This document is being used to collect all of the different questions that we will ask and answer in the following forum.
NB: This doc was apparently lost when the server got hacked in mid-December 2014, but it has been recovered from the Google cache of 23rd November 2014. Anything that may have been added subsequent to that date, has unfortunately been lost, and if you notice that anything you had added is now missing, please add it again, and sorry for the inconvenience.
Below you’ll find version 1.0 of the FAQ. All of the questions have been answered at the moment but this is still a draft, and some answers could be modified in the coming days. So please feel free to add or modify content. We’ve created an index that appears first followed by the questions and answers below. Ideally, when formatted for WordPress, the index would include quicklinks to the answers.
FairCoop already holds 20% of all Faircoins in existence, which guarantees that the growth of the currency’s value will go to the common good. This is guaranteed by FairCoop’s democratic accountability system.
If we were to distribute the cryptocurrency from the outset among the collectives that filled out a form and met certain criteria, it might seem quite fair outside the cryptocurrency community, but inside we could easily find ourselves up against boycotts and complaints for having distributed it among our colleagues, using political criteria, etc.
If, to avoid this situation, we were to allow a large percentage to be distributed by conventional criteria (mining it for several days, with a random list anyone can sign up for, etc.), we’d end up with minorities from the North making personal profits from our project, in a framework of speculation (because of the project we would be presenting). This could increase the value of what we defend more quickly, leading to price drops which would create confusion, etc.
By contrast, if we took advantage of a cryptocurrency that had already been created, had already been through this initial speculative phase, was currently devalued and on its way to being abandoned (Faircoin was ranked at number 200 with a total value of 50,000 dollars; that is, 1% of all coins could be bought with 500 dollars), it would be very easy for us to obtain an important share by means that are completely accepted by the cryptocommunity: buying it on the market for next to nothing. This way, we were able to create a very advantageous situation for our project without having to assume the delicate responsibility of creating and distributing the cryptocurrency from the beginning.
Besides, it shouldn’t be difficult to ensure that once the dissemination of the project has begun and it is generating the ability to purchase and accumulate the currency, we can bring about a general trend toward a rising value of Faircoin, boosting the credibility of the project.
Once FairMarket is launched, those shops which are paid in Faircoin will have offers of faircoins for sale. Furthermore, when those projects that receive Faircoin donations are eligible to spend them, it will be possible to buy Faircoin from them as well.
March 6th 2014 – Faircoin created by an anonymous developer.
April 23rd 2014 (approx.) – Faircoin abandoned by its anonymous developer.
May 6th 2014 (approx.) – Faircoin taken over by the community. Enric Duran was among the people involved in the takeover.
The above actions are documented in this bitcointalk thread:
Faircoin began in March with this first ANN: https://bitcointalk.org/index.php?topic=487212.0
“FairCoin was abandoned at the end of April 2014 by its original developer; but not after promising huge projects, private investors, and much more. The FairCoin community was left to sit with unfulfilled promises, high hopes diminished, and its morale completely drained. A few leaders in the remaining community organized a new development team, consisting of some of the most devoted members.”
This was the context of our second ANN: https://bitcointalk.org/index.php?topic=601280.0
From the initial community takeover, a team of three committed individuals, were the people who really gave continuity to the dev team: smartaction, drakandar and thokon00
Because the creator of the second ANN was not really involved and this made good communication inefficient, we decided to close the second ANN at the same time of the First hard fork, and we created this third ANN only accessible by the current FairCoin Development Team.
- “FairCoin is a decentralised virtual currency, distributed through a vast airdrop process during the 6th and 8th of March, 2014 (view airdrop statistics). An approximate 49,750 addresses were logged for the giveaway, each able to claim 1000 FAIR per hour. Automated airdrop claiming methods had no effect, as each IP address could register once per hour, and 2 different captchas had to be solved. These security precautions were hidden till the day of distribution. FairCoin’s vast distribution method allowed a good portion of the cryptocurrency community to claim a little bit of the 50,000,000 FairCoins, each.” https://fair-coin.org/
99.99% POS: It is a hybrid POW / POS system but money creation is 99.99% POS. Thus, the majority of faircoins are minted, ie, the system works thanks to everyone’s savings.
As for security, there is a POW block every 5 minutes, and a POS block every 10 minutes. These two methods were combined to provide the best of each in securing the system.
The low remuneration for mining, 0.001FAC / block, prevents energy waste since using high consumption mining devices is just not worth it.
Money Supply of 50,000,000 coins mined in the first block and initially spread to all who applied for it, so that not only those with capital or mining resources could have access.
- Savers, ie, people connected to the network and minting, will receive 6% of the coins during the first year, 3% the second and 1% from the 3rd year on.
