Author Topic: Instead of dilution/inflation, increase transaction fees  (Read 5557 times)

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Offline jsidhu

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

I think you can do it with a properly planned hard cap.  But capital infusion in business is not like QE.

Say you have a farm full of fertile land and a water system but no extra money.
Wouldn't it be worth it to get some new capital to buy and plant a million seeds than just sit there with empty fertile land?

Why not increase the burn rate and transaction fees?

The goal is to attract & incentivise customers not scare them away with higher transaction fees & unfortunately burn is negligible regardless.

BTSX's current income can only buy a few seeds a day but the time for planting seeds is right now.
BTSX with capital infusion can buy a million seeds and plant them right now. Then at the end of the season it will have a flourishing crop, the profit from which can pay off the amount borrowed for seeds, buy new ones and turn a handsome profit, whereas the other farm will be pretty sad.

"As you sow so shall you reap."

That's the theory, of course the marketing is hush hush, so we don't know if they will actually be overpaying for 'magic seeds' like in Jack & the Beanstalk :)

(I would have preferred a hard CAP that set aside 20% of shares for development and marketing, but for BitShares dilution is the best option, especially as it allows a SuperDAC which gets all of BM's attention.)

Transaction fees are actually very low and can rise. It's not like any other technology can do market pegged assets.

We've been hearing about marketing plans for months and months. With no evidence of any marketing plan how can you as the board of directors go to shareholders without showing at least some details of that plan?

And also you need ways to track progress. It's not enough to just hire a marketing them and let them work their magic. We need to know the important metrics and track them.

Actually the technology can already be forked.

If BTSX doesn't add dilution, the Vote DAC will fork BitUSD and offer it using the same marketing campaign planned for BTSX. Except the Vote DAC has dilution so would be able to offer greater incentives. It would also receive more of BM's attention, which to me is the secret sauce and is priceless :)

I'm confident for BitShares dilution is the best solution & I support the proposal for one BitShares DAC that maximises network effect and developer focus rather than competing amongst ourselves for customers and developer attention.

However as I've also said I would hedge a little if I saw a credible hard capped competitor on the market for reasons I've discussed in detail elsewhere.

I'm ok with it aslong as a seperate asset is created for PTS/AGS integration.. not to put it into BTS. We then solve the PTS DPOS issue and kill 2 birds with 1 stone.
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Offline Empirical1.1

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

I think you can do it with a properly planned hard cap.  But capital infusion in business is not like QE.

Say you have a farm full of fertile land and a water system but no extra money.
Wouldn't it be worth it to get some new capital to buy and plant a million seeds than just sit there with empty fertile land?

Why not increase the burn rate and transaction fees?

The goal is to attract & incentivise customers not scare them away with higher transaction fees & unfortunately burn is negligible regardless.

BTSX's current income can only buy a few seeds a day but the time for planting seeds is right now.
BTSX with capital infusion can buy a million seeds and plant them right now. Then at the end of the season it will have a flourishing crop, the profit from which can pay off the amount borrowed for seeds, buy new ones and turn a handsome profit, whereas the other farm will be pretty sad.

"As you sow so shall you reap."

That's the theory, of course the marketing is hush hush, so we don't know if they will actually be overpaying for 'magic seeds' like in Jack & the Beanstalk :)

(I would have preferred a hard CAP that set aside 20% of shares for development and marketing, but for BitShares dilution is the best option, especially as it allows a SuperDAC which gets all of BM's attention.)

Transaction fees are actually very low and can rise. It's not like any other technology can do market pegged assets.

We've been hearing about marketing plans for months and months. With no evidence of any marketing plan how can you as the board of directors go to shareholders without showing at least some details of that plan?

And also you need ways to track progress. It's not enough to just hire a marketing them and let them work their magic. We need to know the important metrics and track them.

Actually the technology can already be forked.

