My fellow retards,
Anyone who spends ten minutes on CT will come across some fools throwing out the motto “stacking sats”. This refers to their never-ending goal of accumulating more bitcoin. It’s fine, it has a nice little ring to it, but it doesn’t really work the way it sounds due to limitations of bitcoin that make tiny transaction amounts unviable.
Bitcoin uses a UTXO (unspent transaction output) system. The way it works is akin to dollar bills and coins. Basically, if we want to send phren Senor .5 bitcoins and we have UTXO of .2 and .4, we would need to create a transaction that includes two signatures, one on each UTXO, which creates a new output of .5 in an address owned by Senor and .1 in a return addressed owned by your friendly deacon of abysmal hope (ignore miner fees for simplicity). For your edification, the more signatures your transaction requires, and the more inputs to be spent means that your transaction is larger with regards to data, thus the miners will require a greater amount of a fee to broadcast and confirm larger transactions. Size here is not size of the bitcoin, but size of the inputs and signature data.
This UTXO system is roughly how transfers on the phonon protocol work, though there is no creation of new UTXOs within the protocol. In other words, there is no change function.
In bitcoin, you can’t actually stack a sat. Sat is short for Satoshi, the lowest denomination in the system, equivalent to 0.00000001 or 1.0 * 10–8 in scientific notation. This is a very fucking small amount. While you could create a UTXO worth 1 sat, nobody would ever want to because the fee to spend it on the network would be many orders of magnitude more valuable than the sat itself. Why would you spend $5 to move something that is worth a fraction of a penny?
This limitation DOES NOT exist in phonon world. This is because there are absolutely zero fees to make a transfer. There is no global mining or validator cartel to bribe to include your transaction as part of the canonical history known as the blockchain. Phonon has no blockchain. Transfers actually take place as Satoshi would have desired, in a completely peer to peer manner.
Because of this, there is no lower threshold to denomination either. You could conceivably create a $0.0000001 USDC phonon that originates on a L2, with zero fees. In practice nobody would want something this small either, but it makes us wonder what we actually desire to *stack* in phonon. There is no de minimus denomination or unit currency, thus what we really want to stack are keys.
Private keys are the underlying value driver of the entire crypto ecosystem.
Every asset on every blockchain requires a private key to move, and Phonon lets you swap those across a completely fee-less, private and scalable topology. There is no currency Phononites claim to stack…they go a bit lower to where the dwarves live, and stack the private keys themselves!
Next time you hear a fool on CT talk about stacking sats, drop some knowledge on them and launch them into the phononsphere, where they can start stacking keys like real gentleman.
If you are ready to move beyond the tiny and inconsequential sat-stackers, join Phonon DAO discord.
Tips to phonongod.eth will be invested in bounties that advance the Phonon project.
Hatemail to phonongod@protonmail.com will be scathingly considered.
Targets for the marketcap of PHONON DAO remain:
$1b by Q2 2022, $12b by EOY.
On the high end, $300b marketcap in 3 years.