Egal

Egal is born out of a few axioms, which many people may find hard to accept. Inherent to many of them are ideas I don’t like myself, but which I find useful as a starting point or abstraction whose accuracy is not necessary, but is useful to accept from where we exist as per the writing of this document. Below I will outline them and I hope you will keep an open mind. I don’t put them forth as unchangeable truths, but as primitive elements from which we can build going forward:

1: Competition is as basic building a block of human economics as mutualism and we return to it time and time again regardless of how we attempt to reset. To move forward we need to recognize this dualism not only as a dichotomy but as a set of circumstances that aren’t inherently mutually exclusive. Humans are at times mutualistic and at times competitive, it is not human nature to be one way or the other, we fluidly transcend each behavior contextually. This axiom is built on the idea that history repeats and in regards to economic systems it certainly appears to. We have a lot of arbitrary rules that we use to define capitalism for example, but I see no real need to differentiate between feudalism, bartering, and the oligarch dominated capitalism we see today. The hallmark of capitalism is hoarding as a selfish act, out of protectionism, fear based, territoriality of our ancestors. I think hoarding is inherent to the human survival strategy and in times of scarcity it probably served us in ways it no longer does. Egal is not designed to dethrone capitalism, as I assume many people are hoping, but to plug into it and embed a socialist economic paradigm into it that incentivizes mutualism. Instead of capitalism vs socialism, we are building socialism out of capitalism as a primitive, accepting that capitalism is a building block, much too incomplete to form a fair and just economic system on it’s own, but from which our system must be built given our current economic realities. The acceptance here-in is that capitalism in it’s purest form is not really very complicated and not nearly enough so as to encapsulate the diversity of exchanges of consideration within the reality of the human experience. The sad reality that underlies this axiom is that regardless of how we have tried to restructure human society, we return to an oppressor, oppressee, hierarchical system, whereby the hoarding impulse of man has determined the state of economics. What egal attempts to do is “mine,” a token, which can be viewed as a unit of value in an underlying capitalist economic paradigm such as exists today in the united states, through direct correlation to the labour of an individual. This labour however may be any unit the worker chooses and all units will be equally valuable. In Egal all tasks required to keep the network functioning are considered equally valued units of work as well and so in allowing a transaction to complete you also earn a new Egal. This is an attempt to build a set of economic rules into a framework that enforces ideas of collective ownership of capital(meaning the sum of property that relates to production as well as any fiat assets). The mined tokens or fractions thereof, being a unit of value exchangeable for USD, can thus be exchanged either for another currency or for goods and services directly. As Egal increases in value, it is entirely plausible that users will be able to pay for their necessities in the underlying capitalist system directly using Egal. At the end of the day, many people believe capitalism works just fine and for those people I have no malice or ill will, but rather than hurt those who hold this belief, I would rather build a self-contained economic system, fully compatible with capitalism and strive for co-existence. This comes from acceptance of the next axiom.

2: Violent revolutions have failed to replace or even reform capitalism. The communist states that have existed still maintain the hallmark of capitalism: hoarding. At best these systems can be described as State Capitalism and have largely been guarded by fascist infrastructure. This is incompatible with the main value of Egal, which is Egalitarianism/Equality. Rather than try to remove the instinct to hoard from humans, we are building a system where hoarding is no longer really possible. In Egal hoarding is impossible due to a restructuring of wealth every 6 months. At the end of each half year cycle, all the wealth within the Egal system is redistributed with weights assigned by the relationship to overall network wealth a user has and based on the current rate of inflation(which can be adjusted by an individual instance). This economic reset is known as jubilee. Under capitalism, scarcity is necessary to create value, however with Egal, scarcity will be a thing of the past. Economic value is easy to generate through the labour of one’s choosing, and even if one is incapable of labour, they will be compensated for their participation, further decoupling the ideas of economic and personal value.

