SocialCoin: A Cryptocurrency for a Global Basic Income

http://llsourcell.svbtle.com/socialcoin-a-cryptocurrency-for-a-global-basic-income

by llSourcell • 12 years ago

60 46 12 years ago

llsourcell.svbtle.com

One thing this autonomous corporation should do is have a tax built in to pay the verification teams, and also to keep the system going as mining becomes harder and harder -- if say 2-3% of all transactions go to pay verifiers, and into the GBI pool, ... it might be more stable. You could also have some sort of bonus program where people could run small-time cpu/gpu miners on their home pc--donate all the hashing power back to the main network where 100% goes towards the GBI pool, and it'll sort of be like a huge botnet of miners keeping the gbi aspect going... etc... -- There will need to be a LOT of thought about how to ensure stability 5+ years into the future.

oakwhiz• 12 years ago

In order for SocialCoin to work, we need to figure out a way to create a decentralized ID system that doesn’t rely on government issuance like a Driver’s License or a Passport. This is currently an unsolved problem.
One possible way to do this is to have there be agents in the SocialCoin Distributed Autonomous Corporations who a user would schedule appointments with.

I can imagine these "agents" colluding together to prevent people from receiving their basic income unless they receive a cut for themselves.

prawn• 12 years ago

Why not automate the process of iris scanning somewhat by having monitored booths or rooms. They could be monitored by cameras and a local or remote human presence that can intervene but has limited communication abilities to prevent potential for bribery?

Unless a basic income is global, immigration problems are only going to get more difficult.

jedunnigan• 12 years ago

Any sort of "decentralized" network of autonomous agents acting at the behest of identity verification would be extremely easy to game. There must be some incentive for these verifiers to act as an agents of the protocol, so you would assume they are compensated with SocialCoin. This is an incentive that is easy and rational to abuse.

Syndicates of agents will most likely pop up and commoditize iris scans or whatever the verification procedure requires. They'd quickly spoil the payouts for people without massive numbers of identities under their control.

Not only are they paid to sign people up, but they also can MITM payouts from unsuspecting individuals.

monkeycantype2• 12 years ago

I think eventually we will learn to do this by analysing a person's connection to a network. Today a spy/criminal can gain a new identity by acquiring a fake passport, what if verification of identity came not from a document, but from an analysis of your relationships on a blockchain, who had signed that they know and trust you, and when had they done it, and who had signed that they trusted them. A trusted identity would become something that took years to build. I work with a small team of developers, drip by drip I'm trying to convince the other three this is what we should be working on.

dllthomas7• 12 years ago

I've long been quite interested in whether there's a meaningful way to use WoT approaches to demonstrate uniqueness of an identity.

orasis• 12 years ago

You could bootstrap the identity verification off of Facebook and do some machine learning to look for bot clusters.

TrainedMonkey• 12 years ago

I do not think bitcoin derivative is the right solution for something like basic income.

It is hard to distribute resources fairly and anonymously, this kind of thing that governments excel at precisely because there is no expectation of anonymity. It might be possible to come up with a solution, however at that point it would likely be either too complex to be practical, or not fair, or not anonymous.

TL;DR doing this with crypto-currency defeats purpose of crypto-currency.

monkeycantype2• 12 years ago

I wonder if crypto-currency's best feature, might turn out to be not secrecy, but transparency. Imagine a government that can only spend crypto-currency, where it's every transaction only becomes a transaction by virtue of it being on the public record / block-chain.

Where any transfer by the government to a recipient who was not publicly identified with signed keys, was a criminal act of fraud for which the government could be held accountable.

