Author Topic: Sidechains should be a priority for bitshares.  (Read 17630 times)

0 Members and 1 Guest are viewing this topic.

Offline pc

  • Hero Member
  • *****
  • Posts: 1530
    • View Profile
    • Bitcoin - Perspektive oder Risiko?
  • BitShares: cyrano
Is there a detailed description of the blocknet protocol available somewhere? blocknet.co is just meaningless marketing mumbo-jumbo. Their github documentation tells how to integrate a bitcoin clone, but nothing about how things actually work.

Quote
What Coins Does the Decentralized Exchange Support?

The Blocknet was designed to maximise interoperability, and so most blockchain tokens may be integrated with no coding required.

The current integration requirements are:

* Support for OP_CHECKLOCKTIMEVERIFY
* A stock JSON RPC interface from Bitcoin Core

BitShares is so different from bitcoin-clones that these requirements don't even make sense.
Bitcoin - Perspektive oder Risiko? ISBN 978-3-8442-6568-2 http://bitcoin.quisquis.de

Offline moinyoin

I can't support this enough. This is the #1 weakest point now and with it bts would be unstoppable.

Blocknet has been doing it the most and has mentioned it would be great idea for blocknet powered gateway to bts. Convo linked here: https://bitsharestalk.org/index.php/topic,24741.0.html

BTC with segwit should make this possible! I think priorities are BTC to enable trustless BTC - bitFiat trading and also steem for future EOS compatibility

I actually bought some blocknet the other day, still don't fully understand how it works though.

We just need a bts dev chat with blocknet dev as blocknet guys do think it's worth trying and are right NOW in process of doing swaps to many different coins - why not also BTS and BTS assets that would make this all possible - https://twitter.com/The_Blocknet/status/890890575452491776

I don't know best way to reach bts devs or someone who wants to at least chat with them about it. Chat and see if together they can propose/work on it with someone from each platform.

Block should also have source available since it's traded on bittrex. For them block can still fund and validate trustless-gateway platform while bts handles the ultra fast trading.

they also just hired some UI devs and designers for their exchange - but they could do that work on top of BTS blockchain just as easily and provide kick ass UI as well now that ground work has been done for BTS - why reinvent that part of the wheel. Block can use what BTS has as they don't have the speed, and BTS could use what block has as they do not have the trustless gateways. Both can work together.
« Last Edit: August 06, 2017, 07:17:14 pm by moinyoin »

Offline yvv

  • Hero Member
  • *****
  • Posts: 1186
    • View Profile
Everybody is talking about cross chain transfers today and everybody suggest 100500 different solutions.  So, it looks like this feature is in high demand, but I guess the way it is implemented matters, because shitty implementation can have bad negative effect instead of doing good.

Offline JonnyB

  • Hero Member
  • *****
  • Posts: 636
    • View Profile
    • twitter.com/jonnybitcoin
I can't support this enough. This is the #1 weakest point now and with it bts would be unstoppable.

Blocknet has been doing it the most and has mentioned it would be great idea for blocknet powered gateway to bts. Convo linked here: https://bitsharestalk.org/index.php/topic,24741.0.html

BTC with segwit should make this possible! I think priorities are BTC to enable trustless BTC - bitFiat trading and also steem for future EOS compatibility

I actually bought some blocknet the other day, still don't fully understand how it works though.
I run the @bitshares twitter handle
twitter.com/bitshares

Offline moinyoin

I can't support this enough. This is the #1 weakest point now and with it bts would be unstoppable.

Blocknet has been doing it the most and has mentioned it would be great idea for blocknet powered gateway to bts. Convo linked here: https://bitsharestalk.org/index.php/topic,24741.0.html

BTC with segwit should make this possible! I think priorities are BTC to enable trustless BTC - bitFiat trading and also steem for future EOS compatibility

Offline R

  • Hero Member
  • *****
  • Posts: 1004
    • View Profile
We should work on a draft BSIP for the potential implementation of sidechains.

We do have the UIA Gateways though, there will probably be more popping up in the future (we should encourage existing exchanges to run their own BTS gateway).

http://www.truthcoin.info/blog/drivechain/
https://en.bitcoin.it/wiki/Atomic_cross-chain_trading

Would sidechains require witnesses to monitor external block explorers or run full clients? The later would be asking a lot of the witnesses.

Offline virtualgrowth

Good bump, surely an idea to think more about.  As a decentralized exchange it would make sense to try to have some of the more attractive creative assets since we have the ability to create forms of creative assets with bitshares functionality.
iWkjpAW7TLIHr0vO

Offline JonnyB

  • Hero Member
  • *****
  • Posts: 636
    • View Profile
    • twitter.com/jonnybitcoin
I run the @bitshares twitter handle
twitter.com/bitshares

Offline rgcrypto

  • Hero Member
  • *****
  • Posts: 557
    • View Profile
    • Cryptoctopus Blog
Bitshares' #1 priority should always be making its p2p asset trade platform better. just nailing that one value proposition would add billions in market cap if promoted even halfway decently.

 +5% +5% +5%

Feature creep is our enemy.

Solving the Decentralized Exchange is a HUGE value proposition. Once we are succesful we it, we can move to the next problem.

By the way...what problem does having a cryptocurrency backed by BTC solves?

Offline VoR0220

A) It is possible, to my knowledge, to build a sidechain on Bitshares. Really anything is possible if you can code it so.
B) We should not go onto a BTC sidechain, we should maintain our own. We have distinct features that make us better than BTC.
C) That said, they do have the network effect in terms of being the currency of the internet. With THAT said, BTS is working to be the new standard for decentralized autonomous companies. We seem to be in a competition with Ethereum on that round. MaidSAFE too.
D) There are many features that other coins can offer that we cannot. For example, extreme privacy features would severely hamper scalability in the BTS ecosystem. Ring signatures are not cheap, and zero knowledge proof relies on one node to keep the secret (though it's very very solid if that one node can be trusted).
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline cylonmaker2053

  • Hero Member
  • *****
  • Posts: 1004
  • Saving the world one block at a time
    • View Profile
  • BitShares: cylonmaker2053
Yes that's true.  But also think decentralized uber on a sidechain.  It would be application specific without the need for a scripting language

Possibilities are amazing for sure; i still think BTS is a p2p asset exchange and nailing that capability will make/break the project.

Offline topcandle

Yes that's true.  But also think decentralized uber on a sidechain.  It would be application specific without the need for a scripting language
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline cylonmaker2053

  • Hero Member
  • *****
  • Posts: 1004
  • Saving the world one block at a time
    • View Profile
  • BitShares: cylonmaker2053
Bitshares' #1 priority should always be making its p2p asset trade platform better. just nailing that one value proposition would add billions in market cap if promoted even halfway decently.

Offline topcandle

Bit shares sidechain would be huge if bts focused.  Then programmers can build their own side networkising bts and develop advanced features like truth coin style prediction marketed, scripting languages, open bazaars etc.  think this coupled with our referral and cheap dpos.  A developer could make all the fees in his sidechain paid to him so they can retain money for investment and growth
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline wallace

  • Sr. Member
  • ****
  • Posts: 215
    • View Profile
Ha! Nice pictures guys... :D

But think of this. What would you say about a banking system that only allows its products and loans to be backed by shares in itself? Why shouldn't that banking system be open to accepting any form of good collateral, as in modern finance? Who is on the horse then?

