Proof of Weak Hands 3D (P3D)
Proof of Weak Hands 3D (PoWH3D) is the title of a smart contract based on Ethereum (ETH), a cryptocurrency. Users can purchase P3D tokens (an ERC20 token) from this smart contract directly using Ethereum. Ten percent of the Ethereum used for this purchase is distributed to the existing token holders as dividends (slightly less if the purchase is made through a masternode). In addition, ten percent of each transaction (buys, sells, and trades) is distributed to all existing token holders in proportion with their share of tokens owned.
Due to the nature of the smart contract, there is no mechanism by which the Ethereum it contains can be hacked, drained, or otherwise stolen unless this function had been included in the initial code. The code is open-source and has been audited by community members as well as impartial reviewers. As a testament to its fortitude, the contract at one point contained near $6,000,000 USD and remained unmolested. Despite the secure code and equitable model, the token jokingly refers to itself as a 'Ponzi scheme' or 'pyramid scheme:' in truth it is neither of these. This has not stopped several commentators from labeling it a scam without doing any actual research.
Unlike many other cryptocurrencies or ERC20 contract tokens, P3D tokens are created upon purchase and destroyed or 'burned' when sold. One result of this is that token price changes based on total token supply: lots of Ethereum in the contract means lots of tokens with relatively high value, less Ethereum in the contract means less total tokens, each with a lower value. However, because dividends from buys and sells are distributed over existing tokens only, it is possible for the token price to drop while overall portfolio value rises.
The complex and unpredictable interactions between supply, token price, and dividends result in several different approaches to increasing one's token holdings. Chief among these is to avoid selling, reinvest dividends frequently, and let those who feel the need to do more buying and selling feed your dividends. This strategy embodies the concept of 'strong hands,' while the 'weak hands' would be those who sell when prices are high and buy in when they are low. Weak hands are never in short supply in the cryptocurrency trading space. Now, it is possible to essentially mine the volatility of a market - hence, Proof of Weak Hands.
For a more thorough explanation of Proof of Weak Hands 3D, a more detailed history, and the philosophy behind these projects, see the P3D wiki, a community-run page. For price charts and user volume, see Powh3d.eu. The main Proof of Weak Hands site also contains info and several useful links in the menu bar.
A previous version of Proof of Weak Hands 3D, called simply Proof of Weak Hands, was launched about two months before the release of PoWH3D. While similar in concept, the earlier contract was subject to an integer overflow vulnerability which allowed a single user to submit a transaction which caused the contract to be drained of over 200 Ethereum by an unknown user. After the original project was compromised, a new development team led by Mantso rewrote the contract entirely from scratch and expanded on the features for the current version of PoWH3D.
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