I think, as you suggest, that would defeat the original design purposes of crypto-currency, but it might be purpose for which crypo-currecy works very well.

lukifer• 12 years ago

Another way of framing the problem is that we don't currently have a distributed way to authenticate identity at scale; currently the least worst solution is some kind of bureaucratic institution. (Public key encryption is a good start, but it doesn't prevent the creation of infinite sock puppets, or offer a good solution for stolen keys.)

dllthomas7• 12 years ago

Part of the problem here is that we need to not only authenticate that you have a persistent identity - which we are very good at, human interface notwithstanding - but that you have a unique persistent identity. Since we need to let people join, that's going to take more than just math.

patcon2• 12 years ago

Maybe the limiting factor for each participant is social interactions of a certain sort -- something to act as a rough proxy for "time", specifically "time interacting with fellow humans". After all, time is the finite resource that we can only divide between our sockpuppet identities, but we can't poof more of it into our aggregate identities. That's assuming that this "certain sort of interaction" is something that can't easily be scaled out of sync with our time (as could perhaps be done with our digital interactions on Twitter).

My first crazy thought was some sort of average proximity from other human beings, where perhaps our phones could sign a digital transaction when we pass within a certain proximity and stay there some amount of time /t/, for some value weighted by proximity and time. The time-proximity (to make up a word, because why not?) from fellow humans might vary by geography, but I assume it might have some degree of consistency on the order of magnitude. So someone in Toronto, Canada would have a value comparable to fellow citizens, but would obviously not be on the same magnitude as someone in a rural Russian village. So if I'm in a certain geographic place and my time-proximity for interacting with my fellow humans is consistent, and aligns with margins of error for that place, then maybe some undescribed service or oracle monitoring the identity network are happy. but if that drops drastically, then maybe that's because i've created a new identity and started to sign interactions with that. Or maybe it's something more innocent, like a job switch. Or a depression. Maybe that's what the oracle needs to confirm.

But anyhow, simple time-proximity wouldn't work, as the real humans are using phones that aren't visually confirming the interaction with another real human. So maybe it would need to be something like Google Glass that recognizes and signs transactions using eye contact as the trigger -- detecting eye contact as a symmetrical relationship, reading/sharing identities, signing and broadcasting a record of that human interaction. Someone could fake data, but it would likely interact with the "real" world network's data in a detectably odd way.

I guess what this is all about is a distributed, self-referential version of TrustCloud.com. But none of this seems to solve the "this is a human: y/n" sort of question -- but more like a "this human is likely 80% of a human identity in geography X" or something like that. So maybe they now deserve a certain take of a pie (if socialcoin were a thing).

Anyhow, I'm sure this is incredibly flawed on many levels, but it was a fun thought experiment to work through :) Feel free to point out any glaring errors in logic, or to promptly ignore it, for that matter

seoguru• 12 years ago

crypto-currency's value is derived from the "greater fool theory" I don't think socialcoin will fly. Happy to be proven wrong.

http://neweconomicperspectives.org/2014/05/need-taxes-mmt-pe...

monkeypizza2• 12 years ago

A system where people can survive and reproduce without working can't end well.

Imagine it in the context of computer resource management - "every program deserves this much RAM and this much CPU". When you have randomly varying, recombining programs, what will the result be after 50 generations? Eventually a program will evolve to reproduce faster, and it will come to dominate the population. Why would you think that such a thing wouldn't happen with human beings, too?

What do you think happens when you provide unlimited free food to a population of rats? A few continue being "productive" - searching for new food supplies, etc. but they get out-reproduced by the ones who just eat all day. So the population explodes, eventually the food runs out, and then they all die.

So overall I think that a global basic income, combined with unlimited reproduction, would have a horrible outcome for humanity.

llamataboot• 12 years ago

So just a Malthusian argument then? Or are you hiding some contempt of people "getting something for nothing" in there as well?

waps2• 12 years ago

Isn't the malthusian argument that either current population has already passed the "support" threshold of the planet or will do so soon ?

This is a similar, but not the same argument. He's simply claiming that taking away the brakes on population growth will cause exponential growth. That argument is simply called "evolution theory", and is not controversial at all. Theory [1] and practice [2] agree (note that logistic growth happens because there is a new limit hit. If no new limit comes then we would be on a logistic curve going to +inf. If you calculate that limit, incidentally, you get an exponential growth curve).

