Once upon a time, in a land far far a way, where a tribe of doge’s roam free and eat cake all day, the tribe’s council of elder shibes got together and decided “ooh ether world. We can haz token. Make doorway. Bridge worlds. YAY!” Little did they know what would happen once they activated that bridge to worlds unknown. They had no idea they would be opening Dogethora’s Box.

Let’s pause this story and talk about another land. The land of Decred. Decred has proof of stake. Not proof of Steak. Although I think the latter is a much tastier option that could do the world a load of good. Sigh. If Proof of Steak, Doge’s would have adopted it first. Decred simultaneously uses proof of stake and proof of work.

Now, lets talk about proof of steak for a minute. I mean, proof of stake. This is just one idea out of many on this post. By itself, it doesn’t really do much, but it’s one of the moving pieces in all this. One of the many issues with proof of stake is that the richer get richer and take control of the network. Same could be said about proof of work though once asics are released onto the network. But lets make some tweaks to PoS (for the shibes I just lost I’ll be referring to the consensus algorithms by their acronyms). Instead of PoS generating new coins in the block reward and collecting the fees, let’s make PoS BURN the fees in that block. OUCH! SHIBES BURN COIN? SUCH BLASPHEMY MUCH OUTRAGE! Calm down, stay with me here. To keep an incentive for running a PoS node, we’ll split the burn so that 20% goes to the PoS node (nodes if a PoS pool) and the other 80% gets burned, thus reducing the supply of coins available. As we all know from supply and demand, when supply goes down, assuming demand remains the same, price gets pushed up. OH! SUCH BURN! DOGE BURN COIN, MOON? Well, no, it’s just one piece. But keep this function in mind. We’ll call this Proof of Burnt Steak…i mean Proof of Burnt Stake (PoBS).

Now let’s talk about the Dogethereum bridge. Essentially what you have is a smart contract reading superblocks and interacting with the ethereum blockchain, and bridge operators read the contract and broadcast those changes in superblocks which the rest of the dogecoin network sees. The first thing you can obviously do here is create a bridge between the two worlds of ethereum and dogecoin. Shibes can pass through the bridge and trancsend into an ethereal form (doge erc20 tokens) leaving their physical selves (the utxo outputs) as collateral at the bridge. They can always go back to the bridge, burn their ethereal forms away and return to their physical forms on the Dogecoin network.

But that’s just the tip of the iceberg. You can put a shit ton more into a smart contract. And here’s where things start to get interesting. Let’s take said smart contract, and include a price feed. Not from a centralized source. Because, such centralization, much bad. Let’s use a decentralized price feed instead. Why not partner up with the guys over at MakerDao and use their oracles to get a pricefeed? Their platform has proven pretty resileint. The Dai, which is a stablecoin pegged to a dollar, hasn’t dropped to dust value despite ethereum losing 80% of it’s value since January and having Arthur Hayes dub it a double digit shitcoin. And remember that PoBS that I mentioned earlier? No? Confused? GO BACK AND READ IT. Then start here. Let’s put PoBS and the PoW that we use now on different difficulties, and let’s also include those different difficulties in the smart contract and be broadcasted in the superblocks. And let’s add some functionality to tie it all together. We have an inflationary proof of work, and a deflationary proof of stake, with different difficulties.

If 1 Doge < 1 Dai = Send the PoW difficulty off a cliff and make it so high it’s impossible to mine, and lower the PoBS. Coins will be burned through transactions as the price gradually rises.

If 1 Doge > 1 Dai = Set PoW to it’s default difficulty (1 min block time) and set the PoBS difficulty off a cliff. Opposite of the previous.

You now have built in inflationary and deflationary mechanisms built into the coin. Of course, it can be pegged to any price feed your heart desires, be it the USD or a basket of commodities, as long as you can oraclize a price feed into the contract. You can use kyber for your price feeds instead of makerdao. There are more options out there.

That’s a really cool thing to be able to implement. But i’m not done yet. We’re only half way through. Things are going to start to get a little crazy (if not already at that point) from here on out. Too much edibles last night… There’s another protocol based stablecoin being worked on in the ethereum environment called Fragments. They have a pretty cool whitepaper, but one of the features of that coin is how it maintains it’s price — if it’s price goes above 1 USD, it creates more tokens to increase supply and thus bring the price back down to 1 USD, but the really cool part is HOW it does this. Forget the stable price pegged to the USD and all that. This is the one feature of this coin’s protocol I want to focus on: the coin splits in your wallet, so if you have 1 Fragment, and the price of Fragments goes up to 2 USD, the token will split IN YOUR WALLET, and you will have 2 Fragments, still equaling 2 USD, but bringing the price of the token down. So basically, hyperinflation that rewards hodlers of the token.

So lets say that Doges become really expensive, and the standard inflation from PoW isn’t enough to bring the price down to $1. Why don’t we go ahead and implement Fragment’s token splitting protocol into the Doge tokens? Well, for starters, there’s a problem — each token is backed by 1 actual dogecoin in the form of utxo’s held in the bridge’s smart contract, so if the token splits, there isn’t enough dogecoin utxo’s to back them when it comes time to send them over the ethereum bridge back to the doge network. So, let’s add that value of outstanding tokens that aren’t backed to the contract and (somehow, i’m obviously not a dev, just really optimistic) relay that information into the superblocks. we’ll refer to this value doge debt.

Now let’s tweak PoS again. This time, though, we’re going to tweak it to create an additional type of PoS. In times when the price runs away above say 10USD, we activate a PoS that mints all of the outstanding doge debt we defined previously as the block reward. This would involve implementing a variable block reward and thus removing the cap of coins that can be created. Dunno if that’s possible, but this is all hypothetical shibe theory anyway. The difficulty for this PoS would also be separate from the other two, and would remain FUCKING IMPOSSIBLE most of the time except when we need to enter periods of super doge hyperinflation to settle the debt above (except I guess this is inflation done right, as your wallet doesn’t lose value here. Kudos to Fragments that). Because this is a hyperinflation PoS, we’ll call this Proof of Federal Reserve Style Stake, or PoFRS. And BAM. You now have a coin whos user’s wallets hodling it rises over time, yet stays stable tied to the price of a commodity or whatever the community decides it’s price should be (algorithmic shibe manipulation?), and can be transferred between blockchains with different functionalities in a decentralized and trustless manner, and can be traded in a decentralized and trustless manner.

Shibes, I have forseened it the future, and in it, I see MOON.