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Offline AdamBLevine

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Hey all,
I'm a big believer in the DAC concept, recently spent a lot of time thinking about it and this is the future I think I'd like to help create.  Please read it, and tell me what things I've gotten horribly wrong so we can get the bugs out of the concept and change the world

-Adam B. Levine
Editor-in-Chief, Let's Talk Bitcoin!

https://docs.google.com/document/d/1PBjrpMBViJh1-QrWJ80XMcQmhqcG3NhhoeSn0C_ML7Y/edit?usp=sharing

Application Specific, Autonomous, Self Boot-Strapping Consensus Platforms (And the DACs that live on them)
by Adam B. Levine, December 24th 2013 - [email protected]
Recursive Music: https://www.dropbox.com/sh/eywks5bfousf017/XorrU3jrb9

Definitions:
DACP - Distributed, Autonomous Consensus Platform
DAC   - Distributed, Autonomous Consensus (Rides on top of a DACP)
Voice, Vx - DACP Specific Tokens, analogous to “bitcoins”
Voiceholders - Anyone controlling more than .001 Vx (Enough to create 1 New Vx) of a brand new DAC

Acknowledgements
What follows are ideas I am articulating, but do not claim as my own.  I have drunk deeply from the open source cryptocurrency and the nascent cryptoequity ecosystem, and the document that follows is more a connecting of the dots than a piece of original art.    I encourage you to improve on my work, leave comments and help me think through this next part of our Cryptocurrency development. 

Bitcoin Started Something Unstoppable

Bitcoin is to Money what DACPs are to any “problem” or market need that is not being filled with the maximum possible institutional efficiency.   

Bitcoin was a first; something new.  The pseudonymous creator worked in the open to collect and vest stakeholders in the platform and at the earliest opportunity walked away from the project.  Distributed Computing as “mining” served this purpose as it presented a learning curve that biased the initial community towards technically savvy early adopters rather than the conventional early adopters of a currency system.   

Bitcoin is a platform for assigning and transacting a digital asset (the token form of bitcoin) without requiring any central concentrations of responsibility.   This had been attempted before utilizing centralized mechanisms, but due to non-technical reasons these attempts failed after a modest amount of time for threatening the existing infrastructure stakeholders. 

Once the network had been seeded and a continued interest in the systems development embedded in the hearts of others, the catalyst prudently withdrew.  When the implications of this new system was eventually recognized, there simply was no owner to even speak to, only the caretaker  who knew him years ago and subsequent generations of open developers.

Only a few years later, we see even such a disruptive innovation as Bitcoin will be judged on its function rather than its creator simply because it is such a compelling solution in an area rife with systemic inefficiencies.

Distributed, Autonomous Consensus - How and Why

Turns out this is not unique to finance, and in fact wherever you find existing, centralized legacy companies you’ll find a structure that is woefully inefficient for the purposes of performing the stated task.  This is not to say these companies or their owners are bad, just that they are operating in an older and incredibly inefficient paradigm that we are no longer restricted to.

A legacy structure has the intelligence seated at the top of a hierarchy, automation serves to perform the will of the intelligence at the human level.    This is why when legacy companies make cuts for efficiency, they cut at the edges of the network.  Low level humans are the least valuable and most easily replaced parts, while to trim from the brains is to cripple your decision-making capacity which no intelligent organism would do.    This all changed when Bitcoin introduced the idea of autonomous distributed consensus, automation at the center of the network and intelligence on the edges.

Unlike in a legacy company where decision-making authority is concentrated at the executive level, in a DAC(P) the decision-making authority is the part automated in that it has specific rules which are followed without possibility of deviation from expected form, and has no humans in positions of anything more than fractional organizational power.

Power and authority rather than being collected at the top is spread to the edges of the network by allowing VoiceHolders to influence the decision-making and priorities of the DACP proportionally with their Voice holdings. 