Some of these features may be changed by consensus on the network in benefit of FairCoin, a topic on which Fair.Coop and its members have a lot to say.
In fact, since Fair.Coop is based on open political participation, we can say that Fair.Coop adds to FairCoin with an approval based on agreements between humans– which, to our knowledge, no other cryptocurrency does. We call it “human-based consensus”.
Proof-of-Work Mining. This is exactly what it sounds like: you earn coin and transaction fee rewards according to the number of blocks you mine successfully. Once a miner or miners have completed the satisfactory mining of a data block, they earn a number of coins, a share of the transaction fees contained within that block, or a combination of the two. This type of mining requires an investor to take an active part in mining data blocks, which helps verify transaction data and create new coins. With proof-of-work mining, if you don’t put in the effort to mine, you won’t earn anything extra.
Proof-of-Stake Mining. In the truest sense of the word, this isn’t actually “mining” per se, since there isn’t any additional work required on the part of the investor. All you have to do to earn with this method is to hold coins in a given type of digital currency. Your earnings are based upon the number of coins, or “stake,” you hold. The more you invest, the more you are likely to earn. The advocates of this method like to point out that it provides for higher currency security, for those who invest more heavily are more likely inspired to see it succeed. This method is very rarely used alone as it doesn’t provide for any actual mining to take place.
The digital currencies which use the proof-of-stake method almost always use it in combination with proof-of-work mining. Otherwise, the temptation to invest heavily, but not take an active role in mining data blocks, could result in extremely slow mining. This in turn could result in longer transaction times and lower transaction security, neither of which are healthy for an alternative currency.
Cryptocurrencies, as deregulated markets based in freedom, are susceptible to speculation. Put another way, if you value decentralization, you need to be conscious that it is not possible for a decentralized money system to be closed to trading in private markets.
You could ask yourself if the Euro or Dollar are speculation. And yes, there are many traders speculating with these fiat currencies; we don’t notice this if we have all our money in the same currency that we use for spending, but when we have money in a currency other than the one most used in our region, we can gain or we can lose value.
The percentage level of gains or losses in a market depends upon the volume and liquidity of that market. Therefore, markets with high liquidity, like Euro/Dollar, have low variations of price. In these markets, the way to gain or lose a lot is to invest a lot. Otherwise, in markets with very low volume, the possibility of high percentage gains or losses is greater. Seen from the outside, this creates the impression that cryptocurrencies are about speculation.
That said, people willing to buy or sell for short term wins are also doing a some social good in a money market of low liquidity, because they facilitate access (in or out) for the people using that currency for practical uses (like buying or selling goods and services, or helping the value of the currency through long term savings). Therefore, this is still a controversial question in anti- and post-capitalist environments.
In fact, a currency like Faircoin needs to have a low volume at the beginning in order to have higher volume and acceptance in the future.
Everyone has a role here, and can help make it possible. Depending on how you are interested in taking part, you could have different kind of rewards, for example:
– if you get involved in some tasks through a commission, you could be rewarded in faircoins (and in the future, Faircredit) which may be saved or spent. The way this will be organized is still being discussed in the Ecosystemic council.
– If you get involved by selling your products or services in the FairMarket (the future online marketplace), you can work for yourself (or help sustain your previously-existing personal business).
– If you get involved in a future project related to the global commons, perhaps you could receive a part of the faircoins donated to this project….
These and many other options will defined in the future.
The type of organizations we want to work with will be those who could potentially generate peer production in the material plane, as well as benefit from the shared knowledge accrued by the coop. We also want to focus on projects that lack the necessary means to activate this type of peer production.
Other examples would include strategic projects that can add more value to the global commons. Projects which, on their own, maybe wouldn’t have the ability to network at this scale to share their knowledge. Projects would also benefit from the moral and material support of a global community if and when attacked by hostile interests. All in all, Fair.Coop will increase the resilience of these projects.
More than naming specific organizations, we are very open to being approached so that everyone can participate in Fair.Coop’s co-creation and ongoing development.
We are also very interested in empowering the Global South to increase its resiliency. While there’s an undeniable geographical truth in saying “the Global South”, we also mean the 99% independent of where we may reside.
For further details on ways to participate, see the related page on Fair.Coop /ways-to-participate/
Finally, feel free to directly ask people already involved in the network about anything related to your own involvement.
The CIC should be considered as one more local participant, and one of many true “peers” in the P2P network making up the global Fair.Coop.
At any rate, we could make a working distinction between two sets of mechanisms that would be produced by Fair.Coop: global and local. At the local level we would see local, specialized mechanisms and knowledge which, in turn, would feed into a global open knowledge economy comprised of, among other things, valuable data and monetary and economic tools. This will be a bidirectional relationship, as both parts will nourish one another for the benefit of the whole.