Difference between revisions of "Emission Rate"

Revision as of 22:06, 16 January 2018

Cryptocurrencies such as Terracoin and Bitcoin are created through a cryptographically difficult process known as mining. Mining involves repeatedly solving hash algorithms until a valid solution for the current mining difficulty is discovered. Once discovered, the miner is permitted to create new units of the currency. This is known as the block reward. To ensure that the currency is not subject to endless inflation, the block reward is reduced at regular intervals. Graphing this data results in a curve showing total coins in circulation, known as the coin emission rate.

Terracoin Coin Emission

While Terracoin is based on Bitcoin and Dash, It follows the Bitcoin model and reduces the coin emission rate by 50% every 4 years.

Total coin emission

Bitcoin's total coin emission can be calculated as the sum of a geometric series, with the total emission approaching (but never reaching) 21,000,000 BTC. This will continue until 2140, but the mining reward reduces so quickly that 99% of all bitcoin will be in circulation by 2036, and 99.9% by 2048.

Terracoin's total coin emission is also the sum of a geometric series, with the total emission approaching (but never reaching) 42,000,000 TRC.

Block reward allocation

Unlike Bitcoin, which allocates 100% of the block reward to miners, Terracoin splits the block reward between the miner, a deterministically selected masternode, and the decentralized budget system. Terracoin features superblocks, which appear every 21600 blocks (approx. 30 days) and release 10% of the cumulative budget over that budget cycle period to the winning proposals in the budget system. To pay for superblocks, the block reward for normal blocks over the period is reduced by 10%. Normal block payments are split equally between miners and masternodes according to the payment logic, resulting in an coin reward allocation over a budget cycle as follows: