But this makes zero sense! What purpose does the coin serve here? Imagine coins had somehow gotten tied in with email protocols. The person who came up with the protocol somehow gets to magically siphon off money every time someone sends an email? Why? How?

The same is true with Bitcoin or Ethereum. You can fork it and make your own, but the majority of the people want to use one of the original protocols, and you can only use the protocol if you pay with the proper protocol token (either BTC or ETH).

But not value that can be captured by the creator of the protocol. Let's go back to cloud storage. Sellers of storage sell 1GB-Month for 1 token (or whatever). Buyers of storage eventually run out of tokens because they've given them all to sellers. So they have to purchase the tokens back from sellers for dollars. How much will sellers charge? The cost of storage (plus whatever profit they can get away with).

At that point buyers of storage are paying exactly what they'd pay for storage if the token system didn't exist. It's just this goofy middle layer of scrip. There's no magical extra money that the protocol creator can siphon off.

Step back and look at the big picture. The only way for a protocol creator to make money is for either sellers of storage to charge less than they otherwise would or for buyers of storage to pay more. Why would either of those two groups ever want to do that?

That's also how proof-of-work systems should have worked with surplus compute cycles, except ... ASICs. I basically consider Bitcoin broken because of this.

As to how the protocol creator makes money, they can sell storage like everyone else, but creating a protocol doesn't require the same initial capital as starting a whole cloud storage company.

I'm saying that the creator of the protocol won't.

Because? Value?

Sorry, I really lost a lot of faith after that one.

No, it doesn't. Being scarce, by itself, is not valuable at all. Being useful is was gives something value. In fact, I'd argue a protocol that I have to have a coin for is much, much, much less useful, and therefore less valuable, than one that doesn't.

The only people who need to be magically paid are the ones executing the contract... miners, signers, etc.

In FoodCoin the cooks would get paid, the health inspectors would get paid, the poisoning investigators would get paid, the underwriters would get paid when those people do their jobs and lose their stakes when they don’t. The eaters would pay.

These people are paid for doing work in alignment with the contract incentives. A good cryptocontract makes it hard to get rewarded for work that goes against the planned incentive scheme. A bad one fails at this.

In order for this to work without a centralized payment gateway like PayPal, you need to issue tokens. Those tokens will have a value of TOTAL_TRANSACTED_PER_AVERAGE_HOLDING_PERIOD. Their price will depend on speculation about that value over time. Contracts finding more use will tend to have a bigger TOTAL_TRANSACTED_PER_AVERAGE_HOLDING_PERIOD.

They don't, why would they?

Email is not centralized under a single authority, but I disagree that it's so decentralized that "anyone" can do it.

The openness worked so well in the short-term that spammers and scammers started using it, so all the major email providers started running serious spam filtering. As an individual, I can't realistically set up a mail server to send email to anyone, like I could in 1995, since Gmail will reject it.

SMTP is a pretty simple protocol but now I have to use major third-party services for both sending and receiving internet email.

In the case of email, that's fine, because there was never a centralized alternative. In the case of currency, what's the point? Isn't it just going to circle back around to (mostly) centralization again, and so what was the point?

I'm an individual who runs his own mailserver and all emails are accepted by Gmail.

Sure, today a mailserver must be absolutely properly configured. Not just to play with Gmail, but with all other players as well. The HELO string, DNS settings and especially reverse DNS settings must be correct. Don't run it in a non-dynamic IP range. And for IPv6, better have correct SPF/whatever records.

This is initial effort, for sure, but absolutely doable for an idividual who plays with their own server/VM anyway. Pro tip: It is more fun if you share the infrastructure with friends.

And there are properly configured projects with ready-to-use VM images and good tutorials out there.

In some sense it is even easier than HTTPS, because for SMTP+TLS and IMAP+TLS a self-signed certificate is sufficient, you don't need Let's Encrypt certificates, let alone pay dubious CAs for certs if you are commercially active.

Seems like a bit of wand waving going on in your description there.

This is my limited understanding:

1) You want to allow users to send and businesses to receive (micro-)payments within your messenger/protocol.

2) You want to allow users donate/vote/gift/award other users/groups/posts with their tokens within your messenger.

3) You want to allow users create custom (chat-)bots which could apply some scripted logic to send/receive tokens; etc.

Inventing a new distributed messenger/protocol with cryptocurrency, you essentially create (and own) a new platform with services operating on "virtual money". Rules of money (tokens) distribution in theory must be guaranteed by your protocol implementation (usually presented via whitepaper).

If potential future users like your idea (whitepaper), they may invest into your new shiny platform via ICO (with other cryptocurrencies) to get some of your initial (limited) tokens. They want to get them while they cost less than they potentially will cost later, if your platform becomes popular. It's assumed that in the case of an open distributed blockchain platform, amount and belonging of tokens won't be able to be painted by you, but guaranteed by algorithms and public network.

We've seen how it works on totally scam projects. And apparently, we'll have a chance to witness how this works out in case of the already popular platform[1].

[1] https://techcrunch.com/2018/01/15/inside-telegrams-ambitious...

It seems like a bit of a chicken-and-egg problem (at least in the way I keep seeing it described): you fund your project/app/scam with money from your ICO, but you only get money from your ICO when people believe in your project enough to put ("real") money in it prematurely.

At best, this is basically the Kickstarter model that everybody likes to trash, is it not?

But people who participate and invest from the start can make money if the project succeeds. So the economic incentives for those involved are greater than the incentives in a walled garden.

There actually already exists a coin connected to messaging protocols, Kin. I don't see much practical use for it however.

In theory, protocols like the blockchain are open, decentralized, interoperable. Yet in current practice a cryptocurrency only works with platform lock in: if you don't lock people into your platform it isn't monetizable. Market forces push toward closed (artificial scarcity, rising costs for new players to enter the market versus entrenched players/miners/etc) and centralized (central wallets/brokers/exchanges on the one side, complex miner unions as complex political boundaries form on the other side).

I'm not sure cryptocurrencies can save the internet from platform problems when they themselves are platforms.

For example, the little guy might be able to make a small income from IPFS/Filecoin that would otherwise be strictly the domain of AWS and other giants.

In that case it is not an open protocol (at least not in spirit). It is better to go with platforms.

What Ethereum for instance did is genius. It distributes storage and compute across the world to those willing to share their resources and you get paid by doing so. It's a way to drive decentralization, because there is an incentive for mining. Is it perfect? Not quite yet for various reasons (performance, privacy), but its an interesting new paradigm.

Anyone who believes this probably wasn’t alive then.

Everything we take for granted is built on open and free (as in beer) protocols. The people who created and supported TCP/IP, HTTP, XMPP, etc. figured out ways to have successful careers without a micropayment scheme for basic participation.

And personally, I remember a simultaneous mix of excitement and disappointment from the internet of the 90s.