How It Works
The GoodDollar economy revolves around two primary user types: Claimers and Supporters.
Claimers are individuals that claim a daily basic income in the form of G$ coins. Their unique identity must be verified.
Supporters are individuals or institutions that believe in basic income and bottom-up growth and fund the supply of G$ coins through staking their capital to support the GoodDollar economy. They do this through committing and locking funds (“staking”) to various third-party interest-bearing protocols and mechanisms.
Every day, a number of G$ coins are minted and distributed as basic income to Claimers. The value in the GoodDollar reserve comes from the interest that is generated from Supporters who stake cryptocurrencies in decentralized third-party protocols. Through the amassed reserve interest, G$ coins are minted. They are used to pay Supporters market-rate interest payments, while a daily amount of G$ coins is set aside to be distributed as basic income.
Over time, more G$ coins are minted relative to GoodDollar’s Reserve. The system is built to accommodate scale, whereby the value and utility of the G$ coin to its holders increases as more people and merchants join the GoodDollar network.
- Third-party protocols generate value in a supported cryptocurrency such as DAI or ETH, and that interest is moved into GoodReserve.
- The number of G$ coins minted is determined by the GoodDollar’s leverage, relative to the value of interest locked in the GoodReserve.
- Initially, every G$ coin is fully collateralized in a supported cryptocurrency on a one-to-one ratio. For example, every 1 DAI – a decentralized cryptocurrency stabilized against the value of the US dollar (US$) – moved into the reserve produces G$ coins in equal value.
- G$ coins are distributed back to Supporters in value equal to the interest they receive in the third-party protocols and mechanisms. The reserve ratio is expected to decline over time, minting more G$ coins relative to the crypto assets in the reserve.
- The remaining balance of G$ coins minted is distributed equally on a daily basis as basic income to Claimers, divided evenly between the number of Claimers that issue a claim on a given day.
Claimers will be able to access and claim G$ coins initially through the GoodDollar Wallet, though ultimately G$ coins will be available through a variety of endpoints with secure and unique identity solutions. The GoodDollar Wallet requires Claimers to identify and occasionally re-verify themselves to restrict fraud and system abuse.
Last modified 3yr ago