Algorithm Change/Inflation Modification

This proposal ensures blockchain safety going forward

ScPrime SCIP020 - Algo change

Background/Goals

In a previous post, we detailed our intention to migrate the blockchain to a different ASIC friendly consensus algorithm in order to find space where we are the only or dominant participant. We have identified an algo and have a potential partnership with a major manufacturer in the works to ensure there are affordable new ASICs available to provide security on the blockchain. The process will start with a hard fork that allows our current algo to mine alongside the new algo and then after a specified period, Blake2b-Sia will be removed from the code (soft fork).

In order to make conditions favorable for a robust mining environment, we are proposing to the community a modest inflation change that also cleans up the issue of current block rewards not providing enough coins for secure profitability. The proposal is to increase current block output from ~10SCP to 50SCP and flatline this number with an endpoint set 5 years into the future. This will provide plenty of coins for miners, while also making the Maximum Supply finite as opposed to the current open ended number.

At current inflation, a little over 500k SCP will be produced. Under the new reward, just over 2.5M will be produced over the next 12 months. While dilutive to the overall supply, it is fairly negligible as 55,000,000 coins have already been mined. Because price has not responded to the supply curve as expected, this should alleviate issues that have made the chain less secure as time has passed.

A secondary decision is about changing where the original 10% dev fee is allotted. Currently, 10% of every block reward is sent directly to a burn address. In the same way, coin price has never properly reflected this and as such it is a coin burn w/o much purpose. The proposal seeks to set an address that will be tied in with the Transporter and create a pool of SCP to payout yields for Liquid Staking on Solana. We would not unburn any coins, only future rewards.

The team feels these changes are critical to the survival and thriving of the project going forward and we encourage everyone to vote affirmatively on them.

SCIP020

This specific proposal is launched as SCIP020. This constitutes the new community vote proposal mechanism numbering and lays the groundwork for proposals and governance going forward. Only valid storage providers on the network are eligible to vote. All votes occur within the Web Wallet and are tied directly to an operational Storage Provider node.