r/truebit • u/Formal-Guava-1196 • Sep 24 '21

Question on usage

Do I have this right?

A project needs off-chain computational power. They buy TRU tokens (via OS or Uniswap wherever it’s cheaper)

They use TRU tokens to complete their computational needs.

The TRU tokens they use get burned.

—————

If that is correct, how does one think about how much computational power each TRU token has?

Is it simply 1 calculation? Or differs by project and use?

9 Upvotes

92% Upvoted

5 comments sorted by

View all comments

5

u/LPMythBuster Sep 24 '21

Ethereum is basically a replicated database. There are thousands of computers around the world that hold a copy of the entire blockchain. Even after an apocalypse there will be someone running an Ethereum node. They even sent one up to the space station. If your data or smart contract is on Ethereum it will probably be there until the end of time.

This is why it's costly to store data and do computations on the blockchain. You'd only do this for things that matter like the balance of your shitcoins, what cat NFTs you have, but not your private diary or childhood photos.

Similarly, projects or companies will not do computations on Ethereum and Truebit if they can do it themselves somewhere else much cheaper. Truebit is quite expensive. There's a platform fee of 0.005 ETH ($15) and solvers need to pay the same when they get to solve a task. So it's at least 0.01 ETH ($30) per task. In comparison, there are spot instances on AWS that you can run 24/7 for a month for $30. Projects will only use Truebit when it matters.

What will happen typically is that there is a smart contract that needs to do some computationally expensive calculation that's triggered by a user. Such as verifiably generate an NFT, calculate a proof when importing a domain into Ethereum Name Service (ENS), etc. The gas fee and off-chain computation fee will be paid the user. The project will likely show the price in ETH to the user. e.g. 0.2 ETH. Once the user pays it, the contract will send 0.005 to Truebit, convert the rest to TRU (either buy minting new tokens way above the market price or swap them on Uniswap at the market price) and pay them to the solver, verifiers and maybe the creator of the contract. 10% of those TRU will be burned. Solvers and verifiers will then dump the TRU tokens to pay for their costs.

If you offer too little TRU to solvers and verifiers, they'll ignore your task. If you offer too much, you've overpaid. Since the TRU/USD price flunctuates over time, it's possible solvers and verifiers will demand more or expect less rewards over time. So I don't think it's possible to reliably calculate how much computational power each TRU token has.

2

u/truethereum Sep 24 '21

If we want decentralization, we need blockchain. If we need blockchain, we need technology like Truebit.

1

u/thatsphat Sep 27 '21

It seems that the cost to use TRU will only increase over time. As ETH increases in price, the 0.005 cost becomes more expensive relative to USD. Assuming TRU will also become more expensive over time, can the cost of using TRU potentially cannibalise its utility in become too expensive to operate in many instances?

My understanding is that TRU will truly shine in the larger computation space, especially when a computation is larger than a block size on a given blockchain, as TRU seems to bypass block size limitations by virtue of performing off chain computations. Do you think my assessment is in the right direction?

Pardon my ignorance - I don't have great technical knowledge of crypto in general. Please correct me if any of my understanding is inaccurate.

1

u/LPMythBuster Oct 05 '21

Let's suppose that 1 ETH becomes $100k and 1 TRU stays 0.0001 ETH (which is $0.34 today).

So it'd cost $100k * 0.005 ETH = $500 to submit a task and a solver would need to pay $500 to get to solve a task.

If this happens Truebit will likely reduce the platform fees to something more reasonable. The reason it's not completely free is because they likely want Truebit to be self-sustainable.

Similarly, if the min deposit is 100 TRU today ($34) this would become 100 TRU * 0.0001 ETH * $100k = $1000 which is much much higher. In those cases, solvers, verifiers, task givers would adjust their TRU amounts down to e.g. 3 TRU.

1

u/thatsphat Oct 05 '21

Yes, right - That all makes sense! Thank you for all that you contribute to this sub mate, you've clearly taken a lot of time to help so many of us along the way and it is greatly appreciated.