A 2017 market retrospective

Welcome to this week’s edition of the Rhizome WIRE!

Just how did 2017/18 play out?

This week, as Bitcoin continued it’s rapid climb and eclipsed $18,000 — thus flirting with hitting its previous all-time high—there was great excitement throughout the crypto world, especially on social media.

However, after this initial enthusiasm, a new emotion began to take shape. As holders of various alt-coins looked at their portfolios all they saw was…red. And while Bitcoin holders continued in their elation, alt-coin holders became despondent, as the morale on crypto social media began to darken (despite the fact that alts remained in basically the price range they’ve been for the past few weeks).

Of course, it’s understandable as to why this reaction occurred. Bitcoiners were getting rich, and alt-coiners were not.

“Will we be left behind in this bull market?” many wondered.

“Bitcoin is rising because it’s the only coin institutional investors care about?” others lamented.

Ultimately, I believe the biggest culprit for this feeling — aside from seeing one token go up while others don’t — is the clouded memory of 2017/2018’s bull market. The memory that most people seem to have was the full-on market going nuts, with every token, Bitcoin or otherwise, rapidly climbing in value at the same time. In the context of a multi-year time span — as one is doing when thinking back from today to four years ago — this is a fairly true representation. The market as a whole did rise in that general time period.

Unfortunately, what many are doing today, is applying a multi-month memory upon Bitcoin’s three-day price movement. See the problem?

In order to calm some emotions, let’s actually take a look at how the 2017 market began and evolved.

Bitcoin

First, let’s go back in time to December of 2013. This was the highest parabolic run that Bitcoin had seen, rising to a new all-time high of around $1,127 (according to CoinGecko’s chart, which all prices in this article will be based around).

As you can see, it “crashed” afterward, falling all the way down to around $200 in early 2015. This was nearly 1/6th of it’s price at all-time high (sound familiar?).

It wouldn’t again see it’s all-time high again until January 2017 (about four years later…sound familiar?), when it briefly touched the prior high, and fell back again. Take note of the fact that Bitcoin started November in the $700s, making a fairly rapid ascent to it’s new all-time high by January.

After falling back from all-time high briefly, Bitcoin ramped back up, eventually beginning the climb that would bring it to it’s current (as of today) all-time high of the mid $19,000s in mid-December of 2017.

Ethereum

Prior to the 2017 bull-run, Ethereum’s previous all-time high was $20.51, set in June of 2016 (less than a year after Ethereum’s price showed up on the chart).

Ethereum wouldn’t see that price again until March of 2017 — about two months AFTER Bitcoin saw its prior all-time high. In other words, Ethereum’s momentum ran about two months behind Bitcoin’s. Meanwhile, it reached it’s current all-time high of $1,448 in mid-January of 2018 — about a month after Bitcoin reached its top.

XRP

Let’s take a look at XRP (Ripple). Although this is seemingly everyone’s favorite coin to hate on, it does help with our analysis in the sense it’s a tier below Ethereum and Bitcoin in terms of market cap (especially at the time period under examination).

XRP’s prior all-time high was around $.05, which it hit in late November of 2013 — basically the same day Bitcoin hit its local all-time high, indicating overall momentum for the market as a whole.

With brief exceptions, XRP fell hard after that, and was less than a penny for the next several years. It would once again make a run toward it’s all-time high in late April of 2017 — about a month after Ethereum hit its all-time high.

XRP would go on to hit $3.40 in early January of 2018 before tumbling downward again.

Dogecoin

Again — not everyone’s favorite coin — but it serves a purpose here in the sense it’s a tier below XRP, and also has enough price history for the purpose of this analysis.

Dogecoin hit an initial all-time high of $0.0018 in early 2014. It wouldn’t hit that price again until…May 2017. A month after XRP hit it’s all-time high, two months after ETH, and about four months after Bitcoin.

Big Picture

So, to summarize, here is about when each token hit it’s prior all-time high.

Bitcoin - January 2017
Ethereum - March 2017
XRP - April 2017
Dogecoin - May 2017

Of course, each would go on to much greater heights after hitting their prior all-time high (although it would take between six months to a year in each case for that to happen — but with each token, it was basically an ongoing succession of green candles).