3: In the current state of Capitalism, which is to say; Late Stage Capitalism(LSC), Our social needs cannot be met. The economics of LSC don’t allow for infrastructure to be changed or even for systems to be built for the benefit of everybody. As money is the resource that begets all other resources, controlling more capital allows you to build and mould our society in a way that resounds to your own personal needs if you have the capital to do so. This inherently violates our prime directive. Capitalism is destroying the very planet that sustains us and yet the masses cannot mould it to our will if it in any way conflicts with that of our masters. We may wish to stem the onset of global warming and build socialist systems that benefit everybody, but we cannot do so without the capital to do it, and those structures can only ever be temporary in nature as humans seemingly default to capitalism again over time. No matter how hard we work to reform the system, we fail to do so in any meaningful way when it ultimately creates conflict with the underlying system. Everybody wants good schools, good jobs, stable housing, affordable food, safety, security and we don’t have those things universally because the systems built within a capitalist society cannot consider the will of the poor even if the poor vastly outnumber the rich, even if the poor are more correct, more efficient, greater by any metric you can imagine. Egal again uses ideas of wealth redistribution to increase economic efficiency. What this means is that money is useless when sitting still in somebody’s bank account. That money could be going towards projects to build food security, housing security, technological advances, etc. In capitalism, the rich are incentivized for hoarding. There can be no such incentive with Egal due to the periodic redistribution of wealth, furthermore Egal ensure that value is never stagnant, but constantly in flux. If you have earned a high balance, but you know in 6 months it will be redistributed, it is pointless to hoard that money and makes much more sense to spend it, this is designed to recondition workers to use their money to the greater good of material progress, such as buying supplies for projects and the like.

Given these three axioms, which might appear to be largely at odds with each other(though they aren’t if you consider the use case of capitalism being to benefit the most aggressive hoarders), we are pressed to find a solution or perish. In the earlier part of the 2000’s, I discovered Bitcoin. I thought that it was very promising at the time. It promised to be immune to regulation by any mechanism of any state. That has not been shown to be true, nor do I necessarily think that idea serves the people. At the time I discovered it, it seemed an ideal currency for leftists due to it’s decentralized nature. It has failed to be decentralized as those with more assets can actually move the market substantially. It promised to be a fungible asset, tradeable for goods and services. That too it failed to deliver, since Bitcoin has largely functioned as an investment vehicle at best and a black market currency at it’s worst. Finally it promised to be as anonymous as cash. It is not. Every existing cryptocurrency is built on top of these failed ideas. Rather than pick apart the efforts of many great computer scientists, most of whom are much smarter than myself, I challenge you to consider what might have happened if they had succeeded. Bitcoin as it turns out is the currency of Anarcho-Capitalists or extreme Libertarians, who believe if they could only remove the shackles of regulation, they could achieve their dream of neglecting the poor, the disabled, the sick and other individuals left behind by capitalist structures. Bitcoin is a ponzi scheme designed to enrich early adopters and reward loyalty and incumbency. It is designed to be hyper-inflationary. In the last boom/bust cycle I think all of the failures of Bitcoin have become too evident to ignore going forward. To adopt any direct derivative of Bitcoin is to accept that we cannot do better than this. While the computer science that has gone into building crypto-currency is incredibly impressive, the political science has been materially lacking.

Enter Egal. Egal is built on the ideas of crypto-currency that have been time tested and proven, while challenging some of the long held beliefs about it. Previous crypto-currencies have been mined using some sort of consensus algorithm, proof-of-work as in the case of Bitcoin and proof-of-stake are two of the more popular. Both require that miners invest significantly in the underlying infrastructure. As such, these investments ultimately benefit the fiat capitalist structures upon which this infrastructure is built. Not to mention, these algorithms are extremely inefficient and detrimental to the environement due to the amount of energy they require, proof-of-work being the worse of the two in that regard. Proof-of-stake compromises decentralization and rewards incumbency rather than work itself. It promotes wealth disparity in ways that I cannot in good conscience support.