What I'm leading toward is open architecture, not promoting any specific coin or philosophy. Anyway, this conversation is a bit ahead of its time as its not really possible yet. So I'm comfortable taking the jibes for now!  ;)

I'm wondering if issue a pegged bitAsset with BTC backed, how to frozen the BTC in Bitshares system? Sidechains can do this? even if it would do, how to stand a 10min confirmation in a 1s confirmation system, what we're talking is about the pegged bitAsset, if you want a UIA, who cares it's BTC or LTC or whatever else? and I think our target should not be crypto world but real world.

I'm not good at technical and this is just my understanding.
give me money, I will do...

Offline vegolino

  • Sr. Member
  • ****
  • Posts: 450
  • Reality is Information
    • View Profile
Ha! Nice pictures guys... :D

But think of this. What would you say about a banking system that only allows its products and loans to be backed by shares in itself? Why shouldn't that banking system be open to accepting any form of good collateral, as in modern finance? Who is on the horse then?

What I'm leading toward is open architecture, not promoting any specific coin or philosophy. Anyway, this conversation is a bit ahead of its time as its not really possible yet. So I'm comfortable taking the jibes for now!  ;)
  +5%

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
Ha! Nice pictures guys... :D

But think of this. What would you say about a banking system that only allows its products and loans to be backed by shares in itself? Why shouldn't that banking system be open to accepting any form of good collateral, as in modern finance? Who is on the horse then?

What I'm leading toward is open architecture, not promoting any specific coin or philosophy. Anyway, this conversation is a bit ahead of its time as its not really possible yet. So I'm comfortable taking the jibes for now!  ;)

Offline speedy

  • Hero Member
  • *****
  • Posts: 1160
    • View Profile
  • BitShares: speedy
Someone else will make a bitcoin collateralised BitUSD if bitshares doesn't.
That will be the one people use.

So you are saying that everything this community has been trying to do since day 1 is pointless, because bitcoin is the one true chain and its useless to make any other cryptocurrency.  Everyone should do everything with bitcoin instead because it was first.

Its not pointless to make another cryptocurrency, only because the BTC core developers are too comfortable with being the incumbent. As soon as the core developers realise how tying up BTC collateral in BitAssets could be huge for Bitcoin, they will rush to implement BitAssets into the BTC protocol too (I would).

I personally hope they do, because Bitcoin is not going away - check out its growth in transactions: https://blockchain.info/charts/n-transactions?timespan=all&showDataPoints=false&daysAverageString=1&show_header=true&scale=0&address=
« Last Edit: June 11, 2015, 10:26:24 pm by speedy »

Offline Ander

  • Hero Member
  • *****
  • Posts: 3506
    • View Profile
  • BitShares: Ander
Do we really need something like this? is this analogy wrong?



LOL... perhaps if the car was a Tesla.  :)
LOL... perhaps if the car was a Tesla SpaceX Rocket.  :)
LOL... perhaps if the car was a Tesla SpaceX Rocket Delorean Time Machine.  :)
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline Method-X

  • Hero Member
  • *****
  • Posts: 1131
  • VIRAL
    • View Profile
    • Learn to code
  • BitShares: methodx
You can't make bitshares a side chain of bitcoin without accepting all the bad design decisions they made - POW, 10 minute block times etc...

Not true. It takes 10 minutes to get the BTC on the sidechain, at which point the coins have the same properties as the sidechains coins. In other words, BTC would have all the properties of BTS until you "withdraw" the BTC.

That's having BTC as a sidechain of BTS, which isn't possible, since BTS does not have side chains.

That's good news. I'll definitely have to look into how sidechains work when I've got more free time. So what you're saying is, nobody can just fork Graphene and use it as a sidechain because the sidechain would be insecure (no financial incentive to protect the network)?

Offline fuzzy

starspirit & arhag make my head spin.  My contribution to this can only be on a conceptual level.....bitcoin's network is tiny compared to the internet wherein lies the true potential.  Bitshares can gain network effect that dwarfs bitcoin's simply by innovating and getting the product right.  There's no need to add complexity to the objective by attempting to find a technical solution to patch in a less advanced network.  The lag we are seeing is because people are only just getting their heads around bitcoin, let alone bitshares, but they will.  The economics of the bitshares system is carfully built around BTS as collateral.  The trust built around what bitshares/BTS stands for can only be maintained via DPOS on the Bitshares network.  That is an important anchor to people.

I will love and respect Satoshi & Bitcoin forever, but they were only the beginning.
^this.
WhaleShares==DKP; BitShares is our Community! 
ShareBits and WhaleShares = Love :D

Offline JA

  • Hero Member
  • *****
  • Posts: 650
    • View Profile
Do we really need something like this? is this analogy wrong?



LOL... perhaps if the car was a Tesla.  :)
LOL... perhaps if the car was a Tesla SpaceX Rocket.  :)

Offline Ben Mason

  • Hero Member
  • *****
  • Posts: 1070
  • Integrity & Innovation, powered by Bitshares
    • View Profile
  • BitShares: benjojo
starspirit & arhag make my head spin.  My contribution to this can only be on a conceptual level.....bitcoin's network is tiny compared to the internet wherein lies the true potential.  Bitshares can gain network effect that dwarfs bitcoin's simply by innovating and getting the product right.  There's no need to add complexity to the objective by attempting to find a technical solution to patch in a less advanced network.  The lag we are seeing is because people are only just getting their heads around bitcoin, let alone bitshares, but they will.  The economics of the bitshares system is carfully built around BTS as collateral.  The trust built around what bitshares/BTS stands for can only be maintained via DPOS on the Bitshares network.  That is an important anchor to people.

I will love and respect Satoshi & Bitcoin forever, but they were only the beginning.   

Offline bytemaster

Do we really need something like this? is this analogy wrong?



LOL... perhaps if the car was a Tesla.  :)
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

chryspano

  • Guest
Do we really need something like this? is this analogy wrong?


Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
By the way starspirit, I don't see how the BitAssets backed by a mix of collateral types would be fungible unless a fixed mix ratio was specified as part of the BitAsset definition that all shorts of that privatized BitAsset had to satisfy. And in that case, I would imagine the only practical way to short new BitAssets with mixed backing collateral into existence would be through a self-short. The logic for margin calls would also get more complicated with mixed collateral.
Correct. With self-shorting and self-cancellation, shorts get to control the mix of collateral they want. I've been working on just such a structure. Collateral can then be completely independent of the markets in which the token trades. Also margin calls could be satisfied by applying each collateral token in sequence to covering the debt until it is satisfied, and then returning the residual collateral tokens to the short. This sequence could even be determined by the short.
Also, in case it wasn't clear in my answer, no, you don't require a fixed mix ratio. The shorts could change the mix of collateral as they please, as long as they met the minimum coverage conditions.

