What is Firstcoin?
==================

There are no technical white papers explaining the technical decisions
nor any form of [community developing this cryptocurrency](https://github.com/firstcoinofficial/firstcoin) except:

-   1 minute block targets
-   subsidy halves in 2.5M blocks (\~5 years)
-   110 million total coins
-   6 confirmations
-   1 Satoshi per block

Most important (and missing in this description): 109,999,999  coins are already mined.

Bad design or Fraud by design?
==============================

[FirstCoin](http://firstcoinproject.com/) has a supply of 110,000,000 coins. I suspected the mining algorithm is similar to Bitcoin, where the number of coins generated per block is set to decrease with a [50% reduction every 210,000 blocks](https://en.bitcoin.it/wiki/Controlled_supply) (Starting with 50 Bitcoin for the Genesis block). 
Bitcoin has chosen this decreasing-supply algorithm because it approximates the rate at which commodities like gold are mined.

But things are different in the world of Firstcoin: The reward is **fixed** to 1 Satoshi (0.00000001 [FirstCoin](http://firstcoinproject.com/)) for every single block to be mined!

If you wonder how the supply of 110M coins can be reached: There is a special case for block 2 coded in the [GetBlockValue](https://github.com/firstconn/firstcoin/blob/9d5f136ccf7e4f7a4c4d62f7af6873d067bd4e88/src/main.cpp#L1092) function:

``` {.c}
int64 static GetBlockValue(int nHeight, int64 nFees)
{
    int64 nSubsidy = 1;

    if(nHeight == 2)
    {
        nSubsidy = 109999999 * COIN;
    }

    if (nHeight > COIN + 1)
    {
        nSubsidy = 0;
    }

    return nSubsidy + nFees;
}
```

So there is only **1** Coin left to mine and the inventor of Firstcoin [sent the 109,999,999 to
himself.](http://explorer.firstcoinproject.com/block/34853dd4108804f3df772ce24fd99ea974af09847708384adfbcbe30e56728c4)

This is obviously not the way a healthy cryptocurrency should be designed. There is no incentive to mine because there is actually **no reward**. This is also reflected in the current mining difficulty: [0.0042](http://explorer.firstcoinproject.com/).

There is no mining software available for download (nobody would use it anyway) and I suspect only the inventor keeps mining blocks to keep the network alive.

So taking over the mining (to prevent transactions to happen or reverting history) should be easy.

FirstCoin.Club: Ponzi at work
=============================

Funnily you can invest in Cloud-Mining and other fake packages to get monthly rewards (between 3% and 7.5% of the invested coins) in the so-called [FirstCoin.Club](https://firstcoin.club/).

The reason Firstcoin increases in value is the fact, that still people get fooled by the Firstcoin marketing to buy Firstcoins at the [LiveCoin exchange](https://www.livecoin.net/) to "invest" in [FirstCoin.Club](https://firstcoin.club/).

Most likely the promoter/inventor of Firstcoin will vanish once investment slows down and the scheme collapses. He will have made enough profits selling some of his remaining 109,900,000 Firstcoins!