Ultimately, crypto miners hope to make their ROI not simply in mined crypto, but by converting it to a fiat asset. This has caused those who invest in these technologies to attempt to inflate their value as an investment and as long as the crypto-asset is viewed in the context of inflation against a fiat currency it fails to be fungible and promotes the hallmark of capitalism, which is hoarding. Egal challenges you to re-evaluate the meaning of work. Mining doesn’t need to be tied to consensus, in fact consensus can be secured in much the way it always has been with humans, by federating trust. If you trust an institution and they maintain trust in other institutions, you can build a network of trusted institutions, the brunt of which can be assumed to be reasonably trustworthy. Our current monetary system is actually built that way, though the underlying institutions are not trustworthy, but they are considered to be too big to replace. Egal relies on federated trackers to build a trustworthy database of transactions. However even the idea of blockchain as the basic unit of security is being challenged. In Egal we build a tree of related transactions off of every mined coin. To confirm a transaction it is only necessary to trust that the sending account actually has the available funds. This idea opens up a whole new world of decentralization, where individual trackers can federate with each other based on the trustworthiness of their actions. Also by decoupling consensus from mining we are free to build systems that mine using any criteria we want. As an example the default methods will be kinetic mining using the gyroscope in your phone and content creation, whereby content created on federated social media platforms is linked to a transaction and confirmed through an app to mine Egal. The latter is done by posting a cryptographic signature to your profile, such that the content can later be verified by a tracker. Once verified, a transaction is created in the database and can be federated with other trackers.

That is the basic infrastructure of Egal, but that is not where our ideas end. Every coin mined will be subject to a tax, which will be distributed to the accounts in the bottom 50% of value. A built in form of welfare if you will, ensuring that those who cannot work, can still have their basic needs met. In addition, every 6 months, the most wealthy accounts will have a portion of their wealth redistributed to the poorest accounts during the jubilee. Both of these features are designed to prevent hoarding and ensure that even those incapable of working will have a steady flow of income. Since mining is so easy, it will be a very inflationary currency, which will also encourage spending as opposed to hoarding. In addition, trackers may levy a tax with a 2/3 majority approval from their connected clients that can be used to fund additional infrastructure projects or donate to causes. Trackers will also have the ability to isolate bad actors. All such decisions may be appealed(though during this process an accounts assets will be kept in escrow and if the account is found at fault, the funds will be redistributed randomly to the network) to a vote of individual users on a given tracker. A separate blockchain containing all such decisions will be kept and can be reviewed by all other trackers to assist in deciding whether to federate with a given tracker. The users may also initiate a vote on whether to federate with other trackers.

As you can see, Egal is not just a monetary system, but a social institution. Direct democracy and openness/freedom of information is key to maintaining trust in these institutions. Without trust Egal cannot function. Rather than promote total decentralized structure at the expense of social infrastructure, Egal has opted to focus on promoting social structures, while sacrificing a small amount of decentralization. It is a give and take. As such, Anonymity is not an option in such a system as a user’s individual reputation is very important. For this reason, accounts will have a feedback system associated with them, where transactions can be rated. A certain cumulative rating defined by the tracker will trigger a review of the account. A conglomeration of these reviews will determine the trust rating of an individual tracker. As such trackers that give a great user experience will be prioritized and those that do not will be diminished and potentially isolated. This also serves to limit users who would attempt to cash in by having many accounts and waiting for the redistribution to cash out. Such behavior would impact their reputation and would not be worth the effort in aggregate.

Egal strives to promote psuedo-anonymous connectedness the way existing in a city might. Your account does not need to be tied to your individual identity, but your rating will be something of a credit report that anybody transacting with you can review. They cannot see what you’ve purchased, but they can see overall ratings and reviews from accounts you’ve transacted with. As such Egal is a compromise between anonymity and security, decentralization and socialism.

The idea of this structure is that it can plug directly into any underlying economic system, but promote a more egalitarian structure within it’s localized boundaries. Capitalism will not be overthrown or even attacked by Egal, but Egal will allow the individual the choice of how they wish to live. You can partake in a socialist economy locally, but exchange Egal for fiat to pay your rent or groceries, etc… Ideally, over time, Egal will be accepted directly for many goods and services, if not globally, at least in certain localities. This promotes decentralization in the ways that it is necessary to separate powers. It creates economic governance that mandates separation of powers in a way that cannot be overridden by any single entity. While it does not eliminate the potential for abuse, it certainly makes it more difficult.

One of the central organizing principals of Egal is that we need each other. We cannot exist in a world without trust as some crypto-currencies attempt to assert. Rather we can build a world where reward structures are built on positive re-enforcement of trustworthy activity. Institutions still have a lot of responsibility to make sure rules are followed, but they will be negatively punished for not doing so, as their ability to bring in income will be limited by their poor reputation and tempered by the fact that anybody can start a new exchange with very limited resources(Egal is being designed in Python, using SQLMy as a back-end database for efficiency, so that it can hopefully be run on very lightweight infrastrcture, such as a raspberry pi or some of the infrastructure designed by Pine Labs).

