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Economics of Incognito Network

#12

Thats not the point. The main point is the decentralisation of the project, which is not realizable with 65% from the pNodes going to the core team.

1 Like
#13

65% for pnodes has always been there

You just now realize because vnode earnings dropped? Why triggered all the sudden?

2 Likes
#14

You do understand that decentralized has NOTHING TO DO with who takes the reward profits and has EVERYTHING TO DO with the pnodes not being run by the same people in the same locations on the same ip addresses the same ip blocks in the same counties.

Again, has nothing to do with reward payout.

3 Likes
#15

One thing that wasn’t factored into your initial post (sorry if I missed it) is the space for the pnode. With one or two nodes, and with the node tree maybe even with 10 or 20 the space doesn’t matter. But if someone has or wants 50, 100, or 500 nodes you probably have to factor the space for the nodes into your costs. If you get a two-bedroom apartment so you have a bedroom just for nodes you can’t ignore the cost of that bedroom in your costs.

This is a plus for vodes for me, and when I do get a pnode it will just be a novelty to have in my house.

2 Likes
#16

Please do not mix up rewards with decentralization.

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#17

Has changed already in the past Node earnings split changed to 35/65 from 25/75

But this is not the main issue. The problem is that it makes economically now because of the high price for PRV no sense anymore to fund your node. Instead, people will shift over to a funded stake. And in this case most of the earnings will always go in one wallet of a third party. This leads to having them one day so many PRV that they will be able to control the network. So no decentralization. No one claims that they will act evil intentionally but hey blockchain ist about a trustless setup. If I have to trust a third party to not jeopardize the network then the fact it is a blockchain becomes nonsense. I can also decide then to trust a bank or another third party. No blockchain is needed in this case.

1 Like
#18

Yes you are right according space. But I just wanted to make a quick example :slight_smile:

Let’s assume PRV goes to 10 USD, if we do the math:

1 Node = 1750 PRV

What are you going to do setup a node for 17500 USD or take the same money and buy around 50 Nodes?

I guess everyone would choose 50 pNodes vs 1 vNode. Which is ok. But the problem is 65% of the earned PRV go to Incognito. As longer this goes the more control they will have over the network.

#19

I made 3 times as much with my vnode’s this week as I would have if it sat in pool.

Speak for yourself.

Vnode earnings are down. It’s been reported. They will go down more when tree is released. So will pnode earnings.

I thought this has been discussed. The hope is price rises as earnings drop and the get close to equaling in total $ made.

This isn’t about decentralization, this is about profits and rewards and greed.

Please don’t mix the two.

2 Likes
#20

I cant speak for you, maybe you look for the profits. Which is ok as everyone has different interests. I care mainly for the long term success of the project, which is why I came up with this.

#21

I think you have an interesting point on validation options:

  1. Buy a pNODE for $400 and self stake with 1,750 PRV ($2,200+) for a total of $2,600+ investment to get 100% of the rewards of that one pNODE; or
  2. Spend $2,400 and get 6 staked pNODEs and get 210% (6 x 35%) the rewards.

The advantage of going with option 1 is that while your rewards will be less than half of option 2, you will still hold 1,750 PRV.

The advantage of option 2 is that while you won’t own 1,750 PRV, you get more than double the rewards of option 1.

I just want to make sure we don’t forget to value owning the PRV in option 1.

#22

I think reading through this thread in its entirety will help clear some things up: Some in-depth questions

1 Like
#23

Hi @sato

@Clint makes a very valid point…

You seem to be driving that decentralization will only happen through monetary value, which may ultimately affect the purchase or funding of nodes. I don’t see this as a problem because your assumptions are based on everything (payouts, team nodes, network utilization) staying exactly the same and the price of PRV going higher. Based on our dev teams dynamic outlook and ability to adapt, to the ever evolving project, I highly doubt this would be the case.

Your thought experiment is fun for thought minded to play through but it can easily lead people to have a negative outlook when it’s not the case.

#24

I would disagree with this. If this development continues at one point there would be only pNodes running the whole network. In this case 65% of all PRV will over time go the Incognito. Thus we are as long decentralized as they want it this way. They could setup easily set up a lot of nodes on their own with all these PRV or even simpler just decide to stop the funding program in order to get rid of all the other nodes. Sure this might not be happen because they are nice guys. But in my opinion the fundamentals of a chain needs to be trustless. Otherwise we could just trust a different third party or incognito as well and let them simply run a database with several severs like Visa, Mastercard etc. No need for a blockchain solution in this case. I want this project to succeed long-term and in this case it does not matter if I trust the team right now. In 30 years or more others will have the control, who knows what they will do with all the PRV?

1 Like
#25

@sato, a lot of funded PNode owners save up enough PRV rewards to fully fund the PNode themselves. Validators do the same thing to spin up their own vnodes.

#26

I’ll rather unstake my vNodes then, because pNodes are giving me much more return. So why should I set up another vNode then @Gold ? Just wouldn’t make sense…

#27

Its not about money.Its about so called decenteralized network.We all(most of us) care about it.Money comes after that.

2 Likes
#28

@Nubex, that’s good your pnodes are earning well. I wasn’t suggesting you should spin up vnodes. I was simply saying that there are ways, despite the cost of PRV, that users can build up to fully funding their own nodes.

#29

Why fully funding own nodes if the return is much higher with a pNode? You didn’t get the point I mentioned. The only reason why I would keep my vNodes is if the price would go up. If this wouldn’t be the case, I’d rather unstake, sell my PRV and buy pNodes from the $ I get.

#30

If you have earned now 1750 PRV with your pNode. You have two options:

  1. Buy more pNodes -> 1750 PRV * 1,30 USD = 2275 USD / 399 USD each Node you will get “5,70” Nodes. If you earn 10 PRV with one node per week you will earn 57 PRV every week then and you get 35% of this so finally 19,95 PRV for you.

  2. You set up your own self funded Node price 1750 PRV = 2275 USD. You are going to earn only 10 PRV as you own one node.

In this case what are you going to do?

Most people will choose the pNode with funded stake then I guess. As this is what gives a better return. But in this case 65% of all distributed PRV will always go to incognito. This is dangerous for further decentralization. In a Proof of Stake Blockchain the one who owns the most coins can control the network, because you need them for staking in order to be able to validate. Thus if the actual change to more funded nodes continue, we might will have decentralized “computers” running in different places but incognito will finally be in charge of them. If we really want this movement to succeed we need to find a solution soon. This is at leas my opinion.

1 Like
#31

are you saying that pnodes that are shared are selected more often than vnodes that are not shared? or even fully owned pnodes?