If anyone can be blamed for the creation of a DACP or DAC, it is the VoiceHolders who exchange their Digital Funds for DACP specific Voice.  Those funds are used by the DACP to hire contractors to create it according to a spec selected and approved by those Voiceholders. This is yet another reason why it’s so important the investment

The Game of DACs

Think of a service, function, cause, technology, wish, whatever.   You must have a desire to either know an outcome or for a specific outcome.  For the purposes of this paper we’ll be talking about “MUSIC, DACP”, “CONFERENCE, DACP” and “ RESEARCH, DACP”   

DACPs are created through the articulation of a desired outcome (the pitch), those who agree with the sentiment send funds to the DACP (the fundraising) and after a value-threshold is met, the DACP acts to bring about the desired result.    Funds that are raised during this process are not releasable until a majority of those who put the value there in the first place, or those who purchased their voice,  agree to both the need for the expenditure, and the final product being submitted for reimbursement.   

Because only those invested have a say, the dynamic will bias towards conservative use of the collected funds unless the idea really pushes forward the goal of the DACP, where it will get overwhelming support.   Proposals to spend and the submission of solutions is a completely open and transparent process everyone can participate in (you do not need to be a voiceholder to perform a job for a DACP)

A DACP is a DAC, but a DAC is not always a DACP.   Distributed Autonomous Consensus Platforms

Outcomes, not Means or Methods
Although this may sound futuristic, these autonomous platforms have no “Artificial Intelligence” at the top of the pyramid.  Where the capstone used to be the  ultimate centralization of power, now it is only the nexus point for consensus from those participating further down the structure.   It has the ability to spend funds, but only at the direction and authorization of the majority of Voiceholders.   

Because of this, it is advisable to give a DAC the very specific outcome you wish it to achieve but to let the actual humans performing the work for the DAC innovate at the edges of the network.

Purpose:
Music - Identify and Rank all Musical Acts against each other.
Conference - Organize and operate Conferences about DACPs.
Research - Identify Research Opportunities and bring solutions to market.

There is another, general rule - All DACPs MUST operate as for-profit entities, even charities.   If a DACP ever loses all its money, it will fail and its tokens will be substantially devalued.


What is Voice?

Voice is the power to influence the spending (or saving) priorities of a DAC or DACP.   Owning Vx of a DACP is a speculative play that more people will want to use the platform rather than specifying a project to tie its fate to.

Since DACs (like SnoopLion DAC) are created, trade against and operate on top of DACPs (like Music DACP), the relative price movements of DACs are completely independent of the value of the DACP’s currency it trades on top of.     Whether the BTC price of ResearchDACP is going up or down, a promising or growing DAC project ,on its platform should be growing when denominated in DACP Vx,  the underlying DACP currency.     Conversely, an unpopular project that had initially seemed promising might lose value as people cease to believe in it and exchange their DAC Vx directly with the DACP for general platform Vx.   This is the creation process in reverse, Vx is refunded at a 5% premium to the last 24hr market rate.  The redeemed DAC Vx is destroyed and removed from the monetary base.


Everybody Plays by the Rules, Even The Creator
Just like Bitcoin, DACs and DACPs are consensus driven, rules-based systems.  To be part of the system is to follow the rules, so there can be no pre-mining, no individuals with privileged status at all.  Privilege is the antithesis of efficiency, and these structures seek efficiency above all things.   

On the one hand this means a creator can neither rest on their laurels indefinitely and be perpetually rewarded for their one time contribution, they need to be active participants.   An active creator obviously competant and acting in the best interest of its creation would surely find regular work with the DACP or DAC they inspired, the Vx Holders having all the authority to make it so and likely being thankful to the creator for catalyzing the vehicle they have all invested value in.     

A “Bad” creator, acting against the best interest of the platform on the other hand would be shown the door by invested VxHolders very quickly.   Even though they have an advantage, the fact that they’re doing wrong now means they should no longer be able to do wrong.  Past behavior does not guarantee future behavior, so neither should it guarantee an ongoing role.

Any DAC or DACP contractor who does not perform their role simply will not continue to have a role, no matter if it’s the newest maintenance worker or the original creator of the DACP Specification

Overwhelming Success breeds Overwhelming Competition
The ongoing success of a first-to-market DAC is not guaranteed.  Because the whole ecosystem is open source, DACs and DACPs can be completely forked, including DACs contained on a DACP and a snapshot of systemic VxHoldings.   Any DAC that operates with any degree of profitability above the bare minimum will likely find forked competition before too long who takes their work and turns a 10% fee into a 1% fee.  And then a 1% fee into a .01% fee, until whatever the minimum possible operating budget is found.

