HiFi "Blockchain"


#1

https://blog.highfidelity.com/roadmap-protecting-intellectual-property-in-virtual-worlds-4388096d72c2

I like where this is going. Also, it wouldn’t be too far of a stretch to implement smart contracts such as resell agreements for vendors to carry creators’ products. These could handle “land” sales as well.

Just a thought.

Also… Does HiFi intend to develop with bitcoin or create a hifi coin and launch a ICO (initial coin offering) for early adopters? If there will be a hifi coin PLEASE make it publicly mine-able otherwise there is no point in using cryptocurrencies at all (and will probably be labelled a shitcoin or scam by the crypto community).

And… there is no point in using a blockchain without a cryptocoin since then there would be no miners to reach a majority concent, therefore the blockchain would be untrusted (might as well just use a normal database in this case) because it will then be a centralized system which defeats the entire point of using a blockchain.

A new crypto with a ICO would probably be pretty popular and a good way to raise money. The crypto community would want to get involved even if they don’t care about VR or VWs because it is coming from solid developers and a solid company with Philip Rosedale’s name on it, and there is something to show (not just a white paper which many ICOs begin with). ICOs with WAY WAY less (virtual nobodys) have even done well, no doubt HiFi would too.

There is also the option of a bitcoin side-chain. This is where you would have a hifi blockchain that is connected to the bitcoin blockchain. This has the advantage of a pre-existing network with pre-existing miners and people would be able to use actual bitcoins in HiFi. Bitcoin is getting really popular so this might be a good way to go too, only thing is you won’t be raising money by running a ICO.

A third option is using ethereum. The advantage here is ethereum is like bitcoin but is “programmed”. It can do all the things mentioned in the blog and much more. This would be the most flexible and expandable way because if you want to add new functionality you can just make up a new smart contract.


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#2

A big problem with existing crypocurrencies is that the money supply is not very elastic. That’s why I don’t think an mineable cryptocurrency will be stable enough. A cryptocurrency is tied to the success or failure of HighFidelity and thus the money supply has to be quite elastic.

The Swedish economist David Davidson proposed the idea that the money supply should follow nominal growth. That means that money supply should be proportional to the real value of goods and services traded with this currency. In contrast to real economies, the economy of High Fidelity is measurable since every transaction is traceable. We then know the velocity of money, the price level and the monetary base. The equation of exchange (MV=PQ) proposed by Irving Fischer in 1911 is correct, but since P*Q (GDP) is observed with a lag in real economies we can’t really use this knowledge to create a rule that will stabilize the economy.

In a virtual world P*Q is observed immediately, because of the blockchain and knowledge of the consumption of goods in the virtual worlds (the items sold and bought). It is very easy to create a CPI once the economy starts to become stable. That means it is also possible to apply a monetary rule like that proposed by David Davidson.

The problem, as I see it, is making this rule transparent for all the users. Mining of the currency could be done by HighFidelity, the seigniorage from minting the currency would then be a source of income for the company and a way of financing the infrastructure on which we all depend. It would be very hard to cheat, since that would immediately create inflation and lack of trust in the currency. I’m personally not so worried about the trust aspect. Even if the currency was totally independent of HF it would still be worthless if High Fidelity were to disappear for some reason, since the currency would then stop circulating.

Here is a paper about the subject:

https://www.researchgate.net/publication/254683340_Private_Electronic_Money_Fiat_Money_and_the_Micropayment_Systems


#3

The whole point of a cryptocurrency is a trustless decentralized network though. If they are going to mine it themselves why not just do what they did in SL and create numbers from thin air (a never ending sell order) and rig the economy? Cryptocurrency only works when you have miners over a decentralized network. If not it’s totally pointless. Blockchain is a distributed ledger and is only trusted because everybody (at very least the miners) has a copy. If you have a blockchain on a single computer whats the point? Then the blockchain can be changed and is not a permanent record. At this point is is just a normal database.

If HiFi makes a cryptocurrency, trust me… people WILL mine it whether they are interested in hifi or not. A lot of people have mining gear they like to turn on new cryptos. Not only that but if you are familiar with SL you might remember campers. People got paid a few L every minute to stand in a sim. Well that can work in hifi too if you have them running mining scripts.


#4

It sounded at fridays meeting that the currency wasn’t being minable


#5

Then it’s a waste of code and they are just using blockchain as a buzzword. Might as well just use lindens.