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
But I can imagine it might be possible to create UIAs on the bitShares block-chain that are backed by BTC, LTC, NXT, you-name it, as long as there are ways to minimise counter-party risk through appropriate operations like multi-sig, escrow or the like. To be honest I don't know if side-chains help with that or not, I'm naive in that area, though I've asked the question before.

Yes, UIA gateway assets (like GATEBTC) + the new privatized BitAssets should make this possible. The only question is if the trust can be decentralized out to many parties to keep the counterparty risk is low enough for people to use it for more than just a means of quickly getting value in an out of the system to/from assets without counterparty risk. On the BitShares side, the new multisig features provide a lot of flexibility for managing the UIA properly (e.g. not diluting its value). The limiting factor is on the Bitcoin side. It doesn't make sense to have more decentralization on the BitShares side than on the Bitcoin side when the UIA could become worthless if the reserve is stolen. Ignoring advances in ECDSA threshold signatures (and assuming Bitcoin does not adopt new cryptography like EdDSA or radically increase the limits on their scripts), we are currently limited to an M-of-15 multisig for the BTC reserve backing the gateway UIA. You want M to be large to reduce the risk of compromise but obviously not too large that it dramatically increases the risk that the reserve holders get locked out of access to the reserve because some of them become unresponsive or disappear. Not sure what would be the ideal value for M, but the main question is if a well selected group of 15 individuals/organizations can be trusted to not collude to steal a potentially huge reserve. If not, very few people would trust holding the BTC-backed UIA for long term or holding BitAssets that derive their value from such UIA.
This is why its good to have you participating here again arhag! You clearly know better than many of us what's feasible here or not. Though I do think that there is some level of trust where people will be comfortable, and it's not necessary to have a trust-less system. That's clearly evident in that people give trust on a daily basis, to their financial advisors, fund managers, brokers, exchanges etc etc. All I need is a solution that everyone would agree is very low risk, not no risk.

By the way starspirit, I don't see how the BitAssets backed by a mix of collateral types would be fungible unless a fixed mix ratio was specified as part of the BitAsset definition that all shorts of that privatized BitAsset had to satisfy. And in that case, I would imagine the only practical way to short new BitAssets with mixed backing collateral into existence would be through a self-short. The logic for margin calls would also get more complicated with mixed collateral.
Correct. With self-shorting and self-cancellation, shorts get to control the mix of collateral they want. I've been working on just such a structure. Collateral can then be completely independent of the markets in which the token trades. Also margin calls could be satisfied by applying each collateral token in sequence to covering the debt until it is satisfied, and then returning the residual collateral tokens to the short. This sequence could even be determined by the short.

Offline arhag

  • Hero Member
  • *****
  • Posts: 1214
    • View Profile
    • My posts on Steem
  • BitShares: arhag
  • GitHub: arhag
But I can imagine it might be possible to create UIAs on the bitShares block-chain that are backed by BTC, LTC, NXT, you-name it, as long as there are ways to minimise counter-party risk through appropriate operations like multi-sig, escrow or the like. To be honest I don't know if side-chains help with that or not, I'm naive in that area, though I've asked the question before.

Yes, UIA gateway assets (like GATEBTC) + the new privatized BitAssets should make this possible. The only question is if the trust can be decentralized out to many parties to keep the counterparty risk is low enough for people to use it for more than just a means of quickly getting value in an out of the system to/from assets without counterparty risk. On the BitShares side, the new multisig features provide a lot of flexibility for managing the UIA properly (e.g. not diluting its value). The limiting factor is on the Bitcoin side. It doesn't make sense to have more decentralization on the BitShares side than on the Bitcoin side when the UIA could become worthless if the reserve is stolen. Ignoring advances in ECDSA threshold signatures (and assuming Bitcoin does not adopt new cryptography like EdDSA or radically increase the limits on their scripts), we are currently limited to an M-of-15 multisig for the BTC reserve backing the gateway UIA. You want M to be large to reduce the risk of compromise but obviously not too large that it dramatically increases the risk that the reserve holders get locked out of access to the reserve because some of them become unresponsive or disappear. Not sure what would be the ideal value for M, but the main question is if a well selected group of 15 individuals/organizations can be trusted to not collude to steal a potentially huge reserve. If not, very few people would trust holding the BTC-backed UIA for long term or holding BitAssets that derive their value from such UIA.

By the way, I agree with others in this thread that side-chains are not the way to go (for technical reasons, e.g. PoW) to bring BTC tokens into the BitShares blockchain.

By the way starspirit, I don't see how the BitAssets backed by a mix of collateral types would be fungible unless a fixed mix ratio was specified as part of the BitAsset definition that all shorts of that privatized BitAsset had to satisfy. And in that case, I would imagine the only practical way to short new BitAssets with mixed backing collateral into existence would be through a self-short. The logic for margin calls would also get more complicated with mixed collateral.

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
sorry but I have to say I'm a little bit disappointed that so many people support this idea...

what application will build based on a 10min confirmation and 7TPS system? forget the BTC Sidechains guys, it will not change anything

wake up, we will have a 100000TPS system!
I suspect that different people on this thread are potentially coming from quite different perspectives on how such a structure would be put together. Most debates are like that...
But I can imagine it might be possible to create UIAs on the bitShares block-chain that are backed by BTC, LTC, NXT, you-name it, as long as there are ways to minimise counter-party risk through appropriate operations like multi-sig, escrow or the like. To be honest I don't know if side-chains help with that or not, I'm naive in that area, though I've asked the question before.

Now imagine you have, on the bitShares block-chain, tokens physically backed by these outside assets. Not only might these be in high demand in their own right (given the relative benefits of our network), but they could serve as collateral behind other asset structures such as bitAssets. No need to change the properties of bitAssets - just simply plug in a new accepted collateral type.

These assets could then trade externally and be promoted as collateralised tokens, with all the same benefits as bitAssets, but without the market having to decide whether it likes BTS as collateral or not. It takes away the inclination to make any judgement on BTS at all, and focuses them on the security of the block-chain enforced collateral rules.


Offline wallace

  • Sr. Member
  • ****
  • Posts: 215
    • View Profile
sorry but I have to say I'm a little bit disappointed that so many people support this idea...

what application will build based on a 10min confirmation and 7TPS system? forget the BTC Sidechains guys, it will not change anything

wake up, we will have a 100000TPS system!
give me money, I will do...

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
Having said that, if doable, I would lean to a flexible collateral system rather than one backed solely by BTC, which would be more flexible and less controversial. See for example...https://bitsharestalk.org/index.php/topic,16326.msg208798.html#msg208798
I think the issue for this idea is that the asset is no longer fungible. If the one backing collateral system fails, only those associated tokens are in trouble, which means an existing BitUSD token can be worth a different amount based on its backing. That wouldn't fly.
No it would still be fungible. Every short would be able to choose their own mix of collateral, as long as it satisfies the Coverage conditions (maintains minimum collateral according to the rules). The market will value the token at the value of the reference asset as long as collateral backing it is always sufficient. Only in the event of a black swan (or the perceived risk of such an event) does the actual value of the collateral make any difference to the value of the token.

