  We describe a distributed coin minting protocol that mints one coin per time
unit for each member in a digital community. The protocol assumes that
community members use a trust-graph to determine the genuineness of digital
identities, and that doing so bounds the number of sybils (fake or duplicate
identities) in the community, but does not completely eliminate them. The main
goal of the protocol is to be resilient to the sybils that penetrate the
community, in the sense that, in the long run, only genuine identities mint
coins. The protocol accepts that sybils penetrate the community from time to
time (by gaining enough trust within the trust-graph), yet assumes that every
sybil is eventually exposed. Since coins minted by a sybil will most probably
circulate by the time it is exposed, the protocol puts the responsibility for
introducing a sybil onto its trusting neighbours and confiscates subsequent
coins minted by them, until the coins minted by that sybil are accounted for.
In particular, the protocol confiscates two coins for each coin minted by the
sybil: one to recover what was wrongly minted and one as a fine for introducing
the sybil in the first place. We argue that this approach constitutes a
mechanism to deter the introduction of sybils into the community and to
incentivize sybil hunting (using part of the confiscated money as a reward).
