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Offline AsymmetricInformation

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DACs vs. Firms (Are DACs useless?)
« on: June 10, 2014, 05:05:56 AM »

Hello,

I've written a short essay on the Truthcoin forum (I am the designer of Truthcoin, if you didn't know) which takes the probably-unpopular position that DACs are actually inferior to firms.

I'm positing here to get some feedback from (who I assume will be) my harshest critics, and refine these initial ideas.

http://forum.truthcoin.info/index.php/topic,90.msg195.html

I guess I'm hoping the conversation will take place there, as the forum is new and needs more posts, but I'll take whatever I can get.

Offline gamey

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #1 on: June 10, 2014, 05:17:36 AM »
Hello,

I've written a short essay on the Truthcoin forum (I am the designer of Truthcoin, if you didn't know) which takes the probably-unpopular position that DACs are actually inferior to firms.

I'm positing here to get some feedback from (who I assume will be) my harshest critics, and refine these initial ideas.

http://forum.truthcoin.info/index.php/topic,90.msg195.html

I guess I'm hoping the conversation will take place there, as the forum is new and needs more posts, but I'll take whatever I can get.

You don't really go into the problems with "firms".

I think quality writing at least examines the opposition.  I see a lot of hack writing that is just over the top pro BTC while seemingly completely misunderstanding why we might have DACs.  You should write a paper first about all the problems with centralized entities and then you would have your own critique of your work.
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Offline bitmeat

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #2 on: June 10, 2014, 09:41:17 AM »
Good write up! I believe that DACs have not evolved yet. Tools will become better, new systems will be tested/proven. It will take a much longer time than people expected.

I found it quite bizarre that Invictus would preach DACs, yet they have 2 legal entities and complain about "regulatory issues around making AGS liquid".

To me a true DAC is not controlled or owned by any legal entity. It is owned and controlled by voted delegates. Delegates in turn are incentivized to do what is expected of them, and even punished if they do what isn't expected.

Offline bitmeat

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #3 on: June 10, 2014, 09:44:04 AM »
That said, I am very interested in brainstorming around methods that make the block-chain obsolete.

I have come up with couple solutions, some close to what MaidSafe does, but there are few places that would need a different form of decentralized consensus, perhaps something like DPOS.

Offline fuzzy

Re: DACs vs. Firms (Are DACs useless?)
« Reply #4 on: June 10, 2014, 10:19:16 AM »
To me a true DAC is not controlled or owned by any legal entity. It is owned and controlled by voted delegates. Delegates in turn are incentivized to do what is expected of them, and even punished if they do what isn't expected.

If I am correct (and obviously I think I am :P), Invictus is a Central entity that formed to create the DAC toolkits and develop their own DACs to start and compete in the market.  I do not recall them ever saying anything about being a DAC themselves, though.
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Offline bitmeat

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #5 on: June 10, 2014, 10:41:25 AM »
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Re: DACs vs. Firms (Are DACs useless?)
« Reply #6 on: June 10, 2014, 10:45:11 AM »
To me a true DAC is not controlled or owned by any legal entity. It is owned and controlled by voted delegates. Delegates in turn are incentivized to do what is expected of them, and even punished if they do what isn't expected.

If I am correct (and obviously I think I am :P), Invictus is a Central entity that formed to create the DAC toolkits and develop their own DACs to start and compete in the market.  I do not recall them ever saying anything about being a DAC themselves, though.
+Invictus/Bytemaster/Stan stated several times that invictus is a part of the bitshares ecosystem
+AGS/PTS is just their way of distributing initial shares, legal issues have nothing to do with DACs in general but with invictus holding the keys for the Angel addresses!
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Offline bitmeat

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #7 on: June 10, 2014, 10:57:01 AM »
To me a true DAC is not controlled or owned by any legal entity. It is owned and controlled by voted delegates. Delegates in turn are incentivized to do what is expected of them, and even punished if they do what isn't expected.

