Implementation of DW20 Decentralized Standard currency

——Improving the Bitcoin Standard through the BRC20 Protocol

Decryption White Paper Series

As the airdrop approaches, we have begun to publish DW20 white papers, chainless white papers, and comments from experts. The knowledge span of cryptocurrency is enormous. Based on our learning experience, we have launched a white paper series with various authors and perspectives. There will always be one that suits you. There are five versions of the DW20 white paper; there are two versions of the chainless white paper, suitable for different readers. We will publish them starting with the most readable version. Interspersed with commentaries.

Authors: Zhu Weisha, Lu Tiegeng, Cui Qi

Editor: Shi Guangrong

Acknowledgments: Tang Wanchuan,,Zhang Hai, Ray Yang, He Bing, Li Pengyi, Lu Bo, Miles, Ren Leipeng, Hu Xiangyang, Zhou Haibo


Chapter 1 Implementation Logic of DW20 Decentralized Standard currency


DW20 Decentralized Standard currency, which differs from the various stablecoins in cryptocurrencies. It has the similar pricing mechanism as the US dollar, i.e., it uses a market-based pricing mechanism. That is the pricing method used by various fiat currencies, such as the US dollar and the Euro.

DW20 does not have a centralized issuing entity like the Federal Reserve; it is also distributed in its issuance, similar to the distribution of Bitcoin. Therefore, it requires a consensus-building process similar to Bitcoin’s gradual growth. The design of DW20 Decentralized Standard currency incorporates the issuance principles and methods of the US dollar, Bitcoin, fiat-backed stablecoins, algorithmic stablecoins, and collateralized stablecoins. It absorbs their advantages and improves upon their shortcomings. Currently, stablecoins issued in the cryptocurrency field do not possess the conditions to become a standard currency, but DW20 has the potential to become a standard currency.

Becoming a standard currency is our pursuit, as well as the pursuit of cryptocurrency elites represented by Satoshi Nakamoto. If the Decentralized Standard currency DW20 becomes a standard currency one day, it will embody the efforts and dreams of all participants in the cryptocurrency industry. We are honored to be the last ones to fill the gap.

The most significant difference from Satoshi Nakamoto is that the team members’ identities are public. In fact, “transparency” is the core concept demonstrated by Bitcoin. It is important to emphasize that anonymity is not the core concept of Bitcoin; “privacy is not secrecy.” The essence of privacy is “anonymous systems allow individuals to disclose their identities.” That can be understood by reading Eric Hughes’ “A Cypherpunk’s Manifesto.” Otherwise, Satoshi Nakamoto would not have placed the quote “all transactions must be publicly disclosed” as the first citation in the Bitcoin whitepaper. DW20 Standard currency will not be considered security from any perspective, and we do not require anonymity. Transparency is a responsibility; transparency is an obligation. When someone has a public duty, transparency is a necessity. If something can be made public, it should be made public. Non-disclosure is a shame, and anonymity is a last resort.

Building on the work of predecessors, we have designed a chainless platform. This transparent centralized platform embodies the “transparency” concept of Satoshi Nakamoto and the ideas and technological achievements of cryptocurrencies. It includes the privacy level hierarchy and privacy decision-making power in the user’s mind. Through this platform, we use the BRC20 protocol and the chainless platform’s smart programs (smart contracts) to issue a Decentralized Standard currency DW20. It will serve as a demonstration example of smart  programs applications on the chainless transparent centralized platform and the foundation application of the chainless system (see the Chainless Whitepaper for more information on the chainless platform).

This solution is another approach to the Bitcoin Dollar (Hong Kong Dollar) Standard ( concept. It is an alternative method to achieve a Bitcoin standard using distributed thinking. The idea and original solution remain the same, but the improvement is that it does not rely on governments, Satoshi Nakamoto, or any issuing authority. After the invention of Bitcoin, the birth of Decentralized Standard currency DW20 will make the Bitcoin standard the industry’s second hot phenomenon.

This solution is an invention consisting of four parts.

The first chapter is the implementation logic of DW20 Decentralized Standard currency, which is the most important part.

The second chapter describes the functionalities, which are straightforward and mature. For detailed descriptions, please refer to the “Chainless Whitepaper.” The third chapter explains the distribution and stability methods of DW20 tokens, describing how consensus value becomes stable. The fourth chapter provides an outlook on the competition.

Understanding the first chapter is challenging as it requires knowledge spanning cryptocurrency and financial domains. This article does not explain the fundamental concepts involved.

1. Overview of DW20 Standard currency Solution

1.1 DW20 Inherits the Ideas and Technological Achievements of Cryptocurrencies

After 15 years of financial and technical exploration, Satoshi Nakamoto designed a brilliant solution to the currency’s credit problem through imitation, modification, and innovation. In his initial release statement on January 9, 2009, he identified three issues: central bank currency overissuance, commercial bank lending bubbles, and the inconvenience of small payments. He prepared a rich space of script instructions to address these problems. From a practical standpoint, the Bitcoin system is the most suitable system for issuing store-of-value currency. The term “most suitable system” means that, in terms of practical implementation, no other technology or method is more suitable than the Bitcoin system. If the Bitcoin system were to solve the issues of commercial bank lending bubbles and small payments as a substitute for fiat currency, it would require adding many features, making the system too complex and impacting the stability and security of the Bitcoin system. Wise individuals have contributed their intelligence and numerous examples to solve the latter two problems, which have been incorporated into the content that can be imitated, modified, and become human wealth for future innovation. The emergence of DW20 is still the result of imitation, modification, and innovation.

1.2 Summary of DW20 Scheme Features

In order to provide users with a quick overall impression, this section presents the conclusions first, and the following chapters will explain and discuss the related details.

1. The formation of consensus in DW20 consists of three stages: The discovery of values and the formation of consensus, known as the meme coin stage; the stability of consensus, known as the stablecoin stage; and the solidification of consensus, known as the standard coin stage. After the first stage, the airdrop stage, DW20 will have as many users as Bitcoin or even more. With the expansion of applications, DW20 will gradually stabilize at around $1. In the second stage, the volatility of DW20 gradually decreases. The DW20 market’s automatic adjustment mechanism is more sensitive than the artificial mechanism of the Federal Reserve, resulting in more minor fluctuations than the US dollar. For more information, refer to “5.1 Pricing Mechanism of DW20.” Together with Bitcoin and DW20 can ultimately achieve the Bitcoin standard, with DW20 serving as a substitute or competitor to the US dollar as a commodity Ruler.

The use of consensus to form a standard currency is an imitation  and improvement on the idea of Bitcoin issuance.

2. If DW20 is viewed as an independent system, it has no central control, just like Bitcoin.

3. DW20 is not a maintenance team and is an application project on the chainless platform.

4. DW20 has a community decision-making mechanism similar to Ethereum’s community mechanism.

5. Airdropping DW20 coins as initial distribution is the basic capital issuance. The role of basic capital is similar to banks’ capital, providing financial security to the system and addressing issues of system elasticity and early system fragility. Most basic capital is issued over 30 periods (see Chapter 3 for details), and it shares the characteristic of “early participation brings advantages,” similar to Bitcoin.

6. Over 80% of the basic capital is owned by independent individuals, making the DW20 system not a traditional bank in the conventional sense. Similar to the Bitcoin system, DW20 is not centralized. DW20 does not represent the value of any system; it only improves the transaction medium and ruler function of Bitcoin. The DW20 system itself does not generate profits. As a transaction medium, DW20 facilitates transactions between the demand and supply sides of currency through the chainless platform, which charges fees. This decentralized process eliminates intermediaries and reduces bubble effects, aligning with Satoshi Nakamoto’s pursuit of “peer-to-peer” transactions.

7. Designed a stable  fund to form a market fund. Market makers are external parties. Although market makers generate profits, they do not own the stable fund  but most token holders own. The fund and its operation aim to steadily grow DW20 and facilitate the transition to a stablecoin. After the transition is complete, the subsequent handling follows the community proposals.

8. The collateralizers of Bitcoin are also the issuers of DW20, maintaining the financial stability of the DW20 system and benefiting from it. The profits come from balancing the growth of DW20 demand.

9. DW20 is not tied to any national economy like Bitcoin. Therefore, corresponding to the measurement of economic value, DW20 is also objective. The reason why the ruler exists is that it has nothing to do with the measured object. Gold has nothing to do with the economy; fiat money does.

10. Besides the above features, after DW20 is issued, it is imported into the chainless platform, a high-security circulation and settlement platform. All blockchain single-signature wallets through the chainless platform can be transformed into multi-signature multi-backup wallets. Inheritance programs defined by the chainless platform, can enhance personal asset security, surpassing the current banking system’s security level. The wallet is entirely controlled by the individual.

11. Cryptocurrency systems operate without system management fees; the chainless platform retains this characteristic. The operational management costs of the chainless system are meager and lower than those of banks. When DW20 becomes a stablecoin, transfers of less than $1 DW20 on the chainless platform are fee-free, and the speed is comparable to centralized payment systems, addressing the issue of small payments raised in Satoshi Nakamoto’s initial release statement.

12. The chainless platform serves as the second layer of the Bitcoin system, adding ecological value to the Bitcoin system, which means that Bitcoin has both a store-of-value and ecological value.  DW20 will constitute a complete Bitcoin-based financial system with Bitcoin and chainless systems. This value will inevitably be reflected in the price of Bitcoin. For a detailed discussion, refer to “8.2.3 Exploration of the Capital Pool Issue.”

Those familiar with Bitcoin will find the above scheme familiar. We will now explain the project in detail.

2. BRC20 and Micropayments

2.1 Inspired by BRC20

BRC20 is the format standard for homogeneous tokens issued on the Bitcoin system, anonymously created by @domodata on Twitter on March 8, 2023, based on the Ordinal protocol. Like Ethereum’s ERC20 standard, it defines the issued tokens’ name, supply, and transfer functions. Along with the release of the BRC20 standard, @domodata introduced the first experimental token called “ordi” using the BRC20 protocol, with a total supply of 21 million. Ordi token is a meme coin issued on the Bitcoin system using the BRC20 protocol, and this innovation has attracted attention in the market. However, meme coins lack value support, and their popularity fades after a while. We need BRC20 tokens with practical use cases.

Significant controversy has been surrounding directly storing BRC20-generated content in the Bitcoin system, as reflected by the decline in Bitcoin’s price. However, BRC20, through the use of segregated witness, opens up the imagination of the Bitcoin system as a credit root, similar to the functionality of the Ethereum ecosystem. The popularity of BRC20 also reflects market sentiment, as the security of the upgraded Ethereum ecosystem has not been tested for a long time. At the same time, the Bitcoin system has undergone extensive testing. That has led project teams seeking greater security to shift their focus toward the Bitcoin system. As a reliable credit root, the Bitcoin system provides machine credit confirmation for second-layer ledgers and the authenticity of NFTs through storing hash values, demonstrating limitless possibilities. That is what a chainless system is all about.

The chainless system is a transparent centralized platform equipped with multi-signature multi-backup wallets and intelligent programs (see the Chainless Whitepaper).

The multi-signature multi-backup wallets of the chainless system are simple cluster systems controlled by users. They can be infinitely scalable, possess centralized ease of use, and have customizable privacy features. They have a significant function: the ability to convert all current single-signature wallets into multi-signature multi-backup wallets. With the inheritance program set up alongside it, personal assets’ security level surpasses present banks.

Moreover, intelligent programs are more flexible and powerful than smart contracts, and migrating existing smart contracts is straightforward. The chainless system is a transparent centralized platform and the best complementary platform for issuing BRC20 tokens, allowing BRC20 projects to be equipped with smart contracts with enhanced functionality. There is a reusability effect between smart contract users and the chainless platform, just as users of DW20 are also users of the chainless system, and the chainless system also provides token airdrops to customers who are introduced to the platform. That is the resonance effect that all public chains of cryptocurrencies cannot achieve.

2.2 Implementing Micropayments using the BRC20 Protocol

Micropayments, which involve collecting minimal fees, are not suitable for settlement on the Bitcoin base layer and should be conducted on the second layer. The chainless system is a transparent centralized payment platform (refer to the Chainless System Whitepaper) that, through the BRC20 protocol, utilizes the space of segregated witness in the Bitcoin system and the reliability of proven POW consensus to upload the hash value of the second-layer chainless system’s transaction ledger, which can be queried using a Google browser. That provides the single-entry bookkeeping system with the credibility of the Bitcoin system. The emergence of BRC20 establishes a close connection between chainless micropayments and the Bitcoin system, which will enhance the value of Bitcoin.

Using Bitcoin for micropayments was one of the tasks set by Satoshi Nakamoto in the initial release statement on January 9, 2009, and it remains one of the pain points that Bitcoin has yet to solve.

2.3 Reasons for Naming DW20 as the Micropayment Token

To pay homage to Bitcoin! To pay tribute to Satoshi Nakamoto!

We chose DW20 for the following reasons: DW is the “Dai Wei” abbreviation in Pinyin, representing our research capabilities and style. It does not simply use “Satoshi” or “Sat” to describe the token but instead involves deep thinking and directly addresses the essence of the problem. Dai Wei is the true form of Satoshi Nakamoto and the sole creator of the Bitcoin system. Please refer to Zhu  WeiSha’s article “Invite Out Satoshi Nakamoto Welcome The New World” for more details. The article puts forward many vital arguments and discusses the clear view that Satoshi Nakamoto is Dai Wei. Here’s a small example to explain why Dai Wei is Satoshi Nakamoto. According to the customary digital definition of Bitcoin, 21 million bitcoins are measured in ten thousand units, is Wan in Chinese  units, and one hundred million satoshis equal one bitcoin, measured in hundred million units, is Yi in Chinese  units. “Ten thousand is Wan,” and “hundred million is Yi” are not units of measurement in the English system; they are units of measurement in the Chinese system. The carry of Bitcoin and Satoshi always makes people feel that the carry span is too large, and adding a ten thousand digit(Wan) in the middle matches China’s measurement habits. With the addition of DW20, the transition from satoshis to bitcoins follows the Chinese convention of ten thousand units(Wan). Satoshi to DW20 is a transition of ten thousand units, where 10,000 satoshis equal one DW20, and 10,000 DW20 equivalent to one BTC, again following the ten thousand unit(Wan) convention.Yi is WanWan Satioshi units.

Dai Wei has uniqueness; he is closely associated with Bitcoin and possesses strong identification and commemorative significance, making it difficult for imitators of the same kind to gain market recognition. Just as BRC20 easily brings to mind ERC20 for insiders, DW20 easily evokes the idea of a token based on the BRC20 protocol. With the increase in the number of protocols, “20” has acquired a special meaning.

3. Issuing DW20

3.1 Reasons for Issuing DW20

Why don’t we use existing stablecoins and instead create a new token? It’s because no stablecoin of any cryptocurrency can become a standard currency. DW20 token has unique distributed characteristics and advantages, such as providing Basic capital, and it doesn’t have centralized issuances like fiat-backed stablecoins or centralized market-making like DAI and Luna. The transition of DW20 to the stablecoin phase is market pricing and is a long-term preparation for the future era of the Bitcoin standard. The Bitcoin standard requires a ruler currency for valuation and a token for micropayments.

3.2 Target audience for Issuance

When issuing DW20, Users have the advantage of having bitcoin addresses. The issuance quantity is only related to the issuance period and is not dependent on the amount of Bitcoin in the address. That is beneficial for users with small amounts of funds in their addresses that are insufficient to cover transaction fees. DW20 and Bitcoin are integrated, with Bitcoin providing support for DW20. There are millions of addresses with balances less than the Bitcoin transaction fee, and by distributing DW20, these assets are effectively activated.

3.3 Explanation of issuing DW20

The code for issuance is DW20. A total of 210 billion tokens will be issued, which is ten thousand times the quantity of Bitcoin. By 2140, the total human wealth growth(GDP) excluding inflation will be approximately 70-80 trillion US dollars. From a measurement perspective, if one DW20 is equivalent to 1 US dollar, a reasonable capacity is 21 trillion US dollars, which is the most reasonable connection with the current monetary system. DW20 is issued based on the BRC20 protocol and is a BRC20 token that is intelligently distributed using the chainless system.

3.4 Issuance Methods

3.4.1 Issuance Method 1:

Issuing to Users with Bitcoin Addresses.

Since Bitcoin addresses can be randomly generated, there are requirements for address age and holding amount for eligible addresses. Bitcoin issuance follows a halving issuance mechanism, and DW20 also has its issuance mechanism, which is based on the issuance method of chainless coins. Among the 210 billion DW20 tokens,  80% of the issuance will be conducted over 30 cycles. The distribution method is similar to Bitcoin, with limited and reduced allocation. but the issuance of DW20 is more evenly distributed. Currently, there are around 60 million non-zero addresses in Bitcoin. For specific issuance methods, please refer to the content in Chapter Three.

