Thursday, July 21, 2016

an idea for an ideal cryptocurrency

Introduction, context:
Previously I have discussed the problems with limited-quantity coins.  This is a coin idea that might be constant-value, or half-way between. This is an outline (without addressing implementation problems) of what I think would be close to an ideal based on the idea that maximizing median human happiness is the "meaning of human life" and the implicit goal humans should be assigning to the economic machine.  I do not say "our" economic machine because we are not intentionally (let alone intelligently) cooperating to maximize the benefits we receive from the machine as whole.  The "invisible hand" of competitive, cooperative, honest selfishness at the individual transaction level is not a God that makes everything better for our system as a whole, without diligent, intelligent, conscious effort at the system-wide level (such as government regulations for rule of law to encourage safe and honest transactions, and against monopolies and pollution). The prisoner's dilemma does not have a synergistic gain during cooperation unless the rules and goals of the game are intelligently known and enforced.  My goal is to prevent evolutionary optimizations from mindless humans and mindless machines to sneak into our economic optimizations without regard to human happiness.  But as can be seen from the following, maximum median human happiness might turn out to be equivalent to letting the machines rise, encouraging a decrease in human population. This could be painful in the short term like the black plague, but beneficial in the long term like the enlightenment.  But the machines have enough wealth in efficiency that the process does not need to be painful.

Coin description:
Assign a fixed amount of coin to each person on planet. Co-join their "DNA" (not necessarily a retinal scan) and a 2-factor authorization device (random key generator based) as part of their private key(s). The number of coins each adult (25 and older) with unique DNA receives along with their 2-factor device is 1,000,000.  Young people receive 100,000 per year from age 16 to 25.

Governance, fees:
If world is overpopulated, people will have less purchasing power.  Pay-weighted voting might be a good balance between democracy (which can cause too many regulations, socialism, and overpopulation) and stake-weighted voting (which has problems from insiders and lobbies).  Pay-weighted voting might be the only tax for implementing the governing laws.  If it's not, then fees, interest, and rent should be collected by the government, targeting entities that are acting against the overall goal which is "maximum happiness per median person".

Constant quantity or constant value?
I can't decide if it should be constant quantity like this (increasing only with population), or if the government can be allowed to expand or contract coin supply based on a basket of commodities. Tracking a basket of commodities keeps prices and wages very stable and prevents boom/bust cycles. Today's financial games driving commodity prices away from supply and demand (Szabo wrote an article on this) do not help in tracking a basket of commodities. Maybe if a measurable-quantity coin(s) takes over the world, these games are not possible. (would it be harder to do fraudulent/stupid derivatives and keyboard credit that pretends to be real coin?) Government printing could be directed to reduce the effect of technological dis-employment. Constant-quantity coin could encourage dis-employment and thereby lead to reduced population and increase median happiness per person.

Coin is continually created, but population is not increasing as fast as productivity gains, so it is half-way between a constant-quantity coin and a constant-value coin.

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