A Community Proposal to Resolve the Obelisk Purchaser and Nebulous Funding Issues
those Bitmain ASIC units are no longer profitably able to secure the network w/o extremely cheap electricity.
This proposal seeks to protect the community members who invested in Obelisk ASIC units to profit and secure the network. ***It does NOT seek to protect the Obelisk company or its principals.*** It may occur that community members pursue options against Obelisk even if this proposal is agreed to, but the key goal is to protect the Sia protocol/network/community above all else.
Immediate and ongoing funding is necessary for the long-term success of the Sia project. By crypto standards, Sia is ahead of the game with an actual working project that is close to real-world use. A recent funding attempt through the sale of one (Siafunds) of two Sia project tokens (the utility token is called Siacoin) was less than optimal and Nebulous is unable to proceed with additional new hires and plans to accelerate completion. Cash burn for the current staffing levels is expected to carry into 2019.
Besides core protocol development, Sia needs to attract outside entities willing to start building 2nd layer applications to interface with customer segments and drive network use. Another need is for an evangelist/hunter to seek out potential trial customers and to represent the Sia project in the public arena for pre-trial engagement, critical marketing to lay a foundation for when the project is ready. The Siafund tokens were created to provide adequate funding for ongoing protocol/network development once the network reaches a tipping point, but there is a critical gap between now and then.
The way to solve both issues requires the community come together with a few taking a modest hit to emerge as a stronger united project. This proposal suggests the project knowingly bends a core principle (decentralization) in a one-off manner and only through an overwhelming show of community support. It is not precedent-setting and does not impact long-term decentralization. Decentralization at Sia means there is no and can be no built-in governance model such as that at projects like Decred. Once the protocol is completed, it likely such governance will be mostly unnecessary.
The proposal has the following goals
1. The obelisk initiative broke bad due to learning curve and an aggressive competitor. Loyal community supporters are taking a beating financially and emotionally as they paid with crypto near the bubble highs and are waiting for units to ship. We seek to alleviate the financial penalty incurred for supporting Obelisk.
2. The project reaches the highest goals by adhering to as much decentralization as feasible without becoming dogmatic and unforgiving of human mistakes or immune to the suffering of community members. The community matters. We seek to clean up honest mistakes without breaking the future.
3. A divisive fork into 2 functioning Sia network chains would schism the community and weaken the initiative. It may well be likely that multiple Sia side-chains come into existence with full community support, but a current division would wound and not further the project. We seek to avoid this.
4. Other crypto projects are awash in investor cash, often for projects that can never succeed. Sia is among the few projects solving an actual business problem, but the initial funding methods stifle the project at a time when we need to accelerate. We seek to remedy ongoing development funding.
*Obelisk Exclusive Mining Period*
The community should take advantage of the algorithm change with some tweaks. Implementation in January could not have practically worked as Obelisk units were not close to shipping. The change neuters existing ASICs but unprofitable A3 models should already have positive ROI while newer S11 units have some level of profitability. S11 customers bought after the divisive January fights and knew well this possibility existed.
The algorithm change would occur with a corrective fork to provide exclusivity for community Obelisk units to mine profitability. This period should be time-limited with a date-certain reversion back to a network supporting the original algorithm through a second corrective fork. A Difficulty adjustment combined with a much lower hashrate should allow for Obelisk ROI and some profitability in a short period.
At no point are hashing equipment owners guaranteed the right to mine on any crypto project, and A3/S11 owners have no such rights here. This is not taking away something they can lay any claim to. And, current equipment owners are not without mining options. A Sia competitor called Hyperspace (Fork) is operational and A3/S11 owners can mine until the algorithm reversion. There is no danger of network insecurity as the Obelisks will provide at least 6-8PH/s in hashrate. Obelisk batches could be held and shipped such that earlier batches get specific priority (eg 2 weeks vs 60 days as an example)
*Interim Development Block Reward Fee*
At the implementation of this corrective hard fork, a new development fee should be implemented into the block reward. The fee should be reasonable and should not exist in perpetuity as Siafunds are the ultimate funding mechanism. Setting a date-certain expiration or a declining schedule are two ways to handle this. The proposal is for a block reward fee of between 5 and 10%.
The community should have input into how these dev fees are used including a better project roadmap with specific hiring milestones that includes business development and evangelism.
**Possible ramifications (implemented and if not)**
Perceiving the move as an overt threat, Bitmain could attempt to hurt the project, likely thru a market attack on the Siacoin token. While possible, it seems unlikely as the company probably continues to own Siacoin assets and would not be losing any business in the situation. They may in fact start designing new and more powerful Sia units. Also it should be noted the SC token is down \~94% from ATH and is close to the level where organic buying will occur if it drops further. This is a non-issue.
It is possible other situations will occur and people will point to this episode and demand core protocol changes. They will have to reach the high level of issue and seek support just as this proposal does.
Though the team and several community members frown on SC price discussion, it is salient to everything in the project. Resolving these issues will likely set a positive note in the investment community and would likely cause the SC price to stabilize and regain an upward trajectory. A valuable token is extremely beneficial to the project development funding.
*If not accepted*
A 3rd party could reverse-engineer the algorithm once Obelisk units ship to hard fork the network (i.e. Sia Classic). Chain splits have a history and the reality is that one project ends up diminished, less valuable and project control moves to the successful chain. With a built-in dev fee, the 3rd party may exercise too much control over the project. The Sia network has significant strengths as large cap crypto. The project is listed on all the largest exchanges with excellent liquidity, a chain-split would require new listings which may or may not occur. At minimum, a subset of the current community will likely depart. In fact, this idea has already been floated with and individual stating strongly he would “almost certainly” pursue it.
**To the Nebulous Board Members and Team**
The Sia community is asking that you support this community initiative as the the entirety of the project/protocol is currently in jeopardy for unforced errors. David believed and reiterated that the algorithm implementation was the right thing in January, yet ***such a move was not possible practically or logistically due to where the Obelisk units were in design and where Bitmain units were***. It is both feasible and desirable today.
Crypto communities are for the most part, asked to do very little with most projects. This is a call to arms for the community to support the project.
A corrective hard fork to implement the obelisk killswitch algorithm for a limited period, after which it reverts thru a second planned fork. A new block reward fee of a limited duration to fund development and marketing. Vote YES!
Please note there are 3 detail postings seeking feedback and guidance on the individual parameters of this initiative. The goal is to get the feedback stage done by Wednesday so we can begin to draft a formal proposal for the team to review....
In case you are fairly new to the whole Crypto game I’ll start by explaining a little about Bitmain. Bitmain is a company who develops ASIC chips and also mines Bitcoin and other cryptocurrencies. Th...