John Von Neuman predicted the Singularity: an event where computer intelligence would go into a chain
reaction of advancements leading to AI. He also worked on developing the atomic bomb - another chain
reaction phenomenon. Chain reactions can be predicted and designed. Sometimes when they have not yet
occurred it is only those such as John Von Neumann that can predict them. (He was able to calculate in his
head the energy of a nuclear blast from the wind that went by) Other times predicting chain reactions
may be as easy as predicting the flow of dominoes set to fall. It seems nature has the possibility of chain
reaction events built in at a few points. One example might be when the Chinese discovered gun powder. Discovering these chain reaction scenarios is a combination of expertise and luck in the right area.
What does this have to do with NEM? NEM advances the crypto ecosystem with something called Proof of Importance, POI for short. POI calculates a nodes importance just as Google calculates a web pages PageRank. Really there is almost no difference and the matrices do their machinations in the same way. PageRank is a really genius mathematical formulation. There is real elegance behind PageRank, and elegance has a purpose. Anyway it works, and it could drive the market cap of NEM to the top of the cryptocharts-- If only there were not some MISSING PIECES in the chain reaction formulation.
NEM is missing two elements that would cause this reaction that I am talking about. First, as has been discussed in this forum rewards are not working optimally. Here is what should have happened: The coin should have had inflation built in. A new coin cannot bootstrap itself into existence on transaction fees alone. That should be obvious because beginning ledgers have few transactions. Node rewards in the form of newly created coins are needed to create incentives for nodes and drive the coin economy. The PageRank algorithm is sitting there like a mega turbo machine waiting to encourage economic work, but there is no output from this machine because it offers no rewards to (miners) nodes because no coins are being created. NEM is like the fire cracker without a match.
To understand this better we have to look at how PageRank works. PageRank counts how many nodes are connected to you and their weights. With NEM this works by counting transactions to you and the amounts. We see if you build the NEM network you would also build your PageRank and hence get more rewards - if there were any. If we had new coins being issued each block then we could reward nodes that were building the network and then our chain reaction would occur.
There is one other small (giant) problem. The minimum transaction to build PageRank is set at 1,000 XEM.
This is way too many. Consider a 7-11 that got all its customers to use XEM. ZERO page Rank. That’s right
ZERO. Why? All the transactions are too small. This can be fixed easily. The other problem no inflation
requires a difficult hard fork. Most likely political and contested. All I can say is: We are at the ignition point
of the SINGULARITY. If we don’t do this someone else will, but with another coin. So exactly what do we
need? Something like 3 billion new coins issued over 10 years to Nodes that build page rank including those
that have lots of small transactions. I’ll be watching and put my money on whatever cyrpto does this first.
Please add your thoughts.