FCS Proposal - Research Grant on Economic Audit of Firo Hybrid Consensus Method

A new proposal has been posted to the Firo Crowdfunding System.

  • Title: Research Grant on Economic Audit of Firo Hybrid Consensus Method
  • Author: ryan_ff
  • Proposal type: Miscellaneous
  • Link: click here

Use this topic to discuss this proposal!

I’m inclined to vote against this as there are more productive things to fund. I don’t think this grant is needed for the following reasons.

We already know the following from the previous halving:

When node rewards are reduced, the number of active nodes reduce in proportion to the reward reduction. As nodes leave, the remaining nodes become more profitable which gradually increases the incentive to keep nodes online. A new equilibrium is eventually reached. There will always be nodes if there is profit.

If miners leave in proportion to reward reduction. The remaining miners earn more profit. Again, a new equilibrium is eventually reached. There will always be miners if there is profit.

The bigger questions to consider in terms of long term sustainability, in my opinion are tail emissions and transaction fee markets. For fee markets to make sense in the long term, we need increases in transaction demand and throughput. People need a reason to use Firo. This is something Elysium can potentially do. That is some distance in the future, and while I think it’s better to adjust the social contract sooner rather than later. I think we need to give it some time before we have another vote/fork as we already have a rewards vote coming up soon.

I’m as a member community and have somes masternode. In my opinion if the price of firo is high in the future, it doesn’t matter if next halving, masternode reduces 50% reward. The problem if the price still same like now and masternode get reduces reward then sure many masternode will be off. I think this proposal will help us. Keep it up !!! I still to hold firo whatever will be happen. :sunglasses::sunglasses:

By doing the research we also hope to be able to find out if there’s any potential threat to the network security considering the amount of incentive received by nodes. Ok we might have tail emission, but how do we know if that’s going to be enough. Remember, even though theoretically additional use case and product quality should contribute to increase in coin price the reality is not always like that, and it is always saver for us to assume that nodes are here for the incentive.

Interesting, but would like more details:

What exactly is your background in economics? Have you done similar studies?

What models do you want to use? Why? Are you going to model other balances of PoW/PoS rewards for comparison? Models for different projections in Firo price? Etc.

If you do set up a MN, why / what is the goal? What will be done with the rewards? Transparency is important here.

Also, I think it would be more interesting if the projections were much longer term, way beyond one halving. Incorporating different tail emissions would be interesting too, maybe even more so.