Garrett Camp, the co-founder of Uber, has announced that he is developing a new cryptocurrency and giving half of it away. As well as attempting to make a new global payment method, he hopes to reinvent what a cryptocurrency, and ICO, looks like.
Last year Camp started to research cryptocurrencies. After buying some Bitcoin and Ethereum he struggled to get excited about any of the others. “The more research I did, the more I was not really wanting to buy a large amount of any one of them,” he said.
In his view cryptocurrencies were inefficient and incapable of handling the transaction volume a widely-used currency would create. They use tremendous amounts of power and were still confined to a tiny proportion of the global population, he reasoned. Mainstream adoption was unlikely while cryptocurrencies were “held back by issues related to complexity, usability and scalability.”
In Search of Alternatives
Camp decided to investigate if there might be a different way of doing things. “It might be better to release a new project from a different philosophical standpoint,” he said, “ … with cooperation from … universities, scientists, and research institutes.”
The result of these enquiries is the Eco, named for its associations with e-commerce, economics and ecosystem, and its pronounceability in most languages. Designed to be a worldwide currency for everyday transactions, it overturns many of the assumptions of what a cryptocurrency, and ICO, should look like.
First, half of the Camp has come up with a novel way of seeding his currency into the market. Rather than stage an ICO, he plans to give away half of the 1 trillion Eco tokens to the first billion people who sign up and express an interest. This should give it a critical mass of initial users, making it immediately viable as a means of exchange.
The other half of the Eco tokens will be distributed between universities, advisors, partners and the Eco foundation.
Universities Given Central Role
The universities play a key role in the ecosystem. They will receive 20% of the Eco supply in return for acting as “nodes”, and will confirm all transactions made on the network.
Camp argues that this will improve both the number of transactions the network can handle – he is claiming an initial capacity of 1,000 transactions per second, rising to 100,000 within a few years – and reduce the energy inefficiencies of multiple miners.
Though this goes against the decentralising ethos of most cryptocurrencies, Cash points out that Bitcoin itself is becoming less distributed: “the emergence of large mining pools has led to uncertainty around long-term governance, and a small number of entities now control mining capacity,” he said.
Though having authorities verifying transactions is highly controversial, it is also more energy efficient. Bitcoin miners compete with each other to receive the jackpot, so it makes economic sense to throw as much energy at the problem as you can.
Under the Eco system, rather than compete with each other, all nodes will share tokens when blocks are confirmed. This incentivises them to use the least amount of energy that they can get away with.
For all the innovative ideas on display, the platform is at a very early stage – a trend we are all becoming familiar with in the crypto domain. Its design proposal – it is still a long way from a white-paper – makes a plea for contributions from interested parties. So if you’re “ … an expert in technology, security, economics, governance, policy or design” and want to help out, you can email firstname.lastname@example.org. Or, if you just like the sound of the free money, then you can sign-up for some at Eco’s website.