A collaborative EOSIO chain ecosystem with flexible governance

This is a WIP proposal to improve the EOS and sister chain utility, governance, security and scalability.

Problem — an ecosystem of separate sister chains

The current ecosystem of EOSIO blockchains are weaker due to their separation. As each new sister chain is created, it decreases the utility of all other chains. The price of other system tokens decreases due to loss of utility and the attack cost and producer rewards of all EOSIO blockchain’s decrease.

Solution — an ecosystem of united chains

Instead of creating an ecosystem of separated sister chains, this new system allows for freedom of governance of separate chains, the ability to compete with other chain’s governance (including the EOS blockchain) while keeping the one shared system token, creating a shared economic model and economy, directly improving the BP remuneration and attack cost of all chains.

The EOS token (the system token on the EOS blockchain) is used on sidechains as their system token. Sidechains unlock tokens on their blockchain by sending them to a locked address on the EOS blockchain and visa versa.

EOS token inflation is sent to the sidechains to pay for governance costs (BPs and any other activities that they may choose) in proportion to the number of EOS tokens that are on that chain.

Distribution of EOS inflation tokens. % is calculated based on the deployed blockchain EOS equivalent supply / total EOS equivalent total supply

In this way, one token is used throughout all chains, creating a collaborative economic ecosystem. Sidechains are free to implement governance of their chain (voting, accounting, rewards etc…), in effect creating a competitive governance ecosystem. The more the sidechain get used (by creating sustainable economies with dapps that have demand for system tokens) the more funds they receive from the global EOS inflation.

If a sidechain starts to get a similar amount of EOS tokens on it as the EOS blockchain (which run’s the global inflation), it will put pressure on EOS to upgrade its governance to keep balance among the ecosystem. In this way, EOS governance can be upgraded in a well-tested way and sidechains can influence the EOS blockchain.

Note: The use of EOS and sister chain names has been used for illustrative purposes only. Each chain would need to opt-in to this new system.

How it works

EOS blockchain

1. A 5% inflation of EOS tokens is allocated to a new account e.g. “eosio.global”
2. These funds are allocated to EOSIO chains balances based on the number of EOS tokens that are on the blockchain chain network. E.g.
   Telos has 3,000 EOS tokens on its network and Wax has 2,000 tokens on it’s network. In this case Telos would receive 60% of the eosio.global balance and Wax would get 40%.
3. The sidechains can send these EOS tokens to its network through a cross-chain atomic swap which can then be used on the sidechain.

Sidechains

1. Receive EOS tokens from the EOS blockchain inflation rate to pay for its governance. The more EOS on a sidechain the more they are awarded from inflation, incentivising them to operate an sustainable and trusted platform for dapps.
2. Users can send EOS tokens between the EOS blockchain and the sidechain (or from sidechain to sidechain) to pay for the use of different dapps on their networks.

Sister chain to sidechain

The new model can allow for sister chains to join the EOS sidechain network by replacing their system tokens with EOS tokens. This can be paid for through the current balance of the eosio.savings balance, or by minting new EOS tokens.

Deloyed sister chains

EOS blockchain eosio.savings balance = 13,617,707 EOS

Benefits

Ecosystem

1. Create a shared utility of their system tokens between all chains, greatly increasing utility.
2. Change fragmented chains into one ecosystem adding security and network effects.
3. Creates a collaborative environment where governance can be experimented with.
4. Creates one dapp ecosystem that has higher scalability than each chain individually.

EOS blockchain

1. Adds extra utility for the EOS token.
2. Allows EOS governance to be upgraded through pressure from sidechains.
3. Allows chain governance to be experimented on in a way that collaborates with EOS, which can be used as a guide for EOS governance. if a sidechain becomes popular enough then it will add pressure to EOS governance itself.

Sidechains

1. Create a shared utility of their system tokens between all chains, greatly increasing utility.
2. Can influences EOS governance.
3. Increases block producer pay and network security from an increase in EOS token utility and price.
4. Access a greater liquidity pool for their system tokens. Note that support of exchanges to allow users to choose which blockchain to send to would need to be provided.

Dapps

1. Can choose a blockchain to deploy to in the same economic ecosystem.
2. If a dapp wishes to move to another chain in the ecosystem (e.g. for better governance or scalability) they can do so while keeping the same EOS balances, a better UX for its users.

How does it actually work?

Reading the amount of EOS tokens on a sidechain, and sending tokens across chains is not new. This is possible using EOSIO blockchain technology but is not trivial. It would possibly require an upgrade of the EOSIO software. Block One is yet to release a standard or supported feature to do this but it is in their pipeline.

Briefly, it is possible to read the token balance on another blockchain by verifying the merkle proof of a block from the other blockchain. There are several strategies for cross-chain atomic swaps, which rely on cryptographic primitives that exist on all EOSIO chains. Examples of sidechains in practice that do this: RSK, Loom Network, and POA.

After getting the support and feedback from this article we can create a technical strategy which I would be happy to participate in technically (paid).

Please post feedback comment in medium below and/or add on Twitter:

https://twitter.com/theblockstalk/status/1165577177892642817

Please RT with BPs who may be interested.