An Open Source Initiative Electronic Payment System, a Payment Fulfilment System, and a thesis on the Practical Application of a Mixed Economic Model to Achieve Crypto Coin Stability
In 2008, an unidentified cryptography enthusiast, decentralisation advocate, and technology visionary, using the pseudonym Satoshi Nakamoto wrote the revolutionary whitepaper, Bitcoin: A peer-to-peer electronic cash system. The paper defined the blueprint for the world’s first decentralised electronic currency, Bitcoin, and became a catalyst for an evolution in the practical application of its concepts, namely proof-of-work and coins derived from a chain of digital signatures, cryptographically secured on a digital ledger, which later become known as the blockchain.
The history of Satoshi’s Bitcoin can be traced back to the Cypherpunks movement of the late 1980’s and 1990’s and their philosophies on how to create a more open society using advances in cryptography and computerisation. The movement promoted the use of anonymity through strong cryptography to achieve genuine freedom of speech. This was especially significant in oppressive societies where censorship and monitoring were, and still are common practice.
In 1983, Richard Stallman founded the Freedom of Software movement and the GNU Project. Several other freedom of software initiatives followed, including the Open Source Initiative and its MIT License, which grants users the rights to use, copy, modify, merge, publish, distribute, sublicense, and/or sell copies of the software without restriction. This project is licensed under the Open Source Initiative MIT License.
The economy for digital currencies has grown 3000% in 2017 and a conservative estimate is that it will double in size in 2018. This has led to a modern day gold rush with prospectors from all walks of life rushing in to stake their claim in any one or more of 1520 active ‘Gold mines’. Zero or limited regulation has also led to an influx of dishonest enterprises touting unfeasible roadmaps and the promise of high returns while hiding behind a veil of anonymity*. Founders that have nothing on the line, even if only their identities, are more likely to walk away when the going gets tough. In some circumstances, the founders, unable to establish a crypto currency with any real value, can escape via the project back door, and dump their remaining coins onto the market at the expense of their own investors.
*It ought to be distinguished between the rights to anonymity in open society in the pursuit of freedom of speech, and expecting the same privileges as an anonymous project team asking for investment from the general public. The former is both legally and socially acceptable; the latter is ethically tenuous to say the least.
This paper will define a blueprint for an ethical project based on sound fundamentals, transparency, and an effective economic policy.