Continuing the discussion from Clarifying safecoin distribution percentages:
I posted the above topic last week when sorting out some of my confusions about safecoin percentages, etc. While valuable, it didn’t really sort out the whole topic and needed more work.
Hope this helps give a clearer view of safecoin’s overall distribution, etc.
Safecoin Issuance and Distribution
The total number of whole safecoins which can exist on the SAFE Network is 2^32, or just under 4.3 billion. 5% of that number have been allocated to compensate early investors who have backed the network over a long period of time, and 10% were sold to crowdsale participants in early 2014, in the form of MaidSafeCoin–a blockchain-based token which will be exchangeable one-for-one for safecoin when the network is live. These safecoins will be available to their designated recipients soon after network launch, at which time they will circulate and be recycled like any other safecoins, at the discretion of their holders.
Beyond that, safecoins will come into and go out of circulation in a continuous flow, according to the following description, which has been made as non-technical as possible.
All new safecoins are generated as a part of the farming process and distributed to Farmers, App Builders and the Core Developer pool according to their individual algorithms, as described below.
Safecoins are distributed as the product of a successful “farming attempt.” The sequence leading up to a successful farming attempt starts when a Farmer’s Vault accurately delivers up stored data when the data is requested. When this is successfully done, the Vault seeks to qualify for a farming attempt. The chance of gaining a farming attempt is regulated by the network Farming Rate (FR) which prevails at that moment, and adjusts the ease or difficulty of gaining a farming attempt, depending on prevailing network conditions (availability or scarcity of storage resources).
–Farmers qualify for farming attempts at 100% of the Farming Rate (FR) (as modified by Vault performance ranking).
–App Builders qualify for farming attempts at 10% of the FR.
–The pool from which Core Developers are rewarded for their contributions qualifies for farming attempts at 5% of the FR.
Thus the relative rates of qualification for farm attempts (and therefore, ultimately, successful awards of safecoin) are: Farmers - 87%; App Builders - 9%; Core Dev pool - 4% [percentages rounded]. (100+10+5=115 therefore 100/115=86.9% 10/115=8.69% 5/115=4.3%) [This paragraph is inaccurate. Please disregard. --fergish]
When a farming attempt is qualified for, the Vault queries a random safecoin address (deterministically computed) to see if a safecoin exists in that location. If there is a safecoin there, the attempt fails. If no safecoin currently exists at that valid safecoin address, the network creates a safecoin and enters the public safecoin address of the successful requestor, whether it be the Farmer, App Builder or Core Dev pool.
The recipient of the safecoin then holds, transfers or spends it as they choose.
Ultimately, when a holder of the safecoin wishes to use it to purchase network resources, such as the capacity to write a certain quantity of data to the network (or computational services, which will be implemented later on), the safecoin is recycled (erased), leaving the address open for farming when a new farming attempt is made to that address. In this fashion, safecoins come into and go out of existence in response to the needs of the network and those who contribute to maintaining it, and the End Users who ultimately benefit from using the network.