3.4.2 Role of Bitcoin addresses

Bitcoin addresses serve as proof and do not require collateral. Their purpose is to activate tiny amounts of Bitcoin. Since Bitcoin has transaction costs, the mainstream fee standard charges based on bytes: a fee of 0.0001 BTC per kilobyte (transactions below one kilobyte are charged as one kilobyte). When Bitcoin is congested, the costs can be higher than this standard, making small transactions uneconomical. According to Table 1 below, around 80% of the addresses hold less than 0.01 BTC. About 60% of the addresses hold less than 0.001 BTC. In other words, in 60% of the addresses, most account balances are insufficient to cover the transaction fees when exchanging. If Bitcoin reaches $200,000 per BTC, 0.001 BTC would be $200. If Bitcoin goes to $10 million per BTC, 0.001 BTC would be $10,000. That is a significant waste. The coins and  address age in these address accounts can use DW20 to revitalize it in disguise.

Table 1:

3.4.3 Proportion of Bitcoin holders

Based on the data of Bitcoin holders in Table 1, it can be seen that there are only over a hundred thousand people who hold more than 10 Bitcoins. In other words, not many people can become gold medal winners. The conditions for obtaining a gold medal are explained in Chapter 3, Section 4, “Locking Mechanism.”

3.4.4 Issuance Method 2:

Issuing DW20 by Mortgage of Bitcoin.

Bitcoin is mortgaged to the chainless system, a transparent centralized platform controlled by user private keys and system multisignatures to control the collateralized coins. It belongs to the smart contract method. The users determine the number of multi-signatures and are also controlled by multi-signatures when releasing the collateral, the private key of the chainless system only plays the role of verification, therefore after the user’s private key is signed, there is no system private key to sign, and the money cannot be transferred. ensuring the transparency and non-transferability of the entire system.

The entire mortgage program is a smart program, similar to a smart contract, the conditions are selected and set, then the program is automatically executed.That is an automated method that is highly mature in the cryptocurrency field.

The mortgage method is as follows: The amount mortgaged can be redeemed accordingly.

Our goal is to adjust the market price of DW20 by issuing DW20 through the mortgage of Bitcoin when the demand for DW20 increases.

The collateralized DW20 is valued at 1 US dollar, and Bitcoin is mortgaged at a collateralization rate of 50% based on the market price. The principles of liquidation and replenishment refer to DAI. We consider giving users the option to choose the collateralization rate, with users assuming the corresponding risks.

When redeeming Bitcoin, the corresponding DW20 will be destroyed.

Bitcoin serves two purposes: market-making profits and micropayments.

Due to the mechanism of BRC-20, the functions of additional issuance and destruction cannot be realized for the time being, and new protocols will be introduced in the future.

3.5 Current stablecoins are not a standard currency

Compared to DAI and Luna, their market-making is done by themselves, based on the assets they issue themselves. Their stability is not as solid as fiat-backed stablecoins, which assets used for market-making  are fiat currencies, such as the US dollar.

The US dollar is currently the fiat standard currency, like the Euro and others. Compared to the US dollar, DAI and Luna do not have a market-making mechanism like the US dollar. The market prices the US dollar. In other words, the fiat standard currency must be priced by the market. DW20 can achieve market pricing through the mechanism of Bitcoin collateralized redemption. One reason algorithmic stablecoins have failed is that the market does not price them. The lack of market pricing carries risks, as evidenced by Soros’s attack on the Hong Kong dollar’s linked exchange rate. The USDT model is also not totally market-priced and not secure. Cryptocurrencies need stablecoins with market pricing.

Fiat-backed stablecoins like USDT can also use chainless platforms for market pricing. However, the problem is that their flexibility is insufficient (their profits can be considered flexible). The Hong Kong dollar’s linked exchange rate has significant flexibility, requiring a large reserve of US dollars to maintain. USDC immediately unpegged due to Silicon Valley Bank’s $3 billion issue, demonstrating a lack of flexibility. Therefore, although a 1:1 ratio between fiat-backed stablecoins and the underlying fiat currency may not necessarily collapse, unpegging often occurs. Unpegging means instability, which affects credibility. As pegged stablecoins, there is no major issue. However, if such coins are used as the standard currency, their stability is insufficient.

DW20 is decentralized, and stability requires flexibility. How can it be ensured? The DW20 distributed through airdrop forms a funding pool, addressing flexibility and vulnerability issues. The flexibility issue is further explained in Section “8.2.2 Necessity of basic fund determined by the nature of DW20.” For vulnerability issues, refer to Section “8.2.4: Anti-vulnerability attack.”

Since Bitcoin can be transferred to the chainless system and become BTCy, the collateralization and redemption within the chainless system incur extremely low transaction fees as long as they remain within the system. That is suitable for retail speculation. The chainless system also supports the exchange of DW20 for BTCy. The specific implementation of collateralization is explained in the system implementation section.

4.  Coin Minting and Distribution of DW20

210 billion DW20 tokens are minted all at once and placed in the DW20 address of the chainless system. The total amount and the number already issued are displayed using the DW20 indicator. The tokens are then redistributed to four addresses. All four addresses are multi-signature addresses.

  • Token allocation to user addresses:         80%.
  • Token allocation to stable fund address: 10%.
  • Token allocation to team addresses:        5.42%
  • Token allocation to market:                     4.58%

As can be seen, The team is lower than that of the Ethereum Foundation in the overall distribution ratio. After deducting market fees, the Proportion occupied by the team is almost equal to the Proportion of Bitcoins held by Satoshi Nakamoto among all Bitcoins. Bitcoin experts estimate that Satoshi Nakamoto holds 1.14 million Bitcoins, which accounts for 5.4285%.

The market fees are used for market activities, and most rewards are given to coin holders, with a portion given to peripheral contributors.

DW20 tokens exist in two forms: on-chain tokens, which are BRC20 protocol DW20, and cross-chain mapping in the chainless system, also known as chainless DW20. The symbol remains DW20, and we use colors to differentiate the mapped coins in the wallet.

The DW20 tokens within the chainless system are subject to the chainless system’s fee structure. The first year will be free after the official launch of the chainless system. Within the chainless system, all the functions described above are easily implemented. The fees for on-chain BRC20 protocol DW20 tokens are the same as the fees for the Bitcoin system’s segregated witness area.

5. Pricing Principles of DW20

5.1 Pricing mechanism of DW20

Currently, in the case of the US dollar, approximately 200 billion US dollars are used to pricing trillions of US dollars. The pricing mechanism is market-based. The pricing funds have leverage. Generally, US dollar market makers give a leverage ratio of 20-50 times or higher. The pricing of the US dollar is done in the secondary market, and liquidity is not directly injected into the market. The liquidity injection from collateralizing Bitcoin is uncontrolled, making the pricing mechanism of DW20 different from that of the US dollar and more complex than fiat-backed stablecoins. Once DW20 enters the standard currency phase, its adjustment mechanism will be more sensitive than the US dollar.

The adjustment of the US dollar is divided into two parts: the market “responsible” for adjusting pricing, and the Federal Reserve is responsible for adjusting liquidity. However, the data relied upon by the Federal Reserve has two problems: data lag and data distortion. The adjustment of DW20 directly faces the real market demand, representing real market feedback. The adjustment is equivalent to a negative feedback mechanism in automatic control, and manual adjustments cannot match its level. The adjustment of the US dollar is a lagging manual adjustment, and overshooting is unavoidable. When DW20 is in the stablecoin phase, the plate is not large enough, so market-making funds will not exit all at once but gradually. That is a rescue measure to ensure it does not become unanchored.

The issuance of the US dollar is influenced by market pricing, and the price fluctuation is based on the market’s understanding of the demand for the US dollar. The issuance of fiat-backed stablecoins is unrestricted but requires a price stabilization mechanism. The situation with DW20 needs to be segmented into the growth and stable phases, as described in Section 5.2.

The pricing of the US dollar is influenced by two factors: liquidity release and economic expectations. Generally speaking, the US domestic economy’s influence on the US dollar’s pricing lies in monetary expansion. The US dollar price is determined by two indicators: the amount of money supply and interest rates. These two indicators are also reference indicators when comparing the price of the US dollar with other fiat currencies.

The stability of the US dollar stablecoin is linked to the US dollar. Since DW20 is not tied to any national economy, it depends directly on the demand for DW20 and the market’s regulatory ability.The same goes for Bitcoin.

5.2 Staged Predictions of DW20’s Price

Stage 1: Airdrop Stage, Estimated to be around 2-3 years.

During this stage, DW20 is similar to the early “mining” stage of Bitcoin, where it has no value initially. The cost of Bitcoin is determined by the price of computing power, which initially increased due to the consumption of electricity.

How is the price of the US dollar determined? Its printing cost remains relatively stable. The value of the US dollar is the result of market consensus, as it serves as a measure of value and the currency standard. The US dollar was initially anchored to gold, with a fixed rate of $35 per ounce under the Bretton Woods system. That was the value borrowed from gold. Similarly, fiat stablecoins are anchored to the US dollar, relying on its value. However, As Satoshi Nakamoto said, central banks continuously undermine this credit, leading to the emergence of Bitcoin.

DW20 has a one-time issuance of 210 billion coins, with an on-chain transfer fee. Clearly as with the US dollar, the DW20 is only valuable if there is a broad consensus, i.e. widespread use. Before its applications are developed, it only had the value of a meme coin, which will be further analyzed later in this article. The rise in DW20’s coin value depends on market makers’ discoveries, and its long-term stability relies on market makers. However, market makers carry risks, and they could collapse. Therefore, the rules must be followed.

In this stage, as a competing meme coin, DW20’s concept is a “valuable meme coin,” reaching a level of 2-5 cents, comparable to SHIB and Dogecoin. The market capitalization would reach a level of 4-12 billion dollars.

Subsequently, with the increase in users and consensus growth, after Stage 1, DW20 will eventually reach a value of 1 US dollar per DW20. If it reaches $1, DW20 would have a market capitalization of 210 billion dollars, ranking third in the cryptocurrency market, which is a massive market value. A detailed explanation of this process will be provided in the third chapter.

Stage 2: Formation of a Stablecoin, Estimated to be around 10-12 years.

As a candidate Standard currency, the concept is a “Decentralized Standard currency or a stablecoin regulated by Bitcoin.” That is the most reasonable psychological implication, priced at $1. At this stage, an automatic collateral stabilization mechanism appears. This principle is similar to the Bretton Woods Agreement, where the US dollar was backed by a fixed rate of $1 per DW20 using Bitcoin as collateral, which is also a way of “borrowing” value from Bitcoin.

Stage 3: The ruler for Commodity Value, Estimated to be around 24-28 years.

As a candidate for a global commodity value ruler, the concept is to “replace or competitive fiat currencies as a currency standard.” DW20’s price will be 1 US dollar at this stage. The market capitalization would be 2100 billion dollars plus over half of the total Bitcoin supply in billions of dollars. Market goods are priced in DW20. In this stage, Bitcoin is used to measure global wealth and growth, while DW20 is used to measure specific commodity prices. Fluctuations in economic development are reflected in Bitcoin, while DW20 replaces the US dollar to measure Bitcoin. That means DW20 becomes the currency standard.In other words, the price of Bitcoin continues to rise, while the price of DW20 does not move.

As the volatility of Bitcoin and DW20 is small at this stage,  and giving users the power to choose the collateral rate. The users themselves would bear the risks associated with their choices.

Figure 1a shows the division of the three stages.

Figure 1a

6. Stability Principles of DW20

We have outlined the three stages of DW20’s development because DW20 follows the principles of Bitcoin’s growth and relies on natural market growth. Stablecoins like USDT and DAI do not have this growth stage, as their prices are fixed at 1 US dollar.

6.1 Role of Stable Fund in the First Stage

6.1.1 Stable Fund Determines the Rise of DW20

In the first stage, DW20 will fluctuate with the market. Since its price is low, no market makers will provide collateral. At this point, its value reflects market demand and expectations and the market’s evaluation of DW20’s advantages. Its advantages include:

  1. It has the same credit and legal advantages as Bitcoin.
  2. It has the advantage of activating Bitcoin’s small change.
  3. It has the advantage of being used for small payments in Bitcoin.
  4. It has the advantage of authenticating the value of Bitcoin customers.
  5. It has the advantages of Decentralized Standard currencys, and are genuinely regulated by the market.
  6. It has the advantage of being a solution to the remaining problems of Satoshi Nakamoto.
  7. It has the advantage of being a price ruler under the Bitcoin standard;
  8. It has the advantage of forming a capital pool.
  9. It has the advantage of psychological implications.

As described in 3.3.5 “Issuance Method 2,” the collateralized DW20 is priced at $1, implying that one DW20 is worth $1. If the market capitalization of Bitcoin reaches 20 trillion dollars, DW20 will follow the rise. Therefore, without a regulatory mechanism, a stablecoin status would not be achieved, and it would follow Bitcoin’s fluctuations, becoming a shadow currency of Bitcoin, similar to BCH and LTC, without bringing added value to Bitcoin. Therefore, a stable  fund is needed in the first stage. That may lead to an increase in Bitcoin’s value.

6.1.2 Market-making Cooperation of Stable Fund in the First Stage

As mentioned in Section 4, the stable fund accounts for 10% of the total supply of 21 billion tokens. Initially, the stable fund has no money, only tokens, and no independent operators. It must be infused with balanced funds to form a new market-making fund managed by other teams. In the first phase, an independent market maker invested $10 million, which means 21 billion DW20 tokens are valued at $10 million, and the total valuation of DW20 is $100 million. The valuation of one DW20 token is 0.05 cents. The first phase is community consensus people organise their own subscriptions.The stable fund pays management fees. The profits of the stable fund are retained to expand the fund’s size and enhance the strength of DW20 as its price rises. From the second phase onwards, the fund manager will be selected globally, and management fees will be charged based on 1%-2%, as VAM Agreement. The leading investor of the first phase, 8005, will be selected through the gambling process.

The market value of the fund should continue to grow. For example, when the market value reaches $200 million in the first phase, it ends, and the second phase starts from $200 million. When the market value of the second phase reaches $1 billion, it ends, and then it enters the third phase, which ends when the market value reaches $3 billion. At this point, injecting an equivalent amount of DW20 tokens is required.

At this stage, investors in the market-making fund may hold many DW20 tokens, similar to the continuous turnover of Bitcoin, where the tokens eventually flow to large holders. Refer to Table 1 above. Under an upward trend, market-making risks are relatively low.

For the operating rules, refer to Chapter 3, section “9.5 From Meme Coin to Stablecoin Method.”

In principle, if Bitcoin does not collapse, the worst-case scenario is that it remains at a certain price level without losing money.

6.2 Second Stage: Mortgage Bitcoin for Market Making

Laszlo purchased two pizzas with 10,000 Bitcoins, marking a remarkable leap from Bitcoin being “air” to becoming a commodity. The second stage is marked by people mortgaging Bitcoin to issue DW20. At this point, DW20 enters the journey of becoming a stablecoin. In other words, there is no need for external funds to join the  Market Making fund, and external funds should gradually exit the market-making fund, which becomes a backup fund. That is similar to the operation of a chainless whitepaper’s backup fund. The fund will maintain a “50%:50%” ratio of DW20 tokens and USD or stablecoin like USDT.

In theory, DW20, as a shadow currency of Bitcoin, should rise with the increase in Bitcoin’s value. This rise is a comparative effect, similar to the rise of BCH and LTC. Additionally, DW20 has payment characteristics, and its price is determined by supply and demand. If the price remains stable, it would require an increase in the supply, and issuing tokens through mortgage increases the supply. Therefore, the profits that should have increased with demand are taken away by the Bitcoin market makers who issue DW20 tokens. This analysis does not yet consider the expansion of DW20’s demand; it only focuses on the impact of Bitcoin price increases on DW20.

Since DW20 is not tied to any country’s economy, how do mortgage holders determine the value of DW20? Even simpler than with stocks, it is two factors: Growth in the number of clients and the volume of transactions.

Number of clients  conforms to Metcalfe’s Law: “The value of a network is proportional to the square of the number of connected users.”

Transaction settlement volume growth: in line with the rule of linear growth in value. That is analogous to the linear relationship between the issuance of currency by the Federal Reserve and economic growth.

Note that this is only a consideration, not a quantitative indicator.

Despite the simplicity of the factors, and due to differences in individual judgments of value, it leads to the existence of foreign exchange speculation markets and investment schemes. Speculative funds in US dollars amount to over $200 billion, with a daily trading volume of $3 trillion, corresponding to the total money supply issued by the Federal Reserve of over $30 trillion. The position of DW20 is similar to that of the Federal Reserve’s currency issuance, as it is a form of base currency injection. They are not bank loans creating bubbles. The two can be compared as a reference. As an analogy, if the total supply of DW20 tokens is 21 billion, and speculative funds for market making are $1.4-1.5 billion, the pricing can be determined. In section 6.1.2, we estimated a market size of $3 billion, and no further predictions were made. If the above speculation is valid, the stable fund would no longer be necessary as a market maker. Since DW20 is sensitive to fluctuations compared to the US dollar, the required funding will depend on its operation.

BTW, Bitcoin is also not pegged to any economy; the same laws as DW20 should exist. However, Bitcoin has no market maker and no ecology. Except for the halving every four years, speculation entirely determines its rise. After the speculation ends, it will return to the bottom of the computing power to store energy for the next speculation.

