We held a debate around the stakes of cryptocurrencies, and more specifically around the Free Currency Ğ1, after the conference of their contributors on November 13 at the 42 school.
The debate was limited to a small circle and brought together about 19 people around this theme.
We originially wanted to direct the debate around defined and announced issues, but in the end, the participants were able to lead the debate without our intervention.
Brume took care of taking notes and writing the report.
Hugo Trentesaux and Elois then made some revisions.
Pohl and Therbret translated the document to English.
Following their intervention, the contributors provided us with some resources to further explore the subject.
Articles mentioned by Hugo Trentesaux:
- Motivations for free currency: https://blog.trentesaux.fr/monnaie-libre/
- Reformulation of the RTC (relative theory of currency): https://blog.trentesaux.fr/monnaie-democratique/
Various exchange platforms:
Contact the speakers:
- Hugo Trentesaux: https://trentesaux.fr/
- Attilax: https://forum.monnaie-libre.fr/u/attilax/
- Daniel: https://forum.monnaie-libre.fr/u/nox
- Elois: https://librelois.fr/
- Adrien: https://forum.monnaie-libre.fr/u/paulart
You can find below a summary of the debate.
Q: You mentioned the ecological aspect of Ğ1, but I don’t understand what prevents me to use a super powerful machine?
The custom difficulty algorithm uses an exclusion factor to prevent the use of high-performance computers: the more blocks a device finds, the more difficult it is for it to find new ones.
We would like to replace the proof of work by another consensus mechanism, but a decentralized network is necessarily incomplete and inconsistent, so it is very complicated to have an effective consensus mechanism in a truly decentralized network. Many cryptocurrencies solve this problem via falsely decentralized networks with a list of “master nodes”. Today, the proof of work is the only consensus mechanism that is economically neutral to have been tried and tested on a truly decentralized network.
There are many questions about consensus mechanisms. These problems are very well studied, we speak of distributed algorithms (see Rachid Guerraoui’s course at the Collège de France). The GAFAM - and especially Amazon - are working a lot on the subject (a concrete example: distributed databases). The ideal would be determine randomly which node “has the right” to add the next block, and the best way we have today to do something similar is to prove that we are working. We have adapted it so that a super powerful machine does not have an advantage. This does not encourage the race for power, but you are always free to waste electricity!
Q: How many transactions per block?
There are at most 10% more lines of transactions than in the previous block (the 1st block being limited to 500 lines). This makes it possible to keep a constant, but it can increase over time. We assume that if there were too many users, and therefore too many interactions, it would be possible and even desirable to split Ğ1 into several other currencies. Indeed, the fact that there are too many users causes different problems, such as the stretching of the web of trust.
If users were to be found on all continents, it would be very difficult to be within 5 steps of 80% of the reference group of users. One could imagine that these free currencies would differ by their “c” rate: the constant used to calculate the universal dividend. Currently, this rate is based on many parameters, such as life expectancy. The value of the “c” rate is a political choice in its own right, since it influences the amount of money earned each day by each member.
Q: Do illegal purchases/sales (drugs, sex, weapons…) become legal in Ğ1? What says the law in this case?
The law is unclear on everything related to cryptocurrencies (too recent). Officially, the use of Ğ1 is considered barter. As a result of this, is it legal to barter illegal products? No real answer on this subject, judges must act on a case-by-case basis. Per se, the definition of the word “purchase” does not change, regardless of the currency. For example, I can buy bread in euros, but for the baker, it will be buying euros in bread. It comes to the same… (Or even… buy backhoes in bananas or buy bananas in backhoes).
So, if it is an illegal purchase or sale, it can be considered illegal in Ğ1, as it is in euros. Finally, members of Ğ1 are not encouraged to engage in illegal actions, since they are on a web of trust. If they did, they would lose the trust of their contacts.
Have you ever refused to certify anyone?
It happens when we don’t know the individual. We consider that it is necessary to meet physically, ideally several times… On the other hand, once you know and trust them, there is no point in refusing.
Q: How do you become a member?
It is necessary to meet members in order to obtain the five certifications. To do this, use the forum, meet several people before getting certified… It is best to test Ğ1 before becoming a member. Everything is possible: buy, sell… You simply won’t be able to earn the universal dividend, to certify people and to write blocks. Trying out the currency is therefore an opportunity to find out if it is suitable for your needs, before actually becoming a member.
