation purely by transaction fees.
Note that according to the White Paper, Node Mining will be active immediately MainNet is launched. This means both Mobile APP mining and Node Mining will run concurrently(at the same time) until APP mining ends on December 12, whiles Node Mining still continues until after 81 year period. Again, it’s important to note here that mining CORE coins will be extremely scarce. Not just scarce, but EXTREMELY SCARCE.
The logical explanation behind this extreme scarcity lies in the fact that Bitcoin miners among other factors will join in the Node Mining with their existing hash power, together with Validators, Relayers, and CORE holders. So these Bitcoin miners will delegate their hash power to a Validator self-run or by a third party through Relayers. There will be 21 highly competitive active validators on MainNet, so therefore, it pays to have a strong ASIC miner with competitive enough hash rate to mine profitably. This is a non destructive mechanism because BTC miners will still be earning Bitcoin and CORE at the same time. Also by delegating their hash power, BTC miners will be securing the Core Blockchain via Bitcoin Proof of Work(PoW) algorithm. It’s a win-win relationship.
The good news for CORE holders is that we can still engage in Node Mining by delegating our CORE holdings to any active validator(s) of our choosing. So the Mainnet scenario is this: if MainNet is launched today and CORE asset withdrawal is enabled, we can delegate our CORE tokens with one or multiple validators. We receive our first rewards in 48 hours and thereafter, every 24 hours. At the same time, we will be receiving our CORE blocks on the Mobile APP until December 12. Therefore, we will be earning CORE blocks in two ways; via Delegating on Node Mining through and into our external wallet(MetaMask) AND through the usual mobile APP until December 12th 2022 as scheduled.
In both block rewarding instances, how much we earn is entirely dependent on Primary and Secondary factors. With Mobile APP mining, primary factors include our consistency in receiving blocks and increasing our MyHash through GiftCard share, HashCards exchange, TestNet transaction(if still active). Secondary factors correlates with our Contributed Hash accumulated through our miners and their activeness.
With Node Mining, primary factor is entirely dependent on our delegated CORE amount. Whereas, secondary factors comprise of Annual Percentage Rate (APR) of Validator, Commission fee, Number of Delegators, Activeness of the Validator, among other unforseen factors/ circumstances.
The emphasis here is that in a decentralized blockchain like Core, no room is made for manipulation or bribery in gaining unfair advantage. Rather, your input will determine your output: nothing more, nothing less. All must adhere to the principle of Egalitarianism (human equality) and the mantra that “no one is above the law”.