6.3 Third Stage: Bitcoin-standard ruler

The third stage is marked by DW20 having more minor fluctuations than the US dollar and no devaluation in the pricing of commodities. At this point, the market naturally anchors to DW20. The initial “50%:50%” ratio of DW20 tokens and USD in the fund begins to change. DW20 still accounts for 50%, while the other 50% corresponds to the USD and includes BTC. Ultimately, the fund maintains a “50%:50%” ratio of DW20 and Bitcoin. That is when DW20 becomes the ruling currency. Conversely, the DW20 fund becomes a small Bitcoin stable fund.

7. Value Analysis of DW20

The value of DW20 varies in different stages, and only a part of it is listed here. The actual value is much greater than what is listed.

7.1 Value as a Meme Coin

DW20 possesses the characteristics of a meme coin and can be compared to Dogecoin and SHIB coin but with better performance. Dogecoin has a market cap of 12 billion, and SHIB has a market cap of 4 billion. DW20 is valued at 2 cents per coin compared to SHIB. The value of meme coins, like Bitcoin, has a bottom and a top price. The bottom price can be generated through algorithms like mining for Dogecoin. Another way, as with SHIB, is without mining, and the standard for measuring its bottom is the number of participants. In the Internet age, the value of approximately one registered user is $50, which is the valuation method used by venture capitalists for a non-profitable company.

When Facebook acquired WhatsApp, each customer was valued at $46. However, the value of financial customers differs, and the market recognized valuation is higher, reaching $500-1,000 per person, also known as the customer acquisition cost. Based on this, one can calculate the value of the acquired company. If SHIB has no other application value and corresponds to its market cap of $4 billion, it would be worth at least the value of 4 million users. Based on this, assuming Bitcoin has 50 million user addresses and the total customer value is US $50 billion, it would be lower than the total value of Bitcoin’s bottom price, estimated to be $400 billion based on the current mining power of $20,000 per Bitcoin. A normally operated project would have a higher valuation than the bottom price. Before the fall of Luna, it had 4 million users, and under normal operating conditions, the market gave it a bottom valuation of $4-5 billion. Luna’s peak valuation exceeded $40 billion due to increased trading volume and market imagination about its application demand. However, when Luna fell to $4-5 billion, it failed to hold its ground, exposing design flaws. Luna’s market valuation is residual because it only has approximately $200-300 million in customer value. It is still valued at around $50 per customer for internet company acquisitions.

It must be noted that when a project loses its imagination, its valuation will inevitably return to the bottom, and Bitcoin is no exception. Bitcoin’s valuation is only about 30% higher than its bottom price based on mining power, a ratio far inferior to gold. For gold, people are promoting the gold standard and providing new imagination. The market price of gold exceeds its bottom cost price by more than double. Bitcoin’s halving every four years is a positive expectation that may generate a bull market, but we don’t know how big that market will be. However, the Decentralized Standard currency DW20, as it aspires to be based on Bitcoin, will enhance the future imagination of Bitcoin.

Regarding how high Bitcoin can rise, please refer to our article “Invite Out Satoshi Nakamoto Welcome The New World” and the predictive curve in Chapter 13. With the efforts of the Bitcoin community and the stimulus provided by DW20, and all the positive factors combined, this halving market may be big.

DW20 has designed 16.8 million airdrop coins to be distributed to Bitcoin customers. Bitcoin accounts for about half of the total cryptocurrency market cap and represents the highest quality customers in the cryptocurrency space. It is unreasonable for DW20’s valuation to be lower than SHIB’s. From the perspective of DW20 as a meme coin, user value is its bottom price.

However, DW20 has value in other aspects as well.

7.2 Value Based on historical evidence

Bitcoin participants in the past lacked an objective symbol to prove their historical status in the Bitcoin system. Still, Bitcoin addresses can serve as objective proof of users’ history, making them valuable. It should be noted that the number of early Bitcoin users was small, just like the Red Army soldiers who traveled over 25,000 li during the Long March. After the establishment of New China, they all became scarce. This proof of scarcity is verifiable. Our medal system and NFT technology can generate unique proof.

The significance of its proof can determine how many bitcoins may be dead coins. Dead coins refer to coins whose private keys are lost or entered into illegal addresses and can never be moved. The idea that the value of dead coins can be transferred to live coins is not valid. The source of this view is that the stock market similarly destroys stocks, causing other stocks’ values to rise. However, Bitcoin is different from stocks. Stocks are the valuation of the system, and Bitcoin does not represent the value of the Bitcoin system. Bitcoin is a demand valuation, which can be evaluated by the number of users and transaction volume. But the lost coins are a double loss of transaction volume equal to a decrease in both demand and supply and users. It’s like losing a mountain of gold. If Bitcoin is standard, the value of dead coins is vast. The restoration of this value must be done by Satoshi Nakamoto, which can benefit Bitcoiners and world peace.

7.3 Unlocking the residual value of Bitcoin’s loose change in the trading system

The above section, “3.4.2 Role of Bitcoin Addresses,” mentioned that around 60% of addresses hold a Bitcoin value lower than the transaction fees, resulting in accounting losses. According to the principles of Bitcoin, change will always exist. Activating the change coins of these Bitcoin addresses will be a source of continuous demand for DW20. We have reserved funds for various activities and will continue to activate change addresses. DW20 provides a solution for changing funds, which will improve the efficiency of the Bitcoin system, benefit Bitcoin users’ wealth, and promote the adoption of Bitcoin.

The historical evaluation of Bitcoin users’ credit and the activation of Bitcoin change funds add value to Bitcoin users, which Bitcoin users will welcome.

7.4 Pioneering value

The value of pioneering is determined by seeking novelty, seeking differences, and speculative trading, which is inherent to cryptocurrency participants. Pioneeringvalue is the most recognized value in the cryptocurrency world. DW20, through the BRC20 protocol and the chainless platform, utilizes the Bitcoin system ledger as the first layer, demonstrating how to use the Bitcoin system properly. Since cryptocurrencies do not have patents, the market has unwritten rules that greatly respect original innovations.

7.5 Creating an alternative Standard Currency based on Bitcoin

7.5.1 Providing support environment through chainless platform

DW20 supports the BRC20 protocol and facilitates transactions through smart contracts on the chainless transparent centralized platform, making transactions more convenient.

Trading can be conducted between the chainless platform exchange and BEC20 tokens.

Trading can also be conducted between the chainless platform and stablecoins.

Once all DW20 tokens have been distributed, it will have complete correspondence with Bitcoin. The distribution is based on Bitcoin addresses, and after the full airdrop distribution of DW20, it will correspond to approximately 50 million Bitcoin addresses. Subsequent allocations will continue through activities.

Since DW20 has a correspondence with Bitcoin, it possesses all the characteristics of Bitcoin and the reliability that meme coins do not have. It also addresses the pain points of Bitcoin. The exchange between DW20 and BTC is transparent; anyone can verify the quantity and time of burned DW20 tokens.

7.5.2 Market-regulated Standard Currency The issuance of a large number of DW20 tokens provides market liquidity, and the characteristic of the chainless platform is its ease of use and convenience in liquidity, which compensates for Bitcoin’s poor liquidity. The liquidity issue of Bitcoin lies in its inability to adjust monetary policy. DW20, on the other hand, can adjust its stability through arbitrage when scarcity occurs in the market, thereby serving as a means to regulate monetary policy. DW20 is a stable currency regulated by the market. DW20 is similar to algorithmic stablecoins, but its underlying support is different. It does not rely on centralized algorithmic regulation but instead on market regulation. Can DW20 be considered a competing coin for existing stablecoins? We are excited about this possibility.

DW20 differs from DAI stablecoins and USDT stablecoins as a market-regulated stable currency. It is not pegged to fiat currency or Bitcoin but reflects the market price. That aligns with the principles of free currency by Mises and Hayek and the financial principles behind Satoshi Nakamoto’s design of Bitcoin, while Dogecoin and SHIB currently lack this ability.

7.6 Several Characteristics of DW20’s Value

In addition to the value above characteristics, DW20 has the following features:

  1. Increases the potential for profit with Bitcoin.
  2. Offers a new approach different from USD-pegged stablecoins and algorithmic stablecoins.
  3. Serves as an auxiliary tool for Bitcoin.
  4. The value of USD-pegged stablecoins is affected by USD inflation, while the issuance of DW20 is independent of USD and not directly influenced by USD inflation. It should be noted that until it reaches the third stage, becoming a currency standard, it is still affected by some inflation.
  5. There are problems with the backing and algorithms behind algorithmic stablecoins, whereas the market regulates DW20.
  6. The concept of DAI is excellent, and its collateral issuance model is similar to our idea. They anchor the stability module to some extent with a taste of a capital pool, considering the issue of basic funds. Although they appear similar, the most significant difference is that DAI aims for profitability. The use of its capital pool is similar to USDT, where a portion of user funds is collateralized to generate profits. However, the basic funds of DW20 do not need to generate profits. Like the Bitcoin system, the DW20 system is not designed for profit, as discussed in Chapter 3, “10. The core concept of Bitcoin’s distributed system is non-profit.” Furthermore, the settlement platform of DAI does not have the competitiveness of centralized exchanges, whereas DW20 does not have the shortcomings above.
  7. The issuance concept of a portion of DW20 through airdrops is similar to WorldCoin and PI. DW20 are all distributed for free to Bitcoin users, demonstrating the deep understanding of finance and Bitcoin by the DW20 design team, as well as their scientific grasp of airdrop techniques.
  8. When it reaches the currency standard stage, DW20 does not require the endorsement of USD value. It is fully market-based. It is a strong competitor to fiat currency and its stablecoins.

8. Technological and Financial Features for Implementing DW20

The combination of technology and finance reflects a cross-disciplinary ability. The creation of Bitcoin is an example of this cross-disciplinary capability. Inspired by Bitcoin and BRC20, let’s see how far we have come in this cross-disciplinary field.

8.1 Enabling smart contracts on Bitcoin

Smart contracts borrow the concept of cryptocurrencies. In chainless platforms, we prefer to refer to them as smart programs, plugins, or apps. They are much more flexible and powerful than traditional smart contracts, and they adhere to the principles of open-source code and voluntary user upgrades. Ultimately, we can use the Proof-of-Stake (POS) mechanism and BRC20 on the chainless platform as the second layer of Bitcoin, achieving the ecological model of Bitcoin and benchmarking the Ethereum model. That gives Bitcoin significance and a method for ecological valuation and demand valuation. The chainless system does not have the fee self-limitations of Ethereum, and the chainless fees have an upper limit, similar to the one-sided fees charged by banks, which significantly reduces the cost of conducting smart programs to transactions similar to Ethereum’s platform.

BRC20 does not support smart contracts, and the Bitcoin ledger is not an account model. Therefore, smart contracts must be placed on the second layer. We use the chainless system and DW20 as examples of applications to provide a universal and practical method and platform for issuing BRC20 tokens.

When using the chainless platform module and wallet module, apart from utilizing the chainless for verification, project stakeholders can organize their own verification teams, issue their own tokens, and select validators from the users in the verification pool using the POS mechanism. Validators are required to stake and charge verification fees. This approach is more expensive than the chainless’s three-party confirmation.

The benefit of validator verification is that it can replace the transparent centralized verification of the chainless system. However, the accounts are still recorded on the chainless’s transaction ledger, and the hash value of the transaction ledger is stored in the Bitcoin system. That allows us to fully leverage the achievements of cryptocurrencies and open up new possibilities beyond the rigid concept of “blockchain.” This verification system can operate independently of the chainless system and functions as an application app of the chainless system, just like WeChat Pay integrated into WeChat.

The unilateral bookkeeping result hash on the chain is theoretically an improvement, but blockchains are evolutionary, and this does not fit with the traditional idea of blockchain. Someone must insist on multi-party verification to be considered non-cheating. With this in mind, POS witnessing is an option. It is straightforward in implementation and replaces the role of the system’s final confirmation, which was booked initially after verification by the system, with a multi-party confirmation witnessing process added before system confirmation. The current blockchain confirmation is an unrelated party confirmation, which is backward compared to the chainless system confirmation. But in the real world, there are scenarios where multiple parties witness payments, so this is where POS witnessing makes practical sense.

8.2 Financial Characteristics of DW20

We have previously discussed the concept of a Bitcoin-USD standard. The market considers this idea suitable, but its implementation faces specific obstacles, primarily the need for cooperation from Satoshi Nakamoto and approval from regulatory authorities. Fortunately, the BRC20 protocol has emerged while we were puzzled by this, which makes it possible for DW20 to become a stablecoin for Bitcoin. That requires going through the three stages described in the previous “6. Stability Principles of DW20” section, with DW20’s pricing having a market-based, freely floating pricing process. This process is not necessary for a Bitcoin-USD standard but is essential for DW20 to achieve consensus. Fortunately, the successful experience of cryptocurrencies such as Bitcoin can be used as a reference for imitation and modification.

With new stages come new phenomena, and we must follow Satoshi Nakamoto’s approach of careful design and ensure that all methods have a source rather than relying solely on iterative thinking. Let’s explain the new concepts in the “1. Overview of DW20 Standard currency Solutions.”

8.2.1 Role of the basic funds and Maintaining the fund pool

Why do banks need capital? It’s because it’s necessary for credit. Without credit, no one would deposit money in banks. DAI using smart contracts to generate credit is a method, but we remember that it was almost pierced in the early days. We always believed that we relied on external forces to resist the crisis, so we need basic funds to increase credit when we are not strong.

Where does credit come from if there are no banks and capital? We thought about the practice of Satoshi Nakamoto’s Bitcoin, gradually accumulating consensus. Our advantage compared to Satoshi Nakamoto is our specific customer base. Satoshi Nakamoto left behind Bitcoin users. The basic funds are implemented by airdropping to 50 million Bitcoin addresses through “Issuance Method 1” as described in section 3.4.1. Over 10 million Bitcoin customers are on-chain, far from reaching 50 million. Many customers are on centralized exchanges, and they will download chainless wallets to join the ranks of the early 50 million customers. We estimate it will take 2-3 years to reach 50 million customers in the first phase, which is a very conservative indicator. From the perspective of the Internet, this indicator can be achieved within a year. The estimated value based on the evaluation of financial customer value is $50 billion, placing it in the fourth position among current cryptocurrencies. Note that this is only an estimate of the value part of the DW20 meme coin, equivalent to the computing power base of Bitcoin.

Assuming DW20 reaches a value of $1, the basic funds would be $210 billion. That is approximately the total market value of stablecoins in the current blockchain market. This portion of funds constitutes the basic liquidity of the market, which is the basic funds. What is this fund used for? When the United States tightens the liquidity of the US dollar, it affects the global economy. This action is equivalent to redeeming and destroying DW20. If DW20 does not have basic funds and only relies on collateral for issuance, it is equal to drying up liquidity when all collateral is recovered. However, liquidity will never dry up with $210 billion in basic funds. Some people say that you do not control this portion of funds. History has already concluded that it is better to distribute wealth among the people rather than concentrate it in the hands of officials. The modern conclusion is that a market economy is better than centralization. The depth of the DW20 pool is determined by the release and recovery of collateralized Bitcoin and is automatically adjusted by the market. Basic funds solve the problems of system elasticity and early vulnerability. The elasticity issue is discussed in the next section, “8.2.2 Necessity of basic fund determined by the nature of DW20,” the vulnerability problem is explained in section “8.2.4 Anti-vulnerability attack.”

Commercial banks are most afraid of bank runs. Their funds must be used to make money, and their liquid assets are often less than their capital. They need interbank borrowing or central bank liquidity releases. However, the central bank cannot accurately judge whether market equilibrium has been ensured. Excess liquidity must be recovered when the market is imbalanced, making monetary regulation unpredictable. Therefore, the entire monetary system is logically incomplete. With basic funds, when the market knows that a “self-bank” is never afraid of bank runs, people in the market know that their money is predictable and safe. Such a system possesses logical completeness, unlike fiat currencies, where people can only rely on trust in the central bank. Satoshi Nakamoto stated in the Bitcoin whitepaper that central banks often betray this trust. Both central banks and stablecoin USDT rely on their currency for profitability; they are the main beneficiaries. The profit of USDT is beyond reproach, but it is hard not to doubt the fairness Once the central bank has a profit target.

The Bitcoin system is not like that. It does not belong to anyone; this is a principle. The Bitcoin system’s beneficiaries are not the system’s owners but the “miners.” The profit-making entities of DW20 are the collateral providers and maker-maker,  who have the same position as “miners.” And its maintainers are also third parties, namely the chainless system, which has a fee-based profit model. A platform without an owner itself embodies the spirit of Bitcoin.