There’s an image that was sent in ICON’s Telegram price discussion channel that summarized this pattern quite nicely:

This basically describes, in a macro sense, what I described above. Historically speaking, it plays out over a series of months — not weeks or days.

How does this happen?

Well, Bitcoin is clearly the driver of the market, the most popular token, and the coin that brings the most attention to the market. So it goes up first. As it starts to climb, traders typically hop out of alt coins, as they don’t want to see their alt-coin value (denominated in BTC) erode in value as Bitcoin makes a run. So they flee to Bitcoin. This is partly FOMO, but partly utilizing BTC as a store-of-value. That’s why alt coins typically fall in BTC value as BTC rises — but also often fall in USD value as well.

After a while, as Bitcoin’s price stabilizes a bit (consolidates), money starts to flow down a bit, hitting mid-caps such as Ethereum, Litecoin or other tokens in the Top 10. Then, the money flows to small caps — such as ICON.

This process nothing to do with news. This process nothing to do with marketing. This process nothing to do with fundamentals. It’s just how a young market like crypto works.

Now, I’m not saying what happened in 2017 is going to play out exactly the same way (although crypto does tend to repeat itself). However, if you’re a believer that 2021 will be “the year” for crypto, then the train is currently right on schedule — especially if Bitcoin manages to breach it’s all-time high in the next couple of months.

So, there’s a chance Bitcoin hits it’s all-time high soon. And it’s likely your alt-coins will be sitting there, possibly still in the red. When this happens, don’t panic. Instead…


News from ICON World

DAOLevels has surpassed 1M transactions for the ICON network

RHIZOME team member, Andrew Burns as well as several others helped develop DAOLevels and bring it to the ICONbet platform - which is currently the largest source of transactions within the network.


Naver Cloud and OpenBase join ICONLOOP’s MyID Alliance

In case you’d like to learn more about the various partners and entities associated with the alliance, we post infographics detailing each partner weekly and what they’re bringing to the alliance. Feel free to follow the ongoing twitter thread.


ICON Foundation signs an MOU with Band Protocol

Of equal importance, ICON Foundation is now a validator on the Band Protocol network. Band Protocol has also spun up a P-Rep node on the ICON network as well. You can read more about this announcement here.


More ICONLOOP adoption!


ICX is now available on Simple Swap


Blockchain Industry News

Binance says it sued Forbes and two writers for defamation 'to seek justice' - The Block

The lawsuit is in response to a recent Forbes story, penned by the writers Michael del Castillo and Jason Brett, which claimed that Binance "conceived of an elaborate corporate structure designed to intentionally deceive regulators," among other allegations.


Ether Trades Above $500 for the First Time Since July 2018 - CoinDesk

  • Apart from the broader market uptrend, Ethereum's impending transition to proof-of-stake looks to be powering gains in ether, according to Nischal Shetty, CEO of Mumbai-based cryptocurrency exchange WazirX. "The belief is that it'll lead to a supply shortage of ether," Shetty said.


Bitcoin Now Has a Greater Market Cap Than Mastercard - Decrypt

Bitcoin’s market cap amounts to nearly $338 billion while the coin’s price hovers around $18,270. According to AssetDash’s data, Bitcoin’s capitalization increased by 3%—enough to push payment giant Mastercard back to 17th place as its market cap lost 0.6%.

Unifi Protocol: A Bridge Between ICON and the DeFi Economy

Welcome to this week’s edition of RHIZOME Wire!

The integration of Unifi Protocol

A few weeks ago, the ICON community was met with an announcement that the project team behind Sesameseed would be applying for a grant to implement ICON into something called the “Unifi Protocol.” (The grant has been approved)

At the time, most ICONists had never heard of Sesameseed or Unifi — myself included — and most of the community is still relatively unaware of what they are or what they do.

So for the latest article to be published as part of “ICON Spotlight”, I did a deep dive into Unifi, this latest addition to the ICON project.

First and foremost, for those who aren’t as familiar with DeFi as you would like to be but want to grow your understanding, I would highly encourage you to take this brief “course” on the topic, put together by Finematics. It provides an overview of DeFi in easy-to-understand articles and videos and should help anyone become reasonably fluent pretty quickly.

Next, if you haven’t read my writeup on Sesameseed from a few weeks ago, be sure to do so now, as it’s hard to fully understand Unifi without having a bit of background on Sesameseed.

