UBICoin Frequently Asked Questions
Question: Does UBICoin do anything with my bank account?
Answer: No, absolutely not. Banks use proprietary encryption mechanisms to communicate between your bank and your phone. In addition, they use personal digital keys, certificates, and (of course) your account credentials. UBICoin doesn't have access to any of that. UBICoin doesn't communicate with any other apps on your device. In fact, UBICoin doesn't even use an internet connection. UBICoin will never touch your bank account.
Question: Can't I just <insert double-spend hack here>?
Answer: I recommend that you transfer your UBICoin to a friend FIRST before making your attempt. Attempts to alter the UBICoin wallet will result in a RESET(your wallet balance will be set to zero). Please also see the question below concerning the "Honest Mistake" badge.
Question: Where do the UBICoins come from?
Answer: The UBICoin tokens are generated in your UBICoin wallet, using time as a proof-of-stake. Effectively, they are generated out of thin air - just like when you take out a mortgage on a home loan. The money is generated by fiat. NerdWallet has an extremely succinct explanation.
Question: Is this like Bitcoin?
Answer: No, absolutely not. Cryptocurrency, blockchain, and shared ledgers are incredible inventions. But, they come with some pretty hefty disadvantages:
All Proof-of-Work currencies suffer from the Technological Advantage issue. People or groups who "got in early" are able to continuously use their profits to maintain and expand their technological advantage to the point where the "entry fee" is too high for most people to compete. For example, the latest Bitcoin miners (the ANT S19 Pro, for example) cost upwards of $7,000 each - making them far out of reach of the vast majority of people.
Proof-of-Work also suffers from the Collapsing ROI issue. When an ROI Collapse occurs, the time required to see a return on investment for your hardware suddenly and unexpectedly exceeds the expected service time of your hardware. In other words, your hardware suddenly becomes obsolete before it has paid for itself. Current mining hardware executes 110,000,000,000,000 calculations ("hashes") per second, and would make you about $242/month (simple online calculators will show this). At the current difficulty rating, you would need 28 months to pay off your initial investment (in other words, you don't make any profit for over 2 years). It's actually much more than that, because you have to pay for electricity. But, let's assume the best-case-scenario and you are paying $0 for electricity - maybe you are using solar power and huge batteries (but, then you also have to maintain, replace and pay off THAT equipment). Even in the best-case scenario, the difficulty is re-evaluated (on average) every 2 weeks. If the difficult goes up faster than expected (and this does happen frequently), your monthly profit can start to collapse and your ROI time "goes out to infinity" (in other words, it won't pay for itself in a reasonable amount of time). Notice, if you ARE actually paying for electricity (say at the national average of $0.14 per kwh), the electricity cost would currently be $302/month. Therefore, unless you can get your electricity for MUCH lower than average, you would be LOSING $60/month.
All blockchain-based currencies currently have the Onramp Cliff issue. These currencies require the use of a shared ledger, which must be downloaded to every client. These shared ledgers are prohibitive in size for use on mobile devices. For example, the Bitcoin blockchain, alone, is 497 GB in size - and constantly growing. Additionally, the latest mining hardware requires upwards of 3000 watts of power to run. To put this into perspective, that would be about the same as 10 desktop workstations for each miner. Not to mention, a mobile device isn't anywhere near powerful enough to actually mine Bitcoin. Current smartphone technology is impressive, but it's got nothing on hardware-based mining equipment. I'll summarize - it would take almost 2 million years, and cost almost $1.1 billion to mine 1 Bitcoin with a smartphone. It's just not feasible.
All Shared Ledger technologies suffer from the Consensus Delay issue. It can take anywhere from 10 minutes to 30 minutes (on average) to confirm a Bitcoin transaction. Imagine having to stand at the checkout counter at your local grocery store for 30 minutes, just waiting for your Bitcoin transaction to be confirmed. It's just not feasible.
Bitcoin, like all other cryptocurrencies that use Proof-of-Work have an End of Life issue. This is a built-in "feature" that makes their inevitable crash, well... inevitable. Ironically, the component of these cryptocurrencies that drives their rise in value is also the thing that is going to cause their eventual collapse. Namely, all cryptocurrencies like Bitcoin have a maximum number of tokens they can create. In the case of Bitcoin, it can only create 21 million tokens. This is programmatic artificial scarcity - specifically designed this way to continuously increase Bitcoin's value. As Bitcoin gets closer and closer to this maximum, the difficulty in creating new tokens increases, and the annual number of tokens produced is cut in half every every 4 years, which drives an increase in value. However, once the 21 million token limit is reached (or, effectively reached because at some point the difficult level for minting new tokens becomes impossible), then the mining incentive goes away, and without miners there are no new blocks for the blockchain, and the time to validate any transaction quickly goes to infinity. In other words, the whole system grinds to a halt, and the value plummets. Bitcoin has already mined 19 million tokens.
Those are just a few of the big limitations for Bitcoin (and other Proof-of-Work cryptocurrencies), and there are many more when you start diving into the technical details. UBICoin, on the other hand, isn't a cryptocurrency in the traditional sense. UBICoin doesn't use a shared ledger or a blockchain. Double-Spend Prevention is accomplished through the use of a one-time-pad to encrypt every transaction, making every transaction unique. Stanford University has an extremely succinct list of the main issues.