Commercial banks also cannot maintain many liquid assets as basic funds because doing so would prevent them from making money. Liquid assets are only prepared to meet customer withdrawals and redemptions. When there is a shortage of liquid assets, banks first solve it through interbank borrowing. This is the second issue mentioned by Satoshi Nakamoto in the Bitcoin whitepaper on January 9, 2009, the issue of the bubble lending of commercial banks. The $210 billion “capital” of DW20 is already much larger than the $100 billion capital of China Merchants Bank. This money doesn’t have to be used to make money; it only ensures liquidity. What will be the result of doing so? The practice of pre-set fund pools has never been conducted as a monetary experiment. This experiment and the chainless platform may help solve the bubble lending problem described in Satoshi Nakamoto’s whitepaper. In the future, banks can engage in lending, and without attracting deposits, everyone is starting at the same starting line, competing based on profitability, just like how big influencers and TV stations are already competing on the same starting line. TV stations do not have an absolute advantage. There is no difference between TV stations and big influencers on the YouTube platform. There is no difference between banks and big influencers on the chainless platform.

8.2.2 Necessity of basic fund determined by the nature of DW20

Can DW20 replace the US dollar? Initially, it does not possess the characteristics of a reserve currency like the US dollar, so it is not a complete currency concept. DW20 is just a payment tool for Bitcoin. Therefore, it must be flexible. Let’s look at a few examples.

New gold is mined every year, and if the newly mined amount is equal to the economic growth, gold can be used directly as a measure. However, when economic development exceeds the rate of gold mining, it will cause deflation. Gold lacks flexibility in adjustment, and that became the reason for people to eliminate gold.

Fiat currency was designed to overcome the lack of flexibility in gold. It is regulated based on market data to predict the total economic volume, aiming to ensure that the quantity of fiat currency issued is equal to economic growth. However, this prediction is often imprecise and tends to have excessive flexibility, resulting in inflation. The repeated adjustments become the epicenter of economic fluctuations. Those in Authority discovered they could conceal financial storms by excessive currency issuance, which is an excellent way to maintain social stability. Because people cannot perceive slow changes, people only feel that money becomes less valuable. However, by doing so, the principles of a market economy are entirely disregarded. The market’s retaliation will inevitably occur, and this retaliation is gradual. The emergence of Bitcoin can also be seen as a manifestation of market retaliation.

Both of the above monetary systems have problems. We need a currency with a negative feedback mechanism in the automatic control system, which is the automatic regulation of the market. For regulation, there must be a margin of adjustment in the market, just like a machine needs lubricating oil. Basic funds have no profit indicators; they are the lubricating oil of the Bitcoin payment system. The measurement of lubricating oil in a car can be judged as too much or too little, but the question is, where does this measurement come from? It is speculated that it might be initially calculated and adjusted based on practice.

To solve the problems of flexibility and vulnerability, DW20 is issued in the amount of 210 billion without any financial basis. It is only assumed that the future will be based on Bitcoin, and 210 billion DW20 and 21 million Bitcoin correspond harmoniously, forming a decimal system, which may be correct.

8.2.3 Exploring the fund pool issue

Bitcoin emerged to solve financial problems but has been crippled since its inception, leading to stablecoins like DAI and USDT to compensate for Bitcoin’s shortcomings. This direction is correct, but they have their flaws. People have explored alternative methods to solve these problems from another perspective.

Worldcoin and PI have conducted explorations from different angles and have chosen to distribute tokens to attract users. Their genius intuition told them to do so. They adopt the approach of having fund pools and user traffic first, which means having consensus before applications, hoping their tokens will become the global currency. Worldcoin and PI do not understand finance deeply and fail to grasp the necessary correspondence between the total quantity of money and total wealth. Satoshi Nakamoto’s thinking was not about distributing coins first but starting with the total amount of money, making it correspond to the total wealth in society, which led to Hal Finney’s hypothesis that $10 million fits to one Bitcoin.

We adopt the idea of these genius fund pools and combine it with the issuance of DW20 tokens using the BRC20 protocol, providing us an opportunity to compensate for Bitcoin’s shortcomings and an experimental opportunity for alternative thinking. The current bank demand deposits are the most similar to basic funds. Referring to the data of the Industrial and Commercial Bank of China, it has demand deposits equivalent to around $2.1 trillion. The DW20 fund pool is dwarfed by comparison. The idle portion of the airdrop will not be left unused, such as financial institutions on chainless platforms that perform well. If they absorb DW20 tokens and pay interest to users, and the interest rate is equal to or higher than the interest on demand deposits in banks, it is possible to guide users to lend their DW20 to financial nodes. If it is not a fixed deposit, the funds in the fund pool will not decrease. If it is a time deposit, it will cause the price of DW20 to rise. Since the entire platform data is transparent, all financial institutions compete on the same stage, and the effect of head financial nodes will be more pronounced.

Another meaning of the fund pool is user traffic. The more users and applications there are, the more funds will flow in, and the fund pool will become larger. Assuming that $210 billion is the “principal,” referring to the Industrial and Commercial Bank of China data, demand deposits are five times the principal. DW20 would have a fund pool of approximately $10 trillion.

This fund pool naturally forms itself. Market demand increases DW20 issued through collateral, resulting in raised retained funds and an enlarged fund pool. However, the market value of Bitcoin determines the total amount that can be collateralized, indirectly determining the size of the fund pool. When the collateral is insufficient, causing DW20 to rise, some people buy Bitcoin for collateral, driving up the price of Bitcoin. That is the principle we mentioned earlier that adds ecological value to Bitcoin.

Separating the storage value of Bitcoin from the measurement ruler is crucial in terms of financial significance. The ruler and storage value of gold is not divided, which leads to deflation. For more information, please refer to Chapters 12 and 13 of our book “Invite Out Satoshi Nakamoto Welcome to The New World,” which discusses the prediction of Bitcoin’s rise and the Bitcoin-dollar standard. The principle is the same.

Is it permissible to collateralize other valuable assets to issue DW20 in a mixed manner? It is feasible as a pegged stablecoin, but as a standard currency, it should be a ruler, and people have the best accuracy requirements for the ruler, with as few influencing factors as possible.

8.2.4 Anti-vulnerability attack

Bitcoin describes the 51% attack problem and provides clever solutions. However, Bitcoin has not solved the vulnerability attack problem. What is a vulnerability attack? It refers to tokens’ significant ups and downs in the early stages. A small amount of funds can manipulate the considerable fluctuations of tokens, causing the price to be much higher or lower than its intrinsic value. We have detailed the solution in the chainless White Paper, transforming the uncertainty of token growth into determinism. Vulnerability attacks only occur on products priced in the market, commonly known as products priced in the secondary market. With secondary market pricing, there is primary market pricing.

What is primary market pricing? Examples include USDT, USDC, Hong Kong dollars, and Chinese yuan, all priced in the primary market.

•Taking USDT as an example:

Customers would have no risk if it strictly follows a 1:1 ratio of USDT to USD reserves and all the reserves are fully redeemed. But how does Tether company make money? It exchanges the USD obtained by exchanging its currency, USDT, for bonds held in banks and keeps a portion of cash to maintain a 1:1 value between USDT and USD. This operation is profitable. The method of making money is too high sell and low buy based on the price ruled to USD.

Please note that there is a crucial concept here: there is a ruler.

The risks of USDT can be classified as normal risks and abnormal risks.

1. Its normal risks include:

A. Bond value risk: They adopt diversified investments with some risk. All the money is stored in a bank, but what if the bank fails? In that case, the liquidation process could be lengthy, and the value of USDT might be reduced to zero before the liquidation is completed.

B. Insufficient reserves risk: When market risks arise, and the withdrawal amount exceeds its reserves, it can lead to a run on the currency. In the recent crypto market risk event, USDT’s market capitalization dropped from $80 billion to $60 billion, but it managed to hold its ground. That indicates that Tether has sufficient reserves and liquidity.

C. USDT can face the risk of de-pegging, indicating poor elasticity. In contrast, the Hong Kong dollar has sufficient elasticity and has never de-pegged.

D. Because it is pegged to the US dollar, the risk of the US dollar also applies to USDT.

2. Abnormal risks include:

E. Excessive issuance of USDT without sufficient backing. There are over $60 billion in deposits from the accounts, indicating an over-issuance of over $10 billion. However, it is still transparent and far from facing a run.

F. Centralized issuance faces uncertain regulatory policy risks.

3. Regarding potential attacks:

Individuals who control over $10 billion of USDT can attempt an attack under specific conditions. However, converting low-priced USDT into USD incurs losses. That means engaging in a game with the “bookmaker” where the winning odds are insignificant.

Please note that there is another crucial point: primary market pricing requires the presence of a “bookmaker.”

Primary market pricing requires clear pricing rules. The least transparent currency, the Chinese yuan, is said to be “referenced to a basket of currencies,” which is not a peg but a soft peg. That allows for significant manipulation and is why the market claims that the Chinese yuan is manipulated.

The Hong Kong dollar has the Hong Kong Monetary Authority as the “bookmaker”.

DW20 has different pricing methods in different stages

In the first stage, DW20 relies primarily on primary market pricing, while in the second stage, market pricing dominates, which falls under secondary market pricing. The growth of DW20 tokens is divided into three stages, with only the first stage having vulnerability issues. Therefore, referring to the successful experience of primary market pricing is necessary. We issue 10% as a stable fund to form a market-making fund, the equivalent of a “bookmaker”; the market-making fund operates on the DW20 value ruler, similar to how USDT operates based on the US dollar. With a “bookmaker” and a value ruler, these two points form the operating rules, theoretically maintaining an upward trend for DW20 and avoiding major fluctuations. The principle is similar to the stability mechanism of chainless platform coins. Refer to Chapter 3 for more information.

Legitimate and transparent market-making is used by both USDT and the Hong Kong Monetary Authority, indicating that it is not prohibited by law.

The risk lies in whether DW20 possesses a long-term upward trend. Whether this trend is reasonable and acknowledged by the market will determine the success of market-making. For example, if Hong Kong’s economy no longer supports the linked exchange rate, the market-making by the Hong Kong Monetary Authority would fail.

How can DW20 rise and stabilize? It depends on demand, specifically the need for expanding demand.

8.3 Regulation principles of DW20

Any adjustment follows three steps: consumption, injection, and tightening of liquidity.

8.3.1 Liquidity consumption

Cryptocurrencies do not have the problem of in-transit money. When they flow across borders, their speed and efficiency are unmatched by fiat currency systems. Chinese bank funds have the shortest transit time domestically, with the ability to transfer within seconds, which is the speed ruler for DW20 and can be fully achieved. The liquidity consumption only involves transaction fees but does not affect the total amount in the DW20 currency pool.

8.3.2 Liquidity injection

When Bitcoin is collateralized to issue DW20, liquidity is injected and automatically adjusts based on market demand. The injection of USD liquidity is controlled by the Federal Reserve, following indicators and artificial injection. The total infusion of DW20 is no less than half the market value of Bitcoin. Injection leads to a decrease in the price of DW20. According to Hayek’s market theory, market mechanisms are the most effective. DW20 automatically adjusts supply and demand but lacks a stable mechanism like DAI to peg it to the USD in the first stage since DW20 is not initially a stablecoin.

8.3.3 Tightening liquidity

Redemption of DW20 through collateral will destroy DW20, increasing its price.

9. Transaction Tokens for Future Open Financial Platforms

We envision DW20 divided into three stages: value coin stage, stablecoin stage, and standard coin stage. Each step has different goals and characteristics. DW20 is a demonstrative application of the chainless platform, similar to the relationship between Nintendo Famicom and Super Mario and Contra. Nintendo showcases the capabilities of the Famicom through games. A good product speaks for itself.

Finance is the last bastion of the decentralization of the Internet. DW20 is the first standard coin that implements a mechanism similar to the USD. The existing financial system will accept DW20 and Bitcoin. DW20, Bitcoin, and the chainless platform will become tools for the current financial system to move toward openness.

The proposed plan aligns with our Bitcoin-USD (HKD) standard concept and can be referred to in the article “Invite Out Satoshi Nakamoto Welcome to The New World” regarding ideas. Readers can refer to Chapters 12 and 13 of that article and the Q&A series 4.6 ( The difference between this and the original method is that the Bitcoin-USD (HKD) standard is a transparent centralized approach, while the market-regulated Bitcoin standard is a distributed method. This method aligns more with the spirit of Satoshi Nakamoto and the practice of cryptocurrencies. The key point here is that the BRC20 protocol has inspired us. The next chapter will explain the specific implementation of this method’s functionalities.

Chapter 2 System Function Implementation of DW20 Decentralized Standard currency

1. DW20 Standard currency is one of the fundamental features of the chainless platform

1.1 The Origin of Chainless Platforms

As mentioned in Chapter 1, we rarely use the concept of blockchain and instead prefer cryptocurrency. That is because, in blockchain, it takes at least 3 seconds to confirm a block, and the fastest confirmation time for a valid chain is achieved by the BSC chain, which takes 33 seconds. This time duration cannot compete with the centralized payment system. Therefore, in cryptocurrency, projects related to transactions in centralized exchanges and Layer 2 solutions prefer centralized methods. Although blockchain ledgers are useful, they are more suitable for scenarios that do not require high-speed applications and are not ideal for payment scenarios. Satoshi Nakamoto also believes that there needs to be a “sub-node” conversion for payments.

Cryptocurrencies have many valuable and innovative aspects, such as Ethereum’s capabilities that no Web 2.0 financial platform possesses. However, centralized technology is the mainstream technology for developing the Internet. It is necessary to marry the progressive ideas of cryptocurrencies with centralized technology to build a platform product that aligns with the thought of cryptocurrencies, similar to Ethereum. The chainless platform is a transparent centralized platform product similar to Ethereum, and it can even achieve all the functionalities of Ethereum’s smart contracts and surpass them. Since it employs centralized technology, implementing all contracts becomes more straightforward and powerful.

The chainless system still has blocks and chains composed of blocks. However, the transactions are verified and recorded by the chainless system, and the method of recording is different from the competitive bookkeeping used in the current cryptocurrency method. The hash value of the block-based ledger is stored in the segregated witness area of the Bitcoin system, utilizing the credibility of the Bitcoin chain as a substitute for multi-party accounting and providing credibility to the chainless system.

Using a public blockchain as the basis of trust expands the credibility of one-sided accounting, greatly broadening the application prospects of cryptocurrencies and avoiding unnecessary regulatory methods. The most significant feature of the cryptocurrency created by Satoshi Nakamoto is that it does not require regulation.

The origin of the chainless system lies in making full use of human achievements and facilities and improving the shortcomings of previous systems rather than starting from scratch.

1.2 Introduction to the Characteristics of the Chainless System

1. The chainless system consists of a general ledger and multi-signature multi-backup wallets, which can turn all single-signature wallets of cryptocurrencies into multi-signature wallets.

2. The general ledger adopts the most advanced cluster technology, forming a cluster system that can be arbitrarily expanded.

3. Multiple cluster systems are distributed globally, ensuring system uptime.

4. The multi-signature multi-backup wallets are also simplified cluster technologies, with individuals controlling the entire cluster.

5. The credibility of the Bitcoin chain replaces multi-party accounting, through unilateral bookkeeping.

6. It runs nodes of Bitcoin and Ethereum.

7. The confirmation of entries in the general ledger and sub-accounts adopts the data format of Bitcoin, and the transmission process is encrypted.8. The general ledger of the chainless system is not based on blockchain or directed acyclic graph but an indexed general ledger.

9. The chainless system is a bookkeeping system. The three parties involved in chainless system accounting are the sender, receiver, and system. The latest transaction results can be found in the general ledger, while past transaction records can be found in the transaction journal. Different from the current cryptocurrency third-party validated bookkeeping systems,

10. The bookkeeping system maintains privacy, and the identity of the transferor cannot be confirmed through the transaction journal.

11. The sender can make anonymous transfers without exposing their account assets to the recipient, unlike Ethereum.

12. The chainless platform supports anonymous and real-name transactions, with the users having decision-making power, and the users determine the level of privacy disclosure.

13. The sub-account cluster is responsible for personal identity authentication and the degree of disclosure to external parties.

14. The security level of sub-accounts is ensured by multi-signature and multi-backup measures, but security and convenience are contradictory. The chainless system provides a solution for privacy grading.

15. Most importantly, the chainless platform only plays a verifying role in the process of transferring users’ assets.

16. General ledger data is transparent and can be viewed using a standard browser.

For the functionality and structure of the chainless system, please refer to the chainless Whitepaper.Figure 1b is a technical framework for a chain system.

Figure 1b

2. The realization of airdrop

2.1 Airdrop

1. Download the Chainless wallet.

2. Access the airdrop program. Anonymous registration is supported, and anonymous participants can provide contact information to the Chainless platform, as explained in Section “5 Anonymity and Security.”

3. Follow the instructions of the airdrop program. Here is an example of the steps involved:

  1. Users provide their Bitcoin address to the Chainless system.
  2. The system verifies the eligibility of the user’s address and informs the user of their qualification level, which corresponds to a specific “medal.” The user then signs the information with their private key.
  3. Once the system confirms the validity, then send the medal qualification certificate;
  4. After the user confirms the accuracy, they click “Yes.”
  5. The system transfers the Chainless DW20 tokens to the user’s Chainless wallet.In locked state.

4. Check the release status of DW20 on the “Airdrops” page.

The user’s Chainless wallet displays the value of DW20 tokens.