Because it is impossible to stop this from occurring, it is better for a DAC to START at the bare minimum of operating profitability in order to dissuade forked competition.  Lacking easy money, those people will probably go on to create more innovative DACs that can find investment on their own merits.    Ultimately which market succeeds doesn’t matter as there will be an enormous incentive to honor all positions on a forked market so the users of the (legacy) DAC will be able to seamlessly transition to the new operators lower priced service. 

Helplessness is Blamelessness

On the other hand, because there is no possibility of special treatment you not only have the efficiency gains but there cease to be any good targets to blame.    Who ordered the creation of ResearchDACP?  Well, one guy created a document that described the idea, then thousands of people contributed to the funding address.  When the address passes a funding threshold, it put out a work order (Bounty) for the creation of a DACP specific proposal page, and then solicited proposals for how best to continue.   

Those proposals are voted on by the people who invested in ResearchDACP and they take actions, accepting proposals that cause the creation of the platform itself.  This will almost certainly involve systems design that is not included in the Specification.

Given this, is it fair to say the individual who proposed the DACP is responsible for it?   Seems he would be less responsible than those who funded it, but even they were only putting value into an account towards an idea - Not individually or even in a large group could any non-majority cause an action from the DACP, it requires proposal and then consensus.

So who is responsible?  Everyone, and if 10,000 people are “responsible” that’s as good as nobody.   Our legal system lends itself to the prosecution of ringleaders to discourage other ringleaders, in this paradigm it is very possible and quite desirable for a system to operate at a high level of efficiency while having no majority shareholders.

The Process

DACP Spec is proposed with Kickstarter Address collecting Ethereum/BTC
Recieved funds comprise development fund and initial DACP monetary base
Kickstarter Address hits funding Threshold and DACP Proposal Hub bounty is issued and rewarded by DACP Vx consensus
Proposals to develop DACP are created, one or multiple accepted
Completed bounties are reviewed, and bountys are released by Vx consensus.  DACs CANNOT integrate submitted Bounty solutions until the winner has been paid.
Once the platform is created and operational, DACP Vx holders can sell their Vx for Ethereum/BTC at current market rate, hold it to speculate on the platform becoming more popular relative to the fixed number of DACP Vx, or exchange their DACP Vx with the DACP itself for DAC Vx as described above.

Proposal

Proposing a new DAC or DACP will have four standard and expected parts

Executive Summary - 1,000 Words or less, describes the purpose, mission and function at a high level
Kickstarter style Funding address
“Patent Style” descriptive summary - Describes all the outcome/process details that are desirable to map in advance
Test Code - Lays out test problems and parameters that the DACP, if properly implemented will return in the expected and clearly defined way.   

DACs vs. DACPs
Generally speaking, DACPs are markets that specific categories of DACs trade on.  DACPS tend to be perpetual, since the market always needs to be served while the specific DACs that live out their lives atop it will change over time. 

Because DACs are purpose specific, once the purpose has been served the assets can be liquidated and the funds returned to Voiceholders as the DAC essentially buys itself out of existence.

DACs Bootstrap their Money Supply

It’s hard to be smarter than the market, so rather than setting rigid parameters about the monetary fundamentals of DAC token systems, a variable should always be left open.  This can be accomplished in several ways

Variable money supply, fixed price
Fixed money supply, variable price
Hybrid - Issuance = sqrt(price).   100x Increase in interest increase both the quantity of units and the price by 10x

In a Variable money supply paradigm, you charge say .001BTC per Vx.   This means if you get 10BTC worth of value, 10,000 Vx will be generated.  If 10,000BTC worth of value is recieved, 10,000,000 Vx would be created, all worth .001BTC at the start.

In a fixed money supply paradigm, you generate say 1,000,000 and if you receive 10BTC worth of value, at the end of the fundraising period they are allocated at a price of .00001BTC/ea.  If on the other hand you raise 10,000BTC, each Vx will be distributed at a price of .01BTC/ea

Once DACs are being built on DACPs, you have access to the combination method proposed in the prior examples.