So let’s take a quick look at Unifi. The following is from the analysis I wrote for ICON Spotlight:

The best way to think of the Unifi Protocol is that it is a collection of smart contracts that serve as a platform for various DeFi projects to be built upon. Just like ICON is a network that allows DApps to operate on top of the underlying blockchain, Unifi can be viewed in a similar manner, although built with various reward and incentive mechanisms that are geared toward DeFi tools and products. The added bonus is that it not only allows these DeFi tools to be built, but it allows them to interoperate among numerous other chains that have been integrated into the Unifi Protocol.

In other words, the ICON network will be onboarding a DeFi Swiss-Army knife of sorts, which not only brings a number of DeFi platforms to ICON (in addition to the other DeFi platforms currently slated for ICON, including OMM and Balanced), but also creates a bridge between ICON and DeFi on other blockchains.

The article goes into a deep dive on the benefits of Unifi, so I encourage you to read the entire thing, but here’s the cliff notes version of Unifi’s benefits:

  • A new trading platform for ICONists to trade not only different IRC-2 tokens built on the ICON blockchain, but also comes with the ability to trade for tokens on other blockchains.

  • The opportunity for ICONists to serve as liquidity providers on Unifi’s trading platform, uTrade. Doing so will allow ICONists to earn “UP”, Unifi’s native token, which can be redeemed at any time for ICX.

  • Access to the uLend lending platform, which will launch in the future.

The other intriguing part of this development is the fact that both Sesameseed and Unifi are relatively new projects, but with an ambitious and achievable roadmap ahead of them. The fact that ICON is being onboarded fairly early in the roadmap is certainly bullish, as the the tokenomics models for both UP and SEED guarantee they can only go up in value over time.

Ultimately, with the launch of Balanced, OMM, and Unifi over the coming months, the ICON ecosystem is going to gain a number of DeFi tools that will only add value to the network over the long-term. DApps will have access to a new wide-array of tools, and prospective developers will have those same tools at their disposal, opening up a number of new and exciting possibilities for the ICON community.


News from ICON World

Min Kim had an interview with Tech Talk Daily


ICON P-Rep team Sharpn rebrands to ‘Staky’

Staky | ICON P-Rep (ex Sharpn) @staky_icon
🔔 We are proud to announce our rebranding! Sharpn becomes
staky.io 🎉 We stepped up our validator game by providing new features for our delegators 😎 Rewards & balance tracking, Governance, Telegram Bot and much more! (platform teaser in the thread) $ICX

Sesameseed launches a test node on the ICON network


Ricky Dodds ranked one of the best marketers in the blockchain space


Fintech Danal joins the ICON network as a P-Rep


An update from INSIGHT


Blockchain Industry News

Bitcoin Is Now the 20th Biggest Asset by Market Cap - Decrypt

Bitcoin pipped home improvement retailer Home Depot to take the 20th position, and already beat out Verizon and PayPal (perhaps that’s why PayPal’s starting offering Bitcoin). Still yet to conquer are payments companies Mastercard (18th) and Visa (11th).


PayPal says it's opening up crypto services to all eligible U.S. users - The Block

PayPal said Thursday that it is opening up its nascent cryptocurrency services to all eligible U.S. users.


Chainalysis Wants to Help the Feds Sell Millions in Forfeited Bitcoin - CoinDesk

  • On Thursday, Chainalysis unveiled a program for storing and selling forfeited crypto in partnership with confiscated asset consultancy Asset Reality.

The upcoming Contribution Proposal System

Welcome to this week’s edition of the RHIZOME Wire!

The CPS is near

In the most recent ICON Monthly roadmap update, the team provided us with an update on the development of the Contribution Proposal System:

Significant progress has been made over the past month on the Contribution Proposal System with excellent work from the iBriz-Iconosphere P-Rep team. We are targeting the end of November or early December for the mainnet deployment of the CPS. The user interface is nearly complete. Smart contract work is progressing ahead of schedule, with much of the base logic already in code (P-Rep registration, P-Rep voting, application submission, etc.).

For the next month, our goal is to complete development and be in a position to test the entire system. We look forward to bringing this innovative funding mechanism to the ICON Network and allowing all community members to earn income for their work in growing the ICON ecosystem.