The counter argument "but won't population growth drop by itself" is false, because the population is not monolithic. If some group decides to limit procreation, that group will simply (and quickly) be replaced by one that won't. And if necessary, by another species.

[1] http://www.nature.com/scitable/knowledge/library/how-populat... [2] http://en.wikipedia.org/wiki/Rabbits_in_Australia

dllthomas7• 12 years ago

"Why would you think that such a thing wouldn't happen with human beings, too?"

Because other factors dominate, at human scales. Evolution will get there eventually, but by that time we'll all be so dead and the circumstances will be so different, presuming it's our job to solve that problem now is wrong when there are far more pressing problems.

codemac• 12 years ago

What do you think happens when you provide unlimited free food to a population of rats?

1) No idea, I'm not a rat, nor do I have any expertise in the economic lives of rats. Have there been any studies that show this? I don't have access to many journals.

2) Do you think that humans have the same goals, aspirations, and survival behaviors as rats? Do you think they are so similar that given a cage and food, humans would reproduce until they all died out?

monkeypizza2• 12 years ago

This link is somewhat relevant: http://en.wikipedia.org/wiki/Mautam

In India there's a species of bamboo that flowers every 48 years; during each flowering, the rat population explodes. Once they've eaten all the bamboo, they turn to anything else they can find.

noonespecial• 12 years ago

A system where people can survive and reproduce without working can't end well.

Thats bad news because very soon its going to collide with a system that produces so well that almost no one needs to work to produce enough for everyone to survive and reproduce.

Unless we act positively and intentionally as a species, I'm afraid the defacto answer is to kill all the extra people with poverty.

dllthomas7• 12 years ago

If this can actually be worked out, I'd love to see it. I'm pretty skeptical though.

wyager2• 12 years ago

Hahaha. This is so blatantly stupid.

In order for SocialCoin to work, we need to figure out a way to create a decentralized ID system that doesn’t rely on government issuance like a Driver’s License or a Passport. This is currently an unsolved problem.

It's unsolved because it is literally impossible. There is no rigorous mathematical definition of identity, and no way to construct a generic identity-proof algorithm. Even humans can't agree what constitutes an identity, and we've had many millions of years as social animals to evolve heuristics.

Are clones separate people? Are molecular copies separate people? Are brain simulations separate people? If they are, I can just spawn 1,000,000 copies of my brain and collect their SocialCoin. And then it becomes a competition of computing power, just like Bitcoin!

And, of course, there's no non-blinded automated test that can differentiate a human and a machine, neither in theory nor in practice.

The only people who think up foolish schemes like this are those who utterly fail to grasp the genius of solving voting problems with HashCash style proof-of-work mechanisms.

dllthomas7• 12 years ago

I don't think we need to solve the question of molecular copies or brain simulations before considering this. Clones already exist, of course, in the form of identical twins - and I can't imagine us considering them anything but separate people.

I totally agree that this can't be done with math alone, but I've not seen any proof that it's "literally impossible" to produce a system where the incentives work out for enough people to play by - and enforce - the rules with the help of math.

I've also not seen credible proposals for such a system, I don't know that such system could exist, and I certainly don't know that we will be able to produce such a system any time soon. These are hard problems. But "literally impossible" is a bold claim - far too bold unless you have more to support it than what you wrote above.

lorddoig• 12 years ago

The economics behind this is staggeringly flawed.

Technological innovation increases wealth. This is a basic economic principle as evidenced by the industrial revolution (machines took over most of those old jobs, and now there's much less unemployment, poorhouses don't exist, and the average person is much richer in real terms.) To speak of some kind of saturation point where there is a machine for everything is pretty crazy.

Let's step into lala-land and assume there's one machine that can produce anything and perform any task. It requires no maintenance and no inputs. What's the problem? Everyone can have everything. No money required. Winning.