2.2 Mortgage Bitcoin to Issue and Mortgage Release Procedure

The mortgage program can be summarized as follows:

Users mortgage Bitcoin to the Chainless system, a transparent centralized platform where the mortgage coins are controlled by the user’s private key and the system’s multi-signature. The Chainless platform sets up a Bitcoin account for the user, and the entire process is similar to external transfers to the Chainless platform. However, a DW20 account is created for new users in the mortgage program.

If you wish to release the Bitcoin mortgage, the process is straightforward. By clicking the button associated with the mortgaged BTCy, the system will prompt the user to enter the quantity of DW20 tokens to be released and the system’s release address. Once the user inputs the amount of DW20 tokens to be released to the given address, the system will execute the destruction and release process, adjusting the value in the total DW20 register.

2.3 Obtaining Rewards

Within the reserved 4.58% market fee, approximately 3% is allocated as rewards for  participating in various activities. That includes incentives for Bitcoin users to participate in different activities.

2.4 Market Purchase

Market purchases can be categorized as on-chain and Chainless internal purchases, with Chainless supporting trading on exchanges. On-chain purchases refer to buying outside of the Chainless platform on cryptocurrency exchanges.

1. Within the Chainless platform, transaction fees are low.

2. On-chain purchases:

  1. Exchanges supporting DW20 on-chain transactions have higher fees.
  2. Exchanges in external centralized platforms that support DW20 token transactions

Chapter 3 Methods for DW20 Token Distribution and Stabilization

1. Overview

1.1 Resonance between chainless platforms and application projects

The progress of DW20 can be divided into three stages:

  • 1. meme coins;
  • 2. stablecoins ;
  • 3. Bitcoin-backed coins, the Bitcoin standard.

The success of each stage relies on the active participation of users. How to engage users? In addition to traditional methods, we introduced the resonance effect.

What is the resonance effect?

DW20 is an application project on the chainless platform, Its status is equivalent to the “smart contract” of Ethereum, but its functions are far more powerful than smart contracts. While DW20 tokens are being distributed, the chainless platform also issues its tokens, Chainless coins have their own issues logic, see Chapter 2 of the Chainless white paper “Incentives.”  Since the users of DW20 are also users of the chainless platform, the more application projects on the platform, the more customers it attracts; The more customers the platform has, the more application projects there will be, thus forming a positive cycle, which is the resonance effect.

When an application project brings real clients to the chainless platform, the platform rewards them with platform tokens. No tokens will be given if an application project does not bring new registered clients to the chainless platform.

Why do application projects come? The chainless platform has an Ecological Development Fund, which accounts for 24% of the total token supply and is the largest proportion in cryptocurrency.

DW20 clients not only receive DW20 tokens but also receive chainless platform tokens. They can participate in various activities on the chainless platform. Our policy is to reward real clients, as many applications require real identities, especially in the financial sector.

No other platform project in the cryptocurrency field has this kind of resonance effect. That is the chainless team’s competitive strategy. It is easy for existing cryptocurrency projects to migrate to the chainless platform. The chainless platform project development fund serves as an incentive for the project teams while providing chainless tokens to users is an incentive for the users. Both the projects and their clients receive incentives. Combined with the advantages of the multi-signature and multi-backup wallet and the technological and usability advantages, it is highly attractive to project teams and their clients.

1.2 Initial valuation and basic parameters of DW20

DW20 did not have an A-round investment, and the market making fund determined the initial pricing of the tokens. The initial project valuation was $100 million, with each token priced at $0.0005, or 0.05 cents. From the initial issuance to the stablecoin stage, DW20 experienced a 2000-fold increase.

The valuation of the DW20 system is referenced as a post-A-round valuation in venture capital terms. Although there is no B-round, it can be considered a “Pre-IPO” valuation since the “listing” date is anticipated approximately six months after the start of the issuance. This timeframe mainly includes the public testing period. If the value of a financial client is calculated as $500 with only 200,000 clients or $1,000 with only 100,000 clients, a valuation of $100 million can be achieved. The valuation shows that the market maker’s pricing risk is small. Due to the qualification requirement of having a Bitcoin address to receive the DW20 tokens, Since there are Bitcoin addresses that can obtain DW20 anonymously, and the value of Bitcoin customers exceeds that of general customers, the project valuation is not high.

In addition to the valuation data, we have obtained several important data points as primary design conditions:

  • 1.168 billion DW20 tokens for airdrop distribution.
  • 2. Targeting 50 million Bitcoin addresses.
  • 3. Distributed over 30 cycles.
  • 4. Estimated value of $100 per Bitcoin address.
  • 5. Initial listing valuation of DW20 tokens at 0.05 cents per token.

In the initial of first stage, DW20 tokens’ valuation is based on client value, similar to the method for chainless tokens. A similar token issuance formula structure can be used, with adjustments only made to the formula parameters. The adjustment principle is explained in “8. Determining the Token Distribution Model.”

1.3 Airdrop to 50 million Bitcoin addresses

80% of DW20 tokens are distributed through airdrops, totaling 168 billion tokens. We anticipate that approximately 50 million Bitcoin accounts will receive these airdrops.

Using the “mining” terminology, it can be called “register and mine.” That activates the value of Bitcoin users.

The number of tokens received by a DW20 client differs based on whether the client is anonymous or registered. Both real-name and anonymous customers can get the sent tokens.

For anonymous registered clients:

Both real-name and anonymous customers can get the airdropped tokens. the calculation is based on $100 per Bitcoin address, and the number of tokens received varies depending on the cycle period.

For real-name registered clients:

  1. The eligible Bitcoin address gets the same DW 20 token as the anonymously registered customers. In other words, based on $100 per Bitcoin address and varies with the cycle period.
  2. They receive an equivalent amount of chainless platform tokens (CLY) worth $50, which can also participate in various activities on the chainless platform and receive tokens airdropped from other smart contract projects on the platform (if any).
  3. Customers without a Bitcoin address get DW20 equivalent to $50.
  4. Registered clients can participate in the DW20 token lottery. The lottery is very simple, with a draw held once every cycle. The lottery winners are randomly selected from the winners of the last lottery. There are three lottery winners in cycle 1; they are the three people who got the numbers 88, 888, and 8888. The winning distribution is divided into six stages: 1% in cycles 1-5, 2% in cycles 6-10, 4% in cycles 11-15, 6% in cycles 16-20, 8% in cycles 21-25, and 10% in cycles 25-30. The winners of the draw also receive tokens as rewards, and the tokens are distributed each cycle based on the value of $50 per Bitcoin address, which is half of the token distribution amount to Bitcoin addresses. The reward for the lottery winner is ten times that of regular winners. The detailed prizes are specified in the regulations.

It is worth mentioning that regardless of which airdrop cycle, the client’s value remains the same, but the system’s value increases with the growth in the number of clients. In other words, the token distribution progressively decreases.

During the meme coin stage, when the tokens are not yet listed on exchanges, the token distribution logic is based on client value. That model is called the “user model” in the chainless whitepaper.

In the meme coin stage, if the tokens are listed on exchanges, the model should consider the impact of token price changes on client value. That is called the “circulation model” in the chainless whitepaper.

When it reaches the stablecoin stage, where the token price is stable and fluctuates around $1, if the tokens have not been fully distributed, the model should switch to the “standard model” of the chainless tokens. The rule is to divide the token price by the client value of $100 to obtain 100 DW20 tokens. In principle, the coins have already been issued at this time.

1.4 Airdrop after 50 million Bitcoin addresses

After the airdrop to the 50 million addresses, new addresses will continue to be generated, but these new addresses can easily be created without any substantial activity. To differentiate between valid and no valid clients, we will only provide additional token airdrops for newly registered clients who have completed real-name registration, and they will only have the opportunity to participate in the lottery.

 the plan is to give each person three chances to win in the lottery with a winning rate of 10%. That will be done by using 4.48% of the tokens allocated for promotional activities using DW20. However, the specific rules will be subject to the official announcement. Why don’t we provide all the rules for the airdrops at once? Because our distribution data is based on a simulation of the 50 million Bitcoin addresses. Considering there are currently only over 60 million potential addresses, the corresponding measures may need to be adjusted if the number of active Bitcoin users surges. Therefore, the policies after the 50 million address stage will be changed based on the situation.

1.5 What if the issue is less than expected?

Theoretically, the issuing coins rules cannot be changed, but we cannot know in advance how many of the 60 million accounts are dead address. What if there are only 30 million active accounts? Wouldn’t it be stuck when issuing coins? When this happens, the peak of customer growth does not appear in the 19th cycle in Table 1 below but occurs earlier. In this case, it is necessary to adjust the monetary policy so customers can grow smoothly. The community votes on the proposal proposed by the team.

From Table 1 and Figure 2 below, it can be seen that customer growth peaked in the 19th cycle, and it can be considered a decline in the 25th cycle. The monetary policy should be adjusted. New users can enter the market when old customers decline. There are old rules for the original person and new regulations for newcomers. We decide based on practice. After a newcomer buys Bitcoin, it takes five months under the old policy to get the chance to get an airdrop, in the new policy maybe only one month

We cannot make specific regulations in advance. But drawing on the experience of PI and Luna, the adjustment will be very cautious.

2. The Value of DW20

The value of DW20 tokens has been repeatedly discussed from various angles in Chapter 1, and here we approach it from a different perspective.

2.1 Characteristics of DW20

1. Consists of three stages:

A.Commodity stage, which is the meme coin stage.

B.Stablecoin stage, using the US dollar as the benchmark.

C. Standard currency stage, with DW20 as the ruler for commodities.

2. DW20 has different properties in different stages.

D. Does not represent the ecological and user community platform’s value.

E. The issuance of coins follows the conditional approach of “registration equals mining.”  Allows anonymous and real-name registrations.

F. DW20 tokens are BRC20 tokens recorded in the Bitcoin system. It can be traded in the chainless system.

2.2 Narratives of DW20’s Value

1. Limited total supply, gradually reducing the issuance according to the cycle, with over 80% being airdropped.

2. The team  only owns5.42% of the tokens, which is less than the percentage of Bitcoin owned by Satoshi Nakamoto.

3.No market financing, the value generated through consensus is not considered a security.

4. Decentralized Standard currency with market-priced stability..

5. Uniqueness of the DW20 name.

6. Best pairing with Bitcoin as a ruler.

3. DW20 Distribution

Since distribution is the most concerning issue, the distribution method of DW20 has been outlined in Chapter 1, and the following provides supplementary information.

1. Coin Issuance Method

DW20 is not issued based on time like Bitcoin but on the number of customers, following “registration equals mining.”

2. Coin Issuance Period

Referring to Bitcoin and chainless systems, 30 issuance cycles are still used. It is estimated to take 2-3 years to complete the issuance. The estimated total number of anonymous and registered users is around 50 million.

3. Coin Issuance Structure and Quantity

In the first stage:

• the total issuance of DW20 is 210 billion, with no further distribution.

•The specific allocation of DW20 is as follows:

  1. Airdrop: 80%, 168 billion
  2. Stable Fund: 10%, 21 billion
  3. Team: 5.42%, 11.382 billion
  4. Market: 4.58%, 9.618 billion

In the second stage:

•During the stablecoin stage, DW20 can be issued through the collateralization of Bitcoin with no quantity limit.

4. Lockup Mechanism

4.1 Determination of Lockup Period

Since Bitcoin addresses can be randomly generated, in the interest of fairness, we have established lockup tiered systems based on the amount and duration of holdings. A Bitcoin address may appear multiple times in the ledger, and address age should be calculated based on the most recent address. address age refers to the earliest generation of a Bitcoin address associated with an address until the time of applying for the DW20 airdrop. One year of address age is counted as one point, while less than 0.5 years earns no points. If the time exceeds one year, an additional 0.08 point is counted monthly, and less than one month does not earn any points.

One Bitcoin in an account address is worth one point. Less than one bitcoin is also scored based on its face value, rounded to two decimal places. The number of coins held in the address may vary throughout the period. We calculate based on the number of holdings for that specific address on the day of application.

Using a simple algorithm can reduce controversies.

The provisions are made as follows:

1. when address age and Bitcoin holdings accumulate to 50 points, it is considered a gold-tier account;

2. 25 points for a silver-tier account;

3. similarly, 12.5 points for a bronze-tier account;

4. 6.25 points for an iron-tier account;

5. 3.125 points for a tin-tier account.;

6. paper-tier account must have at least 0.5 points.

7. Unlicensed customers, those who do not meet the above standards are unlicensed customers. Register with your real name to receive DW20 airdrop equivalent to US$50.

We use six types of medals to represent and distinguish different lockup periods.

Explanation of provisions and examples:

7. If the latest address holds 20 coins and the coin age exceeds six years, it would be considered 26 points, a silver medal.

8. The amount of coins received by all addresses in the same issuance cycle is the same, irrespective of the tier.

9. For gold accounts, at least two years of currency age; For the silver medal to the tin-tier address, at least one year of currency age. For paper-tier accounts, hold a Bitcoin address for at least five months. That is, assuming that a new user, whether purchasing on a centralized exchange or DEFI platform to hit their on-chain Bitcoin address once eventually, has to maintain a non-zero address in the Bitcoin system for more than five months.

10. different DW20 tokens are issued every cycle for airdrops to customers.

11. Each address can only claim once.

That is a targeted airdrop coin issuance model.

4.2 Release of Lockup

• Lockup: refers to the coins received from airdrops that are not immediately sellable and are released linearly based on the lockup period.

•Linear release: means dividing the total amount of coins by the specified number of days to determine the daily release quantity. Different tiers have different daily release amounts. The release is evenly distributed daily.

• Rules for the release of airdropped coins:

  1. Gold-tier accounts with 50 points are fully released for 30 days.
  2. Silver-tier accounts with 25 points are fully released for 60 days.
  3. Bronze-tier accounts with 12.5 points are fully released for 90 days.
  4. Iron-tier accounts with 6.25 points are fully released for 120 days.
  5. Tin-tier accounts with 3.25 points are fully released for 180 days.
  6. Paper-tier accounts with 0.5 points are fully released for 270 days.
  7. Unlicensed customers can be released linearly within 270 days.

•The number of DW20 tokens awarded is independent of the customer medal, which determines the conditions of release.

•The release date is calculated from the day of listing.

• Rewards for chainless coins follow the rules governing chainlessn coins.

5. Distribution of Airdropped

Coins For airdrops, we continue to use a reduced supply distribution method, but the distribution aligns with the natural growth curve of users. The distribution of tokens is relatively even.

5.1 Determination of the number of coins and addresses for the airdrop and the principle of distribution

Coins DW20 has 80% of its supply distributed through airdrops, totaling 168 billion tokens. We estimate that around 50 million Bitcoin addresses will receive airdropped coins.

Airdrops are based on Bitcoin addresses, with each address valued at $100, far exceeding the value of Bitcoin change addresses. Both registered and anonymous addresses hold this value.

The principle formula is as follows:

Numbers of airdropped coins (g) = $100 / market coin price ……………………….. Principle formula.

That is a principle formula. We adjust it using the following model to suit the various stages of project development.

There are 17,000 people in the first cycle, the total customer value is 8.5 million, which is equivalent to a currency price of 0.004 cents, and 200,000 DW20 coins will be given away. Following this initial phase, the market coin price is in the process of formation for a considerable period. We adopt a method of gradually reducing the number of coins distributed based on the initial pricing.

The parameters in the first line are artificially specified.

The specific algorithm is as follows:

Every three cycles, the standard for distributing airdropped coins is reduced by almost 60% (58.7%). The algorithm for sending coins relative to Bitcoin, this method is much more even.

Even though it is much more evenly distributed, due to the impact of Bitcoin issuance, early customers have an advantage but no risk. From the first cycle to the 28th cycle, the number of allocations differs by 2000 times. See column 6 of Table 1 below.

There is also the feature of reaching 4 million users at the end of the eleventh cycle. That is a sign of the end of the early phase. There is an inflection point where the number of coins given away decelerates, and the difference in the number of coins received decreases, see Figure 5.

5.2 Determination of the user (address) in each cycle

Users and addresses are described below without distinction.

The 50 million addresses are divided into 30 cycles to distribute around 168 billion coins. Here, ‘x’ represents the x-th cycle.

The formula and parameters are as follows:

The number of addresses corresponds to the number of users per cycle uX mentioned in the Chainless White Paper. Whenever “users” are mentioned, it represents Bitcoin addresses.

ux=2×(2+8×0.768(x/3)-0.03345×(x/3))((x-1)/3)………………………. Formula (1)

Formula (1) corresponds to the number of addresses shown in the second column of Table 1.

Table 1 simulated the allocation of coins when user registration

   x 周期 Cycleux 用户数 Number of Users (万人) (10,000 People)dx 新增用户 New Users (万人) (10,000 People)cx当期 发行量  current period issued (亿枚) (100000000 Pieces)Cx累积 发行量 Accumulation issued(亿枚) (10000 0000Pieces)gX 注册送币量   Vx 用户价值 User Value (万) (US $10,000)px 币估值价 Coin Valuation Price (美分) (¢)

Symbols and Meanings:

1. uX represents users and addresses are described below without distinction, the total number of addresses at the end of a specific period. When x equals 30, as shown in Table 1, u30 is 50.014 million, indicating the total number of addresses.

