The Radix Identity Crisis
In full disclosure up front, I like the Radix project. However, the Radix DLT project seems to be going through an identity crisis. The project at https://www.radixdlt.com/ is very promising. They've come up with a new consensus mechanism that is not blockchain, not tangle, not directed acyclic graph. If you're like me and don't know what all those mean, it means Radix has a new system that might be very scalable, usable, and fast. This is good.
However, identity crisis.
Bitcoin has evolved into a store of value. It has become digital gold. The Bitcoin Cash feud exemplifies this. Is bitcoin a store of value or a currency? Or both?
Some cryptos, namely Ethereum, have emerged as blockchains mostly of smart contracts where uses can be built on the system.
Some cryptos, like Grin or Nano, have narrowed the scope of their purpose down to one. Those two simply want to be currencies, "better money" as Grin says. They do not want to be everything to all people. Focus is a good thing.
Radix might fall into this be-all trap. It wishes to be a currency, a store of value, a smart contract platform, a decentralized exchange, and perhaps more. Wow. Perhaps this is why the project has lingered for years, decades in crypto-years, as a still-beta, still testnet, still working-on-it project.
Again, identity crisis.
The most obvious recent example of Radix identity crisis is its revision of its "economic whitepaper." The project seems to forever be planning for a release of whitepaper version X in quarter-Y or a go-live in quarter-XYZ. The standard Radix claim has been that they'd prefer to get it right before going live, as opposed to every other useless-coin that puts out a whitepaper and goes with it then stumbles or immediately gets hacked. I respect Radix's patience and prudence.
However, I urge realism. When Radix finally does go live in quarter-XYZ, the reality is that there will still be changes and improvements to be made. Although Radix says they wish to get things right prior, prepare for the press release that will accompany the mainnet go-live. It will be designed to temper expectations, to allay concerns, and will begin something like this: "Radix is a very new technology..."
The crux of Radix's identity crisis, and new whitepaper release, is the monetary supply. This is big. I give the team credit for revisiting and re-doing the whitepaper now, before going live. Once live, this sort of thing really can't be taken back without delving a serious blow to any trust built up by the community.
The initial Radix plan was to have an infinite monetary supply. One of the stated goals is to be a "relatively stable" currency. The intent here, then, was to manipulate the money supply (supply of XRD coins) in response to XRD value. XRD is to be roughly tied to USD, 1:1. When the price of XRD goes up relative to USD, minting more XRD coins should generate inflation and draw the price back down (those new coins would be distributed to XRD holders - an incentive to have them). When the price of XRD goes down relative to USD, burning some XRD held in reserve should spark deflation, and should urge prices up. This, though logical, is the more difficult to for me to place faith in.
However, and this is a also big, the new Radix discussion seems to be leaning toward a fixed coin supply, such as Bitcoin. Wait, what?! This, despite continued talk of Radix being a somewhat stable currency. The fact-of-the-matter is that being a "stable" coin is not very easy. The ones that exist now either (a) are linked with USD such as the Gemini dollar or, (b) have a complex set of mechanisms to manipulate things in response to market forces, such as Maker DAI.
How Radix proposes to carry this out is unclear to me. There's little use in asking, because the answer would be, "Wait until the (new) whitepaper comes out." I'll give them the benefit of the doubt. They've shown that they deserve patience in not lunging for a gimme-now money-grab, and just wait.
So, Radix currently appears to hold these desires:
- Be a store of value (with a fixed money supply?).
- Be a relative stable currency.
- Be a platform for running smart contracts.
- Be a decentralized exchange.
- Others?
I appreciate the ambition. But, Radix, who are you?