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Offline futurist

Insights and Questions
« on: January 20, 2015, 06:27:12 PM »

Hi there, I'm new here.

Just wanted to share some insights and get some feedback. I get that all of these decentralized, encryption systems (Bitcoin/Bitshares, etc) are still in their infancy, and it is really exciting to be among you, learning from you, and watching these ideas unfold. It's just like the early days of the Internet. Personally, I look to these inventions as another means to counter the increasingly invasive groups and powers that seek to limit our liberty and privacy. These powers seek to control us by monopolizing money, controlling our data, spying on our transactions, our emails, etc. Eventually, I hope encryption and decentralization becomes the norm (or at least the trusted alternative) where we can all freely exchange anything and everything without fear. I also hope that we can become prosperous by doing so, without depending on centralized powers and their systems of manipulation. It would be truly amazing if we could look back and say with pride that we adopted these solutions early and reaped the rewards. 

The biggest hurdle I see to Bitshares/Bitcoin et al (and the real challenge for all developers) is in simplifying everything. I was talking with a friend the other day about these things, and quickly realized that nothing I said was sinking in. There must be some way of making the front-end and back-end integrated to a point where things are intuitive for the average user. Where something like an App Store, registers immediately with the general public. I think that Apple, for example, is arguably the best company right now at creating tools that people can embrace quickly, understanding it without much explanation. Most people aren't familiar with back-end languages and coding. But they do understand value when they use something as simple and intuitive as an iPod, for example. Or if they download something to their phone that they can use to better their lives, provide entertainment, etc. Once a team can essentially create the equivalent in the crypto world, (maybe Bitshares can accomplish this) then it will really take off. And those who make these tools the most easily configured and market them successfully, will gain the quickest adoption and implementation. "Napster" was cool and had a good following at first too, but the idea of music sharing didn't really get off the ground (with widespread understanding and use) until iTunes and the major studios accepted it. Until your average Joe could download the software, navigate it with ease, and see the value and come back again and again. 

I really like how Bitshares is evolving in this area. The approach to the wallet interface is great, and I expect will get better with time. I remember watching an interview on YouTube with Brian Page, and he communicated the ideas very well. He was excellent. A lot of things he mentioned were based on things I believe in, and expressed simply. We need a lot more of that. So because I'm still learning, maybe some of you can point me to some good resources or threads to clear up a few things for me.

One of the great benefits to Bitshares, in my view, is the profit or value motive, where it's “shareholders,” are rewarded for “investing” in it. I understand the concept that the value of BTSX will increase over time as delegates “burn” the supply. Others have equated this process to a company buying its shares back. I like that analogy much better than the dividend comparison. Correct me if I’m wrong, but simply by holding BTSX, there aren’t regular payments paid to my balance, right? 

And it seems to me that BTSX is more of a baseline to launch other assets from, not so much an asset in itself, correct?  Isn't BTSX or "Ripple," for example, somewhat of a neutral medium, that must maintain a certain level of homeostasis for it to be trusted and exchanged with? Something highly volatile or speculative wouldn’t be trusted as a medium for others to exchange with. In a similar way, the USD right now, is the reserve currency around the globe. So does BTSX seek to be the "reserve" ______ of the Internet? Holding a large amount of BTSX may be helpful if it is a trusted reserve, and can be used for exchange for higher quantities of some other asset, but I don’t know if it is really a speculative play. Thoughts?

Another question is about liquidity. Today I can take some USD from a local bank, send it to something like an Etrade or Ameritrade account, then buy shares in a company for a fee per transaction (usually anywhere from $5-15). Moreover, if I sell the shares and reap any profit in my Ameritrade account, I can then send those gains to my local bank and use them. The process is what I am curious about. Does Bitshares intend to emulate this approach with BTSX fees per exchange or transfer? Or to build the value of a single BTSX in relation to other currencies? What is the ideal scenario or what is the role of BTSX in the long run?

On the monetary side, Bitshares seems to be another iteration of a FOREX service. In my view, this is why most people get involved with something like Bitcoin. They want to know how to make money, preserve, or transfer their money, in comparison with something like the USD. There are lots of FOREX services already. But they trade fiat money. Ripple seems to be taking this approach too. Say I want to exchange Bitshares for USD or exchange BitUSD for USD or CNY, for example, how is that accomplished now and what is the hope for this process later? Does one still acquire some Bitcoin before buying/exchanging them for BTSX? Can you purchase half a bitcoin? Or a tenth of a bitcoin? What is the lowest denomination of bitcoin that can be purchased with USD? 

It may be true that eventually fiat or paper money will cease to exist and we will all use digital alternatives. But what is more likely is there will be multiple, competing currencies with multiple ways of transacting. I’d be interested in your feedback on how this all works within the Bitshares model. Thanks!