If BTSX doesn't add dilution, the Vote DAC will fork BitUSD and offer it using the same marketing campaign planned for BTSX. Except the Vote DAC has dilution so would be able to offer greater incentives. It would also receive more of BM's attention, which to me is the secret sauce and is priceless :)

I'm confident for BitShares dilution is the best solution & I support the proposal for one BitShares DAC that maximises network effect and developer focus rather than competing amongst ourselves for customers and developer attention.

However as I've also said I would hedge a little if I saw a credible hard capped competitor on the market for reasons I've discussed in detail elsewhere.

Offline roadscape

We've been hearing about marketing plans for months and months. With no evidence of any marketing plan how can you as the board of directors go to shareholders without showing at least some details of that plan?

This is all part of the marketing plan. BM stated that Brian has been waiting on him to go through with this.
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Offline luckybit

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

I think you can do it with a properly planned hard cap.  But capital infusion in business is not like QE.

Say you have a farm full of fertile land and a water system but no extra money.
Wouldn't it be worth it to get some new capital to buy and plant a million seeds than just sit there with empty fertile land?

Why not increase the burn rate and transaction fees?

The goal is to attract & incentivise customers not scare them away with higher transaction fees & unfortunately burn is negligible regardless.

BTSX's current income can only buy a few seeds a day but the time for planting seeds is right now.
BTSX with capital infusion can buy a million seeds and plant them right now. Then at the end of the season it will have a flourishing crop, the profit from which can pay off the amount borrowed for seeds, buy new ones and turn a handsome profit, whereas the other farm will be pretty sad.

"As you sow so shall you reap."

That's the theory, of course the marketing is hush hush, so we don't know if they will actually be overpaying for 'magic seeds' like in Jack & the Beanstalk :)

(I would have preferred a hard CAP that set aside 20% of shares for development and marketing, but for BitShares dilution is the best option, especially as it allows a SuperDAC which gets all of BM's attention.)

Transaction fees are actually very low and can rise. It's not like any other technology can do market pegged assets.

We've been hearing about marketing plans for months and months. With no evidence of any marketing plan how can you as the board of directors go to shareholders without showing at least some details of that plan?

And also you need ways to track progress. It's not enough to just hire a marketing them and let them work their magic. We need to know the important metrics and track them.
« Last Edit: October 20, 2014, 08:59:53 pm by luckybit »
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Offline Empirical1.1

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

I think you can do it with a properly planned hard cap.  But capital infusion in business is not like QE.

Say you have a farm full of fertile land and a water system but no extra money.
Wouldn't it be worth it to get some new capital to buy and plant a million seeds than just sit there with empty fertile land?

Why not increase the burn rate and transaction fees?

The goal is to attract & incentivise customers not scare them away with higher transaction fees & unfortunately burn is negligible regardless.

BTSX's current income can only buy a few seeds a day but the time for planting seeds is right now.
BTSX with capital infusion can buy a million seeds and plant them right now. Then at the end of the season it will have a flourishing crop, the profit from which can pay off the amount borrowed for seeds, buy new ones and turn a handsome profit, whereas the other farm will be pretty sad.

"As you sow so shall you reap."

That's the theory, of course the marketing is hush hush, so we don't know if they will actually be overpaying for 'magic seeds' like in Jack & the Beanstalk :)

(I would have preferred a hard cap on total shares that set aside 20% of shares for development and marketing, but for BitShares dilution is the best option, especially as it allows a SuperDAC which gets all of BM's attention.)



« Last Edit: October 20, 2014, 08:58:03 pm by Empirical1.1 »

Offline roadscape

Yes and the current proposal is for extra pay from dilution to go to delegates. No one said anything about dacsunlimited.

It is? How on earth will that fund further development?

The proposal is to use dilution to merge BTSX+VOTE+PTS+AGS
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Offline luckybit

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

I think you can do it with a properly planned hard cap.  But capital infusion in business is not like QE.

Say you have a farm full of fertile land and a water system but no extra money.
Wouldn't it be worth it to get some new capital to buy and plant a million seeds than just sit there with empty fertile land?

Why not increase the burn rate and transaction fees?
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Offline monsterer

Yes and the current proposal is for extra pay from dilution to go to delegates. No one said anything about dacsunlimited.