Question: When I am paying or making a payment with UBICoin, do the phones have to both be aligned the same way?
Answer: No, they don't. QR Codes can be read without issue from any rotation, upside-down, sideways, it doesn't matter.
Question: Do you expect me to believe that you are doing all this work for free? You must be taking a percentage somewhere....?
Answer: I built UBICoin for free. No, I don't "take a percentage" anywhere. You can download UBICoin for free, run it for free, make and collect payments, even use it in your own small business. And it's all free. You can make a donation if you want to, but that's completely optional. It's like Humble Bundle - pay what you want, including nothing.
Question: Do I need to [sign-up, give you my CC info, provide my phone number, address...]?
Answer: No, nothing. UBICoin doesn't collect any personal information whatsoever - it doesn't even have a way to do so. It doesn't even use the internet.
Question: Won't just giving people currency for free create inflation?
Answer: It would if there were no "currency sinks." UBICoin, though, has a built-in "currency sink." A tiny percent of UBICoin is destroyed with every transaction. This is called the UBICoin "Burn Rate." The Burn Rate removes UBICoin from the economy as it is used, preventing inflation. This Burn Rate is calculated differently for every wallet based on the number of transactions a wallet makes, the size of the transactions, the inflow/outflow ratio, age of the wallet, and many other factors. All of these measurements are collected automatically. Traditional currency sinks require exorbitant amounts of information from the individual, and then make guesses about income and expense patterns based on all of this information. UBICoin can see the transactions directly (albeit in an aggregate way), so it does not need to collect any personal information or make any guesses. Everything is calculated automatically by the UBICoin wallet. The goal of the UBICoin Burn Rate is to provide enough income for each wallet to pay for basic monthly expenses (like food, clothing, and shelter) while still allowing each person to save for milestone expenses like purchasing a car, paying for college, buying a home, and saving for retirement. This system of achieving eventual equilibrium is nascent and imperceivable. You'll probably never even notice it.
UBICoin that is burned doesn't "go anywhere," it is a true currency sink because it is destroyed when burned. A tiny amount of UBICoin is also burned with every transaction. This is another mechanism to prevent inflation. Any number eventually become 0 when it is multiplied by a number that is less than 1. This is how UBICoin eventually destroys all UBICoin that is ever created. To understand this, get out an old calculator or open up the calculator app on your phone. Type in any number and multiply it by any number smaller than 1 (say, 0.95, for example). Keep hitting the equal sign, and you will see that the number (no matter how big it was when it started), eventually becomes 0. Depending on the calculator you are using, you may get an incredibly tiny number in scientific notation (say, for example 1.1e-17). However, UBICoin has an absolute limit to how small it can be. In other words, there is a minimum denomination, so numbers beyond this minimum value are rounded to 0. These mechanisms together guarantee that every UBICoin that is created is eventually destroyed. In addition, as more and more people use and accept UBICoin, the number of transactions using UBICoin increases. As the number of transactions increase, the rate at which UBICoin is burned increases. Any given UBICoin is only created once, but that one UBICoin can be transferred hundreds of times until it has been completely burned. The UBICoin wallet automatically accounts for this independently of any other wallet. Eventually, a state of equilibrium is naturally reached between creation and destruction regardless of how many wallets are generating UBICoin.
Question: Is the UBICoin Burn Rate like taxes?
Answer: No. UBICoin only burns itself to prevent inflation, encourage spending, and discourage the hoarding of wealth
On the other hand, when you are taxed, a portion of your wealth is given to the government. The government is supposed to use their tax revenue to fund projects that are too large or complex to be accomplished by the private sector. These include, but are not limited to: Fire Departments, Emergency Medical Services, Public Health Programs, Public Schools, Roads & Bridges, Public Transit, Water & Sewage Systems, Electric & Broadband Expansion, Disaster Relief & Recovery, and VA Hospitals. However, since 1971, the percent of taxes that go to these programs has been steadily decreasing while spending on the U.S. military has been growing exponentially. For Fiscal Year 2024 (for example), the Department of Defense (DoD) budget is approximately $842 billion. However, when including other defense-related spending, the total national defense spending exceeds $1.2 trillion. That is where your taxes are going.
Question: I have heard about people getting the "Honest Mistake" badge. What does it look like and, if someone has it, should I accept an UBICoin payment from them?
Answer: Here's what the "Honest Mistake" badge looks like:
If the UBICoin wallet detects any tampering whatsoever, then it will give you the "Honest Mistake" badge. The UBICoin wallet is extremely sensitive to tampering. People who do not touch the UBICoin wallet files in any way will not receive this badge. People who use UBICoin normally will not receive this badge. You can only get this badge if tampering has been detected on your wallet, and your wallet was reset (the balance was set to zero).
If you are a small business owner accepting UBICoin, then you should NOT accept UBICoin payments from someone who has the "Honest Mistake" badge. This is your choice, of course, but I would not recommend it.
Question: How do I get rid of the "Honest Mistake" badge?
Answer: TBD