pWhaleCoinRhett Creighton, Amber HancockAustin, TX, USA, ,Chain Starter, Inc.August 27, 2017 WORKING DRAFTAbstract. We describe a simple mined cryptographic blockchain whichis designed to power a unique decentralized social network. The socialnetwork supports several types of roles and notably the \Whalequot; rolewhich is given to any user who holds at least 1,000 tokens. The totalnumber of Whales on this network will always be limited and Whaleswill have the power to in uence how blockchain rewards are distributed.An incentive structure will be designed so that \Followersquot; will attemptto gain approval from Whales who will then in uence the blockchain tosend them rewards.1 Designing an Exclusive Club on a BlockchainThe founding principle of WhaleCoin is a simple idea if you have 1,000 Whale-Coins or more, you are a \Whalequot;. Whales have the power to send upvotes toother users.Unlike other social networks where upvotes or \karmaquot; have no inherentvalue, in WhaleCoin, the blockchain will pay users a portion of the mined blockreward based on how many upvotes a user received from the Whales.Like other cryptocurrency, WhaleCoin is mined, limited in supply, and im-possible to counterfeit[1].2 Decentralization and Participation in WhaleCoinThere are only two ways to obtain most cryptocurrenciesMine them using special hardware, electricity, and technical knowledge ofthe process.Buy them using cash if local, or more likely using other cryptocurrency onsome kind of internet exchange.Unfortunately, the vast majority of people on the planet still do not haveeasy access to the two processes described above as they can be expensive andtechnologically di cult to get started. In order to spread awareness and use ofcryptocurrencies, it is important to provide people with cheap and easy ways tobecome invested in a crypto-community.For example, Blocki and Zhou described a process where humans could minea cryptocurrency by solving CAPTCHAs in \Designing Proof of Human-workPuzzles for Cryptocurrency and Beyondquot;[2]. However, a key piece of technologyknown as a cryptographic obfuscator[3] requires further development for thisprocess to work.Giving away currency has proven to be a successful way to attract new usersin the past. Noted early Bitcoin investor Roger Ver received his nbsp;rst Bitcoinfrom an online \faucetquot; set up by Gavin Andresssen[4]. Stellar claims over 6million Facebook auths due to their giveaway[5]. But these giveaways do notensure long-term interaction of the new users with the coin.In contrast to simply giving away coins, or to the di culty of creatingCAPTCHAs for humans to solve, WhaleCoin taps into the natural behaviorthat people already exhibit of continually following other people on a socialfeed.3 Steem / S Case StudySince launching in 2016Steem is currently the 22nd most valuable cryptocurrency onhttps// with a market cap of 347,163,415.A ranks as the 1,370 most popular U.S. website and2,428 most popular website globally.Steemit is a social network site similar to Reddit where users can post linksor longer articles. Everyone is able to upvote posts or comments, and theblockchain pays a portion of the block rewards to users based on upvotes received.In order to prevent people from spamming by creating many accounts to sendupvotes with, upvotes are weighted with the amount of Steem currency which auser holds.This has the e ect of users being paid much more if they receive an up-vote from a \Steem Whalequot;. A full list of Steem Whales can be found athttps// . The algorithm has gone through several changesto determine vote weight after many users complained that the Whales had toomuch in uence.The authors of this paper believe that, while Steemit is a novel and ground-breaking project, a nbsp;aw in the user experience is that it solicits everyone to postwhatever they want, but mostly rewards people only if Whales happen to sendan upvote. This leaves many users frustrated when they put e ort into highquality posts which may not nbsp;t the tastes of Whales, or perhaps happens toget overlooked by Whales on that particular day. In Steemit, the top 20 Whalesmay be so powerful that it actually hinders the value of the community. It feelsimpossible to catch up to the Whales that already have millions of coins. Bycontrast in WhaleCoin, each Whale with over 1,000 coins has equal power. Themined blockchain can support a maximum of 864 new Whales every 30 days ata 5 coin reward rate every 15 seconds.4 WhaleCoin User Experience DesignOn the WhaleCoin plat, Whales are the star of the show intentionally.Whales can share news stories that they’ve read or videos that they’ve watched,or a Whale might ask followers for advice or research. To send an upvote to aFollower, it only costs a Whale a blockchain transaction fee, but is otherwisefree. This is similar to tipping, but at no cost to the Whale.Followers, on the other hand, are humans or possibly bots that are rewardedfor doing a task that Billions of people already do every day follow a socialnetwork feed and interact through comments.Because WhaleCoin is decentralized, an unlimited number of portals couldbe built on top of it, which could include chat, SMS, email, or other integra-tions. It may be possible, for example, to build a decentralized personal assistantapplication on top of WhaleCoin.5 Technology OverviewWhaleCoin is a fork of Ethereum and shares many things in common withEthereum. However, in Whalecoin, consensus rules state that miners must paya fraction of their mining reward to a smart contract.The smart contract will split the rewards several ways includingA Developer’s Fund for development and maintenance of the WhaleCoin codeand surrounding applications such as a social network Dapp that connectsto Whalecoin.Rewards paid out to followers of whales based on upvotes from whales. Thereward algorithm should have anti-spam limit to ensure that a small minorityof whales don’t control a large fraction of the reward. Also, upvote rewardsshould decay over time to incentivize followers to participate in the socialnetwork and block chain.It is possible that the rewards will also be split to include a moderator role tohelp ensure that the network runs optimally and to prevent anti-spam attacks.The contract rules will likely be updated after launch to promote decentralizationand participation in the network.6 Mining ScheduleWhale coin will use the same mining schedule as Ethereum, which is currently 5coins every block. Blocks are mined through proof of work approximately onceevery 15 seconds.For the nbsp;rst 200,000 blocks approximately 35 days, rewards will not be paidout to Whale followers. The reason for this is to allow the initial set of coins tobe mined in a fair and decentralized manner.After block 200,000, anyone that holds at least 1,000 Whale Coins has theoption to be a \Whalequot;. Being a whale allows a user to send upvotes to otherusers in the reward distribution smart contract.Ethereum has an experimental plan to switch consensus algorithms in thefuture to Proof of Stake. It is currently unknown whether WhaleCoin wouldupgrade along with Ethereum, or if it would keep using the same consensusalgorithm. Most likely, WhaleCoin would wait and see how software changesa ect other blockchains nbsp;rst before making any major changes.7 RisksThere are many risks involved with launching and deploying any new decentral-ized mined currency. Some of the risks that would be involved in this processincludeDesigning properly tuned economic smart contract rules. It is possible thatsomeone will nbsp;nd a way to game or cheat a contract that handles the logicfor a reward unlocking mechanism.There could be bugs or vulnerabilities in an unlocking smart contract thatgives an attacker access to the funds.Some social networks have more or less success than others. It can be di cultto predict this success or failure ahead of time.This list is not exhaustive. Whalecoin is an experimental idea and the authorsof this paper are not able to predict all of the problems which might occur onceit is put into practice.References1. Satoshi Nakamoto. Bitcoin A Peer-to-peer Electronic Cash System.https//bitcoin.org/bitcoin.pdf, Oct 2008.2. Jeremiah Blocki, Hong-Sheng Zhou. Designing Proof of Human-work Puzzlesfor Cryptocurrency and Beyond. https//eprint.iacr.org/2016/145.pdf, August 24,2016.3. Garg, Miles, Mukherjee, Sahai, Srinivasan and Zhandry. Secure Obfuscation in aWeak Multilinear Map Model. https//eprint.iacr.org/2016/817.pdf, 20164. 20 questions with Roger Ver Exclusive Interviewhttps// Stats - Stellar https//www.stellar.org/stats//p