A thought experiment for DAC Angels
I once misquoted the actor Charlton Heston by saying, “You can have my ProtoShares when you pry them from my cold, dead hands!”
Then, in our latest Newsletter I implied that, as a DAC Angel Investor in Good Standing (DAIGS), I might willingly contribute some of my precious PTS to help kickstart a promising new DAC.
Well, which is it?
If, as a Developer, I’m going to propose a new DAC myself, I’d better construct a deal for investors that, as a DAC Angel, I myself would gladly accept. What kind of deal would that be?
Well, setting aside philanthropic impulses, one that makes a lot of money for me, I suppose.
What would make money for me? Let’s do a Einstein “thought experiment”:
Suppose at some point I have one ProtoShare worth 0.1 BTC.
Suppose that some sexy new DAC comes along whose shares I think may quickly grow from 0.001 BTC to 0.01 BTC, just like PTS did in its first two weeks.Option 1
- Assuming this is a PTS DAC (one that honors the PTS Social Contract) if I just hold my PTS, I will automagically wind up with 1 ProtoShare @ 0.1 BTC and 1 DACshare @ 0.01 BTC. This gives me a total net worth of 0.11 BTC for sitting on the sidelines - I gained 0.01 BTC!Option 2
- Suppose instead I trade my 1 ProtoShare @ 0.1 BTC for 100 DACshares @ 0.001 BTC. The DAC launches and climbs in value to 0.01 BTC in the first month. I then sell 10 of them to get my 1 PTS back. I now have 1 ProtoShare @ 0.1 BTC and 90 DACshares @ 0.01 BTC. This gives me a total net worth of 1.0 BTC - I gained 0.90 BTC, a 90x improvement over my 0.01 gains with Option 1. And I still have my PTS to do this again for every promising new PTS DAC that comes along. If I sold all my new DACshares, I’d raise enough BTC to buy 10 PTS - a 10x gain. Or I could let it ride, expecting the new DAC to grow faster than PTS for a while.
Naturally this all depends upon my due diligence, judgement, and skillfully applied luck in evaluating the potential of a DAC proposal before I invest.
With apologies to Charlton Heston, “take my PTS, …please!”