Waste Source Not Identified

In the case where the Waste Generator is not identified in the chain of custody, the percent distribution (p) of $CARROT rewards is dramatically altered to participants, serving as an incentive mechanism to extend the chain of custody tracking technology (MassIDs) to the “source” of waste creation. The value in $CARROT that would flow to the participants remains in the Carrot Treasury and is used to further invest in the ecosystem. The discount that is applied to contributor categories varies based on the Participant type as follows: Waste Generator, Bin Custodian (which usually is the same contributor as the Waste Generator), and the professional recyclers which include Hauler(s), Processor(s) and the Recycler.

Since the Waste Generator is not identified, 100% of p0 is not distributed to W0. Instead, this value remains at the Carrot Fndn’s Treasury.

S_M is the total $CARROT value of a MassID(M_0 from the Tr_(#1) TRC in this example)

S_M*0=0 \:$CARROT⇒\:P_0

The $CARROT is retained by the Carrot Fndn’s Treasury

If a Bin Custodian is also not identified then 100% of p1 is not distributed to P1.

S_M*0=0 \:$CARROT⇒\:P_1

The $CARROT is retained by the Carrot Fndn Treasury

However, if only a Bin Custodian is identified then P1 is a discounted distribution. This discount is the same for the other participants: Hauler(s), Processor(s) and the Recycler. The discounts to the distribution will be designed to maximize MassID adoption and tracking to the source, and the value that will be discounted is expected to range between 20%-40% to Bin Custodians (when not identified), Haulers, Processors and the Recycler.

if there was no origin identified and a 20% discount (d) to all participants

(S_M * P_0)(1-d)=x \:$CARROT⇒P_0

(S_M * P_1)(1-d)=x \:$CARROT⇒P_1

(S_M * P_5)(1-d)=x \:$CARROT⇒P_5

So, from the previous example, the total value of MassID $M_0$ was 100 $CARROT. Assuming the percentage of $CARROT given to the hauler is 20% $(P_2)$ with a discount penalty of 20% (because the waste-generator wasn’t documented) the discounted equation is the following:

(S_M*P_2)*(1-d)=x\: $CARROT⇒P_2

$(100*.20)*(1-.20)⇒Hauler$ For helping process MassID $M_0$ worth 100 $CARROT,

$(20)*(.80)⇒Hauler$ the Hauler would receive 20 $CARROT

16 $SORT⇒Hauler but now they only receive 16 $CARROT

16 $CARROT ⇒ Hauler but now they only receive 16 $CARROT

4 $CARROT⇒CARROT Treasury and the other 4 $CARROT goes to the CARROT Treasury

Figure 36: $CARROT distribution when waste Source (Generator) is unidentified

Let’s review this case again as it is critical to the understanding of the Carrot Fndn’s Incentive Mechanism and Tokenomics. When the waste Generator is not identified in the chain of custody, the percent distribution (p) of $CARROT rewards is dramatically altered to participants, serving as an incentive mechanism to extend the chain of custody tracking technology (MassIDs) all the way to the waste Generator and reward this critical entity with $CARROT in a manner that will improve sorting at the source, and therefore, overall recycling rates for the system. The value in $CARROT that would flow to the participants remains at the Carrot Fndn Treasury as a reduced payout, and is used to further invest in the ecosystem. The discount to the percent distribution can vary by waste type and location. Since the Waste Generator is not identified, 100% of p0 is not distributed to W0. If a Bin Custodian is also not identified then 100% of p1 will not be distributed to P1. If, however, a Bin Custodian is identified then p1 will suffer a discount to distribution to P1 as will the other participants: Hauler(s) discounted p2 to (P2), Processor(s) discounted p3 to (P3), and the Recycler discounted p4 to (P4). The discounts to the distribution will be designed to maximize MassID adoption and tracking to the source, and will likely range between 20%-40% to Bin Custodians, Haulers, Processors and the Recycler.

It is important to note that distribution percentages per role along with the discounts applied in the case where the Waste Generator is not identified (which will be the most common scenario at first), will be determined initially by the Carrot Foundation and eventually by the Carrot DAO community; not executives or centralized entities such as corporations, municipalities or state and federal governments. The DAO will use its Carrot Improvement Process (CIPs) to determine percent allocations to each participant category specified by waste vertical type and location in order to maximize recycling participation and performance. Even temporary adjustments could be made to achieve breakthrough results. For example, immediate change could occur from an increase in the distribution percentage to bin custodians if a location doesn’t have enough bins to collect recyclables. Entrepreneurs could supply recycling bins and receive payment for their efforts. In the same manner, $CARROT rewards could be raised for locations where composting services do not yet exist, to induce the startup of such services.