« Last Edit: January 20, 2015, 06:33:50 PM by futurist »

Offline carpet ride

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Insights and Questions
« Reply #1 on: January 20, 2015, 07:15:00 PM »
I've had similar observations and have concluded at least one thing.  It's all about selling benefits.  Earn interest 5% in a savings account, trade stocks and currencies at .01 dollars per trade and in the same platform as your savings account, earn money as an internet marketer or cutting edge software developer. These things people let sink in and they often care less about how it works...

btw, Welcome to the community!


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« Last Edit: January 20, 2015, 07:39:38 PM by Carpet Ride »
All opinions are my own. Anything said on this forum does not constitute an intent to create a legal obligation between myself and anyone else.
Check out my blog: http://CertainAssets.com
Buy the ticket, take the ride.

Offline santaclause102

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Re: Insights and Questions
« Reply #2 on: January 20, 2015, 07:38:53 PM »
Quote
Correct me if I’m wrong, but simply by holding BTSX, there aren’t regular payments paid to my balance, right?
Paying BTS to EVERYONE'S balance is equivalent (in terms of the demand / supply ratio -> value of BTS) to burning BTS.

We changed the name from BitSharesX to BitShares and also changed BTSX to BTS :)

Quote
And it seems to me that BTSX is more of a baseline to launch other assets from, not so much an asset in itself, correct?
You can launch assets with the BitShares platform. BTS is the token of the BitShares platform, like btc are the tokens for the Bitcoin platform and XRP are the tokens for the Ripple platform.

Quote
Something highly volatile or speculative wouldn’t be trusted as a medium for others to exchange with. In a similar way, the USD right now, is the reserve currency around the globe. So does BTSX seek to be the "reserve" ______ of the Internet?
I recommend reading: http://bytemaster.bitshares.org/article/2015/01/01/How-to-create-a-stable-decentralized-crypto-currency/
BitAssets, like BitUSD, are stable in the sense that they have hold the value of their underlying.

Quote
The process is what I am curious about. Does Bitshares intend to emulate this approach with BTSX fees per exchange or transfer?
The BitShares platform has many functions. It is possible to emulate and exchange like the NYSE with it in principle.

Quote
But they trade fiat money. Ripple seems to be taking this approach too. Say I want to exchange Bitshares for USD or exchange BitUSD for USD or CNY, for example, how is that accomplished now and what is the hope for this process later?
http://bytemaster.bitshares.org/update/2014/12/18/Benefits-of-Being-a-BitShares-Gateway/
http://bytemaster.bitshares.org/article/2015/01/05/The-Future-of-Crypto-Currency-Exchanges/

The most crucial thing to understand is that BitShares, like Bitcoin, is at it's core a decentralized ledger to record all kinds of things: Account balances (money use case), possession of domains (DNS use case), possession of bought lottery tickets (lottery on a blockchain use case, check out BitShares Play), IOUs (user issued assets from whoever (https://www.youtube.com/watch?v=yzruOULgmng) -> Bitcoin's money use case was just the first application and thinking of BitShares/Bitcoin in terms of money doesn't make too much sense if you want to understand how it works. Money sure is one application but understanding it based on this analogy doesn't get you very far. 

Offline mf-tzo

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Re: Insights and Questions
« Reply #3 on: January 20, 2015, 08:21:54 PM »
Hello and welcome!

I am not the best in explaining things but I will try my best to address a couple of your questions.

All cryptocurrencies including bitcoin are far from mass adoption. I think that we are still in very early stages. A lot of VC investments happened the last year and soon (within the next couple of years) I expect cryptocurrencies to be much easier and friendly used and there will be a stage that will reach mass adoption. Most people believe that the cryptocurrency to rule them all will be bitcoin. Myself and many others in here believe it will be bitshares (and I will explain the potential) or something else not yet discovered..

Now bitshares is so many things and will become much more things. It is a bank, a forex platform with market pegged assets bitusd,bitgold,bitcny, bitbtc, bitoil etc and also UIA (user issue assets, anyone can issue whatever asset he might think of, convince people of its value and sell it).

There are some very big differences with bitcoin and other altcoins out there. Bitcoin are produced by mining and miners verify transactions (proof o fwork POW) other coins are based on proof of stake (POS) where there is no mining involved. Many coins out there are scam coins. Other coins may have good intentions but are getting hammered by the bitcoin elite etc etc...There are a lot to learn out there... Bitshares uses DPOS (delegate proof of stake) which is by far more advanced by POS and by faaaaarrrrr more advanced than POW (bitcoin). Bitcoin is dropping in price right now because mining is just not profitable anymore. There are a lot of flaws and problems with POW coins. POW just doesn't make any sense to me. The economics of POW and simple POS coins will not be able to compete with the economics of DPOS systems.

Now all these cryptocurrencies, although very useful since people can transfer instantly value between them across the internet etc etc have a very big problem. Due to lack of mass adoption and small liquidity they are extremely volatile. BTS has solved this problem by trading bitassets and other market pegged assets. BTS allows people now to trade bitusd that will always track the value of usd with small differences from time to time.