Offline radbll

  • Newbie
  • *
  • Posts: 3
    • View Profile
I understand why there is a heavy reluctance to consider a bitShares product with a BTC underlying. It seems like we are "supporting the enemy". Being dirty. And throwing away our capital gain potential. But if we get past the initial moral disgust, we might see that none of these things are actually true.

Who made BTC our enemy? What is the point of even having an enemy? BTC is really just the industry benchmark that we are seeking to exceed. It need be no more emotional than that. Using it as a form of collateral does not take any credibility from bitShares, nor add any to BTC. It is merely a statement that BTC is by far the most commonly held form of available collateral at this time.

There is also much scope to challenge the idea that BTS derives its growth potential by backing bitAssets.

I've demonstrated previously that bitAssets can be issued via self-creation, with funds raised from the sale of the bitAsset being used for any general purpose the borrower desires. In fact, my view is that using these funds to arbitrage against the real asset is the preferred motivator for issuers. This merely requires participating BTS users to move their existing tokens to the collateral pool. It does not require anybody to increase demand for BTS - BTS leverage is just one potential application of the borrowed funds.

I've also argued (without convincing many people yet!) that the market value of BTS is determined by supply and demand at any time, irrespective of any prior market trades that may have been initiated by new purchases of bitAsset. That is, the market needs to be convinced that any price BTS is forcibly bid up to is a reasonable price given its future return prospects, or it will simply realign the price at a lower level again.

This then gets to the essence of what really does drive the BTS price. In my opinion, its the utility that BTS can provide to owners through the prospect of income, or the potential utility of being able to access opportunities to earn income within the bitShares system. If there is real value there, does it really matter if a source of credit growth is removed?

So if we did offer a product to the market that had much greater demand potential and capacity (BTC>100x the market cap of BTS at this point) in the medium term, and we structured it so as to earn an income stream for BTS owners from that product, that could actually be a very good thing for owners of BTS. This would seem a lot more robust as a business model to me - earn income from a product, rather than the product concept merely being to compound the credit available to BTS bulls.

I believe the theoretically optimal model is to actually offer flexible collateral, where BTS, BTC or other digital collateral can be held as a mix to back bitAssets. Perhaps that will be more palatable to bitshares because its not seen as directly supporting any specific "competing" token and offers maximum flexibility.

Now this is a big shift for many given the previous paradigms held in bitShares, and everyone will have a different opinion on it. So what's to stop us doing both? With privatised bitAssets, the purists can still have BTS backed bitAssets, and there can be a parallel market for bitAssets backed by BTC or other combinations of collateral. Better us earning the reward than a competitor. And to be truly self-funding, bitShares ultimately needs to earn reward by delivering value to the market and meeting its needs.

Offline monsterer

You can't make bitshares a side chain of bitcoin without accepting all the bad design decisions they made - POW, 10 minute block times etc...

Not true. It takes 10 minutes to get the BTC on the sidechain, at which point the coins have the same properties as the sidechains coins. In other words, BTC would have all the properties of BTS until you "withdraw" the BTC.

That's having BTC as a sidechain of BTS, which isn't possible, since BTS does not have side chains.
My opinions do not represent those of metaexchange unless explicitly stated.
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline Ander

  • Hero Member
  • *****
  • Posts: 3506
    • View Profile
  • BitShares: Ander
I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

You guys don't seem to understand what it means if BTS is not used as the collateral.  It means BTS is worthless, and you simply give all the hard work of the bitshares community for the past 18 months to the other crypto community for free, and get nothing in return. 

This idea is not a partnership between two communities, it is a complete theft of all of the value of BTS.

I am all for collaborations between crypto communities, and treating other crypto enthusiasts as friends and not enemies. But that is not what this idea is.  This idea as posted in the OP is to give away 100% of Bitshares to someone else, and leave the Bitshares community holding worthless tokens. 
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline Method-X

  • Hero Member
  • *****
  • Posts: 1131
  • VIRAL
    • View Profile
    • Learn to code
  • BitShares: methodx
You can't make bitshares a side chain of bitcoin without accepting all the bad design decisions they made - POW, 10 minute block times etc...

Not true. It takes 10 minutes to get the BTC on the sidechain, at which point the coins have the same properties as the sidechains coins. In other words, BTC would have all the properties of BTS until you "withdraw" the BTC.

Offline Chronos

Having said that, if doable, I would lean to a flexible collateral system rather than one backed solely by BTC, which would be more flexible and less controversial. See for example...https://bitsharestalk.org/index.php/topic,16326.msg208798.html#msg208798
I think the issue for this idea is that the asset is no longer fungible. If the one backing collateral system fails, only those associated tokens are in trouble, which means an existing BitUSD token can be worth a different amount based on its backing. That wouldn't fly.

Offline Empirical1.2

  • Hero Member
  • *****
  • Posts: 1366
    • View Profile
I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Sidechains likely are legit...which means that there really is no reason to worry on that front.  But the real question is...how does this help us?  And can it benefit us in a way that we wouldnt already see if we had patience and persistence?

We are tying ourselves into a market that actually is not free.  Bitcoin has many backers...ironically one of which seems to be the CFR. For those who know about the CFR, this should be a concern...because if they want bitcoin...it means it is precisely the technocrat's dream device for tracking every interaction we ever have.  In fact nearly all the big names in "journalism" out there these days are actually members of the CFR as well.  If we think these people are not connected with the same kingpins in charge today...we are blinding ourselves unnecessarily to facts.

I see no reason to back bitassets directly with bitcoin...or to even open up that Avenue because then we are opening the floodgates for a stealth attack that steals our tech and moves it to bitcoin with little repayment to our community (what happens to the BTS you each hold if the mining and banking cartels inject huge funds into btc-backed bitassets???).

Just like data said...we CAN back them with bitcoi  INTERNALLY and still keep control over what we ALL have fought so hard to make thrive!  Don't forget everyone... bitBTC can back bitassets to now with the bitassets 2.0 proposal.

Actually fuzzy, what I imagined was a BTC-backed token existing on our block-chain, and using that as the collateral, rather than BTC directly. So the control, issuance and settlement features would never leave the domain of bitShares, although it could trade freely externally like any other bitAsset. I introduced this idea here, and expanded it to looking at using such a token for collateral in this thread...https://bitsharestalk.org/index.php/topic,15957.0.html
Why you might do this rather than using bitBTC backed by BTS is for the reasons I listed earlier in this thread. But like I said earlier, I would prefer the ability to have a collateral mix rather than just BTC, another advantage being less chance of black swans.

I think ultimately something like this will be done if it can be done. Down the track there is no reason why collateral can't just be plug-and-play - insert whatever token or mix of tokens you want. So maybe we are only left to debate how much support we might wish to give it when it happens. Personally I think its better to have the bitShares technology at the centre of it and controlling it, and earning reward and brand recognition for the community, rather than left out of it. But it will be interesting to see how things evolve and what we all think at that point.

I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Hmm...I'm failing to see how we would both win in this scenario. Literally what value would BTS have if it wasn't backing bitassets? Sounds to me like it would have a quick drop to zero, while bitcoin reaps all the hard work of the BTS devs...