#6

You see a blockchain is just a normal database but everybody has a copy. The machines that write to the database are the miners. Nobody wants to download 400 gigs on their hard drive if they aren’t getting paid to mine. Like I said if there is only one copy then it’s just a normal database and to call it anything else is either a misunderstanding of the technology or the use of a buzzword for PR.


#7

https://blog.highfidelity.com/roadmap-currency-and-content-protection-8b4de8acd1f3


#8

"For this reason, we can’t directly use the big public blockchains (Ethereum or Bitcoin), because the full decentralization of these networks imposes limits on how quickly they can process transactions and requires significant fees per transaction. "

That’s not a reason. it is either a lie or a complete failure to understand these technologies. I can see how processing time might be a concern for bitcoin because it’s been an issue they have been trying to figure out for some time. It’s really not all that slow though, in practice (just pay a fair fee and somebody will mine it).

As for “significant fees”, I don’t think it could be any cheaper. It’s cheaper than Paypal, Western Union and even Second Life. In fact you literally CHOOSE how much you pay.


#9

“This is basically because a very large network of ‘miners’ have to share the transaction fees equally among themselves, and the algorithmic ‘game’ that allows the miners to pay each other without trusting each other will break down if the transactions happen too quickly.”

WTF? Definitely NOT TRUE. There are MUCH SMARTER people than anybody working on HiFi who have invested millions in bitcoin and ethereum. So basically he is saying the system is flawed. If it were flawed nobody would even use it. It’s almost as if he thinks he knows cryptocurrencies better than everybody else. Pretty bold statement if you ask me.

“Smart designers (not just us) have observed that if a trading network can trust a smaller subset of members to act as verifiers for new transactions (typically called ‘block signers’), you can greatly speed up the performance of the network and reduce the fees without compromising the most useful quality of a blockchain: a single public ledger which everyone can read and write, and which enforces the requirement for correct digital signatures for every transaction.”

Google 51% attack. And who are these “smaller subset of members”? If they are hand-picked by HiFi then again it’s a centralized network and useless. Most of the experts agree permissioned blockchains are crap. There is only one reason and one reason alone why anybody would want a permissioned blockchain and that’s to have control over it. No other reason is even possible.

It makes me really angry when people pass along misinformation like this.

I thought hifi was built from the ground up as open-sourced. You know what will kill HiFi if they do this? Somebody will come along and implement bitcoin rather than a centralized “currency” and people will use that instead.


#10

But the main point of the blockchain, as I understand it, is not the mining process but that it guarantees that a transaction is unique and that money isn’t spent twice. If High Fidelity has the private key they can create as much money as they want, but that would only create inflation and render the currency useless. What I would not recommend, however, is to peg the currency to some physical currency like the US-dollar.


#11

That’s part of the mining process. Transactions are recorded in blocks produced by miners.

I agree on both counts.


#12

A lot of (traditional) banks are starting to use blockchains. If there is no point in using blockchains, why would they waste time doing it?

Like this one: https://www.wired.com/2012/05/mintchip/


#13

I also remember that it wasn’t profitable. After have paid the electricity spend for that activity, you were always below 0 :wink: (It was only profitable to the land owner for its traffic record)

But well, I read here that was probably just a wrong example to illustrate your point.


#14

They want to use it between their own branches. That’s a different use for it than we have here.


#15

I think you just missed my point. You can have people camp and know exactly what to pay them from minute-to-minute, sort of like a mining pool. It’s the same as mining but you’re distributing the mining between multiple clients (hence, mining pool).

I probably just didn’t explain it well enough.


#16

Perhaps a bit different, there might be other examples. But I find your statement “Then it’s a waste of code and they are just using blockchain as a buzzword. Might as well just use lindens.” rather categorical. Do you actually mean that there is no point at all using a blockchain if there is no mining involved? Or do you mean that unless we find a way of incentivising people to keep the blockchain on their computer the blockchain might as well be centralised.

Another thing: Isn’t the number of bitcoins also finite and what happens when there is no use mining those anymore?


#17

There is no point at all using a blockchain if there is no mining involved, unless you just want to control it (like a bank to its branches).


#18

Yes, 21 million bitcoins is max. After that miners get paid transaction fees directly.


#19

Ok. So if HF did have a mining process parallell to minting the currency themselves it would work. Or?


#20

The only reason there won’t be more than 21 million bitcoins is because it’s decentralized. If it’s a centralized system (as described in the blog) there is no way to enforce this and they can change it any time they want. That’s why I am saying there is no point to using a blockchain because just a normal system like SL has would suffice. It;s a waste of the technology.