Stepping back to reality all these machines will require production, sales efforts, maintenance, electricity, network infrastructure, yadda yadda. Goods-producing machines will need a supply chain and QA, and people to figure out what to make with it next. And when exactly do we foresee machines taking over the service industry? A machine that provides business consultancy? Cuts your hair? Caters to your animalistic needs? This stuff is a long way off if it's even possible.

Even when machines can do all this we'd need to remove every source of friction in the economy before we could even begin to dream of approaching that saturation point - in short that means global governance and regulation, no taxes, free trade, no behaviour limiting contracts, no currency risk, no language barrier. All of these things create market distortions that create the potential for profit, and where the potential for profit exists, people will exploit it, and there will be jobs.

Long story short: we have many, many problems left to solve before we can all kick back and let the robot butler massage our feet.

Further, the idea that a basic income is best tackled with a crypto-currency is nonsense. Crypto-currencies, like other currencies, derive their value from the underlying assets. You can mine coins, but you can't mine value. In the UK we have a bottom-line tax rate of about 30% of GDP, and about 30% of that is social security. We're a generous country in this regard and have lots of people happily living their lives doing nothing. It's pretty close to this romantic notion of 'basic income'.

If you haven't done the maths on that yet, the UK's percentage of GDP spent on social security is 30% x 30% = 9%. Assuming SocialCoin is the only currency in the world and that global PPP is uniform (and in line with the UK today), we need to solve (as per the 10% of mining proceeds idea):

required_inflation * 0.1 = 0.09 required_inflation = (0.09/0.1) = 0.9 = 90%

A world with 90% inflation is a world in crisis. Assuming instead that we give all mining profits to the needy, we'd still need to maintain 9% inflation...which is also a world in crisis.

I haven't, and won't, even touch on the absurdity of the very notion of 'basic income' (but there's a reason it doesn't enter economists heads).

All in this is just a thin and problematic veil over the desire to redistribute wealth from those who have it to those who don't. Theoretically this is already solidly solved - you take lumps of money from the rich (in any currency you fancy), you walk over to the poor, and you hand it to them. You don't add conditions to it and you do everything to seriously minimise administration costs. This is the second fundamental theorem of welfare economics.

fr11• 12 years ago

there's a reason it doesn't enter economists heads.

Let me just respond to this: the basic income was in large part created by Milton Friedman, under the title 'Negative Income Tax'.

The rest of your post is similarly flawed. This is not a case, however, where there are 2 sides of the debate.

ewzimm• 12 years ago

The problem of wealth distribution is certainly not solved, because the system you are describing, in which wealth is taken from someone, involves coersion. It requires violence to enforce. It requires consolidation of power. The system proposed here, however simple, is describing voluntary wealth redistribution. No one is forced into the system, but the rules of the system are set to level the playing field.

I think this is a good start, and we will likely see many more implementations of this basic idea. One genius aspect of software-based currency is that it allows the possibility of the establishment of laws without a police force. The currency is its own police force. Anyone who doesn't like the rules can choose to use another cryptocurrency with different rules. This is consensus-based law, and it is a movement in the right direction.

pjc50• 12 years ago

Most of the people "happily sitting around doing nothing" are pensioners.

woah• 12 years ago

Any 'SocialCoin' scheme pales in significance to the prospect of a decentralized network that can prove individuality, which the author brushes off with a 'oh someone will figure it out'. This kind of technology would have huge, far ranging impacts, much greater than any impact that Bitcoin, Ethereum, or even Dogecoin could ever hope to aspire to.

If you have proof of individuality, proof of work goes out the window, proof of stake goes out the window. The entire thing that makes Bitcoin and any decentralized network hard goes out the window. Proof of human individuality in a decentralized network would completely rewire society and computer science in ways we can't imagine.

This SocialCoin thing is rooted in the world we have today, but the idea is predicated on a technology that would make it irrelevant.

dllthomas7• 12 years ago

Could you elaborate on some of the "completely rewire", &c?

AnIrishDuck• 12 years ago

Yeah, I stopped reading there too. Sybil attacks [1] are the biggest problem with decentralized distributed systems, you can't just hand-wave them away.