To those who may be newer to ICON, or may not have been paying as much attention over the months and years as others, the Contribution Proposal System has had a lengthy evolution since it was first proposed.

In it’s initial iteration, the CPS was essentially broken into two elements: the DApp Booster Program (DBP), and the Ecosystem Expansion Project (EEP). Here are two the two were described:

“The Decentralized Application Booster Program” (DBP) is a program that selects and rewards DApps to help grow the value of the ICON Network, and all DApps on the ICON Network can register with the DBP and receive delegation from ICONists.”

“An Ecosystem Expansion Project (‘EEP’) is a project or activity that can contribute to the growth and expansion of the ICON Network. In order to promote self-development of a decentralized network, the system should be designed in such a way that anyone who is willing to contribute to the development or expansion of the ecosystem can do so without relying on a single development or community group.

All EEP Contributors willing to propose a project can submit their project idea on-chain. EEPs include, but are not limited to: ICON Network development, 3rd Party App development, community activities, and education activities.”

In both cases, the proposals worked similar to how P-Rep rewards were initially distributed. The proposals with the most votes from ICONists would receive the greatest share of rewards, ideally ensuring that the projects that would bring the most to the ecosystem would receive the most funding.

However, after the launch of decentralization and the on-boarding of P-Reps, the reality of inflation set in, sparking off a new discussion about the direction of not only P-Rep rewards, but also on the structure of both the DBPs and the EEPs.

The result was a new proposal, which was formally included as part of the IISS 3.0 vote, for how to incentivize development and expansion in the ICON ecosystem:

The Contribution Proposal Fund (“CPF”) is a smart contract that holds funding to reward direct contributions. The purpose of the CPF is to create a mechanism where the most meaningful economic incentives are allocated to direct contributions approved by the network. Further details of the functionality of the fund will be explained in the Contribution Proposal System paper.

There are two primary benefits of the CPS, as described in the opening pages of the “Contribution Proposal Paper 2.0”:

The importance of the Contribution Proposal System is two fold. For one, it allows for expedited growth of the ICON Network by giving entities the opportunity to receive funding from the network itself. Developers of decentralized applications and contributors to the growth of the ecosystem can submit their work or plan to the Contribution Proposal System, Public Representatives will vote on whether or not this is a legitimate project, and if approved, this project will be eligible to receive funding from the ICON Network. This system will turn the ICON Network itself into one of the first fully operational Decentralized Autonomous Organizations (DAO).

Secondly, and perhaps less obvious, the Contribution Proposal System plays a significant role in the distribution of wealth and power in the ICON Ecosystem. Many blockchain networks give rewards solely to those that produce & verify blocks, thus centralizing wealth & governance power and giving sole discretion of funding ecosystem growth initiatives to such entities. With the introduction of the Contribution Proposal System, anybody interested in contributing to the ecosystem will have the opportunity to accrue governance power and wealth within the network.

To see the full details of how the fund will be implemented, be sure to read the entire proposal.

Amongst a sea of other promising developments coming to the ICON ecosystem in the final months of 2020, the Contribution Proposal System should be among the most consequential, due to it’s ability to provide stable development resources to projects over the long-term. A lot of thought and care has gone into the construction and development of the CPS, and it’s eventual release will be another milestone in the ICON story.


News from ICON World

ICON supply chain use cases!


ICON development roadmap update


ICONDAO organizes blockchain course at Vietnam National University's career academy Devera


The discussion around solutions for vote stagnancy continues


Project Nebula’s second planet presale week sells out in a few minutes (again)

Project Nebula @ProjectNebula_
And we're ready to begin the 2nd week of the Project Nebula planet presale 🚀
play.projectnebula.app/marketplace Sale will open and Rares will be added in 15 minutes. Have fun and good luck everybody!Project Nebulaplay.projectnebula.app

LunarCRUSH hosted a podcast with Scott Smiley, Markus Jun, Benny Options, and Corey Costa


Blockchain Industry News

$5.5 Billion in Bitcoin Is Still Missing From Silk Road - Decrypt

But, while FBI archives detail that 173,991 Bitcoin (worth $33.6 million at the time) was seized, no mention is made of 444,000 Bitcoin which some researchers believe is still unaccounted for


Someone Just Paid a $9,000 Fee for a $120 DeFi Transaction - CoinDesk

  • About 14 hours ago, the address "0xe6e2e0cf5d2686d73abd7d3ba24f46ad5eb31819" – claimed by Reddit user "ProudBitcoiner" – swapped 0.2955 wrapped ether (WETH) for 531 chi gastoken (CHI) (worth $120) on Uniswap and paid 23.5172 ETH ($9,430 at time of writing) in transaction fees.


