The Blockchain

As the economy of civilization expands to include 100s of billions of devices, people and AI, it is increasingly important that economic exchange can happen between machines at the speed of machine thought, and without the direct supervision of humans or central authorities.

Any decentralized collaborative protocol must have a means of value exchange, allowing for the secure transaction of value while addressing the following problems:

The Trust Problem

Participants must be able to form clusters with strangers, and trust that the protocol will ensure good behavior and performance.

The Compensation Problem

In a decentralized network, participants must be rewarded for the resources they provide.

The Consequence Problem

There has to be a negative consequence for bad behavior.

To address the consequence problem, one approach is require the participants to put something of financial value at stake. This collateral, or deposit, would be seizable by the protocol in the event of bad behavior.

However, this approach carries some practical limitations in the real world, namely:

The Regulatory Problem

Deposits in fiat currency must be held by central entities with proper licenses which vary from country to country.

The protocol would have to register in each country of operation, and get the relevant fintech or banking licenses required to hold the deposits and transact in fiat currency. Although feasible in local markets, it is practically unfeasible to maintain such a network globally at civilization scale.

Any value exchange mechanism also comes with transaction costs, and this is particularly challenging for DePIN networks dealing with machine-to-machine exchanges of microvalue.

The Transaction Cost Problem

Individual transactions between participants are likely to represent very small values. These microtransactions are critically sensitive to transaction cost.

For example, if it costs 5 dollars to process an international payment it becomes unfeasible to charge a dollar for a rendered service.

Creating a sustainable and global DePIN economy is challenging, but blockchain has created a path that we believe is both practical, transparent and compliant.

The AUKI posemesh uses the blockchain to manage rewards and reputations for its participants using a native $AUKI token, secured by the decentralization and economy of the host blockchain.

This approach also solves another problem that a global DePIN network will face, namely third parties interfering with the participation of others. For example, if the posemesh is reliant on the international fiat banking infrastructure, then it becomes sensitive to these corporate actors limiting the access to the posemesh.

The Permission Problem

The network has to be permissionless, allowing anyone to participate without third party interference or approval.

Participants may have their capabilities to open bank accounts or companies limited by local actors, but anyone in the world is free to create a blockchain wallet.

It is the permissionless, decentralized and machine-friendly aspects of the blockchain that makes it the best available candidate for a fifth protocol.

Something as ambitious as the posemesh would not be possible to build on any other financial infrastructure.

Choosing a blockchain

The AUKI posemesh uses the Avalanche blockchain to secure its participant reputations and smart contracts. Choosing a blockchain for something as important as the posemesh was not easy, but several considerations were made:

Open Source

The protocol must be able to fork the blockchain to continue its operations in the case of blockchain failure.

There are many open source candidates, but it was important for us to choose a platform that would allow us to continue independently regardless of the success of the blockchain project itself.

Throughput

At civilization scale, the posemesh must be able to handle an enormous amount of transactions.

For all of its inherent benefits, this is where the blockchain suffers the most severe drawbacks. No blockchain in the world is currently capable of handling the amount of transactions that a decentralized machine perception network would have to deal with, and it is unlikely that any single blockchain ever will.

Instead, we believe it is instead important to be able to split and bridge blockchains into subnets with their own discreet responsibilities.

Subnets

A blockchain that allows for subnets becomes scalable through partitioning and layering.

Furthermore, it is important for the posemesh to choose a blockchain that is sufficiently customizable and robust. Ultimately, the network does not wish to be limited by the capabilities of the hosting blockchain.

The cost and speed of transactions is also a major concern, and when using a blockchain the transaction cost problem maps onto the gas fees of the host blockchain.

For a blockchain candidate to be viable for the posemesh, gas fees must be low and ultimately payable in the native $AUKI token.

For these reasons, The Posemesh Foundation and Auki Labs have chosen the Avalanche blockchain to secure the posemesh.

The existing smart contracts of the AUKI posemesh have been audited by Zokyo and OpenZeppelin.

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