Workchain is an entirely new concept for crypto, and thus could be a little difficult to grasp. Essentially, it is a platform for producing value rather than just transferring it, as blockchain is known for.
The Infinite Token Offering (ITO) mechanism is the engine that brings a workchain's participants together. No single entity controls an ITO. After the first genesis transaction, the creator has the same ability and authority as everyone else. An entity would only be able to 'control' an ITO by adding value to it, which benefits everyone that participates. It is truly decentralized.
In an ITO on workchain, 100% of token holders are rewarded at the end of each work block. Compare this with Bitcoin on blockchain, where only an extremely small number of participants are rewarded.
Since most of us are already familiar with ICOs, let's use that as a base for comparison with ITOs.
Send BTC/ETH to get ICO tokens
Stake FTM/ETH to get ITO tokens
Tokens come from a single entity (e.g., company)
Tokens come from anyone that has them
The company benefits
The person that added the tokens, benefits
Centralized power and authority
Decentralized power and authority
A company controls the ICO
No one controls the ITO. Not even the creator
Company gets rewarded first, adds value after (maybe)
Participants add value first, then get rewarded after
A refund is highly unlikely
Submit an autonomous refund request
ICO price can go down
ITO price cannot go down
Attractive to scammers
Nearly immune to scams
Complicated to create
Relatively easy to create
'Inside' information gives some an advantage
'Inside' information offers no real advantage
Has an end date for participation
No end date for participation
Two parties: Investors who buy tokens and the Company that is offering the ICO
Two parties: Agents who buy tokens and the Producers that are offering their tokens
Hold an ICO token, get nothing.
Hold an ITO token and get a variety of other tokens every block, which are yours to keep and do as you want with them.
If you're staking your ETH or FTM into the ITO, you're an 'agent'. If you're offering tokens for distribution to agents, you're a 'producer' (and your batch of tokens is called a 'job').
An ITO is, at its heart, a decentralized, two-way incentive mechanism running on smart contracts. Modelling the real economy, it allows buyers ('agents') and sellers ('producers') to reward each other for just about any reason you can imagine. In a real-world retail transaction, for example, buyers reward the sellers that have the most attractive products, while sellers are incentivized to offer their best. In a basic workchain use case – one of an infinite variety – agents reward the producers that add the most tokens of the best projects, while producers reward agents with their best tokens. Each side has an incentive to add value, growing the size of the workchain's economy.
Bitcoin works because it does incentives very well. However, it only offers incentives for one party (the miners) to do work for the network. The other party (the sender) is not directly incentivized because they are using the network as a service and paying to use it. With smart contracts and two-way incentives we can approach blockchain as a complete economy rather than just a small, financial services sector within it.
Workchains and ITOs can be applied to just about anything you can imagine, from real estate transactions to dating apps to international trade to contests to creating a company from scratch. It turns the world economy into an endless variety of smart contracts that run without any centralized authority and has few bad actors.
If it sounds too good to be true, then we have only to realize that the modern economy would also seem that way to someone that has never witnessed it before. You can order fresh sushi in the middle of the desert, if you wanted. Or one can, for example, stake their funds in a local bank and get rewards every period in the form of interest. You can take your funds out at any time, and choose any bank you wish. Banks can then pool customer funds together and use it as a loan for local businesses to, eventually, offer you other goods and services. But when we put the entire economy on a decentralized platform that anyone can access, something even more amazing can happen.
If the power of blockchain is for anyone to 'be their own bank', then the power of workchain is for anyone to 'be their own economy'.
Check out the Examples and Use Cases section on page 10 of the Workchain whitepaper for a few more examples.
Endless Rewards. Continuous reward schedules as long as there is participation, without end dates. Workchains – and the ITOs within them – can reward a person’s labor forever.
No Need for Exchanges. Send Fantom or Ethereum tokens to an ITO smart contract address and receive ITO tokens back automatically. The rate you get depends on how many other wallet addresses have requested tokens before you. Send the tokens back to automatically request the return of your stake, at a rate that has either remained the same or increased.
Transparent Market. The ITO price is always a multiple of the number of transactions (where the token was obtained) — plus one — and its genesis value. Each ITO determines its own parameters for the minimum and maximum number of tokens the first n addresses can obtain, as well as its genesis value.
Continuous Rate of Inflation. ITO prices are designed to only increase — not decrease —without token burn, in order to secure the economy.