All new DAC Vx are initially created at .001/ea of its host DACP Vx, but they trade immediately on the host DACP, even if the initial created amount is only 1Vx worth (1000).   Those can be offered for sale at any price.  If that price is higher than 5% above the last 24hr average traded price (or the minimum .001), it’s a better deal just to exchange your DACP Vx directly with the DACP.  The DACP charges a 5% premium, adds your DACP Vx to the DAC’s development fund, and creates new DAC Vx

This means while the DAC is initially funding, its money supply and price BOTH float with the DACP Vx -> DAC Vx conversion process at a 5% premium acting as a buffer against sudden shocks.   It is a guaranteed buyer and seller maintaining the money supply and moving with the market to accommodate short term shocks.

Initial Value of Vx is backed by the collected Development funds

DACs create bounties to fulfill their purposes, VxHolders vote on which bounties to issue based on submitted proposals that require an affirmative action rather than implementation through inaction.

As VxHolders approve bounties and subsequently approve submitted work and pay out those bounties, the “intrinsic” value held in development funds is depleted, but it should be replaced by infrastructure or ecosystem that are worth more to the network than the funds were before.  In the VxHolders are doing their jobs, spending will be targeted and conservative with those with the most to lose having the most power to influence the decision. 

  Referencing back to the discussion of mining, this is why it is so important to have very wide initial distribution, prevent centralizations and the associated problems both from a legal and regulatory perspective, but also from a consensus collapse scenario.  Bitcoins 51% attack is in reality a hostile takeover of the network consensus.  This is possible because capital based proofs of work scale really really well, so given enough money an individual or small group can capture the consensus reality. 

The Spark
There is a hurdle - Moving from “funded proposal” to functional DAC requires the DAC to act of it’s own accord before it has the ability to act of its own accord.   To solve this issue, a standardized chunk of “Genesis” code should be available free and open source for inclusion in any DAC requiring catalyst.   

This mechanism should be pre-set with a “threshhold” funding amount - Just like Kickstarter, it can receive more than that threshold amount should there be more wanting to support the idea, but this represents the minimum amount required before the project can be embarked upon.     

This loop of code would check the Bitcoin/Ethereum funding address laid out in the specification, and when that amount is passed the initial bounty to fund the creation of the DAC or DACP specific “Hub” page is released and promoted.  This is the page all subsequent proposals will be posted to, and basically be the DACs official interface on the internet.

Once that initial page is created, the system builds itself through a cycle of proposals -> Proposal approval -> Bounty submissions -> Bounty Submission approval -> Integration of the resulting work product into the DACs system.

Introduction of Stake-based Voting Mechanism

The wallet or tool that tracks DACP and DAC ownership must have an easy and transparent way to request feedback that allows VxHolders to vote proportionally to their Vx holdings.   For DACPs, Vx allows financial decisionmaking about the further development of the platform.  For DACs, Vx allows financial decisionmaking that furthers the goals of the DAC.   

Voting should be threshold based and require a greater than 70% consensus to authorize spending.

To ensure Bounties actually get released rather than just offered but not awarded, DACs can only release funds to pay for bounties where the work has been completed and approved.  DACs cannot incorporate new code generated from bounties until the bounty has been paid according to the original solicitation.

The fact that there is something major to vote on should be very obvious to any user of the platform, this needs to be as easy as possible and if it is people will opt to participate rather than delegating.  There are those who will delegate authority, see appendix B.
« Last Edit: January 01, 2014, 07:19:34 PM by AdamBLevine »
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Offline AdamBLevine

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Sample Proposals

Music - This DACP will be a market built on top of Ethereum - It will have a generic token called MusicVoice.   Those who hold MusicVoice will initially have the ability to vote on how the development funds raised for Music DACP will be spent, once the platform has been developed MusicVoice will be the exclusive token usable on the created platform.   The more people who want to use the DACP, the more valuable MusicVoice will be.   

Those who posess MusicVX will be able to hold it and speculate more people will want to use the system, therefore it will be more valuable later.   The other, more exciting use is to transmute your MusicVX into VX that represents a specific musical act.    So MusicVX becomes SnoopLionVX.   