2. Constants: 2, targeting parameters for user development during the launch phase.

3.Exponential growth function: 2((x-1)/3)

Excluding the influence of “8×0.768(x/3)-0.03345×(x/3)”, the main part of the model is that the number of users doubles every three cycles, represented by 2((x-1)/3).

The number of users in the first cycle is manually set. 1.7 is an adjusted initial user indicator, while 3.4 billion is a manually set initial release amount of DW20 coins, primarily determined based on the natural growth curve.

The term “8×0.768(x/3)” mainly impacts the early cycles, while “0.03345 × (x/3)” primarily adjusts the later cycles.

4. Early growth function: 8×0.768(x/3):

The early impact function of 8×0.768(x/3) mainly represents the rapid growth of users during the market launch period, and its influence decreases exponentially as the cycles progress.

5. Late-stage correction function: 0.03345 × (x/3):

The late-stage correction function of 0.03345 × (x/3) mainly describes the slowing growth of users as the market enters the mature phase, with the influence of the late-stage correction function progressively increasing linearly.

Figure 1 shows the S-curve of user growth. It approximately follows the natural S-shaped growth curve.

Figure 1: User Growth Curve

5.3 Determining User Increment

6. The user increment for the current period is denoted as dX. The newly added users include both registered and anonymous customers. Figure 2 shows the registration volume of users in each cycle. It corresponds to the third column of Table 1, representing the new users.

dX = uX – uX-1……………………………………………………… Formula (2)

The new users in Table 1 correspond to dX. The user increment of 1.7 in the first cycle is a parameter set manually.

Figure 2 – Number of User Registrations by Period

5.4 Coin Issuance Model for the Current Period (excluding the influence of coin price adjustment mechanism)

7. Total coins issued in the current period: c represents a coin.

cx=2×0.8((x-1)/3)+dx×20×0.413((x-1)/3) ………………………………………. Equation (3)

where cx represents the number of coins issued in the current period. dx represents the number of new users in the current period, and x represents the x-th cycle. Equation (3) corresponds to the fourth column in Table 1, which represents the coin issuance for the current period. The core formula for user coin issuance is dx×20×0.413((x-1)/3). Initially, 200,000 DW20 coins were allocated to each registered user in the first cycle, and after that, the reward standard was adjusted downwards by 58.7% every three cycles. In the later period, the amendment function for coin issuance is 2×0. 8((x-1)/3)

Figure 3: DW20 Allocation by Period

8. C30 represents the total issuance of coins.

C30 = (c1 + … + c30) ………………………………………………… Equation (4)

where Cx corresponds to the cumulative issuance of DW20 in Table 1, The cumulative allocation of DW20 over the 30 cycles, C30, is 168.2 billion.

Cx is found in the fifth column of Table 1. Figure 3 illustrates the issuance of DW20 in each cycle. Figure 4 depicts the total cumulative issuance of DW20.

Figure 4: Cumulative Total Issuance of DW20

5.5 Coin Allocation for New Users

9.  gx represents the coins each user receives in cycle x, denoting “get.” It corresponds to the sixth column in Table 1, which indicates the number of coins given upon registration. Figure 5 illustrates the number of coins issued in each cycle.

gx = cx / dx ………………………………………………………………. Equation (5)

where cx is the current period’s coin issuance quantity, and dx is the number of new users in the current period. In the first cycle, each new user receives 200,000 coins g1. This formula is applicable for the first 28 cycles. Afterward, the allocation of 100 coins per cycle is artificially set.

Figure 5: Average Coin Allocation per Period

5.6 Determination of Total User Value Vx

10. Vx = 500 × ux

In Table 1, u30 represents the cumulative total of 50 million customers over 30 periods. Each financial user is valued at $500, and the total user value V30 is $25 billion. Each user is valued at $500 – $1,000 according to the valuation rules for Internet finance users. As for the selected Bitcoin customers, they are considered high-quality customers. However, the user value is only a part of the project’s value. Often, the value of a good project far exceeds the user value. Vx is found in the seventh column of Table 1. Figure 6 illustrates the valuation curve of DW20 based on user value.

Figure 6: Valuation Curve of DW20 Based on User Value

5.7 Calculation of Coin Price P based on User Value

 11. Px = Vx / 2100 ……………………………………………………………………… Equation (6)

The coin price denoted as P1, P2, …, and P30 varies each period. Should be market-priced DW20 coins. However, during the market introduction and growth period, especially before being listed on exchanges, the market pricing mechanism undergoes a developmental process. Initially, we primarily reference the subscription price of the market-making fund and evaluate the value of DW20 coins through user value analysis. Nevertheless, this is only a part of the value of DW20 coins. When evaluating DW20 coins based on user value, there are two options for the coin’s total quantity indicator: the already issued quantity of DW20 coins and the total quantity planned by the project. We use the planned quantity of 210 billion DW20 coins as the denominator in the formula. Such a choice is more prudent.

Px is found in the eighth column of Table 1. Figure 7 illustrates the value of DW20 coins calculated based on user value.

Figure 7: Value of DW20 coins calculated based on user value (unit: cents per coin)

6. Circulation Model (Model with Price Adjustment)

The circulation model differs from the user model discussed earlier. Cryptocurrencies are often evaluated based on their circulation value in measuring project worth. The value in the circulation model, calculated according to the circulating market capitalization, may not necessarily be the same as that in the user model. In the early stages of a cryptocurrency’s development, when coins are initially issued, and not yet in circulation, the user model is applicable. However, once coins enter circulation, they become subject to the constraints of their circulating market value and require the use of the circulation model.

The values of pX in Table 1 correspond to the user model. In the user model, we have:

        Px = Vx / 2100 …………………………………………Equation (6)

which can be further derived to obtain the coin price, px, for cycle x in the user model, as shown in Table 1. Corresponding to px, we use p’x to represent the circulating coin price in cycle x of the circulation model. Additionally, in the user model, for the previous cycle x-1 (the previous period indicated in Table 1), the coin price is pX-1. The average market price for that cycle, representing the circulating model’s coin price, p’x-1, may also be higher than the current coin price, px, in the user model for cycle x. Considering the scenario where the circulating market price, p’x-1, is greater than px, we must retroactively reduce the number of coins issued. In the circulation model, we modify Equation (3) from the user model with the same parameter meanings. In any cycle x, we denote the market’s average circulating coin price for the previous cycle x-1 as p’x-1, and c’x represents the current issuance quantity accounting for market price fluctuations. dx and x have the same meanings as in Equation (3). px corresponds to the price for each cycle x in the eighth column of the user model in Table 1. We can modify the coin issuance model for the current period to account for market price fluctuations in the circulation model as follows:

c’x = 2 × 0.8((x-1)/3) + dx × 20 × 0.413((x-1)/3) / (p’x-1/px) …………………………………… Equation (7)

where p’x-1 > px for the model to be valid; otherwise, it is considered an underestimation. If it is an underestimation, Equation (3) is applicable.

p’x-1 considers the average coin price in the previous cycle x-1, accounting for price fluctuations, and c’x represents the issuance quantity for cycle x, considering coin price fluctuations.

If the result for c’X is less than 100 tokens, the Equation is not applicable, and the result is calculated based on 100 tokens.

For example, let’s consider the data excerpted from the 11th and 12th cycles in Table 1. The 3rd column represents dX, the 4th column represents cX, and the 8th column represents pX.


Using the 12th cycle as an example, in Table 1, d12 is 1.565 million, c12 is 12.32 billion, and the user model’s coin price, p12, is 1.337. At this point, the price for the previous cycle, p11, is 0.965. If the price of p11 no longer remains at 0.965 due to average price fluctuations in the previous cycle and instead changes to the circulating market price, p’11 = 2, the coin issuance quantity calculated using Equation (7) would be c’12 = 8.495 billion, which is 3.825 billion less than c12. The coin price fluctuations help in adjusting the issuance quantity.

In designing the average price of the circulating market, we have not used a 20-day average method but instead opted for the average price from the previous cycle. The length of this cycle cannot be predicted, making it difficult for manipulation to occur.

Figure 8 represents the predictive curve considering coin price circulation, depicted in red.

Figure 8 is a schematic forecast curve considering currency price circulation, indicated in red. The blue line is also indicative because there is no prediction data after 5000 addresses.

Whether the token distribution of this formula is reasonable has not been verified. We have drawn a S red line curve in Figure 3.8, which is a guess curve, that is, the ideal curve for 50 million users to reach a stablecoin.

7. Standard Model

We have entered the stablecoin phase at this stage, where the coin price is $1. If we still consider $100 as the customer value and divide it by the coin price, we get 100 DW20 tokens. This data represents the coin allocation after 28 cycles, as stated in the “1.4 Airdrop after 50 Million Bitcoin Addresses” announcement. This valuation is inconsistent with the customer value in Equation (6). Indeed, the entry of users adds value to the system. If the system allocates all its value to the users, then the value of the system itself diminishes. In the case of DW20, users also receive chainless coins (CLY), which reflect the system’s value.

8. Determination method of currency issuance model

Cryptocurrencies are generally done through halving issuance, with the major disadvantage being that too many coins are taken in the first cycle, which is also unsuitable for projects based on customer value.

The chainless platform is a project based on customer value, and DW20 is also. The difference lies in the customer value. Therefore, the coin allocation formula for the chainless platform also applies to DW20. However, the parameters have been adjusted to accommodate different customer values and coin allocation conditions. Readers can see the differences by comparing the formulas for CLY and DW20.

The basic assumption is that customers naturally grow; a natural growth curve describes this. That serves as the theoretical basis for the entire formula. If our parameter adjustments cannot yield a natural growth S-curve, it may indicate that the allocation of users in each cycle is not reasonable.

An exponential equation usually expresses a natural growth curve, which is difficult to adjust. The formula we provide combines two formulas, each with adjustment factors. By comparing the data for both CLY and DW20, we can see that the issuance quantity and the number of customers differ significantly. Yet, the same formula with adjusted parameters is applied. That demonstrates that the formula has good applicability.

In internet projects, most are traffic-oriented. We hope that the coin allocation formula of the chainless platform can be universally applicable to such projects.

DW20 initially functions as a commodity and later as a currency. CLY is an equity coin. The nature of the two coins is entirely different, yet the formula is applicable from the perspective of their application. Obtaining user traffic is their common goal.

The formula parameters are determined through system simulation.

The data in the first row of Table 1 results from the setup.

The data for CLY in Table 4 of the chainless Whitepaper has been verified through programming calculation.

9. Why Meme Coins Become Stablecoins

This question has generated the most confusion among readers since the release of our draft. That is because stablecoins are typically collateral-backed and have a centralized authority. Decentralized Standard currencys do not align with previous experiences and are challenging to comprehend. As mentioned in Chapter 1 of this paper, “After 15 years of financial and technical practice, Satoshi Nakamoto devised a genius solution to the problem of currency credit by combining imitation, modification, and innovation.” The emergence of DW20 is also the result of a combination of imitating, modifying, and innovating.

To address this question, use several examples: Bitcoin, Dogecoin, Fcoin, and Luna.

9.1 Insights from Bitcoin

Bitcoin is a project that is often difficult to understand, primarily because Satoshi Nakamoto admitted to being proficient in programming but not in writing. Even now, few fully comprehend Bitcoin because Satoshi Nakamoto did not explain it clearly. With the volatile market, few individuals have the mental capacity to dedicate themselves to in-depth research. Unlike artificial intelligence, which focuses on depth, cryptocurrency focuses on breadth. Cryptocurrency serves as both Productivity and production relations, While depth can be achieved through iteration, how does one achieve iteration in breadth?

Regarding the breadth issue, careful consideration must be given in advance rather than relying solely on iteration. Satoshi Nakamoto’s 0.1 Structure from beginning to end, that Bitcoin has remained consistent. This consistency reflects the comprehensive thinking capacity of Satoshi Nakamoto. Examining a project’s whitepaper can determine if the project team has thought deeply about its endeavor. Therefore, writing a good whitepaper is a basic requirement for cryptocurrency projects.

9.1.1 Writing a Good Whitepaper and Avoiding Excessive Regulation

A whitepaper serves as a “constitution,” an execution manual, and a detailed specification document. For an automated system like Bitcoin, transparency is crucial to avoid providing regulatory authorities with a reason for intervention.

Does Bitcoin need regulation? That depends on which aspect requires law. Mining machines, for example, must adhere to legal requirements, operating similarly to company management. There is no controversy regarding regulation in this case. However, the Bitcoin maintenance team, currently devoid of regulation, operates through community consensus, leaving a small gap for regulation. How can you regulate individuals who maintain the system when they are not subject to company management and do not receive salaries?

From Bitcoin, we can conclude that regulatory oversight is necessary in non-transparent areas. The higher the transparency, automation, and marketization of a project, the less it requires regulation. Conversely, third-party regulation becomes necessary when central control, profit centers, data opacity, and a lack of autonomous checks-and-balances mechanisms exist.

The need for regulation can be assessed by considering the personnel involved. The Bitcoin team currently consists of four individuals, and it is estimated that Ethereum has no more than 15 individuals. Even if regulation is necessary, it does not need to follow traditional models. Regulating Bitcoin and Ethereum using centralized thinking would be laughable.

In contrast, DW20 tokens belong to different individuals and, in theory, are not part of the DW20 system because the platform is irrelevant to its operation. Furthermore, DW20 lacks a controlling entity. Similar to gold, how can DW20 tokens be regulated? Gold does not need regulation, nor does Bitcoin. However, the funds associated with DW20 involve operations, and they would require regulation. Only the market making fund associated with DW20 necessitates regulation, falling within the scope of financial law. The project’s operations are democratically managed through community consensus. However, it differs from the Bitcoin technical community’s management approach and resembles the Ethereum Foundation’s operational approach, primarily for token distribution. The Ethereum Foundation determines the technical projects to support through token funding, while the DW20 team allocates 4.58% of active funds. The DW20 team will incorporate successful experiences gained from other cryptocurrency creations.

The allocation of 5.42% of tokens to the DW20 team does not require market consensus, much like Satoshi Nakamoto’s use of tokens without seeking the approval of others.

9.1.2 Why Bitcoin Has Value

Firstly, it is essential to understand what value is. Value can be categorized as utility or asset value, with tradable assets possessing asset value. Different value judgments placed on the same item can facilitate transactions. Free market transactions establish the objective value of commodities. Short-term transactions may be speculative, but in the long run, weight is given to transactions. The determination of short-term prices follows Mises’ regression theorem, where today’s price is determined by yesterday’s price, forming the initial status of prices that can be regressed. Prices formed through countless market transactions contribute to long-term trends, ultimately reaching price equilibrium. Can long-term trends be wrong? Yes, it is in these instances that analysts’ value discovery comes into play, followed by people flocking to their discoveries. Warren Buffett’s expertise lies in value discovery.

Since asset value judgments are subjective, consensus is required for value recognition. Both paper and the “money” you draw on are not money, whereas the money printed by the Federal Reserve is. Behind this recognition is trust.

Bitcoin established a machine credit system, with its value derived from improving computing power. Computing power forms the bottom of Bitcoin’s price. A rational narrative must be established if it deviates from this bottom and rises, just like real estate. The actual narrative for real estate is outperforming inflation based on the expectation of supply and demand balance. An imbalance between supply and demand can cause real estate prices to skyrocket, while the expectation of increased supply can lead to a price decline. The estimated 85,000 properties that Dong Jianhua in Hong Kong resulted in a drastic drop in housing prices, ultimately leading to naught. Bitcoin’s supply is fixed, thus eliminating the risk of increased supply. Bitcoin’s current inflation rate is 1.67%, meaning the depreciation risk when holding Bitcoin is lower than the nominal depreciation risk of fiat currencies, and the actual depreciation risk of fiat currencies is even higher. Hence, Bitcoin has established a narrative of value storage.

Gold is the king of value storage, valued at $11 trillion. Bitcoin has properties superior to gold, albeit with less consensus, making it currently in the value discovery phase. The value of the second-ranked asset is generally 30% of the value of the top-ranked asset. Therefore, when Bitcoin reaches the position of the second-ranked asset, it will be worth approximately $3-5 trillion. Assuming Bitcoin has a value of $5 trillion, there is still more than an eight-fold increase. To surpass gold’s market value, Bitcoin needs an alternative narrative: the Bitcoin standard.

Regarding the Bitcoin standard, there is still no clear path forward. The best attempt thus far is DAI, which is also centrally operated, treating the project as a bank. Additionally, stablecoins pegged to currencies do not possess the power to set currency prices. Pegged currencies are not the standard. For more information, refer to Chapter 1, “3.1 Reasons for Issuing DW20.”

9.2 Reasons Why Meme Coins Cannot Gain Significant Traction

Current meme coins fail to gain significant traction because they do not have a clear direction from the start, and their consensus range is limited. On August 13, 2021, a report from Chainalysis revealed that there are currently 4 million on-chain holders of Dogecoin. Still, a small number of entities hold most of the supply. Of the 106 billion Dogecoins in circulation, 82% is held by 535 entities. The value of 4 million customers is only worth around $4 billion, and this customer base has not seen significant growth.