The economics behind BTS are very strong and the peg will hold. In short, bitusd can only come into existance by short selling the bitusd by adding x2 its value in BTS collateral. Anyone that believes that BTS will increase in value vs. bitusd will want to short sell the bitusd and profit from the increased value of his BTS. Anyone who believes that BTS price will fall compared to bitusd wants security and will buy bitusd. When someone short sells the bitusd, essentially borrows bitusd from the system and sells them, someone else is accepting this bet and the bitusd is created. For the first time since 2009 people can invest in  stable cryptocurrencies. The bitusd, bitcny,bitgold etc..

Now. By holding bitassets (bitusd, biteur,bitgold etc) you can earn interest on your deposit (yield). So if you want to invest in bitcoin, you could get some bitbtc and earn some interest in bitbtc as well Holding BTS will not get you any interest. It all comes to the end of what type of investor you are. If you really believe in BTS and want to profit from a potential huge upside in BTS price you want to keep BTS no matter what happens and no matter how much the price might fall because when / if the price rises the upside potential can be huge. If bitusd is massively adopted and accepted by merchants as a stable cryptocurrency payment, if forex traders inject money in the BTS ecosystem etc etc you can imagine that if for example the market cap of bitusd is millions or billions then BTS market cap should be in billions or trillions. Currently forex trading is worthing trillions $$ and BTS market cap is c.$30 million where bitcoin's market cap is c$3 billion. There is huge potential for BTS once people realize its potential. BTS is also a secured DECENTRALIZED bank. One can save his usd or eur in BTS earn some interest and never be afraid of a bank seizing his deposits (Cyprus and soon Greece and others to follow..). To me the biggest profit with bitshares is not because the supply is reduced by burning bitshares. The biggest value is the decentralised bank and forex platform that it provides, the DNS (Domain system) and Voting system that will provide and many other things that will happen in the future like Insurances, Loans etc etc..

Finally in terms of your other questions. Bitcoin can be denominated in 8 decimal points so the smaller unit of 1 bitcoin is 0.00000001. Ripple is very nice but  the one big problem that ripple has is that it is very centralised (few people own more than 80% of XRPS) so holding XRPs for profit can be extremely volatile and dangerous investment.

The process to obtain easily bitshares is:

1. Get verified in an exchange. The best ones trading Bitshares are bter and btc38. Buy some bitcoins and exchange them for BTS (bitshares)
2. Send your BTS to your BTS wallet and either save them for the future or start trading buy buying bitassets.

If you can not get verified and transfer fiat currencies to the above exchanges you could do so via bitstamp, btc-e, kraken, bitfinex, coinbase. Again depending where you live.

If you haven't done already download the latest BTS wallet from:

https://bitsharestalk.org/index.php?topic=7067.0

The faucet to get you some BTS and register is

http://faucet.bitshares.org/?r=mf-tzo

Bytemaster who is the mastermind of BTS has a very nice blog explaining a lot of things. You definitely want to have a look there:

http://bytemaster.bitshares.org/?r=mf-tzo

Other interesting sites you may want to check is:

http://bitshares.tv/bitshares-101a?r=mf-tzo

http://bitshares.tv/bitusd-mobile-wallet?r=mf-tzo

Now no matter how many explanations give you, eventually you will need to try it yourself to understand how Bitcoin, Bitshares etc all work.

I hope I have answered some of your questions and helped. Anything else give us a shout.





Offline yankey

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Re: Insights and Questions
« Reply #4 on: January 21, 2015, 10:15:52 AM »
Hello. I have been watching BTS for ages with great fascination. Jumping in at last to add my voice -

Mass adoption? What about the appearance of a BITKES in a SIMPLE ANDROID MOBILE APP for Kenya Shillings only? The app must have ABSOLUTELY NONE of the fancy other BTS tech at all because it will only confuse everyone.

This will be a WAY superior form of Kenya shilling that comes complete with a higher interest (>10% in Kenya) (and of course all the blockchain wow for remittance). This will totally obliterate the broken and clunky old proprietary form filling gov plundering Mpesa system.

Africa is way behind the curve and they are just hearing about BTC now - but with BTS there is no need for even the concept of "a new currency" (all users will see is Kenya Shilling numbers moving around) :

RE: MPesa:
http://pesaafrica.com/2015/01/16/whats-right-and-not-quite-right-about-this-article-arguing-that-m-pesa-and-bitcoin-are-mirror-images-of-each-other/comment-page-1/#comment-93

Look to the Third world guys!

Offline futurist

Re: Insights and Questions
« Reply #5 on: January 21, 2015, 10:29:48 PM »
Thank you for all the detailed replies. I will be reviewing the resources you provided and letting it all marinate. I'm sure I'll have questions. Thanks again.  :)

 

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