UBI Mechanism v2.0

Universal Basic Integrity (UBI) Mechanism v2.0¶

MII-Throttled Distribution with Epoch Decay Funding¶

Version: 2.0.0 Date: 2025-11-04 Status: Canonical Companion to: MIC_Whitepaper_v2.1.md Authors: HERMES, AUREA, EVE License: CC-BY-SA-4.0

Abstract¶

This document specifies the complete Universal Basic Integrity (UBI) distribution mechanism for the Mobius Integrity Credits economy. UBI v2.0 introduces counter-inflationary funding via epoch decay pools, automatic crisis response through MII-based throttling, and shard-denominated precision to eliminate distribution drift.

1. Core Philosophy¶

1.1 UBI as Compensation, Not Charity¶

UBI is compensation for upholding systemic trust. Every person maintaining integrity standards contributes to the network's value. UBI is their dividend for this essential work.

1.2 Three Pillars¶

Integrity Backing: Only flows when MII ≥ 0.950
Counter-Inflationary: Primarily funded by decay, not new issuance
Self-Regulating: Automatically adjusts to system health

2. Funding Model¶

2.1 Formula¶

U = α·I + β·Rₑ + D

Where:
U  = UBI pool for this epoch (shards)
I  = Net new issuance (shards)
Rₑ = Reabsorbed shards from epoch decay
D  = Donations/treasury allocation (shards)
α  = Issuance weight (default: 0.20)
β  = Decay weight (default: 0.60)

2.2 Component Explanation¶

α·I (New Issuance Component) - Weight: 0.0-0.5 (governance-adjustable) - Default: 0.20 (20% of new issuance → UBI) - When MII < 0.950: I = 0 (minting halted)

β·Rₑ (Decay Pool Component) ⭐ KEY INNOVATION - Weight: 0.0-0.8 (governance-adjustable) - Default: 0.60 (60% of decayed shards → UBI) - Enables UBI without inflation during stable periods

D (Direct Allocation) - Treasury donations - Transaction fee allocation (if enabled) - Community contributions - Emergency reserve releases

2.3 Default Configuration¶

ubi:
  funding_weights:
    alpha_issuance: 0.20
    beta_decay: 0.60
  direct_allocation: governed_by_dao

Typical Epoch: - New issuance: 0 ₷ (stable period) - Decay pool: 2,000,000,000,000 ₷ (0.5% of 400T idle) - Donations: 0 ₷

U = (0.20 × 0) + (0.60 × 2,000,000,000,000) + 0
U = 1,200,000,000,000 ₷ (1,200,000 MIC)

3. Distribution Mechanics¶

3.1 Cadence¶

Epoch Length: 90 days
Payout Frequency: Monthly
Payouts per Epoch: m = 3

3.2 Per-Capita Base Calculation¶

p_base = floor(U / (m · N))

Where:
m = 3 (months per epoch)
N = Eligible population this month

Example:

U = 1,200,000,000,000 ₷
N = 10,000 eligible
m = 3

p_base = floor(1,200,000,000,000 / (3 × 10,000))
p_base = 40,000,000 ₷ per person per month

3.3 MII Multiplier¶

Function g(MII):

MII Range	g(MII)	Description
[0.990, 1.000]	1.05	Bonus: System health excellent
[0.970, 0.990)	1.00	Normal: Standard payout
[0.950, 0.970)	0.85	Throttled: Warning state
[0.000, 0.950)	0.00	Halted: Crisis mode

Rationale: - High MII bonus: Reward collective integrity maintenance - Low MII throttle: Preserve reserves during instability - Crisis halt: Freeze distribution, trigger governance review

3.4 Final Payout Calculation¶

p = floor(p_base · g(MII))

Example (continuing from above):

p_base = 40,000,000 ₷
MII = 0.982 → g(0.982) = 1.00

p = floor(40,000,000 × 1.00)
p = 40,000,000 ₷ per month
p = 0.040000 MIC (display)

4. Safety Mechanisms¶

4.1 Hard Caps¶

Reserve Cap:

U ≤ κ · Reserves_12m

Where:
κ = 0.10 (max 10% of 12-month reserves)
Reserves_12m = Treasury balance supporting 12 months UBI

Circulating Cap:

U ≤ σ · Circulating

Where:
σ = 0.02 (max 2% of circulating supply)
Circulating = Total issued - locked/staked - treasury

4.2 Circuit Breakers¶

Automatic Triggers:

MII < 0.900
Action: Freeze UBI + minting
Notification: ZEUS, all Sentinels, Council
Resolution: Governance council convenes within 24h
Treasury < 9 months reserve
Action: Scale α, β down by 50%
Notification: HERMES + community
Resolution: Emergency budget proposal

