2018-06-26 Validator Economics Meeting

Defnitions

• Issuance - increasing the supply of token.

Incentive for Block Production

• It is not an invalid block to only issue justifications.

• Nash believes: Whether or not you get traffic should be a matter of luck.  All validators in a shard should be equal.

• Greg believes: Validators should be rewarded for bringing in user traffic.

  • In essence, we want to pay for value.  User transactions or finalization.

  • Do we look at the justification tree?  Can we constrain the DAG.

    • Come up with a set of properties that we do not want in the DAG & make those slashable

    • Any paths in the justification tree have to come back to the main path.

    • Implement configurable 'knobs' that allows us to adjust as the attacks come in.   Attackers will know what the knobs are.  Makes this a very hard problem.

• Greg's idea: Validators place bets.  The bets are multipliers, and if the multipliers have a shape The gossip about the bets acts as an iterative function.

Transaction fees

Need to balance the profits that validators need to make, with the costs that the dApp developers are willing to bear.

First phase - have economics that favor your early investment group, because if you don't, you are punishing your early investors.  Encourage saving + let the token appreciate.  

After your early adopters have profited, then you can begin monetary expansion where expansion (issuance) is slightly over the inflation rate (rate at which transaction counts are growing)

Increasing the number of Rev

• Examine performing splits of the token (rather than issuance)