Bitcoin's price shoots past $15,000 for the first time since January 2018 - The Block

November has seen notable price movements, continuing a ramp-up in activity seen as October drew to a close. Open interest in bitcoin options surged to an all-time high by the end of the month, and monthly trade volumes also hit a new peak of $5.8 billion.

ICON Spotlight

Welcome to this week’s edition of the RHIZOME Wire!

If you enjoy the weekly content within this newsletter and want to receive them directly in your inbox, be sure to subscribe!

Introducing ICON Spotlight

I’ve noticed over the weeks, months, and years that ICON’s social channels will regularly have people pop in who either bought ICON long ago and have since not paid attention, or those who are just starting to research ICON. In both cases, they are often looking for an update on what ICON has going on.

In one category, we have the various enterprise partnerships that ICONLOOP and the Foundation have established and are starting to implement. However, in another emerging category are the numerous DApps and projects that have already launched or are currently in development. Those, too, are important steps on the road to mass adoption.

In order to help people better understand the nuances of these projects and why they could have a significant impact on the ICON ecosystem, I am launching ICON Spotlight, which will be a collection of lengthy articles diving deep into numerous projects being built on the ICON network.

As part of this effort, I’ve also put together what I have called the “ICON Master Roadmap”, which is simply a list of all upcoming launches, either of entire DApps, or important milestones on DApps.

This roadmap will be updated regularly, so be sure to use it as a reference moving forward for all the good stuff that’s coming down the pipeline. Here’s how it looks right now:

In addition, the first article of ICON Spotlight is a deep dive into what is arguably ICON’s most successful DApp thus far, ICONbet. Even if you’re aware of what ICONbet is, I encourage you to read this piece, as it will likely teach you things you hadn’t known before. Here’s an excerpt describing exactly what makes ICONbet so unique:

First — and perhaps most importantly — is the fact that ICONbet never holds user funds. All players participate by interacting with the blockchain and playing directly from their ICON wallet. At no point is a user required to make a deposit into a wallet held by ICONbet, which means your funds can’t be frozen or confiscated for any reason. In an industry full of storiesoffrustratedplayers who couldn’t withdraw their funds for weeks or months — or had their funds frozen entirely — this is a critical distinction. This is not unique to online casinos either. While brick-and-mortar casinos use chips for several reasons, one may be the most important from their perspective — so they can refuse a payout or even seize chips from a player if they determine there is a valid reason to do so.

Meanwhile, the ICONbet platform’s source code for both the platform and each individual game is entirely public on the blockchain. This is certainly not the case for non-blockchain casinos, and usually not the case even for casinos built on the blockchain. This means that ICONbet players can be 100% confident that the odds are what the casino (via the source code) says they are, and that the games operate in a fair manner.

Similarly, this also means that all transactions and bet history can be viewed on the blockchain, adding in additional transparency. For instance, Dan Brehmer of iBriz.ai was able to conduct an extremely thorough statistical analysis of ICONbet based on the open nature of the smart contract and transaction history.

As an added bonus, the open source code nature of ICONbet also means that players don’t even need to visit the ICONbet website to gamble. Instead, they can simply build a bot that interacts with the smart contract, with the bot being written to perform bets in a manner that the user thinks provides the greatest strategic advantage. In fact, the game DAOLevels, which has already launched on ICONbet, specifically makes it easier for users to implement their own script to play the game. This type of direct interaction with the casino’s smart contract is unique to ICONbet.

There is also the fact that ICONbet serves as a platform for other developers to build games on top of, and receive a portion of the profits generated by their game. In other blockchain casinos, games are sometimes built on separate platforms and simply “leased” by the casino in a profit-sharing arrangement, or the code is bought and sold. While this may make minimal difference to the user on the surface, it does lead to less transparency and raises concerns about the integrity of the host casino, as they’re not fully in control of all of their games. ICONbet is in control of theirs, as all games are built and hosted directly on the platform.