Anyone who holds MusicVX can create a new, act specific tradable entity at .001VX/ea, or at 5% above whatever the current 24hr Average market price is.   The market will populate quickly as people create the first VX for all the popular acts out there to capture this low rate.   

At any time the DACP can tell you any number of the top most valuable specific artists on the platform by comparing the MusicVX value of each artist.    Those who discover musical acts before they get popular will see their “vote” for that artist increase in value as more people discover it and add their voice to the DAC.   

New artists could invest MusicVX in themselves and rather than selling music or charging for performances, they could just promote their MusicVX profile.  As their audience grows, the initial minimum value put in when this artist had no reputation will grow exponentially as their fanbase grows.

New Radio Stations would emerge that play Music, DACPs top 1,000 instead of Billboard top 40, categorization is just a matter of forking the market into RapMusic, DACP, WorldMusic, DACP etc.

Conference

Conference, DACP is a platform for catalyzing, funding and producing Conferences, specifically about DACP at first but then just broadly.    ConferenceVx can be held in its natural form which increases as value as more people wish to use Conference, DACPs market functions.   

ConferenceVX holders can also opt to create an event specific “Bounty” specification.   They exchange their ConferenceVX with the platform in exchange for user-denominated VX specific to the proposed event.  This happens at a fixed rate of .001Vx/each (or 5% above the current market average 24hr rate for something already created).

So, the first 10Vx would create 10000 SanJoseBitcoinConferenceVX, the 10Vx would be held in escrow for the eventual payment of the bounty and the 10000 SanJoseBitcoinConferenceVX would be created, “backed” by their value.   Conference bounties probably should not lock in investment forever, probably allowing for a range of expirations from 6 months on the shorter end to 5 years on the higher end for more remote locations requiring longer periods of fundraising or planning.  The market should decide this, these are guesses at best.

If nobody wants to support this project, the Vx held in escrow keeps the sjbcVx from losing market value since ultimately there is a 1000:1 amount of the valuable ConferenceVx that will be returned to whomever holds it if the conference never happens. 

If people like the project and decide to invest in it, they can either buy any that is available on the market at whatever price it is, or you can perform an exchange with the platform itself for a 5% premium over the last 24hr average trading price.   As soon as the existing Vx finds hands that aren’t looking for a short term profit, the most efficient way to introduce new event Vx is to convert it at the 5% premium. 

This expands the monetary base, which is begins as the “hard money backing” of the currency and ends its life as the pool from which the bounty is paid to make the event happen.   At the end of its lifecycle (after the event has occurred) the profit from the event and the remaining, unused Bounty funds are divided by the number of VX originally created and exchanged back to ConferenceVX for whomever is holding them at the expiration.

Research

Research, DACP is a platform for the catalyzing, funding, and utilization of research and development for problems of all kinds.  This can be technological, medical, etc.  Anything whose work product can result in a product, service or intellectual advancement can be operated in this fashion.

The initial funding of this dac would generate ResearchVx, as before you could hold your ResearchVx in pure form to speculate that more people will want to use ResearchVx, which would increase the number of users without increasing the supply of Vx once created.   Your Vx also gives you a say in how the ResearchVX itself uses its funds to further develop as a platform.

A more interesting use of your Vx would be to incentivize research into an area of personal interest.  Lyme disease is not a well understood ailment, it has tests that are expensive and less than 60% accurate and until recently it was not understood to be a chronic affliction at all.   If I am interested in research being done towards understanding and eventually curing Lyme Disease, I could take 10 ResearchVX and exchange them for 10000 LymeVx.   The specification would designate the funds as specifically going towards rewarding lyme research (after the fact), with a large proportion of the funds being devoted to a bounty for any effective cure for Lyme disease that meets the standards of the LymeVx Holders.   

In order to claim a bounty or award, the research or cures would have to be released to the open source.   Where economically feasible, LymeDAC would contract the manufacture, sale and distribution of products/papers furthering whatever its specifically stated goal is.   This all happens through the process of proposals and broad spending consensus amongst LymeVx holders.

