Thoughts on Big Changes for EarthBucks 2.0

I’m considering making some big changes for EarthBucks 2.0. The biggest change I’m contemplating is to how the fees for mining work. I may adjust the fee structure to enable EarthBucks Inc. to take a 30% cut, with each mine also taking a 30% cut, leaving the remaining 40% for individual miners. This change, along with a mining advantage of up to 10x for verified miners, will significantly alter the fees for mining, reducing fees for some users and raising them for others.

Why Make This Change?

As I’ve argued elsewhere, I believe Bitcoin is a brilliant but flawed invention. The status quo of small blocks with a tiny maximum transaction volume doesn’t make sense, and it may be due to the way incentives on the network operate.

Whoever builds and operates the EarthBucks network (for now, me alone) needs to earn money to fund their work, and the tiny fees I would earn from my consumer GPU are obviously not enough. This is why I decided at launch that mines should receive 30% of the revenue. As the operator of the first mine, my company gets 30% of the revenue. This diverges from the pure proof-of-work incentives of Bitcoin.

But there’s another problem. Building and maintaining the network is actually quite different from operating a mine. A mine is a network service that requires a completely different skill set to operate than building and maintaining the software. When you consider that miners on EarthBucks do not provide security to the network, giving them 70% of all revenue is extremely generous, to put it mildly.

Right now, the status quo—where a small number of miners earn most of the reward for doing very little—is, in my opinion, obviously not ideal or sustainable. The people building the network (EarthBucks Inc.) should receive a large share, and the people who operate mines should also get a substantial share. The people who run proof-of-work calculations should not be getting the majority.

Because Bitcoin has small blocks, some of these concerns don’t really matter for Bitcoin. But EarthBucks is not Bitcoin. With the plan to create mines that handle enormous transaction volume, the protocol and software will never be finished; instead, they will need to be rewritten time and time again for each order of magnitude of growth. This requires constant work from EarthBucks Inc. and the mine operators in a manner completely unrelated to the proof-of-work calculations by miners. Thus, the pure proof-of-work incentives of Bitcoin do not make sense for EarthBucks.

What Is the Proposed Fee Breakdown?

I think a fee breakdown that would make more sense would look something like this:

• 30% to EarthBucks Inc. to design and build the protocol, mining software, and wallet software, and to manage the brand and permissioned mine operations.
• 30% to each mine (such as earthbucks.com, compucha.com, and ninjabutton.com) to operate the mine and manage their own users and software. Although this will all be managed by EarthBucks Inc. at the start, it will be opened up to other operators as quickly as the software and systems for that can be built.
• 40% remainder going to the miners who perform proof-of-work calculations.

These percentages are not final and may change over time. However, I simply want users to be aware of my thinking on this. The current fee structure (30% to the mine and 70% to miners) is subject to change and most likely will change by or before EarthBucks 2.0.

Other Changes

There are other changes that I am making, with details still to be decided, that I want users to be aware of. I have already announced the desktop wallet and P2P network. However, there are some decisions about how this will work that I haven’t yet finalized. So here are some ideas about how this might play out:

• There may be a unified mining and wallet app for desktop and mobile, or they may be two separate apps. The problem is that the technologies I’m using for native apps, Tauri and Electron, have a significant suite of advantages and disadvantages that make it unclear what the best configuration is.
• The new mines Compucha and NinjaButton may or may not have their own web wallets or web miners. The challenge here is that I’m not sure if I want to divide my effort across multiple different end-user-facing products, or if it would be better to unify everything around one web wallet/miner branded “EarthBucks.”
• A Bitcoin Cash wallet may come as a separate wallet app first, or it may be launched inside the main EarthBucks app, or it may launch alongside the EarthBucks exchange.

Conclusion

While I build the promised AI app, I am ruminating on the best decisions to make regarding fees, which features go into which apps, and where. I haven’t made these decisions yet, but users should expect big changes for EarthBucks 2.0. All of these changes are designed to make EarthBucks easier to build and grow, and to make it more sustainable in the long run.

If you wish to comment on these changes, please do so on Identellica, where I will be taking input for all EarthBucks decisions moving forward.