Resistance to Scams. Standard ITO smart contract code is designed to be incompatible with cheating. Feeding into the ‘self-aware’ economic organism of workchain, a continuous flow of human intelligence can move consensus away from malicious – or unproductive – actors.
Resistance to Malicious Attacks. The ITO mechanism turns actions that are intended to harm the system into actions that have an overall benefit to its economy.
Flexible Blocks. Token distributions align with work blocks, which are periods of time for validation of productive activity. They can be set to daily, weekly, bi-weekly, monthly, etc., according to the needs of the workchain.
Open Participation for Producers. Anyone can join an ITO and become a work producer within seconds.
Competitive Producer Rewards. As a reward for their labor, producers receive funds staked by agents during a work block. The more a producer's contribution is validated in comparison to other producers the more rewards they will receive for their labor. Their position can change at any time during the work block, depending upon the fluctuating positions of other producers as jobs are validated.
Open Participation for Agents. Anyone can become a work agent within seconds. And, for a minimal stake, receive the tokens of all projects in the ITO at the end of each work block.
Competitive Agent Rewards. When a work agent stakes Fantom they receive the ITO's native tokens. In addition, they will receive rewards in the form of tokens of other projects and entities. The more ITO tokens that an agent has in comparison to other agents, the more rewards they will receive in consideration of their greater workload. These values can change at any time during the work block, depending upon the fluctuating positions of other agents.
Endless Distributions to Agents. As a reward for their labor, agents will receive token distributions every work block. Once the work block is verified, the agent receives the distribution and can do as they want with it. This can continue for as long as they are staking.
Freedom to Roam. A work producer may decide to become a work agent and vice versa. This can be easily done by using two wallet addresses instead of one.
Endless Participation From All Sides. There is no limit to the number of agents in an ITO, nor the number of producers, nor the number of its token distributions or other rewards. The greater the level of participation, the greater the rewards for labor in the workchain.
An Endless Supply of Valuable Tokens. Work producers are provided with incentives to continuously add more valuable tokens to each period's distribution. Additionally, their producer rewards help them to obtain more tokens from different projects outside of the ITO ecosystem and add them to the ITO.
Permissionless. Tokens from any blockchain can be submitted via Fantom's interoperability protocols, without any permission needed whatsoever. (If Fantom workchains are used.)
No Need for Oracles. Workchain relies on collective human intelligence rather than needing to access data through outside services, making it more secure and less centralized.
No Need to Look at Charts. The success of each ITO depends upon the immutable parameters set forth at genesis, as well as the evolving dynamics between work agents and work producers. The irrationality of cryptocurrency markets is transformed into a clearer picture of value that is based on more easily-perceived and measurable market traits.
A Level Playing Field. Transparent, everyone can get all relevant information in an ITO at the same time. ‘Inside information’ does not provide any material advantage to any party. Parties conspiring together are limited to conspiring to benefit a workchain’s economy.
Decentralized. A true ITO is designed to be completely independent and incorruptible, offering the same rights and authority to everyone after it is deployed – including its creator.
Endlessly Extensible. New functionality can be added onto workchains via smart contracts at any time. Simple workchains can quickly self-organize into more complex or disruptive ones.
Limitless. An ITO runs without end. It allows value based on the promise of future labor to be used today for an endless variety of reasons, like the money in your pocket.
Autonomous Refund of Stake. At any time, agents can request a refund of their stake simply by sending any number of their ITO tokens back to the smart contract. Any job tokens received can be kept by the agent, and serves as the reward for their labor.
Organic Consensus. Traditional blockchains have a winner-takes-all consensus approach that invalidates most of the resources used in the validation process. Workchain uses a multi-tiered, dynamic algorithm where every validation forms part of the composite picture of consensus. This all-take-part approach ensures that there is no loss of productivity or idle resources, and is more rewarding for more participants. Further, as the nature of work is to evolve without end, the picture of consensus changes each work block, never needing to reach finality.
Omega Point. If there is more demand than supply of ITO tokens, the ITO has reached the omega point. When reached and as funds become available, agents requesting refunds of their stake will get the current, more favorable rate of exchange as an unsecured loan. This unsecured loan facility acts as a kind of 'golden parachute' for older agents to return ITO tokens to the contract. This can help satisfy the demand of new labor participants and keep the economy healthy and robust, as well as help curtail token oversupply.
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