Interpreting Cellula: Paying tribute to POWMining's gamified asset issuance protocol

Author: Nickaqiao & Faust, geek web3

Since the popularity of ERC-20 assets in the BlockChain Community in 2017, Web3 has entered a low-threshold era of asset issuance, and various project parties have freely issued custom Tokens or Non-fungible Tokens through ID0, IC0, and other methods. Most of them have strong control the market trend or lack of transparency in information. RugPull phenomenon occurs frequently, and various scammers seem to regard IC0 and ID0 as excellent ways to exploit suckers.

As of today, the conventional ID0 and IC0 have fully exposed their shortcomings in fairness, and people have always hoped for a more fair and reliable asset issuance protocol to solve many problems when TGE for new projects. Although some creative projects have unilaterally proposed their own ‘fair economic model’, they often fail to be widely promoted, and in the end, most of these economic models become ‘specific cases’ rather than ‘a protocol abstracted from a trap’.

So, what kind of model is a fair and reliable way of asset distribution? What kind of solution can serve as a universal protocol trap? This article will introduce the Cellula, which provides a new perspective to solve the above problem. They have implemented a simulated asset distribution layer using virtual Proof of Work (vPOW) to ‘mine’ the asset distribution process, simulating BTC to achieve a fairer asset distribution paradigm.

Although the project is considered by many to be Gamefi, due to its distribution of in-game rewards that can be set to any type of Token, Cellula can theoretically serve as an asset distribution platform with POW effect, bringing broader prospects and imaginative space for Web3 asset issuance, and even be called a “social experiment paying tribute to BTCMining”.

POW and vPOW: Lottery draws with unpredictable results

Whether it’s authentic POW or POS, or today’s vPOW, the essence is to set a trap to produce an unpredictable/difficult-to-predict Algorithm, and use the output to conduct a “lottery draw.” BTC miners need to locally construct a Block that meets certain conditions, submit it to the Full Node in the network through Consensus, in order to obtain the block rewards. As for the conditions, it is to ensure that the constructed Block’s Hash meets special requirements, such as having a prefix of 6 zeros.

Due to the unpredictable/nondeterministic generation result of BlockHash, to construct a Block that meets the conditions, we can only continuously change the input parameters of the given algorithm. This process requires brute force enumeration and places high demands on the hardware equipment of the Miner.

In short, BTC mining achieves the unpredictability/difficulty of the SHA-256 hash algorithm, and implements a ‘lottery draw’ system where trap the entire network’s miners can participate online. This design, at the cost of electricity, ensures the permissionless nature of participation.

In addition, POW is a fairer way of distributing assets, and the difficulty of controlling the market trend by the project party in mainstream POW public chains is much greater than that in POS public chains. However, in many POS public chains or ICO, IDO schemes, there are numerous cases of the project party strongly controlling the market trend.

(Under the manipulation of FTX, Solana experienced a big pump of nearly 500 times from 2020 to 2021, which is extremely unfriendly to the Validators who got on board later)

For example, under the manipulation of FTX and SBF, the price of Solana experienced a big pump of nearly 1000 times from 2019 to 2021. Many Solana validation nodes are early investors who obtained chips at a cost close to zero, which seriously undermines the fairness of asset distribution. Although project party in POW also has the space to control the market trend, the degree is often much lighter than in POS.

The problem is that the POW mode is often applied to the underlying public chain rather than the asset issuance layer of DAPP. Can we simulate the effect of POW with an on-chain trap? If so, we can achieve a more fair and reliable asset distribution protocol than IC0, ID0, and other schemes that control the market trend. With some game scenarios, we can create interesting Gamefi (of course, the actual use is not limited to games, but also provide an on-chain fair asset distribution solution for other projects).

So the key is, how can we simulate the effect of POW on-chain asset issuance? In the Gamefi project Cellula introduced in this article, the famous “Conway’s Game of Life” Algorithm is used to allocate Computing Power to on-chain virtual digital entities (referred to as “BitLife”). In simple terms, it’s like letting a group of people breed cell clusters in their own petri dishes. As time progresses, the more surviving cells in their petri dishes, the higher the Mining Computing Power obtained after conversion, and the more likely to receive Mining rewards.

