Fath is a monetary system with proportional distribution of money issued. The amount of issuance is determined by the amount of additional value created in the monetary system - economic output of goods and services sold. The distribution of money issued happens proportionally based on the account balances. When the network’s value rises by 1%, 1% percent of the monetary base is issued. As a result, every bank account and wallet gets 1% of the currency on top of their holdings.
The idea behind Fath is to create a monetary system where emission is distributed proportionally, in contrast to how modern fiat credit-cycle financial systems and capital-based public blockchain networks operate.
Mitigating the long-term effects of devaluation by the proportional distribution of emission. Emission is delivered to every single member of the network directly from the protocol, regardless of whether a person is a validator or not. The amount of emission is defined by the Fath protocol algorithm, which calculates the difference between value created (VC) in two different time periods.
Fath is a reactive monetary algorithm. Total supply of HMND alters reacting to the relative change in nominal value created.
Data-driven monetary algorithm takes time to react to the data from a new period. From the genesis, for HMND, a period will be equal to a year.