86 lines
4.6 KiB
Markdown
86 lines
4.6 KiB
Markdown
# RedistributedDemurrageToken
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## Use Case
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* Network / Basic Income Token
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* 100 Sarafu is distributed to anyone in Kenya after user validation by the owner of a faucet which mints new Sarafu.
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* Validated users are those that validate their phone number in Kenya.
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* A monthly Sarafu holding tax (demurrage) of 2% is deducted from users
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* Each month (after a number of blocks) the total amount tax is distributed evenly out to _active_ users.
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* any single transaction by a user is considered _active_ (heartbeat) (possibly add minimum size of heartbeat in constructor (TODO))
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* This is meant to result in a disincentivization to hold (hodl) the Sarafu token and increase its usage as a medium of exchange rather than a store of value.
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* This token can be added to liquidity pools with other ERC20 tokens and or Community Inclusion Currencies (CICs) - and thereby act as a central network token and connect various tokens and CICs together.
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## Variables
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* Inputs to Constructor (Set only once during contract deployment can't be changed )
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* `Demurrage` aka Decay amount: A percentage of token supply that will be charged once per - aka `period` and evenly redistributed to _active_ users
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* Demurrage Period (blocks)- aka `period`: The number of blocks (equivalent to a time frame) over which a new Holding Fee is applied and redistributed.
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* Inflated Balance: The inflated balance of each user is stored for bookkeeping.
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* Number of Decimals: Resolution on token (TODO) (Default 6)
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* Minimum Activity Volume: (TODO) the minimum transaction amount to be considered active
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* Sink Token Address: Rounding errors and if no one trades the tax goes to this address
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## Ownership
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* Contract creator is owner
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* Ownership can be transferred (also to ownership void contract "no more changes can be made")
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## Mint
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* Owner can add minters
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- A faucet contract would be a minter and choose the amount of tokens to mint and distribute to new _validated_ users.
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- The interface says the amount and is at the caller's discretion per contract call. _validation_ is outside of this contract.
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* Minters can mint any amount
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## Demurrage
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* Holding Tax (`demurrage`) is applied when a **mint** or **transfer** is triggered for first time/block in a new `period`; (it can also be triggered explicitly)
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- Supply _stays the same_.
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- Updates `demurrageModifier` which represents the accumulated tax value and is an exponential decay step (of size `demurrage`) for each `period`
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- `demurrageModifier = (1-demurrage)^period`
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- e.g. a `demurrage` of 2% at a `period` of 0 would be give a `demurrageModifier= (1-0.02)^0 = 1-1 = 0`.
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- e.g. a `demurrage` of 2% at a `period` of 1 would be give a `demurrageModifier = (1-0.02)^1 = 0.98`.
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- e.g. a `demurrage` of 2% at a `period` of 2 would be give a `demurrageModifier = (1-0.02)^2 = 0.9604`.
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* All client-facing values (_balance output_ , _transfer inputs_) are adjusted with `demurrageModifier`.
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- e.g. `_balance output_ = user_balance - user_balance * demurrageModifier`
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* Edge case: `approve` call, which may be called on either side of a period.
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## Redistribution
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* One redistribution entry is added to storage for each period;
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- When `mint` is triggered, the new totalsupply is stored to the entry
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- When `transfer` is triggered, and the account did not yet participate in the `period`, the entry's participant count is incremented.
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* Account must have "participated" in a period to be redistribution beneficiary.
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* Redistribution is applied when an account triggers a **transfer** for the first time in a new period;
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- Check if user has participated in `period`. (_active_ user heartbeat)
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- Each _active_ user balance is increased by `(total supply at end of period * demurrageModifier ) / number_of_active_participants` via minting
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- Participation field is zeroed out for that user.
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* Fractions must be rounded down (TODO)
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- Remainder is "dust" and should be sent to a dedicated "sink" token address (TODO)
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- If no one is _active_ all taxes go to the same sink address
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## Data structures
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* One word per account:
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- bits 000-159: value
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- bits 160-255: period
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- (we have more room here in case we want to cram something else in)
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* One word per redistribution period:
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- bits 000-055: period
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- bits 056-215: supply
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- bits 216-253: participant count
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- bits 254: Set if individual redistribution amounts are fractions (TODO)
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- bits 255: Set if "dust" has been transferred to sink (TODO)
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## QA
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* Basic python tests in place
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* How to determine and generate test vectors, and how to adapt them to scripts.
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* Audit sources?
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