The token model of public blockchains and cryptocurrencies will never gain mass adoption.
Nobody is going to use a dAPP that requires you to go onto a shady cryptocurrency exchange and buy a bunch of stupidly named tokens before using it.
I propose a subscription model to public blockchains is a viable alternative to the token model.
In this model a dAPP developer would offer a monthly subscription fee to use a dAPP, that would be a fiat amount large enough to cover the token cost of average monthly transactions per user.
The dAPP would run on a custodial wallet, where the necessary token transactions into/out of the wallet would be automated and invisible to the user experience. The UI/UX would be similar to a traditional iOS/Android app.
The dAPP token reserve would be sustained by the dev owning Enigma nodes. In the ideal case, the nodes would provide a reward greater than or equal to the transactional volume on the dAPP. The Dev nodes would accumulate a reserve of tokens that reaches a steady state in rewards/spending by subscribers.
The model requires Dev nodes to have a large reserve of tokens for staking and transactions. Devs can crowdfund their token reserve in an ICO. They can also bootstrap their reserve by initially charging percentage fees on the dAPP to traditional token transaction users and later offer subscriptions. The Enigma Company clearly would have a large enough reserve to offer such a service from day one of mainnet. It could also partner with high potential dAPPs to offer subscriptions.
The model is not possible as long as Enigma is on the Ethereum blockchain because dAPPs will require ETH as gas until Enigma forms it’s own chain. This is why Enigma on a stand-alone chain IS actually the most interesting phase of development.
I agree with everything you said. Though my dream is one in which the fiat world and the decentralized/crypto/token economy are seamlessly linked such that participates in either of the systems can interact with the other nearly without even being aware of doing so. I imagine services connecting and interlinking the fiat/credit systems to crypto/token chain will grow out of simple demand and financial incentive of providing a quality service allowing such interactions.
@gengar2718281828459 really interesting points. This can also be a deposit by the users rather than a subscription. I have a couple of thoughts on different parts:
Fee model: This is interesting, as you’ll see in the latest dev update, we are simulating gas costs for the Enigma network. We can collaborate with dApp developers to help them create a tiered subscription model based on usage. The fee model itself will depend mostly on the dApp. Devs running nodes: Currently you don’t have to run a node in order to deploy a secret contract but I can see an overlap between developers and node runners as hardware requirements are not very limiting. Furthermore, dApp developers may be emerge as a new customer segment for Staking as a Service providers. Enigma - dApp partnership: It could be interesting to lend promising dApps the threshold staking amount. We haven’t considered this approach but it is a very interesting idea.
Currently dApps building secret contracts will need ETH but there are economic abstraction tools we are looking into like Weasel, which I believe is not optimal for gas costs or Uniswap.
I agree this is a very interesting direction. Have you seen this custodial wallet approach used anywhere else? I’m curious about how the dApp dev can ensure the wallet will only perform legitimate actions.
Edit: After talking with @can i think I should clarify we do see things like this w/ Veil, for example, or other proxy contracts-- but who handles withdrawals/deposits of the crypto in a subscription model with a USD onramp? Definitely worth mapping it out in detail. The idea of staking to cover fees is super, super interesting.
They already are. I know some developers that have already developed fiat-crypto gateways that are pretty seemless. Once you combine that with an automated liquidity pool that functions using various algorithms based on dAPP usage, token price and volatility, etc. I definitely see it being plausible. Very cool to think about. Actually now that I think about it @gengar2718281828459’s assumption that something like this would NOT work on the Ethereum chain may be false. You could probably even automate the gas using the fiat-crypto gateway and smart contracts.