Should the asset creation fee be kept at 0.5 XCP indefinitely? If not; how and when should the fee be adjusted?
How do you envision the fee system for Smart Contracts?
Are there other cases where fees should be introduced?
My answers:
Fees shall make the platform run smoothly whether one XCP costs $0.10 or $1000 and whether there are 100 users or 100,000,000 users. For the next twelve months or so, the protocol can be changed to accompany a better fee structure. However, as Counterparty grows it will be next to impossible to change the protocol. Therefore a price mechanism should be built in.
If XCP were traded at $1000 and the fee were kept at 0.5 XCP, virtually no new assets would be created. This could stifle innovation and possibly lead way for another, competing asset system to gain popularity. I suggest a simple algorithm to adjust the fee depending on how many assets that are being created. Say that every 2016 blocks, the fee gets adjusted. If more than 1000 assets have been created, increase the fee by 10%. If less that 500 assets created, reduce the fee by 10%. Else keep the current fee. Obviously, this is not a perfect approach but I think it is good enough. A fixed 0.5 XCP fee, even if adjusted for coin supply, I fear is not good enough.
For Smart Contracts it is natural that a higher fee ensures that people use resources more conservatively and thus makes it cheaper to run a server. At least for the next couple of years I want every hobby enthusiast to be able to run a Counterparty server on his laptop or cheap server. How to implement the fee is a technical question beyond me, but as a principle a price mechanism should adjust the fee up as more and more people start using Counterparty.
There is a dividend fee, which makes sense. Other than that, I cannot think of any need for additional fees.
1) Should the asset creation fee be kept at 0.5 XCP indefinitely? If not; how and when should the fee be adjusted?
I think right now it isnt a problem, and to be honest it can stay at .5 for now. I think this issue needs to be re addressed when XCP gets around the $10 mark. Because even spending $5 for an asset is not that bad.
2) How do you envision the fee system for Smart Contracts?
To encourage the use of Counterparty as the platform for someone to use smart contracts on (rather then the competition such as Ethereum) the fees should be free just as the A123541345… assets are. Short answer: fee should be the Bitcoin transaction cost
3) Are there other cases where fees should be introduced?
No. Only assets to limit spam. Even the dividends fee I think could be done away with.
The fee is fine for now. But this should not be indefinite. But I don’t think we need to address this in the near term.
In the longer term, I think the fee should be relative to the amount of total XCP in existence. As XCP becomes more scarce, the fee will drop proportionally.
How do you envision the fee system for Smart Contracts?
Smart contracts must pay a fee as “gas” for each step in a smart contract. This is necessary as an anti-spam mechanism and to limit CPU power required by the smart contracts.
We should make the amount of XCP required as gas to be high enough to prevent spam, but low enough for hobbyists. I don’t know what the number is yet.
I think this fee should decrease proportionally to the scarcity of all XCP in existence (and I think that is the plan).
Are there other cases where fees should be introduced?
XCP should serve as an anti-spam system only in the short term.
I think in the long term it might may make sense to pay “miners” who run smart contracts a small portion of the XCP paid as gas. But this needs to be thought through carefully and is not a short term issue.
XCP should be used to protect and serve the network. Fees should only be introduced when they serve that purpose. As XCP becomes more scarce fees should be adjusted downwards.
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Congratulations to Chris DeRose ( @brighton36), Devon Weller ( @deweller) and Robert Ross ( @FoldingCoin) for becoming the first elected community directors of the Counterparty Foundation!
