Penalizing dumping feels like it’s perfectly in line with the goals of $UBI. I love the idea. Burning the tokens might help with value; however, I could also see the penalty being a recoupable tax for the treasury.
I’m not sure I’d use FEI as a good example, but this raises a valid point. The economics of a token should match its intended use case: in the case of UBI, we could argue that this is to be spent in buying the basic necessities of life.
Exodus 16:1-35 is the story of how God gave Hebrews a kind of UBI under the form of the edible substance called “mannah” while they were in the desert. In order to prevent people from speculating with it, mannah only lasted one day. You would pick it up in the morning. But if you wanted to save some for the next day, it got rotten.
Maybe this biblical metaphor can shed some light on what a universal basic income should look like. This could be useful for thinking about the token economics.
I think the feature to prevent speculation / stabilize UBI is that supply emission grows with adoption. For sure initially we’ll see some large price swings due to price discovery, but once it’s done it could lead to something more or less stable.
Should the use of $ubi as a p2p payment/means of exchange for goods and services be incentivized? Perhaps economic activity can be visualized by a directed graph of registered humans, with edges weighted by payments between addresses (humans), what does the connectivity of a healthy economy look like? Someone providing a service for their community could look like a densely connected node. Perhaps some would have a number of connected edges proportional to the size of their social network. Perhaps some malicious/parasitic actors would have relatively few connections, but a disproportionate amount of holdings. Perhaps inactive/passive members of the community simply have no connections, accruing $ubi and dumping.
What would altruistic social participation look like? How does one incentivize altruistic social participation with $ubi? Perhaps isolated nodes with few p2p $ubi transfers could be penalized while densely connected nodes with many connections can be incentivized? Perhaps a mechanism like FEI could punish dumping by addresses with little social/economic participation (with few connections in the economic graph).
I’ve thought about this some more. I actually think that this may not be needed. Every time the price drops below a certain level it forces the participants to unlock their human and social capital to create more value in the network. If we just used a burn/penalty approach it would create more apathy in the network. Ultimately human engagement is what will drive things forward. Loss aversion is a strong cognitive bias that can be leveraged to develop the network.