1. http://en.wikipedia.org/wiki/Sybil_attack

Houshalter2• 12 years ago

We already have proof of individuality. The post mentions drivers licenses or official government documentation, but you could also use phone numbers or credit cards or something like that (although it would allow some fraud.)

Now why isn't it magically "rewiring society and computer science"?

qznc• 12 years ago

For example, the spam problem would be solved.

Facebook and Google use phone numbers for proof of individuality. However, you can still buy accounts for spamming etc. Apparently, it does not work.

It might work well enough for social networks, because one account is not worth that much. However, if one account gets guaranteed basic income the incentives are much larger.

liamzebedee• 12 years ago

I'd be interested in reading about any potential research in this area, it's quite a fascinating unsolved problem. Like Bitcoin's solution to the P2P untrusted consensus problem (Two Generals Problem), I would think that the solution to ensuring individuality (see the Sybil attack [2]) lies in some approach that isn't 100% failsafe but probabistically ensures the desired result is highly likely (see 51% attack).

I think a web of trust [3] is something that could work. Given a system of nodes with public keys (the most common form of identification in P2P), a possible approach to estimate the 'individuality' of some identity/key would be to measure its degree of relationships with other nodes who vouch for its authenticity, weighted according to the 'individuality' of the other nodes (something that could be solved with an iterative approach, as in PageRank/EigenTrust). The idea being that while a malicious node might vouch for many of its identities, it doesn't have any link to any other node and thus would be weighted lower.

Turns out this exact approach had been developed in 2011 [5] (just found out now, wow, see fig.1 on page 3) and also in other research with SybilGuard [4]. I'm not sure of the limitations of these formalised definitions, but it looks to me like much of P2P research (see PolderCast, a marvellous innovation) -- the possibilities are never realised until someone implements it in software.

[1] https://en.wikipedia.org/wiki/Two_Generals%27_Problem

[2] http://en.wikipedia.org/wiki/Sybil_attack

[3] http://en.wikipedia.org/wiki/Web_of_trust

[4] http://www.math.cmu.edu/~adf/research/SybilGuard.pdf

[5] https://ccl.northwestern.edu/papers/2011/kurve.pdf

wyager2• 12 years ago

Any known identity system can be gamed, including web of trust.

Proof of work is the only known viable sybil attack prevention mechanism.

llSourcell• 12 years ago

hey lets talk. do you live in SF? Can i have your email? -siraj

thomas4019• 12 years ago

You're right about the problem, your solution is off.

It doesn’t matter if retailers don’t accept the coin, users can just exchange the coins for bitcoins or local fiat currency for immediate real world use.

No entity would give fiat currency for these SocialCoins unless they had some real or speculative value.

The basic idea is that 10% of the profits that miners earn from mining this coin is pooled and distributed to every member of the network on a bi-weekly basis.

Are these "profits" from inflation or a transaction fees?

dllthomas7• 12 years ago

"No entity would give fiat currency for these SocialCoins unless they had some real or speculative value."

Or the entity had some other interest in keeping the scheme going.

Not that this necessarily seems likely/sustainable/advisable...

UweSchmidt• 12 years ago

Could this be the most ambitious project of all times? It requires

- mass adoption of cryptocurrencies

- guaranteed basic income

- libertarian principles limiting the role of government

My guess is that we'll have that mars colony first.

dr_win• 12 years ago

I think that governments will sooner or later start taxing work of robots to redirect the resources into social safety nets.

broolstoryco• 12 years ago

"In order for SocialCoin to work, we need to figure out a way to create a decentralized ID system that doesn’t rely on government ... This is currently an unsolved problem ... The user would set an appointment with 3-5 agents individually and each agent would scan the user’s irises in person to verify that they are a real human"

This has to be satire

Executor• 12 years ago

Or we can get rid of monetary systems and use a resource-based economy (read Venus Project).

SocialCoin: A Cryptocurrency for a Global Basic Income

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