Am I missing something?
The point you raise is that we need to be much clearer on the value model for BTS. If its only value is in backing bitAssets, and bitAssets don't require BTS backing, then we are lost...
(BTW I think we are far from lost, just highlighting the need to explore the bigger picture on what BTS can be).

 +5% Makes sense

Bitcoiners and the general public will probably get behind Bitcoin backed BitAssets much more so than ones backed by shares in a company with the convoluted vesting, dilution and ownership structure that BitShares has.

In the short term though I would prefer to use our first mover advantage to focus on BTS BitAssets to see if we can gain the network effect and growth to make them the market leader.
« Last Edit: June 10, 2015, 02:59:58 pm by Empirical1.2 »
If you want to take the island burn the boats

Offline fuzzy

I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Sidechains likely are legit...which means that there really is no reason to worry on that front.  But the real question is...how does this help us?  And can it benefit us in a way that we wouldnt already see if we had patience and persistence?

We are tying ourselves into a market that actually is not free.  Bitcoin has many backers...ironically one of which seems to be the CFR. For those who know about the CFR, this should be a concern...because if they want bitcoin...it means it is precisely the technocrat's dream device for tracking every interaction we ever have.  In fact nearly all the big names in "journalism" out there these days are actually members of the CFR as well.  If we think these people are not connected with the same kingpins in charge today...we are blinding ourselves unnecessarily to facts.

I see no reason to back bitassets directly with bitcoin...or to even open up that Avenue because then we are opening the floodgates for a stealth attack that steals our tech and moves it to bitcoin with little repayment to our community (what happens to the BTS you each hold if the mining and banking cartels inject huge funds into btc-backed bitassets???).

Just like data said...we CAN back them with bitcoi  INTERNALLY and still keep control over what we ALL have fought so hard to make thrive!  Don't forget everyone... bitBTC can back bitassets to now with the bitassets 2.0 proposal.

Actually fuzzy, what I imagined was a BTC-backed token existing on our block-chain, and using that as the collateral, rather than BTC directly. So the control, issuance and settlement features would never leave the domain of bitShares, although it could trade freely externally like any other bitAsset. I introduced this idea here, and expanded it to looking at using such a token for collateral in this thread...https://bitsharestalk.org/index.php/topic,15957.0.html
Why you might do this rather than using bitBTC backed by BTS is for the reasons I listed earlier in this thread. But like I said earlier, I would prefer the ability to have a collateral mix rather than just BTC, another advantage being less chance of black swans.

I think ultimately something like this will be done if it can be done. Down the track there is no reason why collateral can't just be plug-and-play - insert whatever token or mix of tokens you want. So maybe we are only left to debate how much support we might wish to give it when it happens. Personally I think its better to have the bitShares technology at the centre of it and controlling it, and earning reward and brand recognition for the community, rather than left out of it. But it will be interesting to see how things evolve and what we all think at that point.

I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Hmm...I'm failing to see how we would both win in this scenario. Literally what value would BTS have if it wasn't backing bitassets? Sounds to me like it would have a quick drop to zero, while bitcoin reaps all the hard work of the BTS devs...

Am I missing something?
The point you raise is that we need to be much clearer on the value model for BTS. If its only value is in backing bitAssets, and bitAssets don't require BTS backing, then we are lost...
(BTW I think we are far from lost, just highlighting the need to explore the bigger picture on what BTS can be).

Yeh now this is awesome^

I LOVE bitcoin because it inspired me and taught me so much.  I also think there are many amazing people who were very loyal to what was supposed to be the big movement...but those wouldn't be the people in charge.

So I would love to somehow honor btc by adding it to a basket like that.  Pretty much 100% agreed.

Quote from: Method-x[/quote
I'm pleading ignorance when it comes to sidechains. I would assume the DAC can continue making money through network fees. The technology behind bitshares is pretty advanced and can do a LOT of stuff bitcoin can't. Way more than just bitassets. I'm thinking about this strategically. If we're one of the first sidechains, that will gain us massive credibility and momentum. Combine "bitcoin friendly bitshares" with a referral system and that makes for a pretty massive rocket ship.

But like I said, I know nothing about sidechains or if such a partnership is even possible. I'm pretty sure allowing for cross chain transactions isn't permanent. If down the road, things get messy with Bitcoin the shareholders will decide what to do. At the very least, it's worth keeping an open mind about. Bitcoin isn't the enemy. Not yet at least.

Monsterer is right about the technicals because all sidechains are precisely that with respect to bitcoin--subservient to proof of work (and thus mining equipment manufacturers). 

Now if they wanted to connect up to us in such a way and gain all the benefits that comes along with it (especially with respect to the separation of power) I am starting to feel the vibe.  Heck I'd love to cover it.

Now with that said...I dig the spirit you have about cooperation and love ;)

Good to see you around more these days bro.
« Last Edit: June 10, 2015, 02:19:30 pm by fuzzy »
WhaleShares==DKP; BitShares is our Community! 
ShareBits and WhaleShares = Love :D

Offline monsterer

You can't make bitshares a side chain of bitcoin without accepting all the bad design decisions they made - POW, 10 minute block times etc...
My opinions do not represent those of metaexchange unless explicitly stated.
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline Method-X

  • Hero Member
  • *****
  • Posts: 1131
  • VIRAL
    • View Profile
    • Learn to code
  • BitShares: methodx
I see no reason to back bitassets directly with bitcoin...or to even open up that Avenue because then we are opening the floodgates for a stealth attack that steals our tech and moves it to bitcoin with little repayment to our community (what happens to the BTS you each hold if the mining and banking cartels inject huge funds into btc-backed bitassets???).

I'm pleading ignorance when it comes to sidechains. I would assume the DAC can continue making money through network fees. The technology behind bitshares is pretty advanced and can do a LOT of stuff bitcoin can't. Way more than just bitassets. I'm thinking about this strategically. If we're one of the first sidechains, that will gain us massive credibility and momentum. Combine "bitcoin friendly bitshares" with a referral system and that makes for a pretty massive rocket ship.

But like I said, I know nothing about sidechains or if such a partnership is even possible. I'm pretty sure allowing for cross chain transactions isn't permanent. If down the road, things get messy with Bitcoin the shareholders will decide what to do. At the very least, it's worth keeping an open mind about. Bitcoin isn't the enemy. Not yet at least.

Hmm...I'm failing to see how we would both win in this scenario. Literally what value would BTS have if it wasn't backing bitassets? Sounds to me like it would have a quick drop to zero, while bitcoin reaps all the hard work of the BTS devs...

Am I missing something?

  • It's a ledger capable of 100,000 TPS.
  • It's a decentralized exchange
  • It allows for dynamic account permissions
  • User issued assets
  • Bond market
Once we have actual adoption, we can get creative and think of other ways the blockchain can be utilized.
« Last Edit: June 10, 2015, 03:59:49 am by Method-X »

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Sidechains likely are legit...which means that there really is no reason to worry on that front.  But the real question is...how does this help us?  And can it benefit us in a way that we wouldnt already see if we had patience and persistence?

