This document discusses redistributing wealth through blockchain hardforks. It begins by defining permissionless blockchains like Bitcoin and Ethereum. It then discusses how wealth is initially distributed through mining, crowdsales, and trading on exchanges. The document uses Ethereum's hardfork after the DAO hack as an example of how a hardfork can create two networks with different distributions of wealth over time. It proposes that periodic hardforks could be used to intentionally redistribute wealth in a decentralized way, avoiding corruption risks of centralized authorities but with lower operational costs. Finally, it outlines plans to measure the effects of redistribution and conduct a social experiment with an initial hardfork.

1. Restribute.org
Re-distribution of wealth for
company/organization/project/government by
Blockchain Hardfork
By Tomoaki Sato
from Japan

2. Target of audience
- Who has interesting in blockchain
- Who has blockchain tokens (Bitcoin, Ether, Ripple etc…)
- Who has questions about recent Ethereum hardfork
- Who has questions about Ethereum classic & Ethereum
( ex: What is the ETC on Poloniex !? )
- Who has questions about “distribution of wealth” on blockchain economy
- Who has questions about “decentralization”

3. Topics
- 1. What is public blockchain economy ?
(cryptocurrency market)
- 2. What is hardfork ?
- 3. Hardfork example: Ethereum applyDAOHardfork()
- 4. Hardfork and personal wealth
- 5. Distribution of wealth (ex: Ethereum case)
- 6. Hardfork can be useful for re-distribution of wealth
- 7. Merits and Demertis of re-distribution of wealth.
- 8. Schedule for the first testing hardfork
- 9. Join our slack !

4. What is the economy on
blockchain ?
How can I see Bitcoin, Ethereum value and the total supply ?
1

5. 2 types of blockchain
Bitcoin, Ethereum, Bitshares etc. These are
permissionless networks.
Anybody can join in.
Financial institutions try to use blockchain for future finance.
Allowed members(banks, exchanges) can join in the network
1.Permissionless blockchain 2.Permissioned blockchain

6. 2 types of blockchain
Bitcoin, Ethereum, Bitshares etc. These are
permissionless networks.
Anybody can join in.
Financial institutions try to use blockchain for future finance.
Allowed members(banks, exchanges) can join in the network
1.Permissionless blockchain 2.Permissioned blockchain
We are going to talk permissionless blockchain.

7. Economy on blockchain(Start of the economy)
Tokens generated by mining or staking
*mining: computation work for the consensus network
*staking: investment for the consensus network
※rough description
Tokens generated by crowdsale
*crowdsale: people pay tokens to buy newly created tokens (like
pay Ether to buy theDAO token )
* rough descr

8. Economy on blockchain(transition)
Currently, more than 600 crypto currencies
are on the list.
These crypto currencies have value & total
supply. So it shows the market cap by
1 token value * total supply of the token.
Day by day the price of tokens will change
by the trade at crypto currency exchanges

9. Economy on blockchain(end ?)
Low market volume token, or no-developer-
support-tokens are sometimes stopped
trade at crypto currency exchanges.
If there are no exchanges in the world for
the token, it’s difficult to estimate value of
tokens.
So, we can not see the value of tokens, and
we can consider the value of the token is
zero (for most people in the world)

10. Economy on blockchain(end ?)
In Ethereum case, after the DAO hacked
$50M amount of money from frawed
contract, by the voting of network
community decide switch to apply hardfork.
Apply hardfork change to the Ethereum
source code, DAO frawed contract related
balances are moved to refund contract
address.
But if you use not-applying the hardfork
change version of Ethereum source code,
you will use different network from the
changed version.
That’s Ethereum classic.
After the hardfork, original Ethereum network value seems to be
zero(or goes to zero). And only hardforked Ethereum has value
Only 1 Ethereum world
Hardfork
ed
network
There’s
no
original
network

11. Economy on blockchain(end ?)
At first, Ethereum classic is not on any
exchange, and traded.
There are supporters, and people who
believe the thoughts.
So poloniex starts to exchange Ethereum
Classic, and then the value is suddenly
priced.
Now we have 2 network Ethereum and
Ethereum Classic, both tokens have values.
Now we have 2 Ethereum network.
Both network have value, original code difference between the 2
network is about 15 lines
(apply DAO Hardfork to the blockchain or not)
Hardforke
d network
And
original
network
has
value

12. What is hardfork ?2

13. Hardfork is simple
Hardfork is non-backward compatible, softfork is backward compatible consensus rule change.
If you use old software in hardforked network, you can not communicate with
If you use PlayStation2, you can not use PlayStation3 software (hardfork)
Old network users
New network users
If they can have same consensus, it’s
softfork(they can have same blockchain)
If they can not have consensus,
it’s hardfork(they can NOT have same blockhchain)
Software upgrade