As before, the process for creating a specific DAC Vx from its parent DACP can be accomplished two ways.  You can buy available LymeVx on the market, if anyone wants to sell it OR you can exchange your ResearchVx directly with ResearchDACP at 5% above the average market rate over the last 24hrs.   Buying on the market changes VxHolders, but the money supply remains 100% stable.   Exchanging with the DACP increases the average price over time for existing holders and expands the money supply in a broadly deflationary way, increasing the amount of Vx backing with a 5% buffer above market rates.   

Imagine a market with 10000LymeVx and no “fair” (under 5% above market) trades available.  Assume this is the second person entering the field, the price is still at the floor of .001Vx/ea, which means a total of 10ResearchVx are backing that 10000 LymeVX.   

So the first exchange at .001/ea generated 10,000 Lymecoins, which represents 10ResearchVx worth of value. This new market participant exchanges 10ResearchVx with ResearchDACP, the market rate of .001Vx is multiplied by the Exchange markup to .00105/ea.   Those 10 ResearchVx are added to the LymeDAC funding pool and ResearchDACP uses that as the basis to create 9523.8095 LymeVx, with the person giving those 10ResearchVx that caused its creation being the first system user to hold it.

Once there is enough value contained in LymeVx, the LymeVX Voiceholders can use their holdings to “voice” their support for specific bounties and spending propositions that incentivizes the  types of goals encoded in the Specification.
As goals are met, manufacturable products and treatments are created.  Since all work products are released as open source, the DAC can contract the manufacture and sale, for profit of relevant items.  These funds go back into the Development pool of LymeDAC.  If the problem is ever deemed “solved” by the Voiceholders, they could vote to have LymeDAC buy itself out of existance by ceasing operatation and fixing an exchange rate of Issued LymeVx to ResearchVx held in the development fund.  When the DAC has bought back all its Vx and has no ResearchVx funds left it can cease to exist.

Appendix A - Consensus Realities can be modified or re-written by the Consensus “The Merlin Requirement”

Is this a dangerous idea?

Appendix a - Insurance DAC to fund decentralized crime investigation and reporting system
<Appendix A>

Appendix b - Proxy DAC, a market for voting archetypes that allows Voiceholders for various DACPs and DACs to delegate their voting authority to a proxy that matches their decision-making criteria.  More popular archetypes will become more valuable over time.

<Appendix B>


Appendix C - Bitcoins, DACs and Liability

Appendix D
% based bounties, and delay-of-pay to allow dissenting voice to exit through Vx destruction via the DACP
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Offline toast

Whoa, adam levine is here! Cool!

I skimmed over these posts, the only comment I have is about your example DACs.

Quote
Because of this, it is advisable to give a DAC the very specific outcome you wish it to achieve but to let the actual humans performing the work for the DAC innovate at the edges of the network.

I think initially you ought to pick some application domains for which it's possible to make more specific goal states than the ones you listed. Both bitcoin and bitshares have outcomes that are easy to give concrete specifications for. The conference one is plausible, but for music and research I find it hard to imagine how to properly construct an incentive structure that leads to what most people would think of as the "goal" of putting money into music / research.
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Offline bytemaster

I can confirm this is the real Adam B. Levine
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.

Offline Pairmike

Adam,

I just finished reading your proposal.  My initial impression is Wow.  I see you have really been thinking about this system in detail and I appreciate it.  I'll have to re-read it a few more times to digest it all.  Afterwards, I'll make comments.  It is good to see you backing the DAC concept. 

Again thanks to you, Dan, and the entire Invictus Team!   
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Offline luckybit

Appendix A - Consensus Realities can be modified or re-written by the Consensus “The Merlin Requirement”

Is this a dangerous idea?

Is consensus reality the same as alternate reality? I'm not familiar with the term. Some good ideas though.
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Offline AdamBLevine

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Appendix A - Consensus Realities can be modified or re-written by the Consensus “The Merlin Requirement”

Is this a dangerous idea?

Is consensus reality the same as alternate reality? I'm not familiar with the term. Some good ideas though.

That thought came out of a conversation with an acquaintance who has quite a few bitcoins.  He knows I've been working on alternative cryptocurrency theory recently and know people building new coins.  He wants a coin that has essentially a voting mechanism that would let people who are the victims of crime and lose their bitcoins illegitimately to have the consensus be able to reverse or cancel transactions.   