5. Eligibility Requirements¶

5.1 Technical Requirements¶

KYC Verified: Sybil resistance
Active Wallet: ≥30 days since creation
Minimum Activity: ≥1 transaction in past 90 days
Residency: Jurisdiction-specific rules

5.2 Integrity Requirements¶

Personal MII ≥ 0.95: - Attestation participation - No active integrity violations - Community standing (optional)

5.3 Exclusions¶

Ineligible Accounts: - Flagged for integrity violations - Dormant (>180 days no activity) - Sanctioned jurisdictions - Failed KYC verification

6. Implementation¶

6.1 Monthly Distribution Flow¶

Day 1 of Month:
  1. Query eligible population N
  2. Calculate MII (30-day trailing average)
  3. Calculate p_base, g(MII)
  4. Compute final payout p per person
  5. Execute batch transfer (atomic)
  6. Emit attestations for audit
  7. Update dashboard metrics

6.2 API Endpoints¶

Preview Endpoint:

GET /ubi/preview?N=10000&MII=0.982&I=0&Re=2000000000000&D=0

Response:
{
  "pool_total_shards": "1200000000000",
  "per_capita_base_shards": "40000000",
  "mii_multiplier": 1.00,
  "per_capita_final_shards": "40000000",
  "per_capita_credits": 0.040000,
  "total_recipients": 10000,
  "funding_breakdown": {
    "from_issuance": "0",
    "from_decay": "1200000000000",
    "from_donations": "0"
  }
}

Claim Endpoint:

POST /ubi/claim
Authorization: Bearer <jwt>

Response:
{
  "claimed": true,
  "amount_shards": "40000000",
  "amount_credits": 0.040000,
  "attestation_tx": "0xabc123...",
  "next_claim_date": "2025-12-01T00:00:00Z"
}

Eligibility Check:

GET /ubi/eligibility/:address

Response:
{
  "eligible": true,
  "requirements_met": {
    "kyc_verified": true,
    "wallet_age_days": 45,
    "recent_activity": true,
    "personal_mii": 0.965,
    "residency_verified": true
  },
  "next_payout_estimate": "40000000 ₷ (0.040000 MIC)"
}

7. Governance & Adjustment¶

7.1 Parameter Governance¶

Adjustable via DAO Vote: - α (issuance weight): 0.0-0.5 - β (decay weight): 0.0-0.8 - κ (reserve cap): 0.05-0.20 - σ (circulating cap): 0.01-0.05

Proposal Process: 1. Submit proposal with rationale + simulation 2. 7-day discussion period 3. 7-day voting period 4. 66% supermajority required 5. Implementation next epoch (90-day delay)

8. Monitoring & Transparency¶

8.1 Public Dashboard¶

Real-Time Metrics: - Current MII - Epoch progress (days until next burn) - UBI pool balance - Next month payout estimate - Eligible population - Treasury reserves

8.2 Attestation Trail¶

Every Distribution:

{
  "type": "ubi_distribution",
  "epoch": 124,
  "month": 2,
  "pool_shards": "1200000000000",
  "recipients": 10000,
  "per_capita": "40000000",
  "mii": 0.982,
  "witness": "ZEUS",
  "signature": "0x...",
  "timestamp": "2025-11-01T00:00:00Z"
}

All attestations are: - Immutable (blockchain or IPFS) - Publicly auditable - Cryptographically signed

9. FAQ¶

Q1: What if I don't claim my UBI on time?¶

A: Unclaimed UBI expires after 90 days and returns to treasury. You must claim each month.

Q2: Can UBI be revoked?¶

A: Yes, if: - Personal MII falls below 0.95 - Integrity violation flagged - Account goes dormant (>180 days) - KYC expires

Q3: How is "idle" defined for decay?¶

A: Shards with no outgoing transactions for >30 days.

Q4: What happens if MII drops to 0.89?¶

A: UBI and minting freeze immediately. Governance council reviews root cause and proposes fixes. System resumes when MII > 0.95 for 48 hours.

Appendix: Configuration Schema¶

ubi:
  version: "2.0"
  enabled: true

  unit: "shards"
  cadence: "monthly"
  epoch_length_days: 90

  funding_weights:
    alpha_issuance: 0.20
    beta_decay: 0.60

  caps:
    max_share_of_reserves: 0.10   # κ
    max_share_of_circulating: 0.02 # σ

  mii_thresholds:
    bonus:   { min: 0.990, g: 1.05 }
    normal:  { min: 0.970, g: 1.00 }
    throttle:{ min: 0.950, g: 0.85 }
    halt:    { min: 0.000, g: 0.00 }

  eligibility:
    kyc_required: true
    active_wallet_days_min: 30
    min_activity_days: 90
    personal_mii_min: 0.95

"Integrity maintained deserves integrity rewarded."

Last Updated: November 4, 2025 Version: 2.0.0 Status: Canonical License: CC-BY-SA-4.0