In short, Cellula replaces the hash calculation of traditional POW with another calculation method that produces unpredictable/difficult-to-predict results, replacing the ‘Work’ form in ‘Proof of Work’. In Cellula’s concept, the key lies in how to obtain more cultured dishes (BitLife) with more surviving cells, and deducing the state changes of BitLife requires computational resources. Essentially, it transforms the Hash Algorithm executed in BTCMining into a specific Algorithm for deducing Conway’s Game of Life, which is called vPOW (Virtual POW).

Let’s delve deeper into the mechanism design of vPOW, many details here are quite interesting. It can be said that one of the things Cellula is doing is to simulate the Mining Rig industry chain model of BTC through on-chain NFT transaction chain.

The Core of vPOW: Conway’s Game of Life and BitLife

Before we delve into the mechanism design of Cellula, let’s take a look at the most important core of vPOW - the “Conway’s Game of Life,” which can be traced back to John von Neumann’s concept of “cellular automata” proposed in 1950, and then mathematician John Conway formally introduced the “Conway’s Game of Life” in 1970, using Algorithm to simulate the evolutionary rules of life in the natural world.

Assuming we have a Petri dish, divide it into a bunch of small squares according to two-dimensional coordinates, and then we do the ‘initial setup’ for the Petri dish, letting some living cells occupy some squares. After that, the life and death of these cells will evolve over time, gradually forming complex clusters of cells (you can imagine how fungi reproduce). This is essentially a two-dimensional grid game with very simple rules:

• Each cell has two states: alive/dead, just like the minesweeper game, each cell interacts with the cells in the eight squares around it (as shown, black is alive, white is dead);
• If a cell survives, but there are fewer than 2 surviving cells within the 8 neighboring cells (0 or 1), the cell will enter the dead state;
• When a cell is alive and surrounded by 2 or 3 living cells, it remains alive;
• When the cell is in a living state, it enters a death state when there are more than 3 living cells around it (simulating the scenario of excessive competition for resources due to excessive population).
• When a dead cell has three living cells around it, it enters a living state (simulating cell proliferation).

So it’s simple, give the initial pattern of cell state in a two-dimensional culture dish, then according to the above rules, the cell state will evolve iteratively over time, producing ever-changing results. You can even simulate the effect of a computer with Conway’s Game of Life.

For example, the life/death of each cell in a culture dish corresponds to the binary 0/1. You can consider the initial state of the cells as the ‘input parameter’, and the life/death of each cell (0 or 1) represents the input data. The cell states then evolve according to the initial pattern, and each round of state change is equivalent to a step in the computation process. The state obtained after a period of time can be regarded as the ‘output’.

As long as the initial mode is set appropriately, the Conway’s Game of Life can produce specific results after several generations. Due to the endless variations in initial modes, its characteristics can be utilized to simulate the effect of lottery drawing. We can set restrictions, where each player randomly selects a batch of initial modes, and after 100 generations, the output results that meet certain features qualify the cultivator for rewards, which is quite similar to the idea of BTCMining:

“The system first limits which type of output results meet the requirements, and participants input random initial values to a given algorithm to try to obtain the desired output results. Due to the large number of initial input parameters to be tried (almost astronomical), you must make a great effort to hit the jackpot, which is exactly the logic of Proof of Work: Miners must exert a certain amount of effort to obtain rewards.”

After understanding the basic idea of Cellula and Conway’s life game, let’s look at his specific details. Cellula divides the aforementioned “petri dish” into 9*9=81 squares, and the cells on each square have two states of life and death (corresponding to the binary 0 and 1), so that according to the permutation, there are 2^81 initial states of cells in the petri dish, which is equal to 1 trillion squares (basically an astronomical number).

Then, what the player needs to do is to select the initial mode (input parameters) of the petri dish. BitLife acts as the entity of the petri dish (actually a Non-fungible Token), containing 81 squares, with one cell placed on each square (which may be in two states: alive or dead, and empty squares are equivalent to dead cells). Then, every 3*3=9 adjacent squares in BitLife form a BitCell, and each BitLife is composed of 2~9 BitCells (if the BitLife you construct has fewer than 9 BitCells, some areas will be left empty, defaulting to dead cells).

