Each and every day over $100,000 is being spent on mining PTS in the form of electricity or cloud computing costs. This adds up to over $3 million per month. In recent posts we have made the following observations:
1) Mining based upon resource consumption results in centralization.
2) Mining based security is more expensive than proof-of-stake based security and thus less profitable for a DAC and therefore the DAC would be less competitive.
3) DACs require money to be developed
4) Money is another kind of Proof-of-Work... right now we just prove that we burned it, what if we could use it to build the DAC?
5) The ideal mining pool would allow anyone to pay for 'servers' and receive a payout equal to their capital investment without any fees.
In light of these facts we would like to introduce a new model where you mine with your money rather than mine by burning your money. Invictus would launch ProtoShares 2.0 that would honor all existing PTS and then mine 100K PTS per week. To mine, you would send Bitcoin to the Angel address. The 100K PTS would then be divided among those who contributed proportional to their investment. The proof-of-work would be switched to the signature of our private key and we would set up a server to produce one block every 2 minutes. As a result mining will still be proportional to work as measured by the money invested. The more people the contribute the more difficulty mining becomes.
This new model will raise money for Invictus which we can then use to build out the half dozen DACs that will honor all PTS holders. Instead of PTS holders getting 10% of new genesis blocks, they would get 100% of the genesis block. We could implement this as a hard fork that would give everyone time to upgrade their wallets and it would be otherwise entirely transparent to holders of PTS.
Existing PTS holders benefit because instead of being diluted by miners burning money, they get diluted by miners funding the development of DACs.
Considering the number of people at Vegas looking to throw money our way, the most successful way to do so would be by capturing money currently being waisted at Amazon, DO, and your electric company.
It is clear to us that we cannot change ProtoShares even though we believe it would have been a better deal for everyone but the botnets.
Based upon the feedback you all have provided at our request we will leave ProtoShares and its social contract as-is.
In the mean time we are still looking for ways to crowd fund development of new DACs through a concept similar to Angel Shares.
We welcome any constructive suggestions.