Positive-Sum Issuances (Non-technical)

Foundational Concept: What is a Positive Sum Issuance?

A Positive-Sum Issuance represents an economic principle where the act of creating and distributing new units of an asset, stock, or commodity generates more value for the ecosystem than it destroys through dilution - when including market-priced valuation multiples expansion on fundamentals and ecosystem value.

The mathematical relationship is straightforward: when the accretive gain (value created) exceeds the dilutive loss (value destroyed through supply increase) over time, the issuance is positive-sum.

Positive-sum issuances demonstrate that if the newly issued assets are allocated strategically to create value, everyone can end up better off - owning a smaller percentage of a larger, more valuable pie.

The Success Metrics: Fully Diluted Valuation and Price

The true measure of success for positive sum issuances isn't just market capitalization but specifically BPL's fully diluted market capitalization AND the price of BPL. These dual metrics capture the actual appreciation when accounting for dilution:

• $BPL Fully Diluted Valuation (FDV): Represents the total value of all BPL possible minted coins

• $BPL Coin Price: Indicates whether individual holders are better off despite dilution (whether the coin is at a higher price than their entry price)

• The Combined Signal: When both FDV and price increase despite ongoing issuances, it proves the system is genuinely creating more value than it's diluting

This differs from simple market cap metrics that can be gamed through supply manipulation. The focus on both FDV and price ensures that the system benefits all stakeholders, not just the aggregate metrics.

$CORES are tradeable reserve commodities that serve as attribution markers.

CORES are issued to recognize value creation within the Bitplanet economy. They are freely tradeable — holders can buy, sell, or hold them on open markets. Their price can fluctuate significantly without breaking the system, because their primary function is attribution and emission weighting, not price stability.

This fundamentally changes the risk profile. The system separates concerns between two complementary tokens:

• Cores: Tradeable attribution/measurement layer — their market dynamics can be volatile without threatening the core economy

• BPL: The actual value store and governance token of the system

Since Bitplanet taxes economic and financial activity within its own ecosystem to grow the Bitplanet Treasury, BPL voter can always vote to buy up and burn Core.

BPL Stakers can vote for the Bitplanet Treasury to burn Core, creating deflationary pressure on Cores. However, **Cores are not intended to be price stable.

Price stability is important for currencies since currencies are used to buy things for surival including food, water, and shelter. Bitplanet assumes that currencies continue to serve the need of buying goods for survival.

Cores are thus termed reserve commodities and assumes that Cores do not need to be stable and can be optimized for tracking contributions and helping to allocate emissions of $BPL (the real store of value).

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Corporate Equity: The Traditional Example

To understand this concept concretely, consider a startup valued at $100 million. The company decides to issue 20% more equity, meaning existing shareholders now own only 80% of the company instead of 100%. This appears negative at first - a 20% dilution. However, if this equity raise enables the company to achieve a $200 million valuation, the mathematics reveal the positive-sum nature:

• Before: A shareholder with 50% ownership held $50 million in value (50% of $100M)

• After: The same shareholder now owns 40% (50% × 0.8 dilution factor) worth $80 million (40% of $200M)

• Result: Despite owning a smaller percentage, the shareholder gained $30 million in absolute value

DAT Flaws

Digital Asset Treasury Companies (DATs) like MicroStrategy demonstrate positive sum issuances through "accretive dilution" - where companies trading above Net Asset Value (NAV) can issue equity to buy more Bitcoin per share than they dilute. However, DATs represent pure financial engineering without underlying value creation.

The Real-World Analogy: VCs, Angels, and x/brahma

The complexity of positive sum issuances becomes clearer through a real-world analogy. What x/brahma aims to do programmatically is what VCs and startup founders do manually:

The VC Process:

• VCs dilute LP stakes to raise capital (issuance)

• They allocate that capital across portfolio companies (resource allocation)

• They aim for power-law returns that outweigh dilution and losses (positive sum outcome)

The Startup Process:

• Founders raise capital from angels/VCs (dilution event)

• They allocate resources to operations and growth (value creation attempts)

• Success means the diluted equity is worth more than pre-dilution holdings

The x/brahma Innovation: x/brahma does this same process but programmatically and continuously:

• Instead of fundraising every 12-24 months, it can issue and adapt in real-time based on on-chain value creation data

• Instead of pure human judgment, it uses on-chain metrics and artificial intelligence for allocation decisions

• Instead of hoping for value creation, it aims to blend rewards based on "before and after" value creation data (input and output metrics)

The Value Internalization Mechanism: Ensuring Sticky Value

Bitplanet's model includes enforced rewards on revenue and Total Value Locked (TVL). While Cores and Gems can technically lower in overall TVL valuation based on dilution, the system ensures value retention through:

• Breaking Credible Neutrality: The chain deliberately prevents certain assets like Gems from leaving

• Enforced Rewards & Royalties: Creator royalties are mandatory, not optional

• Governance-Controlled Bridging: The community can vote to blacklist smart contracts from bridging certain assets out

Breaking credibility neutrality for enforced royalties might seem counterintuitive to blockchain purists who value permissionlessness and sovereign property rights, but it's essential for positive sum dynamics. If value can freely leave the ecosystem, the accretive gains leak out and data moves off the canonical chain.

By keeping value within the system, every issuance builds on previous value creation rather than replacing it. Ultimately this allows for long-term, aligned, and sustainable economics for creators rather than short-term pump-and-dump incentives.

All fiat economies have discovered that some amount of regulatory intervention and guardrails are needed to minimize value extraction and foster collaborative economies and behavior.

Summary

In summary, the idea of positive sum issuances in Bitplanet revolves around managing the issuance and allocation of Cores and BPL to ensure that their introduction leads to a net increase in ecosystem value, as measured by revenue and chain-native asset values.

This approach aims to foster a sustainable, growth-oriented economy where the value created exceeds the potential dilution, benefiting all ecosystem participants.

We describe in the x/brahma and technical section how a "closed-loop adaptive system" for increasing the positive delta of value dilution to market-based value creation is possible with Bitplanet.