According to permutation and combination, there are 2^9 initial patterns for BitCell (3*3 grid), and what players need to do is to randomly select multiple BitCell patterns and combine them to construct a BitLife. To put it simply, players need to find an initial pattern for their own cultivation vessel. As mentioned before, there are a total of 2^81 different initial patterns, which is a huge number. Therefore, the choice space left for participants is very large, which is similar to the scenario of using SHA-256 in BTC mining.

The cell state of BitLife will change with the increase of Block Height. Cellula allocates Computing Power according to the state of BitLife at different Block Heights. Given a Block Height, the more surviving cells it contains, the higher the Computing Power of BitLife, which is equivalent to creating a virtual Mining Rig.

Here’s a specific example: Cellula participants need to exhaustively enumerate the 2^81 initial patterns of BitLife off-chain, predict the state of each pattern after evolution, and see if it meets the requirements of the reward system. Assuming the current Block Height is 800, and the system requires that when the Block Height reaches 1000, the BitLife with the most surviving cells receives the highest reward. In this case, the participants’ goal will be very clear:

At Block Height 800, I want to obtain a BitLife of a certain pattern, which can have more surviving cells than other BitLife at Block Height 1000.

This is actually the core gameplay of Cellula, and your goal is to construct/buy the most likely BitLife to receive Mining rewards. This model allows ordinary retail investors/advanced retail investors to develop their own Mining Rigs and sell them to others, or buy Mining Rigs from others for Mining. If you want to build your own Mining Rig, you need to calculate the evolution of different BitLife states off-chain, which consumes computational resources. If you want to buy someone else’s Mining Rig, you are actually buying BitLife with different initial states, and you need to judge the future changes of these BitLife states, so you still need to calculate off-chain. This is actually a very interesting aspect of the entire Cellula game design.

After understanding the core mechanics of the game, let’s take a look at other details: In fact, the active cells in BitLife can overflow beyond the initial 9x9 grid, and the number of surviving cells can be much larger than 9x9, without any boundary restrictions. As shown in the figure, if the number of active cells in a BitLife keeps increasing, the allocated Mining Computing Power will also increase. On the other hand, if the initial pattern selection of BitLife is inappropriate and the number of active cells decreases, the Computing Power will also decrease.

Then, the system will distribute a certain amount of Mining rewards (called Energy Points in the game) every 5 minutes, according to the Computing Power share of each BitLife in the network.

In Cellula, the process of synthesizing BitLife is like the process of “manufacturing” a new Mining Rig. As mentioned earlier, the entity of BitLife is a Non-fungible Token, after BitLife is minted on-chain, it needs to undergo a “charging” operation to start Mining, the validity period of a single charge is 1 day, 3 days, and 7 days, and a small fee is required, and it needs to be recharged after expiration.

Here I need to mention that in order to encourage users to charge BitLife more, Cellula has set up a “charging lottery” function. Every time you initiate a charging operation, you may be selected to receive some additional rewards (which means that this reward is independent of the Mining reward). We will briefly introduce the design of this part in the AnalysoorAlgorithm section later.

According to the official rules of Cellula, the BitLifemint containing 3*3 Bitcells (81 small squares) has been discontinued. Players have minted more than 1.5 million BitLife of this type. In the future, new users can purchase BitLife on the Secondary Market and charge them for Mining. According to the official explanation, the limited minting is to maintain the stability of the game ecosystem and prevent scientists from unlimited minting BitLife Non-fungible Tokens, which would devalue the Mining Rig.

And in the future, Cellula will introduce a role similar to the Mining Rig manufacturer, this role is based on permission, to stakeToken, publicly announce sales channels, and have a certain community scale and influence, etc. These manufacturers will be responsible for minting and selling BitLife containing 4x4 BitCell, which is 16*9=144 small squares. The amount of BitLife that manufacturers can mint will be limited by their stakeToken amount.

Here we roughly explain the core concepts involved in vPOW. ** The essence of vPOW is a calculation model based on given rules. Participants can participate in competition by optimizing strategies, and assets issuance and distribution are carried out in a gamified manner. Cellula simulates the operation of the BTC mining machine market, replacing the form of computational tasks in Proof of Work. ** Since the allocation of Mining Computing Power can be dynamically adjusted, any mode of BitLife may not be globally optimal. BitLife with the highest number of cell survival today may be surpassed by other BitLife tomorrow, leading to complex emergent phenomena and dynamic strategies.