This is very possible, but the problem is who gets to decide what is a good reason?  He wanted a "council of 12" or something, who would approve claims to be voted on by the coin holders but no matter how you do it you create a situation where because the rules can be broken for a good enough reason, the people who judge the reasons become the holders of a lot of power.

Thats the issue, otherwise I think its a great idea.
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Offline td services

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Appendix A - Consensus Realities can be modified or re-written by the Consensus “The Merlin Requirement”

Is this a dangerous idea?

Is consensus reality the same as alternate reality? I'm not familiar with the term. Some good ideas though.

Yes, the Illuminatus Trilogy goes into some detail on the subject...

Offline luckybit

Appendix A - Consensus Realities can be modified or re-written by the Consensus “The Merlin Requirement”

Is this a dangerous idea?

Is consensus reality the same as alternate reality? I'm not familiar with the term. Some good ideas though.

That thought came out of a conversation with an acquaintance who has quite a few bitcoins.  He knows I've been working on alternative cryptocurrency theory recently and know people building new coins.  He wants a coin that has essentially a voting mechanism that would let people who are the victims of crime and lose their bitcoins illegitimately to have the consensus be able to reverse or cancel transactions.   

This is very possible, but the problem is who gets to decide what is a good reason?  He wanted a "council of 12" or something, who would approve claims to be voted on by the coin holders but no matter how you do it you create a situation where because the rules can be broken for a good enough reason, the people who judge the reasons become the holders of a lot of power.

Thats the issue, otherwise I think its a great idea.

If they are random and those who judge have reputations and also get judged it might work. It would be a peer to peer moderation system. I think it's something which can be built in theory but getting it right in practice is very hard and it would require layers of anonymous voting.

One idea I stumbled upon was by a guy named Ola who is building a peer to peer based arbitration system( Coinsigner.com ). I think that idea is promising and would be a way to give incentives to the good actors in the system. There should not be a set number of how many people are on a counsel, it should not be a fixed number because that helps anyone trying to determine how to corrupt the system. Instead it should be a range and that range, also the aspect of randomness and anonymity secures things so that no one can know in advance who is on the jury.
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Offline smiley35

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You mentioned Ethereum. Could someone explain this in the common tongue? I have a limited understanding. I gather that it was conceived by Charles... ex ceo of invictus. I read the white paper and it seems like a very open DACP that allows people to build DACs as protocol layers within this more broad framework. Then I saw that it was going to be 25% pre mined, and I just wrote it off. Could anyone shed a little light on Ethereum for me?

Offline AdamBLevine

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You mentioned Ethereum. Could someone explain this in the common tongue? I have a limited understanding. I gather that it was conceived by Charles... ex ceo of invictus. I read the white paper and it seems like a very open DACP that allows people to build DACs as protocol layers within this more broad framework. Then I saw that it was going to be 25% pre mined, and I just wrote it off. Could anyone shed a little light on Ethereum for me?

Ethereum was conceptualized and created by Vitalik Buterin.   Charles joined the team this month in a senior role, the Ethereum ethos is very inclusive and they're looking to pull in as many partners as possible to help develop the ambitious project. 

Charles and I had been talking about starting a company that builds IPOcoins for people in December until the Ethereum whitepaper started circulating, it's a very very ambitious project but could skip a lot of headache if it works.

Personally, I'm a fan of all the projects in the space. 
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Offline smiley35

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You mentioned Ethereum. Could someone explain this in the common tongue? I have a limited understanding. I gather that it was conceived by Charles... ex ceo of invictus. I read the white paper and it seems like a very open DACP that allows people to build DACs as protocol layers within this more broad framework. Then I saw that it was going to be 25% pre mined, and I just wrote it off. Could anyone shed a little light on Ethereum for me?

Ethereum was conceptualized and created by Vitalik Buterin.   Charles joined the team this month in a senior role, the Ethereum ethos is very inclusive and they're looking to pull in as many partners as possible to help develop the ambitious project. 