The narrative for Dogecoin revolves around tipping and payment. Among the 535 entity holders, exchanges account for a significant portion, and speculation has become an important use case for Dogecoin, which was not the initial intention behind its narrative. As the price of Dogecoin rises, the use case for tipping decreases, and its volatility makes it unsuitable as a currency, with a 5% inflation rate being impossible to function as money. Despite the lack of a credible narrative, the consensus among some individuals has supported the price of Dogecoin.

For meme coins to grow significantly, they need tangible applications. That is why Dogecoin fails to gain significant traction, as it does not provide a clear path for its market to view it as a payment currency.

9.3 Experience and Lessons from Algorithm Stablecoin Luna-UST

Luna is the token of the Terra ecosystem, and Chai is a South Korean e-wallet application that allows users to make payments using the Korean Won (KRW). Transactions are processed on the Terra blockchain, with transaction fees paid to the Terra network. As of June 2021, Chai had 2.5 million customers, serving as the capital for Terra. It is worth noting that they already had users from the beginning.

Luna represents equity, and UST is pegged 1:1 to the US dollar. Luna and UST form an arbitrage relationship based on the US dollar. So far, there are no issues. The problem arises when they utilize a treasury, collateralize UST to generate a 20% interest rate, and to obtain UST, they have to buy Luna to exchange for UST for collateral, causing the price of Luna to increase significantly. From less than $1 at the start, the price of Luna reached over $130 by May 2022, with a peak market capitalization of $43 billion. The core question for Terra is how to pay the interest. Terra sells Luna tokens, with a portion used for interest payments and the rest kept as reserves. Terra is rumored to have over $1 billion in reserve assets, including Bitcoin and Ethereum. Relying on selling tokens to pay the high-interest burden places significant pressure on the project. Terra decided to lower the interest rate to 5%, causing 70% of locked UST to flood the market. As a result, Terra fell from its position as the third-largest stablecoin, and its demise became inevitable.

• A vital lesson:

Changes in monetary policy must be approached with great caution.

• A direct experimental result:

Luna confirms that algorithmic stablecoins can be accepted by the market, demonstrating that algorithms can automatically stabilize prices. The key is to design a good algorithm without any loopholes.

• Summary of lessons learned:

1. price is heavily deviated from value.Lana represents the value of the Terra system, which has no computing bottom, only a value bottom made up of users. It has about the same number of users as Dogecoin, and we can speculate that Dogecoin’s 12 billion market cap, which Luna is likely to support. Forty-three billion of Luna’s market cap is too exaggerated.

2. Why can you give a 20% interest rate? The logic of the story is incomplete.

3. pledges skyrocket and usually plummet. There has to be a consensus on the quality of the pledges.

4. lack of risk control tools. At this point, Luna represents equity and the backing of a stable currency. What is used to detect market risk, and what means are available to control it? The Luna algorithm only calculates the price difference of transactions, which is far from sufficient to manage risk.

5. The main flaw is that its pledge is the project’s equity, and the increase in equity is formed by mortgaging UST itself and then selling the equity to pay interest, with obvious Ponzi characteristics. It’s not that there is no hope of success at all. They want to cash out at a high level and return to defend the bottom of the price. That is a very risky logic, but God fails to fulfill their wishes.

• What have we learned?

6. It is feasible to have users, i.e., meme coins, first, then turn into stablecoins.

7. The value formation mechanism should be reasonable, and the logic complete. It has to be thought through from the start, like Bitcoin.

8. There should be market risk testing and risk control.

9.4 Experience and Lessons from Fcoin

FCoin, an exchange, was launched on May 21, 2018, and immediately attracted numerous investors. On June 13 of the same year, just 15 days after FCoin officially launched, the total trading volume reached 28.8 billion RMB. It ranked first globally and surpassed the total trading volume of the six exchanges ranked second to seventh combined, including OKEx, Binance, and Huobi. As a result, it was dubbed the “First Exchange in the Universe” within the industry. However, after reaching its peak at $1.2567 per token on June 13, the platform token FT experienced consecutive days of plummeting prices, followed by a continuous decline in trading volume. On June 18, FCoin announced the subscription of stabilization funds, hoping to stabilize the price of its platform token FT through open market operations. However, these efforts failed to be effective, and a series of subsequent operations failed to salvage the project from its fate of failure.

What is the reason behind this? They failed to understand the randomness of computing power and the fundamental principle of block production’s linearity. When applied to the Fcoin project, the random entry of users to conduct transactions and receive tokens caused the number of tokens distributed to deviate from a linear relationship, resulting in random sell-offs. Insufficient capacity to absorb transactions led to the collapse. A major design flaw ruined the project.

Bitcoin distributes tokens every day without affecting the token price. Why? Because this is a deterministic event. In capital markets, stock prices will correspondingly decrease for the issuance of additional shares. That is because the distribution of stocks is uncertain, and stock revaluation is based on the number of additional shares issued.

In conclusion:

an automated system must have a negative feedback mechanism to counter uncertainty.Turn uncertain customer enters into a linear release to achieve a balance of transactions.

9.5 Methods of Meme Coins to Stablecoins

DW20 is divided into three stages, with the second stage currently in the stablecoin phase, where collateral-backed issuance is in effect. Vulnerabilities are evident in the first phase. The first phase is similar to the description of chainless coins in the Chainless whitepaper, both being value-based coins. The methods for addressing these issues are similar, as Chapter 2 of the Chainless whitepaper describes.

Get the customer:

Based on the above explanations, if we don’t have money like stablecoins from the start, we need customers first, just as Bitcoin adopted a token distribution method worth considering.

DW20 is based on customer value. The gradual increase in customer acquisition enhances the underlying value of DW20.

Customer acquisition is achieved through airdrops and resonance with the chainless platform. Customers can be shared across platforms.

DW20 will serve as the chainless platform’s future stablecoin and transaction currency. The chainless coin CLY represents the value of the chainless project.

Continuous airdrops with decreasing allocation and lottery-based airdrops will contribute to constant customer growth.

After the initial distribution of 50 million customers, DW20 needs to change the distribution conditions.

As the customer value base, 60-70 million customers could support the 210 billion DW20 tokens valuation.

Solving Vulnerability Issues

Vulnerability is manifested as significant fluctuations in the price of the currency.

The Bollinger Bands represent the trend line of market transactions and serve as a means to detect market risks. Adjustment is needed when the currency price deviates from the trend line. With a block generation time of 10 minutes, Bitcoin is also a detection mechanism.

As a means of risk control, Bitcoin is difficulty adjustment.

We have two weapons at our disposal, lockup, and stable funds. The stable objectives to be achieved are:

• Maintain an upward trend in the value formation stage, also known as the transformation stage of meme coins.

• Gradually reduce the amplitude of the Bollinger Bands interval to less than 1.2% in the stablecoin stage.

•In the standard coin stage, the increase in Bitcoin’s rise and DW20 issuance corresponds. The foreign exchange market is bound to exist because of different standard coins. If there is no exchange rate market, we envisage it, but it has not yet reached the level of disclosure.

1 . Lockup:

Since our airdropped coins are given for free, the entry of customers is random, and we have different lockup periods for customers. However, preventing the random selling of maturity coins is difficult. When the currency price reaches 10% below the lower Bollinger Band, we will temporarily add additional lockups to the coins still in the lockup period until the currency price recovers to the middle Bollinger Band; at this point, the lockup will be released. If the lockup is extended by three days, three days beyond the original one-month lockup period, Fcoin will have difficulties implementing this point because others purchase their token FT. The unlockings will be doubled when the currency price reaches 10% above the upper Bollinger Band. The unlockings initially scheduled for the following day will be unlocked one day in advance until the currency price falls back to 5% below the upper Bollinger Band; at this point, the additional unlockings will cease. This principle is to regulate supply and demand. The tokens purchased by the market are not subject to the same restrictions, and the already unlocked tokens are the same. These operations are automatically executed by the machine and are performed on a chainless platform.

2. Stable upward trend

In Chapter 1, “6. Principles of DW20 Stability,” we introduced the principles of DW20 stability, and here we present the specific operations. The market-making fund is a stable measure used when the lockup mentioned above does not work. It begins to collect DW20 when it reaches 20% below the lower Bollinger Band, 10% lower than the lockup position. The collection of DW20 can be increased by 3% upward position, and it stops when the target is reached.

  1. Start selling chips at 5% above the upper Bollinger Band until the selling stops at the upper Bollinger Band.
  2. Stop selling when the market-making fund reaches a 50%:50% ratio of USD and DW20.
  3. Stop selling when the fund maintains a 50%:50% ratio of USD and DW20 and the price rises above the upper Bollinger Band.

The above steps stabilize the trend and enable DW20 to rise according to the Bollinger Band fluctuation trend. The expected rise will be unprecedented. Due to fewer uncertainties than stocks, the factors for judgment are simple: the increase in DW20 users and chainless platform users, and trading volume. In the first stage, like Bitcoin, the consensus is established purely through storytelling. The basic narrative logic is the distributed stable coin, Bitcoin standard, and transaction tokens on the chainless platform. For a detailed description, please look at Chapter 1, Section 6.

3. Stable value floor

The stable fund has no money, only coins. External funds are divided into two equal parts, with 50% used for stabilizing the trend and 50% responsible for stabilizing the floor price.

The floor price is the user’s value floor.

D. Collection is done at the value line, with the collection of DW20 increasing by 3% upward and stopping when the target is reached. Selling at the middle or upper Bollinger Band depends on the percentage of cash in hand. If the cash on hand is below 25%, selling is done at the middle Bollinger Band. Otherwise, selling is done at the upper Bollinger Band.

E. After all the market-making funds are bought, there is still selling. That is a rare opportunity. The market-making fund is responsible for raising cash from the market.

Vulnerability is addressed by the three instruments mentioned above: lock and release, stabilization of the trend, and stabilization of the price floor. Same as market makers in the primary market, based on rules.

Role of the fund during the stablecoin stage

During the stablecoin stage, the role of the market-making fund is to narrow the amplitude of the Bollinger Band. When it drops to the lower Bollinger Band, it starts collecting DW20, and selling occurs when it reaches the upper Bollinger Band. Once the amplitude of the Bollinger Bands is smaller than 1.2%, operations cease.

Bitcoin standard stage

In this stage, the fund’s purpose and how to deal with it,  this is something without precedent and needs to be fully deliberated, listen to the community’s opinions.


J. The market making fund operator and the team sign a contract, subject to the terms of the gambling contract.

H. Securities institutions regulate the market-making fund.

10. The Bitcoin distributed system’s core concept is that it does not generate profits

The stable fund does not aim for profitability but stability. We will agree through the contract that the market maker will make the market according to our conditions.

DW20 has four profit beneficiaries: arbitrageurs who mortgage Bitcoin, fund market makers, chainless platforms, and users.

Bitcoin has two profit beneficiaries: miners and users.

As with the Bitcoin system, DW20’s common characteristic is that the system does not generate profits. However, DW20 does not require system maintenance and separate bookkeeping. In the first stage, the community needs to maintain DW20; the main issue involved is just one, the 4.82% token allocation. The purpose of token distribution is to incentivize user participation. The DW 20 team is responsible for organizing a separate maeket maintenance team.

Why do cryptocurrencies advocate for decentralized systems? Once a centralized system structure exists, there will be a profit model, and with a profit model, it will be driven by interests. Whether it’s banks, stablecoins, or the Federal Reserve, they are all centralized institutions. How can fairness be achieved? Without fairness, what will be the ruler?

In the underlying layer of the internet, all protocols that generate profits have disappeared, leaving behind only non-profit protocols. In real life, it is rare to see a fee-based ruler. The current inflation of fiat currency is like a ruler for fees. The free model of the internet has shattered the fee-based model. Can the fee-based ruler still hold its ground if a ruler doesn’t charge fees? The Bitcoin system does not generate profits, and the beneficiaries are dispersed. The same goes for DW20 – its beneficiaries are also Dispersed.

Chapter 4 Prospect Analysis of Bitcoin Standard and DW20

What is the prospect of the Decentralized Standard currencys DW20 and Bitcoin to realize the Bitcoin standard? Risks mainly come from three aspects, compliance, competitors, and DW20’s logic and technical loopholes. Analyze separately below:

1 Risks of Bitcoin

Bitcoin has experienced 14 years of development, its legal risk is no longer significant, and the reliability of its technology has been repeatedly verified. At present, there are four main risks in Bitcoin. Regarding these risk issues, there are still debates in the industry:

1.1 Carbon emissions

The computing power of Bitcoin mining is still growing exponentially, and many people think that the resulting carbon emissions are one of the reasons for destroying Bitcoin. The carbon emissions issue is a matter of compliance. We are not experts on carbon emissions. Interested people can refer to the statements and discussions on the Internet. Here are some representative opinions:

Pessimistic statement:

PwC analyst Alex de Vries estimates that the Bitcoin network now emits 475 grams of carbon dioxide for every megawatt of electricity consumed. If this estimate holds, when Bitcoin rises to $500,000, 617 million tons of carbon dioxide will be emitted yearly. Annual carbon emissions from bitcoin mining would be much more than the U.K.’s 352 million tonnes and closer to Germany’s 696 million tonnes. The current yearly carbon emission in the United States is 4.921 billion tons. At a Bitcoin price of $500,000, the carbon emissions of the global Bitcoin industry would be equivalent to 12% of that of the United States. It is a fantastic result.

Optimistic statement:

Mines will switch to wind, solar, hydroelectric, hydrogen, and nuclear power. Bitcoin mainly uses “abandoned water and electricity,” which are the electricity that cannot be fully utilized temporarily or that will be wasted, such as the abandoned electricity of the Sichuan Hydropower Station in China.

In 2020, the University of Cambridge provided a map of the location of Bitcoin miners over time, which uses location data to color-fill the carbon intensity of different grids. Currently, the contribution of renewable energy to the Bitcoin network remains low on an annualized basis. According to a 2020 Cambridge University interview, Bitcoin miners said that approximately 39% of the energy used for Bitcoin mining comes from renewable sources.

Musk put it this way:

When miners use more than 50% of clean energy for mining, Tesla will re-allow the use of Bitcoin for business transactions, that is, resume buying cars with Bitcoin.

Musk is an expert in carbon trading, as well as an expert in energy storage. If 50% of clean energy is used for mining, carbon emissions, and indicators will be balanced. Therefore, he agrees to resume buying Tesla electric cars with Bitcoin when this indicator is reached. It also shows that Musk is optimistic about Bitcoin.

Musk’s views have always been avant-garde. Who should we trust when we don’t understand carbon emissions? Trust the experts. Let’s trust Musk.

1.2 Quantum attack

Some people think that quantum computing can destroy Bitcoin’s encryption algorithm. In this regard, Satoshi Nakamoto said there would be new encryption algorithms.

If the encryption algorithm of Bitcoin can be destroyed, the encryption algorithm currently used by banks can also be destroyed. In this way, the entire financial security system ceases to exist. Isn’t it more profitable to attack banks and financial systems?

In fact, according to Satoshi Nakamoto’s theory, if the benefits of honest mining are more significant than the benefits of doing evil, why do people choose to do evil? With quantum computing, just like ASIC mining machines replacing GPU mining machines, mining costs, and power consumption will be lower, thus making mining greener.

When reaching the stage of the Bitcoin standard, the Bitcoin ledger will become an essential infrastructure for human beings, and all large institutions will cold-back up the Bitcoin ledger. In this case, the probability of destroying all ledgers is zero.

1.3  Artificial items

After all, Bitcoin is a string of numbers; how many years can it be kept? It does not have the ability of gold never to die. This statement is indeed irrefutable. However, the current legal currency is also digital, and its nature is the same as that of Bitcoin. If Bitcoin disappears, will digital money also disappear? We believe in the innovative ability of human beings; as long as there is demand, there will be innovations. Will Bitcoin disappear? That is, whether human beings will be destroyed, and God knows where the answer to such questions is.

1.4 Other possible problems

Will governments around the world join forces to block Bitcoin? If this question is compared with whether Bitcoin will disappear, the chance of this possibility is slightly higher. This problem is solvable because we have Satoshi Nakamoto. It will be analyzed later.

In short, after 14 years, Bitcoin has grown from a seedling that can be easily destroyed to a towering tree today, and all the risks it can expose have been exposed. The most considerable uncertainty is the identity of Satoshi Nakamoto. This problem has been solved, so the significant risk no longer exists.

2 Risks of DW20

For the risks of Bitcoin described in 4.1.1-4.1.3 above, DW20 also exists, but the degree is different. The risks of DW20 are mainly those at the “seedling” stage. The following specific analysis:

2.1 Risk of the actual controller of DW20

80% of DW20 coins are sent out, and the team cannot control it. Although the team does not own 10% of the stabilization fund, it has control and still has 10% of the currency distribution rights. This power is similar to that of the Ethereum team. Of course, the market has accepted this approach of Ethereum. Ethereum’s approach has two points:

1. Be open and as transparent as possible;

2. Community decision-making consciously limits their power.

Ethereum has established standards for subsequent projects. Its core idea is that openness is the premise of fairness, and only justice can lead to consensus.

