——Comments on the concept of DW20 standard currency
“Comparison of decentralized standard currency DW20 with Bitcoin, stablecoin DAI and standard currency US dollar” is divided into four sections: 1. Design background of DW20, 2. Comparison with Bitcoin 3. Comparison with decentralized stablecoin DAI, 4. Comparison with the US dollar. This article also comments on this order.
Comparison between DW20 and Bitcoin
The DW20 design’s cleverness lies in its three stages: the meme coin stage, the stablecoin stage, and the standard coin stage.
The first stage of DW20 is the meme coin stage. Like Bitcoin, its price keeps rising. The whole operation law is very similar to that of Bitcoin. The wonderful thing is that it stops rising at $1. The following description is the essence of the first stage design.
1. The distribution of Bitcoin tokens is divided into 33 cycles, adopting a four-year halving strategy. DW20 is 30 cycles and adopts a halving strategy in three cycles.
The difference is that DW20 does not adopt the game strategy of Bitcoin based on time halving but an airdrop strategy based on the number of people. There are currently no successful cases of airdrop strategies. The critical issue is preventing cheating; most projects have not solved this problem. Although this problem is complex, it can be solved. The most challenging thing is calculating people’s value at different stages. Mr. Zhu discovered that the growth of the number of people in Internet projects should conform to the natural growth S-shaped curve. In order to conform to the S curve, two adjustment factors were designed.
2. Bitcoin’s value is mainly the conversion of energy value, while DW20 is the conversion of user value.
Like Bitcoin, DW20 has no internal value; all value is brought from the outside. DW20 is a transaction token of the chainless platform, which is widely used in the chainless ecology and can also be used in various cryptocurrency applications. The user value of DW20 will also be reflected on the chainless platform. The two projects have the same user, which produces a resonance effect of mutual diversion.
The value of Internet financial customers is calculated based on net worth. There are high net worth and ordinary customers, with an average valuation of $500-1000. The value of the Ethereum platform depends on the number and size of application projects on the platform, that is, the number of end users. The standard of measurement is transaction fees. Ethereum is estimated to have 100 million users and is still valued at $190 billion during the market downturn. The chainless platform has the same model as Ethereum, but the fee is lower than Ethereum, and of course, the bookkeeping cost is also low, so the valuation is lower than Ethereum. The difference is that Ethereum is a model where the wool comes from the sheep, while the chainless platform has a user community and user community incentives. This design is not available in all cryptocurrencies. It is a model where the wool comes from the pig, that is, the financial e-commerce model. The innovation of the financial e-commerce model far exceeds the profitability of the social Internet wool coming from the pig. The chainless financial e-commerce and settlement platform model is equivalent to Ethereum + Taobao.
3. The Bitcoin system does not need to make a profit. DW20 does not need to undertake any profit-making tasks on the chainless platform.
It is essential. See the comparison with DAI later.
4. Bitcoin has a computing power bottom, and the cost of computing power constitutes the price bottom of Bitcoin.
The market price of Bitcoin will also fall below the computing power bottom, but it will soon stand above it. The bottom price of DW20 is the average user value, which is equivalent to the computing power bottom of Bitcoin. When it falls below the “computing power bottom,” it will recover with the increase of users.
5. Bitcoin’s upward trend has been caused by its shrinking issuance. DW20 also shrinks in a cycle.
This shrinking issuance is only available in DW20’s first meme coin stage. The goal of this stage is to make the price of DW20 rise steadily with the increase in users, from “air” to around $1, which takes about 2 to 3 years. This stage is a rapid growth period.
The original token distribution method of Bitcoin was to hope that anyone with a computer could participate, with a low threshold, making the token distribution more fair, but this hope was dashed. The distribution method of DW20 inherits the idea of fairness in the token distribution of Nakamoto; that is, it is hoped that the number of people holding coins will reach a large number through airdrop distribution. Only airdrop is the fair method with the lowest threshold, and it is also the risk-free mode that is easiest for users to participate in. In this way, millions can seize the opportunity and achieve a leap in wealth.
6. Bitcoin also has a maintenance team and community consultation to maintain the project’s stable development. In contrast, DW20 does not have a maintenance team, and consultation is unnecessary at the end of the first phase.
DW20 can make very few decisions. There is no separate community, only a sub-community under the chainless community.
7. Bitcoin, a stored-value currency, does not represent equity. DW20, a standard currency, also does not represent equity.
8. Bitcoin is a stored-value currency and a transaction medium, not a transaction ruler. DW20 is a stored-value currency, a transaction medium, and a price ruler.
The idea that Bitcoin is a currency ruler is very naive.
9. With no adjustment mechanism, DW20 will become a shadow currency of Bitcoin,
just like Bitcoin Cash BCH and Litecoin LTC. Just like the decentralized stablecoin RAI is the shadow currency of Ethereum, its price cannot remain constant, nor can it guarantee price increases. All stablecoins need a regulatory mechanism, just as USDT and the Hong Kong dollar have regulatory mechanisms.
The regulatory mechanism that keeps the DW20 price rising in the first phase is also used in the second phase, which is called a market-making fund. I will discuss this issue in conjunction with comparing the second phase and the stablecoin DAI.
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