Simulation of Mixmining Reward Parameters for the Nym Mixnet

We focus on analyzing the use of tokenized cryptoeconomics to provision anonymity to determine if it is economically sustainable from a long-term perspective. This paper explores early design decisions of how the blockchain-enabled Nym network uses a tokenized incentive scheme to create a decentralized mix network. The initial inflationary pool of tokens is given by a mixmining pool. We present a simulated economic model that, under certain assumptions, determines under what conditions the token-based inflation can be economically sustainable for the mix network. We show an exponential rate of inflation is suitable. In conclusion, we note the next steps for research at the intersection of privacy and cryptoeconomics.