We are proceeding with our timely column on the hive ecosystem, in this journey we have encountered new things like LeoFinance’s Layer 0, HP tokens (Hive Power) and Ecency Points.
Now, again thanks to Leo Finance, more specifically Hive, where they talk about it in the Blue Paper, here, we are about to find out how PoB (Proof of Brain) works.
The token
In perfect line and along the lines of Ecency points, LeoFinance’s tokens, PoBs are also Layer 2 tokens on the Hive blockchain.
The availability is 21 million (as with bitcoin!), but the similarities to bitcoin are limited to the supply.
In fact, a halving every 4 years has also been established.
But let’s delve more into this unique Tokenomics.
POB is called a 100% pure token because the only way to come into possession of these tokens is through rewards earned by posting and curating posts with POB tokens in staking.
Everything originated by giving only 1 @proofofbrainio token, thus enabling staking. For the first few articles the only one who was enabled for curation was only proofofbrainio, then we gradually got the process going and now there are many active curators. And if some curators more are required, I will apply for becoming one of them!
So the only way you can get POB tokens is to write deserving posts and receive rewards in the form of tokens or portions of POB tokens!
As I said just above the cliche that it was inspired by is Bitcoin, in fact every 4 years there will be a halving that will halve the rewards.
The distribution
The rewarded tokens are split 50/50 between authors and curators. For the first 42 million blocks of Hive, the reward pool will be 10 tokens for every 40 validated blocks.
That’s basically 50 tokens for every 10 minutes.
As with Ecency points, you can promote your posts by exchanging POB tokens.
Technically we are not talking about actual exchange, as the tokens are not transferred between wallets, but an actual burn of tokens takes place.
In this way we increase the scarcity of tokens by making them inflation-controlled and deflationary.
The voting criterion
Since the token is based on a Proof of Brain, the upvote of content could be done indiscriminately or centrally and without giving due weight to the content of the post.
Assuming that most people write and upvote simply for a financial return, this token was created to give intrinsic value to the blog.
This value is provided by the upvote and curation of posts that are innovative.
But how can it be achieved?
It’s quickly stated.
With front-running, you have a centralization of votes that are, in turn amplified by the curation trail, to avoid this centralization of votes you have opted for a reduction of curation rewards for authors with higher visibility through a weighting mechanism.
This mechanism is based on two possible factors: previous awards or the possibility that users themselves define the variable split.
In a nutshell, we could call it a rudimentary form of DAO (keeping in mind that the POB whitepaper was written over 5 years ago with a huge anticipation of the today’s DAO trend).
Anyway, the decision by users anyway could result in centralization by keeping curation rewards high.
Therefore, it was deemed valid to use the first solution based on previous rewards.
Doing so implies the decrease of the rewards for popular contents and the increase for the less popular contents.
The purpose is to lead to the discovery of new authors and achieve some diversity of content.
Again, everything is designed with the community in mind and to give equal weight to all participants.
I think that this can be a very beautiful example of the democratic nature of the system.
I will probably have tired you with my expression, “Brilliant!”, I understand, but isn’t it, really, brilliant in your opinion?
Until the next installment of this ecosystem!
