CEO of Koinos Group, creators of the Koinos blockchain
At Koinos Group we are obsessed with giving developers a decentralized platform that they will love using to build amazing applications thanks to its free accounts, free transfers, and free smart contracts. Understandably this sounds too good to be true, so in this post I’m going to explain at a very high level how we accomplish this seemingly impossible feat.
On Koinos, practically everything is a smart contract, and smart contracts are pieces of code running on a decentralized network of computers. With one very important exception, every time a smart contract runs digital tokens are moved from one blockchain account, to another account. Code runs, tokens move. That’s a smart contract.
But as everyone knows nothing in this world is free, including the execution of code on a computer system. The problem we have on decentralized networks is that there is no one “in charge” like Amazon or Facebook who can charge a fee or simply eat the cost. Blockchains like Bitcoin and Ethereum solve this problem by allowing the people submitting transactions and requesting that a smart contract be executed to add tokens to their transaction as a fee that someone else can accept in exchange for processing that transaction and executing that smart contract.
It’s a pay-as-you-go model. Every time you want to do anything, you have to add tokens to your transaction and hope that someone will facilitate that transaction in exchange for the fee you included. Once they run the smart contract, tokens move, and some go into the account of the person executing the smart contract.
Koinos will employ a different model which you can think of as a hold-to-play model. When transactions are processed by Koinos a token still moves (it’s actually destroyed), but this time it is a special kind of token called mana with unique characteristics that enable it to operate in the background. We call this token mana because it operates much like mana in a video game would. The Koinos blockchain will constantly be generating and distributing mana to users in based on how much KOIN, with a “K,” they hold. The more KOIN you own, the more mana you get.
The blockchain tracks the resources available and charges users mana based on current availability of resources. The more resources the network has, the more transfers it can process, the more smart contracts it can execute, and the farther your mana will take you. Because it distributes mana based on how much KOIN a user holds, we don’t need a centralized authority to administer the system, and because the system charges mana based entirely on the resources it has available, users can only perform as many actions as the network is capable of handling.
It’s really about as simple as that, though of course the technical details are a bit more, well, technical. Obviously, the people processing these transactions still need to be incentivized, and this will be accomplished through inflation and ties into our consensus algorithm, which is outside the scope of this video.
What’s important to understand is that this token regenerates over time, so as you use up your mana the blockchain will continue to generate and distribute mana to you, and anyone else holding KOIN, because it will almost always have resources to spare.
The sole purpose of mana is to enable YOU to use the blockchain without having to pay fees for every little thing you do which is why it is also non-transferable. You can’t transfer it to someone else (at least not without also transferring your KOIN), or sell it in a marketplace. Being able to create special kinds of tokens, like mana, with unique limitations that enable us to solve previously unsolvable problems, helps demonstrate the powerful potential of smart contracts.
In the case of mana, we impose these limitations because we want this asset to operate in the background. You should be able to use Koinos applications without thinking about how much it’s costing you or whether your transactions will be able to go through. It should just work and you should be able to hold onto every token you buy. The only time we expect users to become aware of mana is when developers use it to deliver an even better user experience by notifying users that they are running out of free transactions, and should either decrease their usage, and wait for their mana to regenerate, or increase their KOIN holdings.
Now, these are already great and unparalleled features, but we know from our unrivaled experience that developers and their end-users still need more. Developers shouldn’t have to require that their users buy KOIN just to start using their apps, which is why every KOIN holder will also have the ability to delegate their mana to other users. This way developers will be able to onboard users into their decentralized application without having to pay for that user themselves, and without forcing the user to acquire tokens. This is why we have no reservations about claiming that Koinos will not just have the lowest barriers to entry of any blockchain out there, it will have no barriers to entry at all!
In this post I wanted to give you a high level overview of how one builds a fee-less blockchain, and hopefully I’ve done just that. I’m sure I touched on a number of concepts that have piqued your curiosity, like how we incentivize transaction processing through inflation and the nature of our consensus algorithm, which I’ll be covering in future content, so be sure to subscribe to our YouTube channel, follow us on social media, and join our newsletter by heading over to koinos.io, where you can also learn more about the Koinos blockchain. Thanks for your time.
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Previously published at https://peakd.com/hive-103021/@andrarchy/building-a-fee-less-general-purpose-blockchain
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