Finally is the fact that those who play the casino can become part owners, via the TAP token. Not only does the TAP token entitle holders to a portion of the revenue from the casino, but it also serves as a governance token, giving holders a direct say in the future direction of the casino. While many other blockchain casinos provide the former, few — if any — provide the latter.

The end result of all these factors is a casino that is more transparent with a complete technical inability to take advantage of users — either by cheating them in the way games are run, or in the fact that it can withhold funds. Furthermore, by making users the owners, the incentives lean toward maximizing the user experience both now and moving forward.

All these combined make ICONbet unique among traditional online casinos. But this is also the case compared to other blockchain casinos as well. While casinos built on other blockchains will claim to offer the benefits of blockchain, what usually ends up happening is they are “blockchain based” in the sense that you can play with cryptocurrency instead of fiat; but that’s where the distinction ends. ICONbet promises to deliver blockchain gambling with all the benefits of blockchain technology, not just some.

I hope you’ll give the entire article a read and be sure to keep an eye out for future articles on other ICON projects!


News from ICON World


Scott Smiley shares thoughts on vote stagnancy


Gangham testnet is now open


ICYMI: Corey Costa had a podcast on Gohkshtein Unfilitered


The Revolutionary Nature and Bright Future of ICONbet


ICON Master Roadmap


Blockchain Industry News

Leaked Docs Reveal How Binance Dealt With US Regulations: Report - CoinDesk

  • When asked for comment, a Binance spokesperson directed CoinDesk to tweets by exchange CEO Changpeng "CZ" Zhao. He called Forbes' reporting bunk and asserted that Binance follows all local laws, including those in the U.S. "Anyone can produce a 'strategy document,' but it does not mean Binance follows them," said Zhao, adding that the slide deck was produced by a third party, not his company.


JPMorgan Tells Investors Bitcoin is Next Big Thing—A Decade Too Late? - Decrypt

“Cryptocurrencies derive value not only because they serve as stores of wealth but also due to their utility as means of payment,” the bank reportedly said. “The more economic agents accept cryptocurrencies as a means of payment in the future, the higher their utility and value.”


Wrapped Bitcoin is now Ethereum's 6th Largest Token - Cointelegraph

WBTC is the most popular version of Bitcoin tokenized for use on the Ethereum network. According to the official website, there currently is a record total of 116,885 WBTC, backed by an equal number of BTC held by custodians. The market cap of WBTC now tops $1.58 billion.

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The new rewards distribution proposal

Welcome to this week’s edition of the RHIZOME Wire!

A possible new economic design for ICON

This week, Scott Smiley of ICX Station posted a vision for the possible new proposal on how rewards would be distributed in the future — specifically once ICON 2.0 is up and running:

Now that we’ll be migrating to Batang we have much more freedom in terms of design. That is why I’m now proposing a much cleaner and straight-forward economic design for Batang with predictable inflation rates and clearly defined percentage breakdowns of where inflation is allocated. In our current system, it is impossible to say with certainty that “x% of inflation will be going to voters while y% inflation goes to validators” or “the amount of newly minted ICX per month is x”. The percentage breakdown and amount of newly created ICX per day constantly changes as more/less people delegate their ICX, meaning we have very little control of how we would like to allocate network resources and how much new ICX will be minted during any given period.

You’ll note that the terminology here has shifted away from “rewards” to “inflation”, which may or may not be an intentional effort, but over the past few months there has been a clear desire to make it known that inflation on the ICON network is driven by the distribution of rewards — and that there is no such thing when it comes to the way rewards impact inflation.

Here are the specifics on how the inflation would be allocated in the future:

IISS 3.1 will consist of several inflation pools with specific percentages of inflation allocated to each of them. The percentages assigned to each pool, as well as the size of the total pool, will all be able to be changed via a Network Proposal vote.

Variables:

  • i_global = Monthly inflation pool size in ICX

  • i_prep = percentage of pool going to P-Reps

  • i_voter = percentage of pool going to voters

  • i_relay = percentage of pool going to relayers

  • i_cpf = percentage of pool going to the CPF

Note: As a rule, i_prep + i_voter + i_relay + i_cpf + i_n must always equal 100%.