It is? How on earth will that fund further development?
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Offline luckybit

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I wrote about before, but it was buried deep in another thread:

So we need more revenue to fund promotion of BTSX. Before we resort to inflation/dilution, how about we try increasing transaction fees? Being able to buy 10000 BitUSD for just a fee 0.1 BTSX seems like I should have been charged more. I would have been happy to pay $2-5 for that trade.

Keep the current cheap 0.1 fee for creating an order, and just charge the larger fee when a order is matched. We could even do what the centralized exchanges do and give market makers a discount.

I think shareholders/delegates should have a vote on changing the transaction fee structure so that in these early days the system could charge more.

This is a much better way of funding development than inflation.

I agree with you but it appears that the community is split and a lot of people want inflation. I don't want inflation any time soon but they do and in my opinion something like this should be put up for shareholder vote.

They have a plan for BitAsset network effect that basically requires dilution, money raised from others sources would not be enough short term.

Every new person that holds a BitAsset essentially increases the BTSX CAP by 2-3X that amount. So the more people you can get to buy BitAssets the better for BTSX shareholders and the fastest way to do that is to offer additional BitAsset incentives funded via dilution.

The second part of network effect is to merge BitShares into one main SuperDAC so that there is one simple to buy into BitShares that maximises network effect and gets all of the attention of key people like Bytemaster.

I think it is very exciting. I will support it. Despite having a lot of AGS, I think that as BTSX is by far the biggest CAP, that it must be protected the most and any mergers should err on the side of being more favourable to BTSX.

If someone else came up with a decentralised constitution enshrined hard capped BitAsset competitor I would hedge a little there, though that option would not be competitive as a BitShares DAC.

You can all it BitAsset network effect if you want but I see it like this. Bytemaster is asking that we all give him and his team a loan by temporarily transferring some of our buying power to him in the form of newly created shares.

This makes sense when we know the loaned buying power will come back to us in a boomerang like effect. This makes sense when for example the entire economy is growing like it was when Bitcoin price was going up and new users were being introduced to the community at a fast rate.

But look at how things are today where you have an ecosystem with an economy in a downward tailspin and think of yourself as the owner of the bank. Are you going to loan money when the economy is contracting?

I think this should be voted on and should only be approved if there is a super majority. This means 75% of the vote, not 51%. If Bytemaster can convince 75% of us to do it then it should be done and I think it's far easier to convince 75% of us to do it at a later date when the market cap is increasing.

When we are optimistic and seeing economic growth we are much more likely to invest. When we are seeing the economy contract the last thing we want to hear is that there is a proposal to dilute our shares. Bad timing is why the market reacted like it did and the fact that it was presented like it was already decided. If the voting capability is set up first and we can vote on it like how shareholders are supposed to then I have no problem with it if the board of directors and chairman Bytemaster vote in favor of it.

I wouldn't vote in favor of it right now though. I think it is a bad time to dilute shares prior to the holiday season and during a time of very low market confidence. I also think there isn't a lot known about Bitshares VOTE to make me think it's the best thing since sliced bread and while it very well could be the proper step is to present the idea before talking about how to pay for it.

I encourage we use the metaphor that dilution is a loan from the shareholders to whomever receives our buying power. There should be reputation attached to this process so that whomever receives the buying power can be held to some sort of measured standard.

the nice thing about having "delution delegates" .. is that everyone can start funding a business (to grow the bitshares business) on the bitshares blockchain .. not just I3

Let me make it clear that I'm not against dilution entirely. I think in certain circumstances it can be the best option. It is a transfer of buying power and it is a loan.

I think if we are going to discuss it we should discuss it in a way so that the shareholders understand the risks involved. Shareholders expect to get their buying power back and then some which means there are expectations with this that would not exist in other cases. How can shareholders make sure that their expectations are met and that the buying power actually increases?

