March has been very productive for the OriginTrail development team, with the first two official releases of our alpha node — Luna Release v0.3a being the first — culminating with today’s release of Mechta v0.4a. The purpose of this blog post is to provide additional information on OriginTrail’s node incentive system, based on the staking of tokens and node reputation.

Incentive Model Documentation

The team has done in-depth research into potential compensation schemes in order to align incentives in a model which provides a trusted, verifiable and stable service of the protocol. It was especially important to make sure that the setup doesn’t allow for manipulation of the rules for individual gain for any of the stakeholders in the system. We also researched systems with similar incentive structures (i.e. Filecoin, Swarm, NEM etc), as well as performed small scale automated simulations of the system. The result of the concluded research is presented in the first version of our incentive model document (found here) which explains the mechanics of the system in fine detail.

Token Staking and Reputation

The incentive model introduces a novel form of a token staking mechanism implemented in order to discourage potential malicious behaviour within the network. It differs from the more common model of staking in decentralized networks where a certain, usually relatively large amount of tokens, is set as collateral in order to qualify as a validator (i.e. Ethereum Casper) or to perform a different set of services (i.e. Dash Tier 2 Masternode) within a system. In case of foul play, the staked amount can be lost, thus discouraging the actor to perform against the rules of the system.

A similar concept is introduced in OriginTrail on a level of individual agreement between nodes. In order to participate in data exchange, the nodes involved need to stake a proportional amount of tokens to the agreed upon amount in the exchange. Because any node (DC — data creator or DH — data holder) is involved in an arbitrary number of agreements, the amount of stake needed is a function of the agreements themselves. This staked amount is used to ensure the agreement success, as it further demotivates the involved parties to act against the system — the DH to remove or change the data it has committed to keeping and delivering, and on the other hand demotivate the DC node to falsely probe the DH nodes in order to try to obtain their stake.

This effectively means that in order to take on more work in the system and thus obtain more token gains and a larger reputation, a node needs to provide a larger cumulative stake, which ensures aligned incentives and motivation to deliver high quality of service.

The elasticity of this system allows both large and smaller token holders to participate on their own terms by being able to “monetize” their reputation and stake if they have a good historical track record in OriginTrail, but without limiting smaller players from entering the system and providing high-quality service. In this way, a data provider can choose to require a certain high level of reputation and stake (which would guarantee a higher degree of trust) from the nodes, which will in return be valued at a higher service price. In this way, the system stays decentralized and the distribution of data remains wide.

Full GS1 Compatibility

The Mechta release brings a major improvement for the interoperability with global standards by introducing a GS1 EPCIS compatible importer. This essentially means that OriginTrail nodes are now able to handle a standardized format of data that has been implemented in supply chain information systems around the globe, making it easier to integrate and to provide consistency of data across supply chains.

The initial importer of OriginTrail and its corresponding data structure was already leaning towards GS1 compatibility, supporting much of GS1 standardized information. By adding more importers into the system — we plan on supporting additional standards later this year — we are enabling easier integration and more interoperability with different systems, finally mapping this data into a standardized graph structure which we are constantly improving upon, with a new iteration being implemented for Ranger release in early April. The Kosmos release later in April will improve upon the integration user experience by fully validating the GS1 information accuracy.

In addition to the two major milestones we talked about above, the Mechta release also brings a number of corrections and bug fixes. We fixed bugs in sending transactions and running on OSX, additional coverage of the code with unit tests, database testing, code cleanup and linting. More information can be found in the release notes on GitHub. OriginTrail developers are available to support you at the Rocket.Chat #dev channel, if you have more general questions (non-dev), you can chat with our team on Telegram.

What’s Next: The Road Ahead

The next alpha node release, v0.5a called Ranger, is scheduled for April 9th. It will introduce several improvements, including a further generalization of the graph logic, based on usage insights, which will enable the easier addition of further standards and an improved version of the compensation system. Following the Ranger release, the next alpha node release v0.6a, called Kosmos, is scheduled for April 23rd will introduce the first implementation of market bidding mechanism and fully implemented blockchain fingerprinting virtualization.

Meanwhile, the dev team is sending kind regards and invites you to take the node for a spin and consider joining our team — take a look at https://careers.origintrail.io/ for a list of open positions.

Trace on!