For context, our current inflation system looks like this:

i_prep = 17.15%

i_voter = 82.85%

And that’s it. The i_prep is currently the “Global Commission Rate” that is set collectively by P_Reps, and can technically fluctuate based on their desires (but hasn’t for a while). Meanwhile, i_voter is currently just based on the reward rate set by the original implementation of IISS. The total inflation amount is just the two added together.

So, under the new model, we’re adding two new ways to distribute inflation: relayers, and the contribution proposal fund, which will be used to distribute compensation on a per-project basis to help fund additional development and building on the ICON ecosystem. The relayers, meanwhile, will serve an important role in helping the network itself function once we migrate over to ICON 2.0.

So there are basically two questions with this new model: 1) how much inflation do we want ICON to have? and 2) how do we slice up this new pie?

For the answer to the first question, it’s a delicate balance. Of course, there are concerns that inflation can drive down the price of the project over the long-term. At the same time, by reducing rewards too much for either P-Reps, voters, relayers, or the CPF, we remove the incentives for those activities.

If we reduce the P-Rep reward too much, we risk losing node operators. If we reduce the voter reward too much, there’s less incentive to vote, and the network loses one of its more valuable marketing tools — the fact that our rewards for staking are among the highest in the industry.

We’ll need relayers for ICON 2.0, so there needs to be adequate incentive there, and if the CPF fund isn’t adequately funded, developers won’t have much incentive to build projects and DApps on the ICON network.

So finding the right balance between the level of inflation we think is necessary to sustain the ecosystem against our concerns about deflating the price will be a difficult debate and conversation.

As far as the second question is concerned, this will tie in similarly to the first question, but carries a bit more nuance.

In order to fund the relayers and the CPF, do we lower the P-Rep rewards but keep voter rewards the same? Or do we lower both? How much do we want to include into the CPF, and what do we think relayers need to receive in order to be adequately incentivized?

Of course, these numbers can be adjusted based on how well they’re working. Meanwhile, if it’s decided that inflation isn’t as big of a concern as we might think, this proposal could lead to increased inflation in order to increase the resources flowing into the network (if the community wants to go in that direction, of course).

Either way, whether we want to move forward with this proposal to begin with, as well as the details of it’s implementation, could have a big impact on the network moving forward, so we should all be looking to a productive discussion. If you'd like to provide your input today, be sure to join the discussion at the ICON community forum!


News from ICON World

ICON Hyperhack winners have been announced!


Balanced Q3 progress report has been released


KBS introduces “Jeju Relief Code”


Busan Echo Delta Smart City being created by ICONLOOP and Kospin Hospital


LICX Final Report and Beta launch


Lexus Korea uses ICONLOOP’s VisitMe


ICONbet releases a new game, Baccarat!

ICONbet @ICONbetofficial
Baccarat is now available to play on
ICONbet.io!! 🚀🚀🚀🚀

ZenSports announces ICX funding, betting, and trading within their P2P sports betting platform


ICON Foundation to launch a new testnet “Gangnam” next week


Blockchain Industry News

CME quietly surpasses BitMEX to become second-largest bitcoin futures exchange - The Block

Yesterday, CME recorded an open interest of $790 million as compared to $718 million by Binance and $601 million by BitMEX, according to The Block Research. Open interest in the value of outstanding derivative contracts that are yet to be settled.


PayPal Launches New Service Enabling Users to Buy, Hold and Sell CryptocurrencyPayPal Cryptocurrency - PayPal

To increase consumer understanding and adoption of cryptocurrency, the company is introducing the ability to buy, hold and sell select cryptocurrencies, initially featuring Bitcoin, Ethereum, Bitcoin Cash and Litecoin, directly within the PayPal digital wallet. The service will be available to PayPal accountholders in the U.S. in the coming weeks. The company plans to expand the features to Venmo and select international markets in the first half of 2021. The service is enabled in the U.S. through a partnership with Paxos Trust Company, a regulated provider of cryptocurrency products and services.


Grayscale Now Manages $6.5 Billion Worth of Crypto - Decrypt

The total value of assets managed by crypto-focused investment company Grayscale has reached $6.5 billion for the first time, the firm tweeted on Monday.

The biggest of the company’s trusts by far—Grayscale Bitcoin Trust (GBTC)—currently exceeds $5.4 billion.

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