We are tying ourselves into a market that actually is not free.  Bitcoin has many backers...ironically one of which seems to be the CFR. For those who know about the CFR, this should be a concern...because if they want bitcoin...it means it is precisely the technocrat's dream device for tracking every interaction we ever have.  In fact nearly all the big names in "journalism" out there these days are actually members of the CFR as well.  If we think these people are not connected with the same kingpins in charge today...we are blinding ourselves unnecessarily to facts.

I see no reason to back bitassets directly with bitcoin...or to even open up that Avenue because then we are opening the floodgates for a stealth attack that steals our tech and moves it to bitcoin with little repayment to our community (what happens to the BTS you each hold if the mining and banking cartels inject huge funds into btc-backed bitassets???).

Just like data said...we CAN back them with bitcoi  INTERNALLY and still keep control over what we ALL have fought so hard to make thrive!  Don't forget everyone... bitBTC can back bitassets to now with the bitassets 2.0 proposal.

Actually fuzzy, what I imagined was a BTC-backed token existing on our block-chain, and using that as the collateral, rather than BTC directly. So the control, issuance and settlement features would never leave the domain of bitShares, although it could trade freely externally like any other bitAsset. I introduced this idea here, and expanded it to looking at using such a token for collateral in this thread...https://bitsharestalk.org/index.php/topic,15957.0.html
Why you might do this rather than using bitBTC backed by BTS is for the reasons I listed earlier in this thread. But like I said earlier, I would prefer the ability to have a collateral mix rather than just BTC, another advantage being less chance of black swans.

I think ultimately something like this will be done if it can be done. Down the track there is no reason why collateral can't just be plug-and-play - insert whatever token or mix of tokens you want. So maybe we are only left to debate how much support we might wish to give it when it happens. Personally I think its better to have the bitShares technology at the centre of it and controlling it, and earning reward and brand recognition for the community, rather than left out of it. But it will be interesting to see how things evolve and what we all think at that point.

I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Hmm...I'm failing to see how we would both win in this scenario. Literally what value would BTS have if it wasn't backing bitassets? Sounds to me like it would have a quick drop to zero, while bitcoin reaps all the hard work of the BTS devs...

Am I missing something?
The point you raise is that we need to be much clearer on the value model for BTS. If its only value is in backing bitAssets, and bitAssets don't require BTS backing, then we are lost...
(BTW I think we are far from lost, just highlighting the need to explore the bigger picture on what BTS can be).

Offline nomoreheroes7

  • Hero Member
  • *****
  • Posts: 756
  • King of all the land
    • View Profile
  • BitShares: nomoreheroes7
I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Hmm...I'm failing to see how we would both win in this scenario. Literally what value would BTS have if it wasn't backing bitassets? Sounds to me like it would have a quick drop to zero, while bitcoin reaps all the hard work of the BTS devs...

Am I missing something?

Offline fuzzy

I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Sidechains likely are legit...which means that there really is no reason to worry on that front.  But the real question is...how does this help us?  And can it benefit us in a way that we wouldnt already see if we had patience and persistence?

We would be tying ourselves into a market that actually is not free.  Bitcoin has many backers...ironically one of which seems to be the CFR. For those who know about the CFR, this should be a concern...because if they want bitcoin...it means it is precisely the technocrat's dream device for tracking every interaction we ever have.  In fact nearly all the big names in "journalism" out there these days are actually members of the CFR as well.  If we think these people are not connected with the same kingpins in charge today...we are blinding ourselves unnecessarily to facts.

I see no reason to back bitassets directly with bitcoin...or to even open up that Avenue because then we are opening the floodgates for a stealth attack that steals our tech and moves it to bitcoin with little repayment to our community (what happens to the BTS you each hold if the mining and banking cartels inject huge funds into btc-backed bitassets???).

Just like data said...we CAN back them with bitcoi  INTERNALLY and still keep control over what we ALL have fought so hard to make thrive!  Don't forget everyone... bitBTC can back bitassets to now with the bitassets 2.0 proposal.

« Last Edit: June 10, 2015, 02:59:35 am by fuzzy »
WhaleShares==DKP; BitShares is our Community! 
ShareBits and WhaleShares = Love :D

Offline Thom

What I'm saying is bitcoin is not the best all singing all dancing cryptocurrency/blockchain.
I don't have to kiss mining cartel butts. I just have to keep doing what the community has seen me doing from nearly day one.  Not only that, but BitShares' ability to process (conservatively) 100,000tps while bitcoin is still stuck at 7, enables me to continue approaching industries that require far more than 7tps. 

So if anyone thinks our network effect is going to always be inferior to bitcoin...or that we will need to partner with bitcoin or risk bitcoin stealing our work, I have news for you...Beyond Bitcoin is here for a reason.  We chose bitshares from the VERY BEGINNING for a reason.
...because we wanted to be accountable to all shareholders and not a technocrats regime of mining equipment manufacturers/networks.
...because we knew that bytemaster was severely unappreciated in the crypto space and would need backing of people who wanted to see his innovations disrupt the unacceptible status quo. 

^THIS! +5% +5% +5% +5%

Awesome post fuzzy!

There have been some interesting thoughts expressed in this thread. I'm impressed with the perspectives offered by starspirit, riverhead and of course fuzzy, who IMO nailed it! 
Injustice anywhere is a threat to justice everywhere - MLK |  Verbaltech2 Witness Reports: https://bitsharestalk.org/index.php/topic,23902.0.html

Offline Method-X

  • Hero Member
  • *****
  • Posts: 1131
  • VIRAL
    • View Profile
    • Learn to code
  • BitShares: methodx
I would 100% support bitassets being backed by BTC (assuming sidechains are legit). BitShares is a platform that goes far beyond bitassets and this would be a great way to partner with another crypto and leverage their network effect. We would both win if this were implemented.

Offline fuzzy

But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.
just saying.

Replace Bitcoin with USD  and USD derivative with Bitcoin and it describes almost every conversation I've had with people who have never heard of the crypto movement.

The Bitcoin user base, and crypto in general, is so tiny we are all about equal in network effect. Amazon.com has more outstanding gift card balances than all of crypto market cap combined.

Also, horse and buggy had massive network affect before the car came along  8)

“If I had asked people what they wanted, they would have said faster horses.”

Great news for jonnybitcoin though.. in 2.0 you can collateralize bitAssets with bitBTC! Fair compromise?

@starspirit.. Today we still use the term 'horse power', but we do not have horses under the hood anymore.



I will just state it simply...

We introduce something other that BTS as the collateralize.. we lose the rights and freedoms that come with the vote.

That is all there is too it. It's not an economic question in my opinion.

As far as network effect goes, we got the solution.. and the day after we introduce it here is someone asking to hitch BTC to this wagon... a sure sign of the success to come. :)

^ well stated data. Welll stated.
WhaleShares==DKP; BitShares is our Community! 
ShareBits and WhaleShares = Love :D

Offline fuzzy

What I'm saying is bitcoin is not the best all singing all dancing cryptocurrency/blockchain.
However it has the network effect (metcalfe's law), it is the gold standard of cryptocoins, the internets reserve currency with huge infrastructure and public awareness. The default way to move crypto value around. The easiest way to buy any cryptocoin is with bitcoin.