Q: Is it possible to buy Ğ1 in euros?
Yes, as long as someone is willing to buy, it is possible, as with any other currency. It can be done both ways. One could also imagine automatic exchange places with other cryptocurrencies.
Q: What happens (technically speaking) when a transaction happens?
It depends on the client used. The client sends a “transaction document” to one or more nodes. These nodes store the transaction in memory and then relay it to all the nodes to which they are connected, thus spreading the transaction throughout the network.
It is then necessary to wait until one of the nodes that received the transaction finds a block for it to be in the blockchain.
Q: Have you tried other alternative currencies?
The answer varies from one speaker to another. Either no or yes, with local currencies. However, many things were not as good as with Ğ1: a local currency has a geographical delimitation, which makes it a kind of captive, limited-use euro. It therefore has no more interest than a meal ticket.
Attilax, for example, had no connection to the economy until he discovered Ğ1. He discovered it by chance. This currency immediately interested him, because it lines up with his ideals as a member of the free software community, it is simple to understand, and finally, it made him understand that “to change the world, it is necessary to change the currency”.
Q: How would a capitalist be interested in Ğ1?
On one hand, the liberals are interested in the absence of taxes and the decentralization of Ğ1. It is the current currencies that lead to capitalism, but also to cheating, to the desire to earn more, to greed… When you change currency, you change the rules of the game. Ğ1 has different rules from the current currencies, which totally changes the situation. Instead of being stingy, people are much more generous, and even tend to under-sell their services, for example. Relationships are much more cordial.
The euro will turn people into skinflints or thieves: these are the consequences of debts, loans with interest rates which, if they are not repaid, harm society. So it encourages people to strive to make money, to get rich…. However, the accumulation of money is not ultimately conducive to the economy, since it works through purchasing. If the majority of wealth is held by a small number of people, people can no longer buy goods. The economy does not work if there are no buyers.
In addition, Ğ1 is the only currency that can handle degrowth without problems, since there is no concept of debt. For any other currency, the decline is seen as very negative, even apocalyptic. Thus, free money is not a “problem” for the capitalist. This is a problem for a person who wants to sit on his privileges, who wants to accumulate money. Ğ1 is therefore not anti-capitalist.
Q: What about the GDPR regarding the blockchain?
There is indeed something to discuss: if someone puts a person’s personal data in a block, there is no way to delete it. This could therefore cause problems with GDPR. There are possible solutions to this problem: storing a hash of the comment instead of the comment itself. However, this isn’t done yet because there is no consensus among the main developers…
Q: How do you renew your certification ?
The web of trust schematizes the social relationships between members. There are two types of certifications: external certifications, which bring a new member into the web (the future member must obtain 5 certifications in less than two months), and internal certifications, which tightens the web: it is a matter of certifying between members. The fact of certifying yourself between members allows you to reduce the distance between people: a person you certify is 1 step away from you. Knowing that it is necessary to be within 5 steps of 80% of the referring members, reducing the distance allows you to certify more external people in the future.
One could imagine that 5 real people certifying a false account, and that false accounts certify each other. It would be a Sybil attack. On a small scale, it is insignificant, and on a large scale, other members will necessarily realize this and can therefore act against this kind of attack. They are therefore unimaginable. In order to become a referent member, you must have issued and received a certain number of certifications. This number is the fifth root of the number of members. Currently, it is 5, but this number is set to increase.
Finally, reading the license of Ğ1 is mandatory. It is therefore necessary to ensure that the people you certify have read it. The person who has certified a person who does not comply with the license will lose the trust of the others, therefore members have no interest in certifying false accounts.
Q: Isn’t there an inconsistency between the focus on trust and the wish to implement Tor (gMix project)?
It’s not that we want to implement Tor, it’s that we can. In addition, it is possible to want to have anonymous interactions; this has no relation to the trust you place in members (the web of trust). It is important to note that Ğ1 is not responsible for the actions of people who use it for illegal or malicious purposes. These members are under the law, like everyone else, as if they were performing the same acts with euros. Ğ1 does not interfere with this.
The debate ended in a very good atmosphere. A snack was then organized, some students were there to discuss with the speakers.
See you soon,
Article translated by Pohl and Therbret.