It's possible that you could give the development team more money but the result could be a further decrease in buying power. This is why I would suggest that these decisions wait until we are at an all time high in market cap, where growth is faster than whatever impact the dilution could have.
« Last Edit: October 20, 2014, 07:46:54 pm by luckybit »
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Offline jsidhu

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the nice thing about having "delution delegates" .. is that everyone can start funding a business (to grow the bitshares business) on the bitshares blockchain .. not just I3

Actually, it makes me think about possibilities and I wanted to take advantage of that by creating the auction business(hopefully integrated with a turing complete script mechanism).. it seems like it could kickstart a new wave fundraising, through voting. It puts more emphasis on making sure voting is secure, in that the unscrupulous user(s) shouldn't be able to tell their friends to vote for them in order to get majority somehow to get scammed shares. I'd like to see some sort of model to show the voting scam incentive as a function of price.. because as it rises, tx fees may justify someone to try to scam the system through voting at some point, or does it? It would be cool to clarify this, as other members of bitcoin have had similar questions.
« Last Edit: October 20, 2014, 07:41:20 pm by jsidhu »
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Offline xeroc

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the nice thing about having "delution delegates" .. is that everyone can start funding a business (to grow the bitshares business) on the bitshares blockchain .. not just I3

Offline Method-X

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

I think you can do it with a properly planned hard cap.  But capital infusion in business is not like QE.

Say you have a farm full of fertile land and a water system but no extra money.
Wouldn't it be worth it to get some new capital to buy and plant a million seeds than just sit there with empty fertile land?

Absolutely. The key is in the metaphor. BTSX is not trying to be gold 2.0, it's trying to be shares 2.0. Centralized companies issue shares to facilitate growth all the time; if a DAC lacks that ability, it can never hope to compete against centralized companies.

Offline Rune

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

Capital infusion to kickstart growth. Once a network effect has been achieved real growth and real profits will take over. Why do start ups take century capital? It means they have to dilute their share, but it is obviously profitable.

Offline Empirical1.1

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?

I think you can do it with a properly planned hard cap.  But capital infusion in business is not like QE.

Say you have a farm full of fertile land and a water system but no extra money.
Wouldn't it be worth it to get some new capital to buy and plant a million seeds than just sit there with empty fertile land?

Offline Pheonike

Also bitusd expands and contracts as needed. Bitshares needs that ability too.

Offline Pheonike

You must remember Bitshares is a DAC(company). One of are products bitusd is the currency.  If you keep those separate then its clearer to see.

Offline jsidhu

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Seems to be capital infusion to generate real growth... therefore capital infusion becomes the only way to grow... how is it different than fed pumping QE to try to drive growth/confidence?
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Offline Rune

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The ability to issue bitshares as a means of capital infusion will be an insane competitive advantage versus all our competitors. While they rely on altruistic programmers to donate their time, we simply pay for the best developers in the industry. While they have fund raisers for dogecar and other random things, we hire real marketing professionals with a proven track record to explode our mindshare and get our brand out there. We have to pay for these things, yes, but they will provide much higher value at a much faster rate than simply begging or praying for generous specialists to donate their time and skills to us.

Offline joele

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Additional burden to users, majority will not like it.
Why not just tax the Delegates?

Offline Empirical1.1

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This will tax users of the system and will reward hoarders and speculators.

It will only tax users who are going from BitUSD -> BTSX, and they are speculators which is no problem at all.

Other users who are doing BitUSD-only transfers for buying goods would not be affected.

Regardless, I think you want to encourage not discourage BitAsset use by anyone in the early stages.

I have debated dilution variables for a month & have sympathy for and funds to invest in no-dilution option too. However imo at this stage it's a given BTSX will have dilution. Within the context of BitShares it is a positive as you get a SuperDAC and 100% of BM & others.

I think the discussion needs to move on to what is the best way to rapidly merge into a main BitShares DAC and move forward. My personal feeling is to get dilution into BTSX first, make it BTS and go from there. BTS shareholders can then make their best offer to the various DACs and pieces of the current BitShares ecosystem.

Offline matt608

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They system should be as lean as possible in order to incentive people to trade assets. It's more important to have more ppl trading for less fees than less ppl trading for more fees.