The first kind of people to adopt a USD crypto derivative will be bitcoiners themselves and they will be more comfortable knowing they will receive bitcoins in the event of a black swan.
Most other 2.0 projects will add a bitcoin sidechain gateway eventually I just think bitshares should lead not follow.

nearly all CFDs and options are settled with USD because it is the worlds reserve currency they are not settled in shares, gold, copper or danish kroner.

Our bonus hangout series is beginning to reach "beyond crypto"....and some of them are going to bring in many new eyes who are looking for solutions to today's problems.  They will be taught that bitshares has separation of powers built in and that bitcoin is dangerously centralized and reliant on mining cartels.  They will also be taught at the same time that bitcoin cannot even find consensus on basic things (like changing block sizes) and that any changes made will have to be given to a technocracy who cannot be voted out by holders...tthe only option holders will have is to risk losing it all by leaving the system.

Now I love what bitcoin started, don't get me wrong, but this is to everyone here: bitcoin is going to change significantly or die (or fracture it's network effect into many other chains-likely new so miners can continue keeping their unnecessary operations afloat just a little longer as we have seen in the pow era from nearly the beginning).
Some will come here to try to get us to subjugate ourselves to bitcoin to help "protect bitshares" by using bitcoin.  Others will come to attack us and spread FUD. 
Now I'm not saying OP has that intention here, but I will say that BitShares keeps getting better and better.  As this happens bitcoiners who have always attacked us will keep watching bitcoin floundering in the wind--they will try in many ways to get us to sell out to their network effect...because that will be all they have left to hold onto...at least for awhile.

My team's jim willie hangout received almost 28,000 unique views from people who are not already in crypto...but would be open to the Right solution.  He will be on again someday...but I do not plan on stopping there.  Trust me on that.  BitShare's economic incentives have empowered me and the team to do this...for bitshares.  I don't have to kiss mining cartel butts. I just have to keep doing what the community has seen me doing from nearly day one.  Not only that, but BitShares' ability to process (conservatively) 100,000tps while bitcoin is still stuck at 7, enables me to continue approaching industries that require far more than 7tps. 

So if anyone thinks our network effect is going to always be inferior to bitcoin...or that we will need to partner with bitcoin or risk bitcoin stealing our work, I have news for you...Beyond Bitcoin is here for a reason.  We chose bitshares from the VERY BEGINNING for a reason.
...because we wanted to be accountable to all shareholders and not a technocrats regime of mining equipment manufacturers/networks.
...because we knew that bytemaster was severely unappreciated in the crypto space and would need backing of people who wanted to see his innovations disrupt the unacceptible status quo. 

I'm sure Alta Vista shareholders were not too happy about Google either when it started picking up steam.  I'm willing to bet some of them even wanted google to partner with them just to protect google...but ultimately we saw where that ended.

I'm all down for different chains, but give me DPOS 3.0 or I'm likely going to be too busy to be interested. 

We are in for one heck of a ride everyone.  This is just the beginning.  And that means that the highs are going to be higher....and the lows will feel lower. But that means we are succeeding. ;)



« Last Edit: June 10, 2015, 02:02:07 am by fuzzy »
WhaleShares==DKP; BitShares is our Community! 
ShareBits and WhaleShares = Love :D

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.

Cringe to say it, but this is a good idea. We could theoretically use any crypto as collateral, and the fact is that BTC does have qualities that make it desirable to be used as such.
I could easily imagine such a feature existing in BTS 3 or 4. It's just a matter of priorities and dev resources.

What's the point?  Why not use bitBTC instead since it'd have the same value as BTC but it'd be more efficient and less expensive?
There are 3 differences I can think of:

1. bitBTC backed by BTS is limited by the availability of BTS. bitBTC backed by BTC is only limited by the availability of BTC.
2. bitBTC backed by BTS will have wider spreads than backed by BTC, because of underlying liquidity.
3. The wider market is more familiar with BTC than BTS and so may be more comfortable with it.

Having said that, if doable, I would lean to a flexible collateral system rather than one backed solely by BTC, which would be more flexible and less controversial. See for example...https://bitsharestalk.org/index.php/topic,16326.msg208798.html#msg208798

Offline yellowecho

But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.

Cringe to say it, but this is a good idea. We could theoretically use any crypto as collateral, and the fact is that BTC does have qualities that make it desirable to be used as such.
I could easily imagine such a feature existing in BTS 3 or 4. It's just a matter of priorities and dev resources.

What's the point?  Why not use bitBTC instead since it'd have the same value as BTC but it'd be more efficient and less expensive?
696c6f766562726f776e696573

Offline roadscape

But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.

Cringe to say it, but this is a good idea. We could theoretically use any crypto as collateral, and the fact is that BTC does have qualities that make it desirable to be used as such.
I could easily imagine such a feature existing in BTS 3 or 4. It's just a matter of priorities and dev resources.
http://cryptofresh.com  |  witness: roadscape

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
We all perceive the same things differently. Somebody could view the product of bitShares as bitAssets. Somebody else could view the product of bitShares as an open architecture platform for finance. I don't see that either of these necessarily destroys our rights and freedoms...

Offline BunkerChainLabs-DataSecurityNode

But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.
just saying.

Replace Bitcoin with USD  and USD derivative with Bitcoin and it describes almost every conversation I've had with people who have never heard of the crypto movement.

The Bitcoin user base, and crypto in general, is so tiny we are all about equal in network effect. Amazon.com has more outstanding gift card balances than all of crypto market cap combined.

Also, horse and buggy had massive network affect before the car came along  8)

“If I had asked people what they wanted, they would have said faster horses.”

Great news for jonnybitcoin though.. in 2.0 you can collateralize bitAssets with bitBTC! Fair compromise?

@starspirit.. Today we still use the term 'horse power', but we do not have horses under the hood anymore.



I will just state it simply...

We introduce something other that BTS as the collateralize.. we lose the rights and freedoms that come with the vote.

That is all there is too it. It's not an economic question in my opinion.

As far as network effect goes, we got the solution.. and the day after we introduce it here is someone asking to hitch BTC to this wagon... a sure sign of the success to come. :)
+-+-+-+-+-+-+-+-+-+-+
www.Peerplays.com | Decentralized Gaming Built with Graphene - Now with BookiePro and Sweeps!
+-+-+-+-+-+-+-+-+-+-+

Offline Riverhead


As always a well thought out post, Starspirit.

I think it important to clarify that I do not consider BTC, Etherium, NXT, or any of the other "coins" the enemy. What I want is for the crypto movement to have a wide variety of offerings. While like most other BTS holders I want it to do well but I am after a much bigger prize than just a sustainable business model to make some money.

It's true that BTC has many detractors here and in the non clone space but I'm not one of them. An analogy to my thinking would be proposing Apple just run Windows on all their hardware because of the huge percentage of the market Microsoft Windows already controls. Apple may do well by switching to Windows (as they did Intel from PPC) but that's not really the point. They are doing their own thing in their own way and it serves a specific market well.

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
I understand why there is a heavy reluctance to consider a bitShares product with a BTC underlying. It seems like we are "supporting the enemy". Being dirty. And throwing away our capital gain potential. But if we get past the initial moral disgust, we might see that none of these things are actually true.

