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Fair Minting

Motivation

Fair Minting is a process whereby users are able to “mint” tokens in a decentralized manner. One user initiates a minter (either with or without a “premint”), and others are able to trigger it to mint tokens for themselves. Fair Minting was likely inspired by the original Counterparty Proof-of-Burn mechanism, by which users sent BTC to an unspendable address and XCP tokens were generated for them.

More recently, BRC-20 introduced a variant of the Fair Minting model that has recently been adopted by many fungible token protocols including SRC-20 on Bitcoin Stamps. In this system, users are able to mint "for free" paying only a miner fee: the term “fair mint” refers to the fact that the creator of the minting system is not enriched in the process and that the minting process is decentralized

In 2023, Joe Looney introduced the ”XCP-20” Fair Mint model by setting up a dispenser on a burn address; its name is a tongue-in-cheek reference to BRC-20. Buyers, largely unaware that Counterparty existed—and this was not new in any way—sent massive amounts of Bitcoin to the burn address and received tokens in return. In this way, tokens got distributed, but the deployer was not directly enriched.

Design

The primary goal is to create a native mechanism for Fair Minting so that a burn address isn’t used. Additionally native support allows for multiple extensions of the core Fair Minting system.

  1. Miner Fees Only, with a Max Mint per Transaction
  2. XCP Fee with a Price per Unit Token (Distributed to Issuer)
  3. XCP Fee with a Price per Unit (Burned)
  4. A “soft cap” mechanism, establishing a minimum amount of the token to be issued, optionally by a particular block height. (Before soft_cap_deadline_block payment will be escrowed trustlessly.)
  5. A commission in the new token sent to the creator of the mint for each mint operation (proportional to the quantity minted)
  6. A “Start Block” and “End Block”

The Fair Minting system allows users to issue assets through a fair and controlled minting process. It involves two primary entities: Fairminters and Fairmints.

  • Fairminter: Represents the rules and constraints under which an asset can be minted.

  • Fairmint: Represents an individual minting event tied to a specific fairminter.

  • Fair Minters can be added to existing assets as long as those assets do not have locked quantities.

  • The premint quantity will be credited to the issuer at the start_block.

  • If an asset can be reset it can also be Fair Minted, but fair minting itself would not first effect an asset reset.

  • Outside the fair minting period the hard_cap has no effect. To lock the quantity you have to use the parameter lock_quantity=true or use an issuance after the minting period.

  • For the duration of the mint period, the state of description lock and quantity lock cannot be changed.

  • In the Fair Minting system, creating a fairminter additionally triggers the creation of an issuance for the referenced asset. If the asset does not exist then it will be created.

  • minted_asset_commision must be between 0 and 1

  • price and max_mint_per_tx cannot both be 0

  • end_block must be greater than start_block

  • soft_cap must be less than hard_cap

  • soft_cap and soft_cap_deadline_block must be set together

  • soft_cap_deadline_block must be less than end_block and greater than start_block

  • If the asset exists

    • It must not currently have an open fairminter
    • It must not be locked
    • The asset issuer must match the fairminter's source
    • If the asset's description is locked then the fairminter's description must be "" or match the existing description
    • The existing supply plus premint_quantity must not exceed the hard_cap
    • divisible must match the existing divisible

  • If the asset does not exist

    • If asset_parent is a provided argument then the asset it references must exist
    • If asset is not a numeric asset then the sources balance must be sufficient to pay a 0.5 XCP fee
    • asset and asset_parent must respect the named asset format

  • If asset does not exist one will be created

  • premint_quantity of asset will be credited to the source if there is no soft cap and the status is open otherwise it will be held in escrow

  • If there is a fee the source will be debited that amount

  • An open fairminter must exist for asset

  • If Fairminter.price is 0 quantity must be supplied as 0 or omitted. Fairminter.max_mint_per_tx is used instead

  • quantity must be greater than 0

  • quantity cannot exceed Fairminter.max_mint_per_tx if set

  • The existing supply plus quantity cannot exceed Farminter.hard_cap if set

  • Fairmint.source must have a sufficient balance to cover the cost

  • If the soft cap has not been reached both the XCP and asset amounts will be escrowed

  • If the hard cap is hit

    • quantity and description are locked
    • soft cap is implicitly hit and payouts are made if they have not been already

  • If Fairminter.burn_payment is True then the XCP used to mint the asset will be destroyed; otherwise it will be sent to Fairminter.source

  • The Fairmint.source will be credited with quantity of the asset.

  • When the end_block is reached, the fairminter closes.

  • If lock_quantity=True, the issuances table records the final issuance event with locked=True.

API

  • Get All Fair Minters: /v2/fairminters
  • Get Fair Minter By Tx Hash: /v2/fairminters/<tx_hash>
  • Get Fair Minter By Asset: /v2/assets/<asset>/fairminter
  • Get Fair Minters By Address: /v2/addresses/<address>/fairminters
  • Get Mints By Fair Minter: /v2/fairminters/<tx_hash>/mints
  • Get Mints By Asset: /v2/assets/<asset>/mints
  • Get Mints By Address: /v2/addresses/<address>/mints

Fairminter​

A fairminter defines the rules under which an asset is minted. This table stores configuration details such as price, supply limits, soft/hard caps, and minting constraints.

tx_hash: TEXT - Hash of the transaction that created the fairminter.

tx_index: INTEGER - Index of the transaction.

block_index: INTEGER - Index of the block containing the transaction.

source: TEXT - Address of the fairminter creator.

asset: TEXT - The asset to be minted.

asset_parent: TEXT - Parent asset of the asset.

asset_longname: TEXT - Full name of the asset (parent + asset name).

description: TEXT - Description of the asset.

price: INTEGER - Price per unit of the asset, in XCP Satoshis.

quantity_by_price: INTEGER - Units of the asset minted per price unit.

hard_cap: INTEGER - Maximum supply that can be minted (asset limit).

burn_payment: BOOL - If True, payment is burned instead of credited to the issuer.

max_mint_per_tx: INTEGER - Maximum amount of assets that can be minted per transaction.

premint_quantity: INTEGER - Quantity pre-minted when the Fairminter opens.

start_block: INTEGER - Block index when the minting becomes open.

end_block: INTEGER - Block index when the minting ends.

minted_asset_commission_int: INTEGER - Commission percentage (in millionths) to the issuer for each mint.

soft_cap: INTEGER - Minimum quantity that needs to be minted for the Fairminter to succeed.

soft_cap_deadline_block: INTEGER - Block index when the soft cap must be reached.

lock_description: BOOL - If True, locks the description of the asset.

lock_quantity: BOOL - If True, locks the quantity minted after the Fairminter closes.

divisible: BOOL - If True, the asset can be divided into fractions.

pre_minted: BOOL - Indicates if the premint quantity has already been issued.

status: TEXT - Current status of the fairminter (pending, open, or closed).

Fairmint​

A fairmint records an individual minting event under a fairminter. This includes the amount minted, the payment made, and the commission, if any, awarded to the issuer.

tx_hash: TEXT - Hash of the transaction that created the mint.

tx_index: INTEGER - Transaction index.

block_index: INTEGER - Index of the block containing the transaction.

source: TEXT - Address of the user who performed the mint.

fairminter_tx_hash: TEXT - Transaction hash of the associated fairminter.

asset: TEXT - The asset being minted.

earn_quantity: INTEGER - Quantity of the asset earned by the minter.

paid_quantity: INTEGER - Amount of XCP paid by the minter.

commission: INTEGER - Commission awarded to the issuer.

status: TEXT - Status of the mint (valid or invalid).