This is a function called a “sigmoid curve”
@mav awesome job, loved to read it. Did you post it already on Reddit or some other forum? I might use it to work on the Wikipedia page.
Very interesting of DAO implementation, as the DAOhub token sales
A great read – thanks for putting this together. Btw I happen to be a professional editor … If you’d be open to some suggestions, feel free to PM me via Reddit (/u/d-lux). I also really like @dirvine’s idea of periodically updating this as needed.
Oh yes, the sigmoid curve. I had forgotten about this, it’s amazing how much info there is to take on. Thanks @smacz, I’ll add a bit about this to the post.
I’ve written a draft, but would like confirmation before putting it in, since I feel it doesn’t alleviate the ‘painting a worrysome picture’ of centralization.
Proposed bit to add for ‘Mining Centralization’: New proposed addition in post 34 below
There’s an interesting mechanism to balance the resource availability of the network, which relates to the ‘safecoin farming speed’, ie how rapidly individual vaults can farm safecoin. We already know that safecoin is awarded to individual vaults based on how much resource that vault provides. But to minimize the impact of giant vaults, the reward is balanced according to the average resource provided across all vaults. The ‘optimum’ earning rate is achieved when a vault provides 20% above the network average. Providing more than that results in rapidly diminishing returns. This sets a very interesting consideration to farmers when provisioning resources. Read more about safecoin farming speed on the MaidSafe blog, and the farm speed algorithm discussion on the forum.
I have my doubts that this algorithm will prevent centralization. This algorithm incentivizes big farmers splitting their resources into many smaller ones, which does not affect centralization. It also encourages continual growth, seeking to always be slightly above average, thus continually raising the average eventually pushing the small players further down the sigmoid curve away from optimum earning. It’s easy to imagine that eventually the average will be so high that no small farmer will have any chance of ‘climbing the sigmoid’ to viability.
The farm speed algorithm is a good one, but only manages the size, distribution and structure of resources supplied to the network, not centralization.
If there’s no clear errors or concerns, I’ll add this to the 'Mining Centralization section. The ‘20% above average on the sigmoid curve’ idea is not trivial, so I want to check I have interpreted the consequences correctly.
It still sounds too bleak, while the general consensus about centralization (at Least on the forums) isn’t bleak at all.
There have been lots of great discussions about it. @fergish is always great at articulating this one in particular.
But the main thing that I think is key here is to remember that Vaults for farming will be Super easy for everyone to set up, and so many people have bought Computers already in the world that they will have ZERO marginal cost to get their own vault up and running, so decentralisation will be very easy for SAFE, since farming is free, makes money, and is so accessible.
So I wouldn’t paint Such a bleak picture.
Even @dirvine has nice talks on YouTube where he says how “all the data centers of the world” --basically aren’t $#!+ compared to-- “all the people’s computers of the world.” We the people truly have the overwhelming power here
The thread How is Farming Centralization Disincentivized seems like the best discussion of this topic. I will ensure a link is included in the ‘Mining Centralization’ section.
I still think large vaults (like large bitcoin miners) are inevitable. The economic logic I understand is that farming 20% above average is most rational, therefore a trend toward larger nodes is always more desirable (from a farming perspective).
The only way for small farmers to manipulate this is to start lots of near-zero-resource vaults to bring the average down, but because they sit low on the sigmoid curve these farmers will earn very little. So relying on this to happen is like assuming people will always be willing to run full bitcoin nodes (which is probably true, but is economically irrational given the rules of the network).
I’d like to be shown this logic is wrong, but currently I can only see economic motives for larger vault sizes over time, not smaller or ‘balanced’ vault sizes.
One important point I will make sure to include (@Seneca makes this point in the thread linked above): “What the algorithms will do is prevent centralisation in XOR space.” I will definitely add that to the ‘Mining Centralization’ section.
Well, what are the threat models?
- Small farmers earning less
- Vault centralization in XOR space
The second you’ve seen is of the most concern, and is disincentivized by this scheme.
As far as the first one goes, I believe that you are right, that small farmers will earn less. But for the time being, and for the forseen future, data storage continues to become cheaper and cheaper. So they may earn less, but as long as the cost to operate vs benefit breaks even, it won’t matter.
The 4.3 billion safecoin question is will the cost and benefits balance given future technological development. I smell a flame war…
This is not the only consideration regarding centralisation, and not the main one IMO.
A crucial element is that many people can and will farm using spare resources that are already paid for in terms of both equipment and energy costs. This will be possible for the average Joe because Safecoin farming is based on proof of resource, whereas proof of work would favour those with the most powerful hardware.
The design is intended to ensure that there will be a lot of people farming with spare resources - just download the software, allocate some disk and bandwidth, then forget about it. These people can earn enough Safecoin to pay for their day to day use of SAFEnetwork to store their data (forever, as this is a one off cost), handle their SAFE email etc
Many will be profitable at a very low farming rate because their incremental costs are zero. Any Safecoin earned will be profit.
In turn, their numbers can be be a strong factor keeping the network average down, balancing the upward factor you identified.
So why is this decentralising? Because it keeps network rewards down. Why? Because farmers are in competition with each other for data. And this makes it harder to turn a profit with a business model that has to cover hardware and energy costs.