14. What is hardfork ?
In Ethereum case.
3

15. Hardfork in Ethereum case
ApplyDAOHardFork in go-ethereum repository, and this change makes different network with
different consensus (further transactions will be different)

16. Hardfork in Ethereum case
There are 2 communities originally from the same source code made by Ethereum developers.

17. Hardfork and Personal wealth
How much do you have in Ethereum network and Ethereum
classic network ?
4

18. Hardfork and personal wealth
Hardfork is only the change like this, so another state of the network is not changed.
So if you have 1,000 Ether in Ethereum network before the hardfork (1,800,000 block)
then you have 1,000 Ether also in Ethereum classic network (what we call 1,000 ETC)
Example account on Ethereum blockchain which has both balances(314,807.84 Ether and
314,807.84 Ethereum classic)

19. Distribution of wealth
How to measure distribution of wealth ?
5

20. How to measure distribution of wealth
Gini index is one way to measure distribution of wealth across people.
For example if total supply is 100 tokens and 100 people in the network.
All people have 1 token, then it’s totally equal distribution, gini index = 0
If onle one people have 100 token, and others 0, then the gini index = 1

21. How to measure distribution of wealth
Gini Index is 0.830 just after crowdsale by
Vitalik Buterin research
anybody can research and verify

22. World gini index
World gini index measured by the local fiat currencies(government currency).
(from wikipedia https://en.wikipedia.org/wiki/Gini_coefficient)

23. Ethereum gini index
More than 1 Ether
txCount less than 100
Then Gini index
0.972
※ In order to exclude some
business account like exchange
withdraw account, I exclude big
txCount addresses
Github:
https://github.com/Restribute/RestributeGini

24. Ethereum gini index
More than 10 Ether
txCount less than 100
Then Gini index
0.948

25. Ethereum gini index
More than 100 Ether
txCount less than 100
Then Gini index
0.900

26. Ethereum gini index
More than 1000 Ether
txCount less than 100
Then Gini index
0.817

27. Ethereum gini index
More than 10000
Ether
txCount less than 100
Then Gini index
0.7401

28. Hardfork can be useful for
distribution of wealth6

29. Two Ethereum communities by hardfork
• Different developers
• Different community
• Different consensus algorithm (will be)
• Different applications on top of it.
etc … so what if we measure the re-distribution effect ?

30. Transition of economy
Hardforked
network
And
original
network
has
value
At the time of hardfork(block 1,800,000) Now(block 2,148,877)
Different distribution of wealth in the 2 network with
different communities
Just after the hardfork, all accounts and
balances in the 2 network is same.

31. So let’s measure Gini index of
Ethereum + Ethereum Classic
Currently under working…

32. Merits and demerits of re-
distribution of wealth7

33. Merits and demerits in blockchain context
Mertis:
1. Expanding financial markets
2. Removing oligopoly situation
3. Making more business opportunity
Demertis:
1. Government or any centralized
authority can be corrupsed for the
redistribution.
=> Smart contracts or blockchain
protocol is difficult to be collapsed if
it’s decentralized.
2. To do re-distribution, it’ll take huge
operational costs
=> Much less costs to do it,
because it doesn’t take time

34. Traditional way by governments
Taxation = by centralized authority
Welfare = by centralized authority
Charity = by centralized authority
Monetary policies = by centralized authority
Sometimes said,
“Redistribution of wealth is not fairness, is theft”

35. New way by blockchain hardfork
◇ Taxation = issue new coins or demurage holders by voting
◇ Welfare = ?
◇ Charity = ?
◇ Monetary policies = issue new coins or demurage holders
◇Hard-Forking
= Create new currency and allocate to existing
holders.
If more people believe the re-distributed value,
more value will be generated by the allocation.

36. Schedule of Redistribute.org8

37. Develop:API for all states at given block
1.If there is API for getting all state objects at given block, it’s easy to revert to history
at some point and generate
newGenesisBlock for hardforking.
1,920,000 block 1,920,001 block 1,920,002 block

38. Roadmap
11/2016
- Re-distribute Hardfork
- Development for making
economical stastics easier
- Write whitepaper with economical point of view
- Make the model for initial allocation of new
blockchain for re-distribution by hardfork.
- Measure stastics around the re-distribution
(gini index, developer numbers etc…)
09/2016
- Make power point presentation for
re-distribution
- Make some teams for doing re-
distribution on blockchain by
hardfork as a social experiment.
- Gini index measurement for current
Ethereum & Ethereum classic
- Slack, Github, Twitter, Forum
construction

39. Join our slack and more discuss !
https://restribute.herokuapp.com/
9

40. Credits of
the presentation-design-template
Special thanks to all the people who made and released
these awesome resources for free:
◇ Presentation template by SlidesCarnival
◇ Photographs by Unsplash
◇ Thank you for providing me great design template !

41. Thanks!
Any questions?
Restribute slack
https://restribute.slack.com
Other presentations
http://www.slideshare.net/tomoakisato35/