Post
Topic
Board Development & Technical Discussion
Re: Can crypto-transaction networks function without a built-in currency?
by
jaked
on 01/02/2014, 19:57:08 UTC
Decentralized crypto-transaction networks such as Bitcoin, Ripple, Ethereum and pretty much all others all include their own built-in currencies. As far as I can tell they do this for one or more of the following reasons:

1) as a reward for those who provide their computing power to secure the network
2) as a mechanism for paying the transaction fees that help to minimize spam in the network
3) to provide rewards for the founders (who either pre-mined (part of) the currency or who are among the first to mine the currency)
4) to encourage people to start using the network by rewarding them (if the currency appreciates in value) for buying into the currency that needs to be and can only be used on said network

But are there other ways than by creating a built-in currency in which decentralized crypto-transaction networks can solve these problems? I'm particularly interested in alternative ways of solving the first 2 problems (network security & anti-spam).

For any network to function, the people running the nodes must be properly incentivized.

Bitcoin has a built-in incentive.

What would your network transact, and what incentive will node-operators have?