Trading system Idea for Stibarc MC

Posted by Merkle at 1:42 PM on 8/3/2021 EST:

What I have noticed is that there is sometimes problems with people stealing resources from other parties - my idea was to create a bank of sorts for goods. I receive resources from other players and issue promisory notes in exchange, for example:

Player A wants to deposit 6 stacks of cobble stone

Bankteller takes cobblestone and issues a promisory note ( a paper ) that is equal to those 6 stacks of cobble stone. Then Bankteller notes the ocurrence on a book (along witht he id of the promisory note to ensure people dont fake notes)

Next the bank teller would deposit the physical stacks of cobblestone in one of the "banks" storage locations - which would be unknown to the public. When a promisory note is to be redeemed, player a would go to bankteller and turn in their promisory note in a chest along with a note saying the exact xyz location of where they want their cobble to be delivered (a fee would be charged for delivery, which is undecided yet). When bankteller is online, they would look through the chest and find the promisory note along with the coordinates - go to the storage location where the cobble is stored - then go to the xyz coords specified by player and leave a chest with the cobble. Then the promisory note would be deleted from the banks records.

ALONG with this system, there would be another system for trade using automated market makers. The basic formula for how this would work is simple:
X*Y = K

The idea is that their would be an established universal form of currency, probably diamonds, and liquidity pairs would be created for every block in minecraft. For example, their would be a pair for WOOD/DIAMOND or COBBLESTONE/DIAMOND, etc.

A liquidity pair consists of two blocks, one the currency (the diamond) and one the block being traded (cobblestone in this example). Each pair's liquidity is independent of one another, so for example diamonds cant be shared between the cobbestone/diamond and wood/diamond pair. We can think of pairs as chests, containing both the diamonds and the block for trading. When someone deposits diamonds into this "chest", blocks would be taken out of the pair and diamonds would be deposited (price increase). When someone deposits blocks into this chest, diamonds would be taken out and blocks would be deposited into the chest (price decrease). This price increase/decrease relation can be estaplished with the formula mentioned above, which would work in the following manner.
X describes the currency (in this case, diamonds)
Y describes the amount of cobble inside the chest (or any block in that manner)
and K is a constant which must ALWAYS remian the same.

How this works is lets say when the pair is initalized i deposit 5 diamonds and 50 cobblestone, the constant K would be 250.

Lets say someone else decides to deposit 1 diamond and wants cobble in return.

The pair would now by 6 x 50 which would equal 300, which is incorrect because the constant must stay at 250, so the amount of cobble (y) would decrease to bring k back down to 250, so in this case there would be 41.666 cobblestone left in the market maker, which would mean the 1 diamond bought 8.3334 cobblestone. The formula is now balanced again, with 6x41.666 equaling the constant, 250.

We can observe how this affects the price in the following scenario:
[PAIR] 5 Diamonds 50 cobble stone, price: 1diamond = 10 cobblestone

Player A Buys 2 diamonds worth of cobblestone (250/7 = Y)
New diamond supply would be 7 for the pair (this can be used to find y, cobble supply)
[PAIR] 7 Diamonds 35.71 cobblestone, price 1 diamond = 5.1 cobblestone (Cobblestone therefore becomes more expensive)

Player B sells 100 cobblestone (250/135.71 = X)
New cobble supply would be 135.71, this can be used to find x (diamond supply)
[PAIR] 1.871 Diamonds and 135.71 cobblestone, price 1 diamond = 74.87 cobblestone (Cobblestone becomes dramatically cheaper)

As you know, you cant have fractions of a block or diamond. The bankteller would only deliver the physical embodyment of what your promisory note has (so 6.7353 diamonds would round DOWN to 6 diamonds) and the .73 would be issued as another promisory note. This allows fractional trades to happen, and allows you to save up until you can afford the full embodyment of the good you are trying to get (in this case, 1 diamond)

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