GEN-locking mechanics primer [Important for Genesis members!]

How GEN locking will work, as far as I know (Math warning, skip to the second section for takeaways!)

  • GEN locking will be enabled in Genesis with a new scheme, added via proposal in the Scheme Registrar.

  • Once GEN locking is active, the new scheme will start tracking GEN-locking periods of [1 month].

  • At any time, anyone can lock any amount of GEN for up to [12] periods. For example, I can lock 10,000 GEN for 10 periods. I will be able to get my 10,000 back after 10 periods have passed.

  • At the end of each period, GEN lockers are each given a score, S = N x T, where N is the number of locked periods left and T is the number of tokens they have locked.

  • Also at the end of each period n, the scheme will distribute R reputation to people proportionally to their score S, where R=[R_0]x[a^n], -1 < a < 1. This means that each period, each GEN locker will get Reputation proportional to the amount of GEN they have locked and how much future time it is locked for.

  • Key note: The R_0 parameter controls the total amount of Reputation distributed through the entire lifetime of the locking scheme.

  • Other notes:

    • A given user can extend their lock, so if they locked 1000 GEN for 3 months, they can wait 2 months and then relock that GEN for another 10 months without unlocking it.
    • They can also create additional GEN locks, so one user could have 1000 GEN locked for 3 months and another 2000 GEN locked for 5 months simultaneously.
    • The GEN-locking scheme can run for a large number of periods, say [100].

[Brackets] denote params that the DAO can set for the locking scheme.

What current Genesis members should know

The DAO has complete control of how much plutocracy is created. In deciding the locking scheme parameters, we can decide the total amount of Reputation that can get distributed to lockers. This is because the equation controlling how much Reputation is distributed each period is a convergent geometric series: even with infinite periods, the total Reputation distributed will stay below a specified limit. In this case, that limit is R_0/(1-a). For example, let’s say we don’t want GEN lockers to receive more than 50% of the Reputation held by current members (~50,000): we could set a=0.9, R_0=2500.


Tech team, please correct any mistakes here! Sorry if I butchered anything.

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Admin note: moved to Genesis category

Wat?
I’m not sure what this sentence means.

Does the rest of that section make sense, though? I’m trying to say that Genesis can decide how much Reputation people can get through locking GEN (which is a form of paying for voting power, i.e. plutocracy). Probably shouldn’t have used the P-word :smile:

Edit: Also, there was an obvious typo there that I somehow only just saw :roll_eyes:

Yes, the rest makes sense from a functional point of view. I’m still unconvinced that locking GEN is useful for impacting the price, particularly if it is the action taken after an auction (aka it does not affect the current float).

Hi Ivan, very relevant question. I suggest you come to our next community call tomorrow, Tuesday at 5pm CET in this zoom room
Adam will demo the necDAO version of the locking scheme which will be live on Dec 11th. We will have some time for questions and further clarifications about the locking scheme, hope you can make it.

Yes, the original post doesn’t comment on this, but also: I would argue that increasing GEN price is not the main point of the locking scheme. The main point in my view is to give Reputation to a group of people with good reason to make smart decisions about increasing GEN’s utility.

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Are there interested parties lined up right now to buy and lock GEN for the REP outcome? I understand the theoretical aspect, but without the demand, who cares?

Also, coinmarketcap.com says there is 41,295,043 GEN circulating out of 60MM total.

  1. Is this correct(ish)?
  2. Where are the other 19MM GEN?
  3. How many does GenDAO currently have at hand?
  4. How many would be auctioned, how often?