Rather than faster or bigger being better full stop - a “winner takes all” arms race to the top - there will probably be a sweet spot, somewhere above the network average where moderately sized dedicated farmers can turn a small profit. But the design is intended to ensure this is limited - too many vaults or too big makes too much competition, the rewards will fall and their profits won’t cover costs.
Simply having more storage, bandwidth or CPU does not make you more profitable - you also have to earn enough to pay for that - while competing with very larger numbers of people farming on the machines and devices they are using for other things, as and when they’re switched on, rather than as dedicated farming rigs.
This is a big difference from bitcoin, and something I’ve seen people struggle to get because of that.
I now think that small farming devices will be very common, if they boot themselves into the network by earning a tiny amount of Safecoin a la the 21 model. Having a tiny amount of Safecoin will give advantages compared to being a passive client only. So you turn on your new smartphone/tablet and you can at least surf Safecoin, and after it has earned some millisafes (1,000ths of a Safecoin) then it can also add content.
Specialized builds can be both big and small…
Here’s a likely soft fork of safe_vault, if divisibility never comes: In addition to the default function of earning Safecoin, it could also earn millisafes and microsafes (examples of private currencies on the SAFE network), instantly exchangeable for Safecoin once the vault accumulates enough.
Your point here is not invalid, but the paradigm is different than anything that’s been in existence before, so merits some comment.
Data centers adding optimum size vaults to the network would really improve the functioning of the network. It would mean that a lot of the resource is coming from more centralized sources, but what is NOT centralized is the important thing: Control. All those vaults will add resilience to the network, make it faster, more efficient, more anonymous, more adaptable in terms of churn, etc., etc. And it’s okay with me for those that put in a bunch of resource to be rewarded for it.
We’re not really looking at a zero-sum game here. Every node added to a network increases the network’s value in a non-linear fashion.
As long as regular farmers get SOME safecoin by participating in the network, it should be fine. Once it becomes popular enough and has enough “unkillability” for the big players to get involved in a meaningful way, the millions of individual users on the network will be hard to completely overshadow. I don’t think it’ll fit any business model that makes sense in current business structures to pile on early, but if they do, it’ll just make the network better.
The point is that the important factor of the centralized/decentralized aspect is control, and the vault structure makes it so that just running a bunch of nodes doesn’t increase control over what happens on the network. It just means your contributing more to network performance and stability, for which contribution you SHOULD be rewarded.
Yes, you’re right, but the big point you’re missing is that they won’t stand up at all to the other billions of people’s computers that are also Farming for SafeCoin.
(and bitcoin got super Centralized because it’s so complicated to set up, and so difficult to mine a single coin, that only the big guys actually attempt to do it / have success)
Many excellent points have been made. I’ve revised the additions to the ‘Mining Centralization’ topic to hopefully include this additional info and better capture the positive attributes of the safe network in this respect. Let me know if this appropriately captures the major points:
The network has a technique (based on the sigmoid curve) to minimize centralization. This technique is unseen in blockchains. The algorithm results in diminishing returns to farmers that supply significantly above or below the average of other vaults, which creates strong incentives to maintain a decentralization of resources on the network (especially in the xor space). Minimizing centralization of the xor space is essential to maintaining the security of the network. This is discussed on the MaidSafe blog post about keeping safecoin decentralised.
There are different forms of centralization that may happen in the safe network, each with their own possible motivators, severity and impact.
- Economic centralization of safecoin rewards, similar to the primary cause of bitcoin mining centralization
- XOR space centralization, which poses a risk to data integrity
- Governance centralization, ie controlling resources that determine the network rules
- Organizational centralization, similar to bitcoin core vs competing implementations
The ability to form these different kinds of centralization depend on several factors
- the intended behavior of participants due to incentives put in place by the rules of the network
- the actual (possibly irrational) behavior of participants compared to the rational behavior determined by the incentive structure
- divergence between specialized and consumer ‘resources’, ie bandwidth, storage, computation etc and how this affects behavior
- organizational and governance decisions, which depend on feedback of many types
The safe network has balanced these considerations differently to blockchains (both proof-of-work and proof-of-stake), mainly due to the underlying structure of the network.
It’s worth reading the discussion on the safe network forum titled ‘How is Farming Centralization Disincentivized’ to further understand decentralization on the safe network.
This is a great piece. I’m from blockchain world as well, and I’d very much like to translate it to Chinese. How do I contribute? Fork your github and create a new MD file in the _post? Again, thanks again for the great work.
Forking the repository is probably the best way to contribue. The site uses Jekyll so feel free to contribute in any way that best suits you.
Glad you enjoyed it. I’ve got a couple more articles I’d like to add so maybe in the near future they will go up. One about ‘unanswered questions of the safe network’ and another exploring ‘the safe network sigmoid function’.
Excellent @mav. I’ve haven’t read it in context so not sure, but one of the things that I think help decentralisation is low farming difficulty combined with ability to farm using spare, already paid for resources.
These together ensure that lots of ordinary folk can farm profitably at next to zero additional cost, which in turn keeps the farming reward profit margin very tight, making pro farming a marginal activity - ie hard to cover the costs of buying resources dedicated to farming.
So some mention of this might be useful?
Everyone say hi to @maxweng from MaidSafe Asia great guy