 +5%

Offline Pheonike

They system should be as lean as possible in order to incentive people to trade assets. It's more important to have more ppl trading for less fees than less ppl trading for more fees.

Offline speedy

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This will tax users of the system and will reward hoarders and speculators.

It will only tax users who are going from BitUSD -> BTSX, and they are speculators which is no problem at all.

Other users who are doing BitUSD-only transfers for buying goods would not be affected.

Offline emski

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This will tax users of the system and will reward hoarders and speculators.

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So we need more revenue to fund promotion of BTSX. Before we resort to inflation/dilution, how about we try increasing transaction fees?

Delegates receive transaction fees, not dacunlimited.

Yes and the current proposal is for extra pay from dilution to go to delegates. No one said anything about dacsunlimited.

Offline monsterer

So we need more revenue to fund promotion of BTSX. Before we resort to inflation/dilution, how about we try increasing transaction fees?

Delegates receive transaction fees, not dacunlimited.
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Offline Empirical1.1

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I wrote about before, but it was buried deep in another thread:

So we need more revenue to fund promotion of BTSX. Before we resort to inflation/dilution, how about we try increasing transaction fees? Being able to buy 10000 BitUSD for just a fee 0.1 BTSX seems like I should have been charged more. I would have been happy to pay $2-5 for that trade.

Keep the current cheap 0.1 fee for creating an order, and just charge the larger fee when a order is matched. We could even do what the centralized exchanges do and give market makers a discount.

I think shareholders/delegates should have a vote on changing the transaction fee structure so that in these early days the system could charge more.

This is a much better way of funding development than inflation.

I agree with you but it appears that the community is split and a lot of people want inflation. I don't want inflation any time soon but they do and in my opinion something like this should be put up for shareholder vote.

They have a plan for BitAsset network effect that basically requires dilution, money raised from others sources would not be enough short term.

Every new person that holds a BitAsset essentially increases the BTSX CAP by 2-3X that amount. So the more people you can get to buy BitAssets the better for BTSX shareholders and the fastest way to do that is to offer additional BitAsset incentives funded via dilution.

The second part of network effect is to merge BitShares into one main SuperDAC so that there is one simple to buy into BitShares that maximises network effect and gets all of the attention of key people like Bytemaster.

I think it is very exciting. I will support it. Despite having a lot of AGS, I think that as BTSX is by far the biggest CAP, that it must be protected the most and any mergers should err on the side of being more favourable to BTSX.

If someone else came up with a decentralised constitution enshrined hard capped BitAsset competitor I would hedge a little there, though that option would not be competitive as a BitShares DAC.


Offline luckybit

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I wrote about before, but it was buried deep in another thread:

So we need more revenue to fund promotion of BTSX. Before we resort to inflation/dilution, how about we try increasing transaction fees? Being able to buy 10000 BitUSD for just a fee 0.1 BTSX seems like I should have been charged more. I would have been happy to pay $2-5 for that trade.

Keep the current cheap 0.1 fee for creating an order, and just charge the larger fee when a order is matched. We could even do what the centralized exchanges do and give market makers a discount.

I think shareholders/delegates should have a vote on changing the transaction fee structure so that in these early days the system could charge more.

This is a much better way of funding development than inflation.

I agree with you but it appears that the community is split and a lot of people want inflation. I don't want inflation any time soon but they do and in my opinion something like this should be put up for shareholder vote.
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Offline speedy

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I wrote about before, but it was buried deep in another thread:

So we need more revenue to fund promotion of BTSX. Before we resort to inflation/dilution, how about we try increasing transaction fees? Being able to buy 10000 BitUSD for just a fee 0.1 BTSX seems like I should have been charged more. I would have been happy to pay $2-5 for that trade.

Keep the current cheap 0.1 fee for creating an order, and just charge the larger fee when a order is matched. We could even do what the centralized exchanges do and give market makers a discount.

I think shareholders/delegates should have a vote on changing the transaction fee structure so that in these early days the system could charge more.

This is a much better way of funding development than inflation.