Who made BTC our enemy? What is the point of even having an enemy? BTC is really just the industry benchmark that we are seeking to exceed. It need be no more emotional than that. Using it as a form of collateral does not take any credibility from bitShares, nor add any to BTC. It is merely a statement that BTC is by far the most commonly held form of available collateral at this time.

There is also much scope to challenge the idea that BTS derives its growth potential by backing bitAssets.

I've demonstrated previously that bitAssets can be issued via self-creation, with funds raised from the sale of the bitAsset being used for any general purpose the borrower desires. In fact, my view is that using these funds to arbitrage against the real asset is the preferred motivator for issuers. This merely requires participating BTS users to move their existing tokens to the collateral pool. It does not require anybody to increase demand for BTS - BTS leverage is just one potential application of the borrowed funds.

I've also argued (without convincing many people yet!) that the market value of BTS is determined by supply and demand at any time, irrespective of any prior market trades that may have been initiated by new purchases of bitAsset. That is, the market needs to be convinced that any price BTS is forcibly bid up to is a reasonable price given its future return prospects, or it will simply realign the price at a lower level again.

This then gets to the essence of what really does drive the BTS price. In my opinion, its the utility that BTS can provide to owners through the prospect of income, or the potential utility of being able to access opportunities to earn income within the bitShares system. If there is real value there, does it really matter if a source of credit growth is removed?

So if we did offer a product to the market that had much greater demand potential and capacity (BTC>100x the market cap of BTS at this point) in the medium term, and we structured it so as to earn an income stream for BTS owners from that product, that could actually be a very good thing for owners of BTS. This would seem a lot more robust as a business model to me - earn income from a product, rather than the product concept merely being to compound the credit available to BTS bulls.

I believe the theoretically optimal model is to actually offer flexible collateral, where BTS, BTC or other digital collateral can be held as a mix to back bitAssets. Perhaps that will be more palatable to bitshares because its not seen as directly supporting any specific "competing" token and offers maximum flexibility.

Now this is a big shift for many given the previous paradigms held in bitShares, and everyone will have a different opinion on it. So what's to stop us doing both? With privatised bitAssets, the purists can still have BTS backed bitAssets, and there can be a parallel market for bitAssets backed by BTC or other combinations of collateral. Better us earning the reward than a competitor. And to be truly self-funding, bitShares ultimately needs to earn reward by delivering value to the market and meeting its needs.



Offline JonnyB

  • Hero Member
  • *****
  • Posts: 636
    • View Profile
    • twitter.com/jonnybitcoin

Let each market decide which chain works best for them.
[/quote]

But bitcoin can be moved on to the bitshares blockchain. You can still use the superior features and built in exchange the bitbitshares blockchain offers.

And then yes let the market decide by letting allowing both bitshares and bitcoin to be used as collateral.
I run the @bitshares twitter handle
twitter.com/bitshares

Offline Riverhead

The first kind of people to adopt a USD crypto derivative will be bitcoiners themselves and they will be more comfortable knowing they will receive bitcoins in the event of a black swan.
Most other 2.0 projects will add a bitcoin sidechain gateway eventually I just think bitshares should lead not follow.

I say let the other 2.0's stay tied to Bitcoin; they will probably do well by it. However, to truly innovate and move crypto forward someone at some point needs to cut the shackles and do something different.

Bitcoin will be around for a long time and will also do very well as crypto grows but like we have BMW, Mercedes, Fiat, etc. there is plenty of room for all of us. Let each market decide which chain works best for them.

Offline Riverhead

But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.
just saying.

Replace Bitcoin with USD  and USD derivative with Bitcoin and it describes almost every conversation I've had with people who have never heard of the crypto movement.

The Bitcoin user base, and crypto in general, is so tiny we are all about equal in network effect. Amazon.com has more outstanding gift card balances than all of crypto market cap combined.

Also, horse and buggy had massive network affect before the car came along  8)
« Last Edit: June 10, 2015, 12:14:59 am by Riverhead »

Offline JonnyB

  • Hero Member
  • *****
  • Posts: 636
    • View Profile
    • twitter.com/jonnybitcoin
What I'm saying is bitcoin is not the best all singing all dancing cryptocurrency/blockchain.
However it has the network effect (metcalfe's law), it is the gold standard of cryptocoins, the internets reserve currency with huge infrastructure and public awareness. The default way to move crypto value around. The easiest way to buy any cryptocoin is with bitcoin.

The first kind of people to adopt a USD crypto derivative will be bitcoiners themselves and they will be more comfortable knowing they will receive bitcoins in the event of a black swan.
Most other 2.0 projects will add a bitcoin sidechain gateway eventually I just think bitshares should lead not follow.

nearly all CFDs and options are settled with USD because it is the worlds reserve currency they are not settled in shares, gold, copper or danish kroner.
I run the @bitshares twitter handle
twitter.com/bitshares

Offline Ander

  • Hero Member
  • *****
  • Posts: 3506
    • View Profile
  • BitShares: Ander
Someone else will make a bitcoin collateralised BitUSD if bitshares doesn't.
That will be the one people use.

So you are saying that everything this community has been trying to do since day 1 is pointless, because bitcoin is the one true chain and its useless to make any other cryptocurrency.  Everyone should do everything with bitcoin instead because it was first.

Some of us arent bitcoin maximalists.  Some of us want to see something accomplished while bitcoin has been debating for an eternity how to deal with its blocksize and TPS issue.


https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline JonnyB

  • Hero Member
  • *****
  • Posts: 636
    • View Profile
    • twitter.com/jonnybitcoin
Someone else will make a bitcoin collateralised BitUSD if bitshares doesn't.
That will be the one people use.
I run the @bitshares twitter handle
twitter.com/bitshares

Offline Ander

  • Hero Member
  • *****
  • Posts: 3506
    • View Profile
  • BitShares: Ander
Sidechains alpha code was released yesterday.
I believe bit assets need to be collateralised with bitcoin instead of bitshares and sidechains will allow for this.
Holders of bitshares will cry because using bitshares as collateral instead means the price should rise more as bit assets are adopted.

What a surprise, someone with the name 'johnny bitcoin' thinks that Bitshares should make itself worthless in order to help Bitcoin.


Quote
But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.

Indeed, Bitshares holders should jump at the opportunity to make their BTS worthless so that they can help out BTC holders.  That just sounds like a great idea. 

Also everyone in the bitshares community should take all our hard earned fiat and buy Bitcoins with it and then send them to a burn address, so that we end up with nothing and help out bitcoiners.
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline JonnyB

  • Hero Member
  • *****
  • Posts: 636
    • View Profile
    • twitter.com/jonnybitcoin
Sidechains alpha code was released yesterday.
I believe bit assets need to be collateralised with bitcoin instead of bitshares and sidechains will allow for this.
Holders of bitshares will cry because using bitshares as collateral instead means the price should rise more as bit assets are adopted.

But the truth is that bitcoin will be the collateral for the most commonly used USD derivative as it is the biggest most liquid and most trusted crypto.
Bitshares need to make btc the default collateral for bit assets or another USD derivative will take its place.
just saying.
I run the @bitshares twitter handle
twitter.com/bitshares