Charles and I had been talking about starting a company that builds IPOcoins for people in December until the Ethereum whitepaper started circulating, it's a very very ambitious project but could skip a lot of headache if it works.

Personally, I'm a fan of all the projects in the space.

Ok, thanks for the clarification. Vitalik is a pretty rad dude. So lets say Ethereum takes off, does it rewrite the rules and swallow up projects like bitshares, and even potentially bitcoin itself? Will history have to bow into the fold of Ethereum or will it be just another way for people to play. It kinda sounds like tcp/ip(Ethereum) coming along after html(bitcoin). I realize that is a strange comparison as html wouldn't be that usefull if invented before tcp/ip, but what I'm getting at is is this a meta blockchain so to speak?
« Last Edit: January 11, 2014, 09:15:24 PM by smiley35 »

Offline AdamBLevine

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Ethereum is really ambitious and uses a lot of untested components.   I think Bitshares will beat Ethereum to market and will offer a competitive service of a different type.

That said, Ethereum looks like an awesome platform to build DACs on top of and for some applications that makes more sense than the blockchain approach.  Personally, I'm investing in all of these projects because they're all ambitious attempts at generational problems by smart, passionate people whom all have my respect.    Worst case scenario, Invictus doesn't bother building their own platform and just focuses on building and launching innovative DACs.
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Offline bytemaster

Our technical team has evaluated the Ethereum proposal and design and have concluded the following:

1) Mining means the DAC will be operating at a loss or break-even at best.  No dividends.
2) Scripts will require more blockchain space and bandwidth resulting in lower transaction volume for the same level of decentralization.
3) We do not believe the scripts can efficiently implement a BitShares like market matching with automatic margin calls at scale. 
4) Merged mining would be required to secure parallel chains... this has its own challenges.
5) Mining will result in centralization one block at a time, something very bad for chains that implement markets.
6) Finding GPU developers is hard enough, defining a new dedicated language for this purpose will be even harder.
7) If you eliminate mining, then the cost of launching a new DAC is near 0 and you can simply use C++ to encode your contracts starting from a 'shell DAC' and launch without having to overload everyone not interested in your contract. 
8) NO 'competitor' thus far is willing to admit that multiple parallel blockchains will be required to handle the order of magnitude greater transaction volume an exchange experiences vs Bitcoin and this is for a SINGLE currency pair.  Imagine attempting to have every tradable market on one chain!   This will rapidly be centralized into trusted supernodes that can handle the bandwidth requirements.
9) You think bitcoin verification times have trouble scaling, imagine executing an interpreted language!

Conclusion: We believe Ethereum is an interesting computer science project with little compelling advantage in developing new DACs and many drawbacks.   

We wish them well and if their scripting language and contract design proves useful as a means for very special purpose contracts then we suspect we will be able to adapt it to a more efficient, profitable, AGS honoring DAC.
 
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.

Offline vikram

Dan, here is what Charles wrote in response: https://bitcointalk.org/index.php?topic=412878.msg4497464#msg4497464

Quote
I'm not going to fully address Dan's concerns here. The questions he listed indicate they either didn't read or didn't comprehend the whitepaper. For example, the entire philosophy of Ethereum is to be a base layer for innovation thus the particular economic model of a DAC running on top of Ethereum is beyond the scope of our design. A person could indeed have dividends in a sub-currency, yet this point seems to have been missed or ignored.

As for P2P exchange, we have a close relationship with Open Transactions and combined with a namecoin style contract provided in the whitepaper and bitmessage makes a significantly more efficient distributive exchange than is possible with BitShares. Trust is not required as auditing can be done on Ethereum blockchain and we wouldn't suffer any bloat. 

Things like 7 again demonstrate either a lack of comprehension or ignorance of our design, contracts are more than robust enough to launch a proof of stake subcurrency. 6 seems to ignore ethereum script is turing complete and thus you can compile a language like c++ into it (anyone ever used coffeescript to write js)?

On a side note, I am honestly curious how Invictus intends on building DACs without a turing complete language? It seems like you would end in an infinite inductive process of having to build a bigger feature set for the next set of DACs. I guess they have a different philosophy and this is fine. I wish them well and hope they find success for the market's benefit.

 

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