Creditbit, the MIT/X11 licensed cryptocurrency project is out with a new update regarding the Proof of Trust/Pawn, a locking mechanism, that is one of the core attributes of future CreditBit token.
The Proof of Trust/Pawn mechanism involves two modes of tokens. Each wallet will have two balances. First balance represents transferable tokens, similar to other currencies. Second balance represents “locked” tokens that are not transferable.
But what is interesting is that “Lock” on the batch of tokens is an item by itself. People interested in getting new tokens or voting, will have to lock a certain amount of their tokens and thus show their trust in the Community.
‘Lock’ signifies the respect of the holder for the community and their trust in it. Locking period will prevent instant dump on the market, helping currency to reach stability and proper value.
It is to avoid any potential damage due to market manipulation. Lock is about the mutual trust between Creditbit and the community.
Bounties for developers and promoters will be paid out in locked tokens which would help spread risk/trust among all participants in the community.
Same principle will be in effect for voting in CreditBit DAO. In order to participate in DAO voting, owners will have to lock certain amount of tokens. Votes will be pounded with the amount of locked tokens, therefore linearly dependent on the trust.
There is also the option of the owners being able to transfer a right to unlock (ownership of a “lock”) a certain amount of locked tokens to other entity.
Lock itself is thus a transferable entity, but the transfer would not affect the current ownership or transferability of locked tokens.
This only means, that after the expiry of the locking period, an entity, that became a new owner of a lock, will have the right to unlock and transfer these tokens simultaneously to an address of choice.
CreditBit desires a constant or at least slowly changing Degree of Trust.
Degree of Trust is the ratio between sum of all locking tokens periods and all existing tokens. More the locked tokens for longer periods, higher the Degree of Trust.
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