- To establish a "Review Comittee" of people that perform code reviews on new cryptocurrencies.
- To avoid badly defined terms like "centralized" and "decentralized" and to instead focus on "open admission" which is easier to define.
- These Code Reviews will be the basis for rules that exchanges must follow.
- The Review Process is objective and not designed to handle issues based on subjectivity.
- The purpose is to encourage investors to invest in the crypto assets based on the most understood technology, and to discourage investiemts on crypto assets based on less understood technology.
(a) Open Mining Protocol - The process defined by this asset's reference implementation allows for any computer systems regardless of what networks it has access to, can participate in the creation of new tokens.
(b) Open Wallet Protocol - The open source code that defines the creation of new addresses for receiving and spending tokens can be performed by any computer system, regardless of the networks that have or not have access to.
(c) Consensus Leader - The person who is able to make new releases of a Categorized Crypto Asset.
(d) Categorized Crypto Asset - A Crypto Asset that has completed at least Level 1 Code Review as defined in §228.8.1 and has been determined to fir within the definition of Categories 1-3.
A crypto asset is defined as any asset that has either a open mining protocol, or an open wallet protocol.
These are crypto Assets that have been newly created and the Administration has not yet had a chance to publish the results of a §228.8.1 Level 1 Review. These assets should be considered the most unstable of all categories of Crypto Assets. Investors are cautioned to only invest into Category 0 Assets what they can afford to lose.
These assets are subject to rules that force them to constantly ensure their Assets remain private. Other rules include forcing asset leaders to design the system in such a way that order can be restored following the event of a hack.
These assets are not fully public, and not fully private.
No known examples
Examples include EOS and Ripple, Teather, Dai.
Crypto Assets with a non-open mining protocol must provide for the Administration a list of all defined new coin recipients, and all names must be verified. (No anonymous "block producers")
Both mining protocol and Wallet protocol has open admission.
All crypto assets determined by a Level 1 review to be completely open, and contain unproven technology will be assigned to Class 1.
Compliant exchanges are not forbidden from trading Class 1 assets as long as they are clearly labeled as "Class 1" and labeled in red.
Once a Crypto Asset has achieved a certain market cap and market volume, it is eligible for a Level 2 code review. Before that review is completed, the asset will be placed in Class 2.
The software of this asset has to be proven by the Administration to be technically correct. All technical claims must be tested by the administration and proven to be correct. An example of a technical claim is a stated transaction per second rate or claims of payment anonymity.
Within this class there are two subclasses:
Subclass A - Non-Administration Lead Leaderless Crypto Asset. Subclass B - Administration Lead Leaderless Crypto Asset.
If an asset wants to be classified, it must be submitted to the administration for classification. After the administration looks over the code, it will assign a classification.
The process of determining the classification is split into three parts:
This is a cursory inspection of the code to determine if the asset is:
228.8.1.i Completely Open Source 228.8.1.ii An open mining protocol. 228.8.1.iii An open wallet protocol.
The result of this review will be called a "Crypto Asset Data Sheet", and will be published on a weekly basis by the Administration. The Data Sheet will only contain basic information, such as Category/Class assignment, and transaction, block and address encoding formats.
This review is more in depth. A Crypto Asset can only undergo this review after it has achieved the market cap and trading volume requirements of Cat III/Class 2 tokens. Category II and I assets at this time re not eligible for
This review is performed by the Judicial Comittee to determine if the Crypto Asset is actually leaderless.
Exchange services are free to trade any asset, regardless of it's category and class. The only stipulation is that the exchange much clearly label each asset with the official category class defined by the administration
- The regulation name must be displayed larger and in a darker color than the common name.
- The proper Category and Class must be displayed in the correct color defined by the rules of each category/class.
- As part of the new user signup process, the signup page must show to the user an introduction of the category class system, telling new users that higher classifications means the asset is based on more understood technology.
A consensus Leader is a person or group of persons who has the ability to make a new release of a reference implementation of a Category III Crypto Asset.
There are two types of Consensus Leaders:
228.10.1 Original Consensus Leader - This person or persons are the original creators of the first reference implementation of any given crypto asset. 228.10.2 Subsequent Consensus leader - A person or group of people who have the ability to make new releases of the reference implementation and is not the original leader.
In general Original Consensus Leaders are free to make any changes to the protocol without any regulatory repurcussions. On the contrary, Subsequent Consensus leaders are required by regulation to follow the official public "vision" of the asset as defined by the
It is often that Original Consensus Leaders make statements towards the end of their time as Consensus Leader, that seem to dontradict earlier statements. This is normal, as people learn new things over time and their opinions change. For this reason, a heirarchy is defined for interpreting the Original Consensus Leader's words.
- Post implementation Whitepaper
- Pre-implementation Whitepaper
- Verified public social media post history
- Contemporarily circulated private conversations
- Post-contemporary private conversations
The administration is compelled by law to perform ownership duties on assets it owns. These ownership duties are as follows:
For Bitcoin based assets:
- Performing network analysis to determine if it's safe to raise maximum transaction validate rates.
- Perform hashpower vote sampling to determine if the majority of mining nodes are able to handle a necessary new reference implementation release.
- Defining new cryptographic primitives in use when existing one are determined to be inadequate. Cryptographic primitives included by not limited to: Proo-of-work mining hash algorithm, Proof-of-stake staking algorithm, Base58 check encoding algorithm.
A Crypto Asset that has new versions published by Subsequent Consensus Leaders that are believed by the administration to be against the Original Consensus Leader's Public Vision (see 228.11).
When a crypto asset has been determined to be of this category, the name of that currency is banned from being listed using the name in total or partial for all forks (either hard forks or solft forks) of the original chain.
To declare a Crypto Asset as Fallen, the process is as follows:
A hearing will be held in public where the Administrator appoints an Administrtive Law Judge (ALJ) and the Subsiquent Consensus Leaders will be able to present their case as the defendant. The entity that commences the process will be required to be present at the hearing and argue the side of the plaintiff.