For those who are not familiar with what is happening, 3Speak is working on setting up a decentralized video and image storage system that is tied into IPFS. This is going to expand Hive's capabilities of censorship resistant by moving past just text.
To do this, they created a tokeneconomic system that is going to utilize the individuals on Hive. This will be the distribution pathway which will be done through a claimdrop. It will be a 1:1 drop, providing each Hive with a single LARYNX, the miner for the SPEAK token.
While this is the basic outline, the true value lies in the Service Infrastructure Pool, SIP for short. Here is where we see the ability to really grow things exponentially in terms of price enter the picture.
Service Infrastructure Pool
What is the SIP?
The easiest way to think about it similar to the liquidity pool on Ethereum. Many are getting involved with them, providing a certain amount of a particular token as well as the equal amount of ETH. Individuals do this to get a piece of the transaction fees which are doled out based upon the percentage of the pool each person holds.
These pools exist to provide decentralized liquidity to markets. Some of the centralized exchanges lack volume to make trading, especially large amounts, feasible. Liquidity pool can address this issue if they have enough people joining.
The SIP is designed to be one of the most liquid pools there is. Unlike the liquidity pools on Ethereum, with this one, the tokens go in but they do not leave. Thus, anything that makes it in there is permanently part of the liquidity pool.
Before getting into the value of the SIP, it is important to mention how the miners work. These are virtual miners like most we have seen over the past year or two. They do not require electricity and produce tokens by being staked. In this instance, the LARYNX token mines the SPEAK token, which is handles governance for the platform.
The key here is that LARYNX tokens not only mine SPEAK but they can only be purchased with SPEAK. Here we see a nice circular loop. Thus, if anyone outside of the claimdrop wants to get involved, they need to purchase SPEAK tokens to get a hold of the miners.
At the same time, each year, new miners will be released which are more powerful than the previous version. While the older miners will still work, people will want to upgrade their miners periodically. Once again, the need to use SPEAK tokens.
The linked article above provides some interesting points about network security and preventing 51% attacks which is outside the scope of this article but a worthwhile read.
How Does This Help HIVE?
In the SIP, there are 3 tokens, SPEAK, BROCA, and HIVE. BROCA is the transaction token similar to Gas on Ethereum. Each time a user wants to upload a video, some BROCA will be required. Here is where the "fees" are generated, which are paid to the miners.
SPEAK is the governance token. There is a capped supply generated through the coding in the miners. However, through the model being implemented, SPEAK will be used to grow the SIP.
Each time a SPEAK token is used for anything, buying some LARYNX, ads, or anything else on the platform, it is divided into three parts. The first is SPEAK. The second third is changed into BROCA. Finally, the last part is used to buy HIVE. Once that is completed, all are sent to the SIP where they are locked up permanently.
Hopefully, it is becoming clear how this creates an even larger circular loop.
Since the SPEAK token is capped, the value should increase along with activity. We also see a lessening of supply as engagement with the network takes place. By pushing the price of SPEAK higher, each token, when converted, should buy more HIVE. This is where we see the potential of the SIP tying up millions of HIVE.
Miners Part II
To conclude the circle, it all goes back to the miners.
Who are these people? How do we know there will be a demand for this token?
The miners are those who not only staked at least one LARYNX token but also are providing storage and bandwidth to the network. Anyone who is interested in supporting his or her favorite content creator can do so by storing some of the videos. To do this, LARYNX is required. This drives the initial demand for the miners which kickstarts the entire process.
This ultimately becomes a truly community driven, decentralized platform. The miners are the entry point for all storing videos. Imagine the time when millions of people are using this service to decentralize video and image storage.
The back end can be used with any UI. Video uploading can potentially come from any site, including one's own website. To mine for the network obviously requires the client but what interface is used to view the videos is secondary. This means that people who get their sites shut down do not lose their content like with YouTube. That content creators community are effectively the ones hosting the videos.
Having the circular nature of tokeneconomics means that, with a permanent fund, money will consistently be generated over time. Since there will likely be a "return" in the fund, this money can be used, according to the decisions of the SPEAK holders, to fund development on both 3Speak and Hive. If chosen, it could also be used to reduce witness costs, thus making Hive less expensive to operate.
Hopefully now the potential is clear and everyone can see how the 3Speak network will feed directly into both Hive the blockchain and the token.
Now that the client is released, time to get excited about the next phase of the development.
To get the client, here is the article that details it:
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