We said in the introduction of the first chapter that the members of the DW20 team did not choose to remain anonymous because the current legal environment is different from that before and after Satoshi Nakamoto’s disappearance. “Open” means that the DW20 team is willing to take responsibility. The existing maintainers of Bitcoin are all publicly named; the reason is the same: they are willing to take responsibility. The departure of BM, the founder of EOS, and the non-leaving Vitalik of Ethereum all illustrate this problem. At that time, both of them were equally famous figures in the circle, but in the end, the market chose Ethereum, and B.M.’s departure meant that EOS was basically sentenced to death. Because Ethereum is entirely different from Bitcoin, it has always needed continuous development as an ecological project. The currency circle remembers Satoshi Nakamoto and the currency circle also recognizes Vitalik because they are all right.

The inventor of BRC20 @domodata is a bit ridiculous. He (they) did not need to be anonymous, but the result of anonymity has aroused suspicion: Is it more convenient for them to manipulate the market for their opaqueness? Did you send all the coins to yourself? The rise in the price of meme coins may be due to speculation. Obviously, anonymity is more suspicious. Satoshi Nakamoto also paid the price for anonymity, and most of his bitcoins (about 1.14 million) have not been moved.

We accept what Ethereum does.

The number of DW20 coins distributed by the entire DW20 team is less  than the number of Bitcoin coins held by Satoshi Nakamoto, DW20 team is 5.42%. As a token issuance project with the same principle as Bitcoin, DW20 has the less than currency holding ratio as Satoshi Nakamoto, and the market has nothing to say.

How much is 5.42% worth? According to the previous 10% of DW20 as a stable fund, the fund is valued at 10 million U.S. dollars, and the overall valuation of DW20 is 100 million U.S. dollars. The team’s token value is 5.42 million U.S. dollars.

The operation of the market-making fund is beneficial, and the actual controller is also related to the initial market-making fund operation team. Still, the initial risks of the project outweigh the benefits, which means that the personal credit of the DW20 team has endorsed the project to the market-making fund operator. Because the operator needs to invest real money, the project requires the market-making fund operator to make an initial price for the project.

The Fed also has a market maker nature, selling high and buying low through the buying and selling of assets. Isn’t he “manipulating” the market? Yes. These techniques are similar. The difference is that one is legal manipulative behavior authorized by law, and the other is illegal manipulative behavior cracked down by law. The Fed does not directly intervene in the market pricing of the dollar. They make public the standard of operation. And we also have operating standards. For these, please refer to the relevant content in Chapter 3, “DW20 Token Distribution and Stability Methods”. We will disclose the market-making fund operation documents when we select the market-maker.

Market-making funds are traditional funds and are regulated by traditional financial laws.

The power of the team is reflected in the handling of 4.58% of DW20 tokens. It is unprecedented and belongs to market operations. However, who can get the tokens is open. The team wants to be fair, but it’s impossible to please everyone.

Satoshi Nakamoto only took 5.428% of the bitcoins, far less than the income of all the early entrepreneurial teams of Internet companies. Only Internet companies that have gone through multiple rounds of investment and publicly conducted an IPO have actual controllers who hold a few percent, such as Ma Yun and Ma Huateng. In fact, after the issuance of Bitcoin, it will be in circulation, which is equivalent to going public. Satoshi Nakamoto used the high standards of the best personnel in listed companies to demand the number of bitcoins he holds strictly. So, we believe he has a dream to change the world. With this dream, money is not the priority. Only with this view of wealth can we ultimately succeed. Satoshi Nakamoto cannot speak directly to the public, but he told people his Bitcoin has never been moved and paid to change the world. We have to learn from Satoshi Nakamoto.

2.2 Technical risk

The chainless platform we chose is a brand new platform, and the essential development uses a new language, the general distributed language Greatfree written in JAVA language. The author of this language, Professor Li Bing, developed it in obscurity for ten years. The language has not been tested in actual combat. Fortunately, the basic code of the chainless system is written by Li Bing alone, which has the primary conditions for creating a great project. It should be pointed out that when Bitcoin was created, its development method was also such a one-person system. The fact is that we have two plan, a one-person system and a public chain, and it may be more realistic to choose one of them. There will be problems and loopholes in the chainless system, which require everyone to participate in solving them. Therefore, considering these factors, we have estimated the first phase of DW20 for 2-3 years. The design logic of this product is complete, but the operation details need to be tested, so Chainless will not be listed on the exchange during the public beta phase within half a year.

2.3 Product risk

1. If too many product failures cannot be resolved in time, it will cause negative word of mouth and cause the loss of users.

2. Products with similar advantages beyond DW20 appear. Because a project enters the main battlefield of the Internet only after it enters the market currently occupied by Web2, capital predators and technical expert teams abound, and their strength far exceeds that of ordinary small cryptocurrency teams. Regarding development, our leading ideas and unique general-purpose distributed language have removed the obstacles for them to enter the cryptocurrency field. They will further intensify Competition in the entire cryptocurrency field.

3. Product growth is not as good as expected, and the assumption is too optimistic.

4. Products are firmly blocked and restricted by interest groups.

2.4 Legal risk

Under normal circumstances, the possibility of DW20 being recognized as security is tiny. Now the world is looking at the United States, and the US SEC uses the Howey test as a criterion for judging. There are four Howey tests, the last three of which are subordinate to the first. The first article, “is an investment of money,” If it is not an investment of money; is it not a security? If judged in this way, DW20 is not a security.

The United States is case law. The US SEC has stated that Bitcoin and Ethereum are not securities. So let’s compare the DW20 to them.

Compared with Bitcoin

There is no financing for the Bitcoin system. The system has no owner, and The Bitcoin system is not profitable. The maintenance team does not directly profit from the system.Tokens are distributed according to the rules, and the purchaser expects a reasonable profit from the investment.

DW20 meets all the above conditions. The distribution rules differ; the DW20 team has a 5.42% retention. This retention is much less than Ethereum’s, Little bit less than Satoshi Nakamoto’s currency holding. The point of difference is that Satoshi Nakamoto dug it. In the early days, no one dug Bitcoin, so Satoshi Nakamoto almost allocated it to himself. DW20 and Bitcoin are just different ways, the  proportion is almost the same, and the effect is the same.

The US SEC pointed out that if the development of a digital currency relies on the efforts of a company or a centralized entity, and the purchaser has reasonable expectations of obtaining a reasonable profit from the investment, then the digital currency is considered a security. Investing has reasonable profit expectations, and Bitcoin does too. According to case law, this is nonsense. So the core of this sentence is to have a business entity, and the project is the profit tool of the business entity. It will be recognized as securities even if not raised in the market. The chainless token CLY represents the equity of the chainless system, and the price of the chainless token CLY reflects the profitability of the system.

Whether the chainless CLY token can be considered a security is controversial. This type of securities is different from traditional equity and has high transparency. We suggest supervising according to the openness of the project.

DW20 has market makers. The market maker and the DW20 team are not a team. Market makers and mortgage arbitrageurs have the same status. In the white paper, market makers must make markets according to the rules.

Market making is not illegal. The Federal Reserve, Hong Kong Monetary Authority, and USDT all make markets. The core is to create a call with rules.


Under the existing conditions, it is difficult to identify DW20 as security. So this, Unless Bitcoin and Ethereum are securities.

3 Competitive Risks

In addition to the product competition mentioned above, the risk of Competition also comes from the Competition of similar solutions and development ideas. The breakdown is as follows:

3.1 Is one Bitcoin equal to one Bitcoin?

The meaning of this sentence in the blockchain industry is Bitcoin standard. At the earliest, there were various trading pairs with Bitcoin and Ethereum as the standard currency. The emergence of such trading pairs is the result of implementing this idea. The mainstream blockchain view naively believes that all commodities must use the Bitcoin standard, but the facts are mercilessly slapped in the face. After the stable currency emerged, these trading pairs disappeared without a trace.

It is correct nonsense that one bitcoin is equal to one bitcoin. Those who say these words are blockchain bigshots. They may understand a little bit of technology, but they don’t understand finance at all.

Currency has more than 20 attributes, with three main financial characteristics:

  1. stored value,
  2. transaction,
  3. ruler.

Bitcoin doesn’t have a ruler feature, at least not yet, and it doesn’t let people see the path to becoming a ruler. Although this road is not feasible, the impact is tremendous and highly misleading. Long-term Bitcoin holders especially believe that Bitcoin will naturally become the standard currency. If Bitcoin does not solve the problem of the ruler, there is no possibility of becoming a standard currency at all.

3.2 Competition with gold

Gold has been used for digital payments longer than Bitcoin. As early as 1996, Douglas created electronic gold E-gold. Unfortunately, the pioneer was sentenced. Until today, attempts to use gold as a standard for payment, or attempts to use gold as an endorsement to issue virtual currency, have never stopped. However, there has not been an influential large-scale project in the private sector yet. That is because gold has problems, and the folk road will not work.

The other way is the way of the government. Gold still has a massive advantage over fiat currencies. U.S. Congressman Mooney promoted the gold bill, hoping to replace legal tender with digital gold. He saw the problem. If a gold endorsement is behind the dollar, excess currency issuance will not be easy. Fortunately, he is not a genius like Satoshi Nakamoto or an entrepreneur. Mooney did not develop a good solution, and only slogans are useless.

In the absence of Competition, the Federal Reserve has no motivation. Once there is Competition, such as the DW20 Bitcoin standard, the United States can use its credit and the strength of gold to re-limit private gold holdings; what will happen then?

If various countries abandon the U.S. dollar, and the U.S. government has nothing to do about it, will the U.S. come up with something like the Bretton Woods Agreement? Now non-US dollar countries have reduced their holdings of U.S. debt since last year and instead increased their holdings of gold. Gold has been fired to around $2,000 per ounce. The world’s central banks love gold more than Bitcoin, and Bitcoin has not yet entered their eyes.

At now, the collapse condition of legal currency is very similar to the collapse of paper money Jiaozi in the Song Dynasty, and the issuance of currency is increasing exponentially, which is conducive to the formation of financial giants. Chinese banks are already giants. Banks of America are also fast. The Federal Reserve, plus a few member banks, can rule the United States and simultaneously rule the world in disguise. Because the E.U.’s finances are integrated, China belongs to the U.S. dollar ecology, Japan sees the face of the United States, and the conditions for blending are almost met. It is not surprising that the United States will do anything. For example, the gold mining quota can be like a carbon emission agreement. When the total amount of gold is limited, it is close to the characteristics of Bitcoin. The disadvantage is that gold is not evenly distributed, without fairness, it is difficult to reach an agreement. It is just an assumption; of course, gold has other flaws. There is a saying in shopping malls: the best thing will be to sell the best. The same goes for financial products. It’s not that people can’t design gold token products, but why use the gold standard? When the Bitcoin standard is the best solution?

In short, if the DW20 bitcoin standard competes with the gold standard under the traditional financial power, although DW20 does not have an absolute chance of winning, the authority may not always win. In the Gamestop case, organized retail investors beat financial dealers. The Bitcoin community has what it takes to win the race, but strong leaders must show up. It is the meaning of “Invite out Satoshi Nakamoto to welcome the new world”; One of the purposes of the article is that to build the world’s No. one bitcoin community.

3.3 Competition with the Bitcoin dollar standard

See chapters 12 and 13 of our article “Invite out Satoshi Nakamoto to Welcome the new world” for the proposal of the Bitcoin dollar standard. The plan is feasible, but Satoshi Nakamoto must show up, and the U.S. government should be motivated. This plan is good for America, it’s suitable for the people, it’s good for Bitcoin, but it takes away most of the powers of the Federal Reserve. It isn’t easy to revolutionize oneself, which requires a visionary leader in the government.

When will the Competition arise? When Bitcoin achieves a market value of 20 trillion, there will be problems with the status of the U.S. dollar. By that time, they may take this option seriously.

We would be delighted, too, If the Bitcoin USD standard proposal succeeds. However, if the DW20 Bitcoin standard is ahead of the authorities, then the monopoly of the U.S. dollar may not necessarily exist. The world has dollars and euros, so who cares about one more DW20 Standard Currency? History has a window of opportunity. When Bitcoin has a market value of 20 trillion, it is hard to say whether the U.S. government can persuade Satoshi Nakamoto to cooperate.

3.4 Competition with the Bitcoin Hong Kong dollar standard

For the Hong Kong dollar standard scheme of Bitcoin, please refer to the “4.6 Using Hong Kong Dollar to Realize the Bitcoin Standard” section of the Q&A of “Invite out Satoshi Nakamoto to Welcome the New World.” This proposal is a competitive proposal for the Bitcoin dollar standard. Hong Kong’s status as an international financial center is being weakened. Therefore, the Hong Kong government has the desire and request for financial reform. Introducing cryptocurrencies to Hong Kong may bring opportunities to consolidate Hong Kong’s status as an international financial center. The essence of the Bitcoin Hong Kong dollar standard scheme is similar to that of the Bitcoin dollar standard scheme. The Hong Kong government has the advantages of land and assets, and realizing the Bitcoin Hong Kong dollar standard is not too difficult. However, when designing and implementing the Bitcoin Hong Kong dollar standard scheme, the Hong Kong government also needs to cooperate with Satoshi Nakamoto and also requires the government’s decisive power.

If Satoshi Nakamoto chooses to cooperate with the Hong Kong government, Hong Kong will have an additional anchor currency, and Hong Kong will naturally integrate into the cryptocurrency market. Similarly, the Bitcoin Hong Kong dollar standard plan benefits Bitcoin and the world, and we are happy to see its success. But if DW20 is ahead of the authorities, it will face the same problem as the United States: the world has dollars and euros, so it doesn’t matter if there is another DW20 Standard Currency. Historical windows of opportunity don’t always open; let’s see if Hong Kong can exploit them.

3.5 Competition with the Ethereum system

Ethereum is a competitor of Bitcoin. Using Ethereum can easily realize the DW20 Standard currency concept and revitalize the Billing loss of Ethereum. While studying DW20, we also carefully studied the Ethereum system and wrote two articles with our friends: “Why hasn’t Ethereum’s market value caught up with Bitcoin?(1)” , “Drawbacks of having an ideal Ethernet that needs improvement(2)” ( These two articles speak highly of Ethereum’s contributions to cryptocurrencies while pointing out their shortcomings. Their main problem is not technical but outside technology. There are two most important problems: ransaction fees have a self-limiting effect on ecological prosperity; ETH represents both POW and POS consensus, which leads to identification confusion.

There are the following problems in implementing DW20 similar schemes with Ethereum:

1. The computing power of Ethereum generated by POW is fixed

Bitcoin has bottom computing power, and the bottom price will continue to rise as the market price increases, while Ethereum is not a POW structure. Ethereum does not have a bottom price (bottom computing power) as an external support. Its computing power is fixed at that moment and transferred from POW to POS.

2. The price of Ethereum represents the ecological value of Ethereum

Bitcoin does not represent the value of the Bitcoin system, so it does not have a price ceiling, which means that Bitcoin can represent the value of the total wealth of humanity; that is to say, it can represent the entire value of human wealth that can be measured by finance. Ethereum only represents the value of the Ethereum ecosystem, so it is impossible to calculate the total wealth of human beings. Although Ethereum has stored value, the growth of its stored value is limited by the weight of the Ethereum system itself.

3. Vitalik and the Ethereum Foundation hold too few coins

Vitalik and the Ethereum Foundation have about 0.25%-0.5% of Ethereum. In this case, their chances of cooperating with the authorities are less than Satoshi Nakamoto’s. In Chapter 12 of “Invite out Nakamoto Satoshi to Weicome the New World,” we put forward a proposal for cooperation between Satoshi Nakamoto and the government.

4. The Ethereum system is immature

Ethereum has just changed from POW to POS, which should be considered a two-year new system, and its new functions are still under development. If the corresponding ERC20 stable currency is issued on the chainless platform, the currency has little to do with the Ethereum system. However, since the value of Ethereum comes from its ecosystem, if the system is unstable, it will harm the value of Ethereum.

Different currencies are better, and some are not so good. For example, in addition to gold, there can also be silver. If a certain coin cannot be the first, it can still be the second.

3.6 Competition with DAI

DAI is a mature system. If it moves to a chainless platform, it will overcome its shortcomings and constitute direct Competition with DW20. It uses a mixed mechanism of mortgaged Bitcoin, Ethereum, and the stable currency USDC. The disadvantage is that there is no primary fund pool. How will this attract users? Its adjustment method is not a market adjustment; initially, It didn’t think about these things, so what will happen to the issued coins? However, DAI is still a good project. It has made many valuable explorations to promote the healthy development of the entire encryption industry, giving us helpful inspiration.


In short, the DW20 decentralized standard currency is a brand new and meaningful invention, but we have not applied for a patent and hope to contribute to the cryptocurrency industry. We want to help realize the Bitcoin standard and hope that the wealth in the hands of the people will no longer be diluted.

This article incorporates the opinions of many friends, and We would like to thank them.

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