My fellow retards,
The discord conversations around native phonon mining are exceptional…so many different thinkers with logical perspectives that wind up at different conclusions. It is truly refreshing to see people think for themselves and not just parrot the party line. This protocol moves forward on the backs of independent thinkers. All must be willing to challenge what they know, question their assumptions, listen to different perspectives, and acknowledge that no one person has all of the answers.
The one conclusion essentially *everyone* agrees with—the market will decide.
Great that it came to this end state; everything else is implementation detail.
There seems to be complete consensus that the phonon mining testnet must move forward. The Texas Architect provided additional insight to the community on what mining looks like under the hood, and many are anxious to get hold of a testkit to participate. Remember; no discounts and no preferential treatment. We have to be cognizant of even the image of impropriety.
Assume a future state where native phonons are useful, be it for speculation or facilitation of transactions (change, and low denomination). From here we can make a few additional assumptions, one of which is that more people will want to buy mining cards to get these native phonons. This is wonderful for selling cards, but it *does not* directly benefit the DAO. It directly benefits users and native phonon holders, but as the DAO has created this system, and the DAO governs this system, it is only logical to seek out virtuous loops which serve the DAO as well.
The numbers are variable here; the structure is what you should focus on:
If it costs ~$7 for GridPlus to create, program, and distribute a mining card, they should perhaps sell them for ~$12 each. The question is; who gets to buy them? If we allow the first bot to put in an order for all 1,000 cards upon the store opening, then the system is fucked. We don’t have a good distribution of future native phonon ownership, and the community loses. Ideally we want to get a native phonon mining card to all the people who are willing to pay the most for a native phonon mining card. The way to do this is a Dutch Auction.
In this system, potential buyers will signal how much PHONON (governance token) they are willing to permanently burn for the right to purchase one of the 1,000 phonon mining cards. If phon/ongod REALLY wants a card, they might signal willingness to burn 1,000,000 PHONON. Now—that amount wont be burned, but when everyone is done committing to their maximum price, we go down the list to see what the 1,000th highest bidder was willing to burn. Let’s say that’s 7,500 PHONON. That means that this user, along with everyone who signaled they were willing to burn more (including phon/ongod) now gets to burn 7,500 PHONON for the right to buy the native phonon mining card. In this scenario, 7,500,000 PHONON is gone forever from the system.
This is efficient. This is the way to appropriately price an asset in this type of situation. If the DAO instead said, “if you want to buy a mining card you also have to pay a $2 fee to the DAO”, it would sell itself massively short. This DA system maximizes the value that goes to the DAO and guarantees that those who are willing to spend the most get the cards.
It also creates an incredible virtuous loop—If native phonon mining takes off, there will be another auction of cards (likely with less efficient mining capabilities). If the demand for native phonons continues to grow, they become too valuable for changemaking and micropayments. To maintain the usefulness of native phonons, the DAO may choose to sell another tranche of cards. What this effectively does is decrease the value of native phonons, since it will be increasing their supply over time. Each additional auction transfers value back into the DAO as more PHONON governance tokens are burned.
This type of loop puts buying pressure on PHONON governance tokens. You will need these tokens to purchase a native phonon mining card; there is no other way to acquire one.
This is an exceptional use case for the PHONON governance token: the ability to control the supply of native phonon mining cards. It is also able to determine the characteristics of those cards (maximum native phonons that can be mined, difficulty curve, etc.).
We band the value and parameters of native phonons with the PHONON governance token, and promise a prosperous relationship.
That’s all for now, need to buy more PHONON to guarantee a mining card.
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.