There are of course many details yet to be ironed out. As the development process moves forward I encourage research into security related issues and more efficient algorithms. The goal is to create a code-base that is easy to understand and contribute to, while conforming to the preset rules. The goal of Egal is to accomplish what we need with as few moving parts as possible. This system may have many more complicated ideas built on top of it, but ideally it will be a relatively simple primitive from which a more complicated economic infrastructure can be built. It is a primitive foundational element built on the idea of economic equality, on which ideas might be stacked, ideas that hopefully share the same values. However it is the goal of this system that anything built using it will resound to it’s intentions, even if it is intended to subvert it. It is for this reason that we think it is important to redefine the ideas we have around work and trust.

Work in a capitalist society is basically any unit or collective exertion required to produce a deliverable for which somebody is willing to pay a price. The price of that unit is defined soley by the supply and demand curves and where they intersect at any given moment. In egal all units and deliverables are considered equal. The worker is thus free to decide what they would like to be doing to make money. There is plenty of room for people to build structures dictated by supply and demand by demanding an additional fee for a given product or service, however, since it does not behoove anybody to hoard money and everybody will have some income regardless of contribution, the idea that some work is more valuable than others is tempered by other economic forces. The idea that a doctor’s labour is more important than a janitor’s labour is thus completely moot if somebody is willing to be a doctor and another person is willing to be a janitor. The underlying goal here is to restructure the value of work by how unpalatable the work is to the worker. If everybody’s needs are getting met already, you will have to make it worth it in some additional way to get a person to risk their life going down into a mine or find some better way to extract the minerals you need from the mine, via automation or something else. In many ways this can help to counteract the over-arching effects of capitalism on society, such as artificial scarcity driving prices or replacing workers with robots without replacing their income, which is tantamount to austerity. In this way, even creating malicious methods of mining is considered valid work. This vastly decreases the attack surface for governing bodies attempting to criminalize the citizenry. Egal will still have to conform to the rules of the over-arching society it is plugged into, but crimes relating to fraud concerning Egal as an economic system will be vastly limited by the broad re-definition of work. Egal accepts everything, including potentially criminal acts, like fraud as valid mining operations, but it does not shield the user from the broader consequences for their actions. It is our hope that traditional disincentives against crime, will help to curb criminal elements that might choose to act within the paradigm we’ve created. However it is not our intention to provide any additional consequences. After all, labour is labour, whether its hacking the system, or writing code within it to extend functionality in a more traditionally accepted manner. So long as it doesn’t result in stolen wages from workers, we don’t see the point in differentiating.

All that being said, Egal doesn’t work without us. Humans working side by side with machines to create a society that is easier on everybody. Innovation does not have to be stunted by capitalist demand for workers. If somebody has an idea they want to build they are free to pursue it, free from the shackles of work. Coercion will no longer be the driver of innovation, it will be replaced by passion.

Fungibility is a core value of egal. Previous cryptocurrencies have been relegated to obscurity due precisely to this issue. Actually Egal punishes accounts that attempt to hoard assets by increasing the rate at which such accounts are taxed during jubilee. This forces those earning egal to engage with the community using the currency. Fungibility is measured and accounts with higher fungibility index are taxed to a lesser extent than their counterparts. As are accounts with a higher percent of the overall balance.

Egal can thrive without too much in the way of GDP growth. Economic success will no longer be measure by production output, profits or other metrics used by capitalism. We will measure economic success by the happiness and quality of life of the users. A better world is possible, but nobody is going to build it for us. That is why Egal is and always will be released using an ethical source license, with only one caveat: It may not be used to promote hate based movements, hate-speech, fascism or oppressive relationships of any kind. Using Egal for such purposes is considered to be against our TOS and will result in legal action being taken. All code may be used or reproduced by anybody for any reason except the aforementioned, in addition to Racism, Sexism, Homophobia, Transphobia, or the oppression of any person or animal for any reason will not be tolerated in any way. Any system built using any component of Egal must conform to those simple rules. Aside from that, anybody, no matter how experienced is encouraged to participate.