Analysoor lottery Algorithm and VRGDAs index pricing curve

In the previous section, we mainly elaborated on the core mechanisms of Conway’s Game of Life and Cellula. Now, let’s examine other designs included in the game. As mentioned earlier, Cellula has a charging lottery section, which uses a random number output algorithm called Analysoor. It uses the Blockhash as the input parameter of the random number generator to draw the winners from the participants in each block, introducing a lottery system.

For example, in the design of Analysoor, the Blockhash of the current BNB Chain is a long string like 6mjv…, which contains 4 numbers: 6, 2, 1, 6. According to the order of these numbers in the string, the first number is 6, the last number is 6, and it is even, so the counting is from the front. The extracted number starts from 0, so the transaction order corresponding to number 6 is 7, and the 7th charging player in the current Block is considered the winner. Of course, the specific design can be more flexible, this is just an example. The random lottery Algorithm mentioned above can effectively encourage players to charge more, and stimulate the activity of the game’s internal ecosystem.

In addition, in the entire transaction model of Cellula, there is an issue: once a certain pattern of BitLife is proMinted by a pro, the BitCell combination scheme it adopts will be made public, and others can also “follow the trend” to mint BitLife according to the same combination scheme, easily triggering a phenomenon of a bunch of people following the trend, seriously affecting the randomness of the game results. Therefore, Cellula has introduced Variable Rate Gradual Dutch Auctions (VRGDAs), which is a pricing Algorithm developed by Paradigm that will dynamically adjust prices—raising prices when the casting volume exceeds expectations, and lowering prices when the casting volume falls short of expectations.

Assuming the initial expectation is to mint 10 A-class NFTs per day, with a starting price of 1 CKB. On the 5th day, the expected total minting of A-class NFTs was 50, but due to many people following suit, the minting amount reached 70, which is equivalent to the target set for the 7th day. In order to limit the speed, the mint price needs to be quickly increased through an exponential pricing curve, and the unit price rises to 4 CKB to suppress the minting behavior.

If only 120 tokens are minted on the 15th day (the original plan was to mint a total of 150 tokens), and the expected sales volume is not reached, the price will be lowered at this time to stimulate minting.

In the above scenario, when a certain type of BitLife is minted in large quantities in a short period of time, the mint price of this type of Non-fungible Token will rise exponentially, and this drastic price pump can effectively prevent scientists.

Summary: Viewing Cellula from the perspective of player games

After discussing all the core designs of Cellula, let’s take a look at this imaginative game mechanism from the perspective of players’ game theory. Firstly, there are many participants in vPOW, each with different strategies. Taking the level one issuance market as an example, a “scientist” can write code and combine different BitCells to find a BitLife with higher Computing Power and obtain higher Mining revenue. At the same time, there are also some MEV players who listen to on-chain minting events. When they find that a certain outstanding scientist has minted a certain type of BitLife, they will also follow suit and mint a large amount.

However, due to the existence of the VRGDAs index-based pricing Algorithm, the price of a single type of BitLife mint can rise exponentially, which can effectively prevent scientists (anti-witch) and also set the price for BitLife/Mining Rig. If a certain type of Mining Rig has a high Computing Power, its mint/production price will also be high, and the price in the Secondary Market will be based on the production price and transmitted throughout the entire Supply Chain.

Analogous to the issuance process of BTC Mining Rig, scientists discover that a certain type of BitLife has high Computing Power, just like a Mining Rig company developing a new chip, MEV players follow suit to mint, similar to a primary distributor completing the pricing of the Mining Rig, and the subsequent Secondary Market transactions are similar to retail investors purchasing equipment from the distributor.

What is different is that compared to the development of Mining Rigs in the real world, scientists have found that the speed of the new BitLife will be much faster, and anyone can participate in the state simulation of BitLife, which is equivalent to dropping the power of developing Mining Rigs. ‘Everyone has the opportunity to become a scientist’, which is more friendly for most people and is also impossible in the production chain of Mining Rigs in reality.

For the project itself, adopting a POW-style asset distribution scheme weakens its power. Therefore, neither scientists nor project parties nor ordinary players can unilaterally control the market. In the Mining Rig minting process and the issuance process, a three-party game arises, where no party can completely monopolize the market, forming a dynamic balance.

Overall, compared to the BTC Mining Rig industry chain, Cellula’s solution is a more interesting social experiment.