If I am correct (and obviously I think I am :P), Invictus is a Central entity that formed to create the DAC toolkits and develop their own DACs to start and compete in the market.  I do not recall them ever saying anything about being a DAC themselves, though.
+Invictus/Bytemaster/Stan stated several times that invictus is a part of the bitshares ecosystem
+AGS/PTS is just their way of distributing initial shares, legal issues have nothing to do with DACs in general but with invictus holding the keys for the Angel addresses!

I'd like to see a system in which the keys of a DAC don't need to be held by a centralized entity. That's all.

What Invictus is doing is good, but not great. Things can be improved 10x. But anytime I raise the questions I'm tagged as a "non-believer" and a FUD spreader. I'm just looking at the natural progression of the space. Nothing wrong with expecting more, especially, when I see it is possible.

I'm not in a position to go work on these ideas full time at the moment. But may be I should. So far every experiment I did for fun is showing promising progress. I even have a prototype for a quantum computing resistant coin.

Offline luckybit

Re: DACs vs. Firms (Are DACs useless?)
« Reply #8 on: June 10, 2014, 11:13:07 AM »
Hello,

I've written a short essay on the Truthcoin forum (I am the designer of Truthcoin, if you didn't know) which takes the probably-unpopular position that DACs are actually inferior to firms.

I'm positing here to get some feedback from (who I assume will be) my harshest critics, and refine these initial ideas.

http://forum.truthcoin.info/index.php/topic,90.msg195.html

I guess I'm hoping the conversation will take place there, as the forum is new and needs more posts, but I'll take whatever I can get.

Inferior in what way?
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Offline luckybit

Re: DACs vs. Firms (Are DACs useless?)
« Reply #9 on: June 10, 2014, 11:17:16 AM »
Good write up! I believe that DACs have not evolved yet. Tools will become better, new systems will be tested/proven. It will take a much longer time than people expected.

I found it quite bizarre that Invictus would preach DACs, yet they have 2 legal entities and complain about "regulatory issues around making AGS liquid".

To me a true DAC is not controlled or owned by any legal entity. It is owned and controlled by voted delegates. Delegates in turn are incentivized to do what is expected of them, and even punished if they do what isn't expected.

I think DACs are superior for virtual entities which have to operate across multiple jurisdiction. The law just cannot keep up with technology. So why would you want to artificially slow the rate of innovation by going with a firm when you can build a DAC without permission and apologize later on?

Innovate and then apologize rather than fear to innovate and have the species go possibly extinct as a result. No one needs permission to make a DAC and it can run independent of human operators someday while a firm will never be able to do that.

DPoS isn't the only possible design for a DAC. I also don't think every DAC has to have a blockchain. MaidSafe may actually be a DAC too if they can get it running properly and it doesn't have a blockchain.

It all depends on if you take the strict definition of a DAC or a loose definition. In the strictest definition MaidSafe lacks transparency because we cannot see all the transactions but it fits everything else.




« Last Edit: June 10, 2014, 11:21:11 AM by luckybit »
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Offline bitmeat

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #10 on: June 10, 2014, 11:34:23 AM »
I think DACs are superior for virtual entities which have to operate across multiple jurisdiction. The law just cannot keep up with technology. So why would you want to artificially slow the rate of innovation by going with a firm when you can build a DAC without permission and apologize later on?
That was my point - even Invictus the "champions" of DAC, had to create entities, and then deal with complications. I'm not judging, just pointing out that a true DAC was not their first choice for their operation.

Innovate and then apologize rather than fear to innovate and have the species go possibly extinct as a result. No one needs permission to make a DAC and it can run independent of human operators someday while a firm will never be able to do that.
Correct. However Stan recently made a post stating the opposite, saying that "better to ask for forgiveness, than permission" was a bad idea.
Again - not judging, just showing that they are not truly embracing and eating their own dog food. However I'm hoping that will soon change.

DPoS isn't the only possible design for a DAC. I also don't think every DAC has to have a blockchain. MaidSafe may actually be a DAC too if they can get it running properly and it doesn't have a blockchain.

Like I said, there are many ways to innovate in the area. Block-chain is probably going to be viewed as an outdated technology not long from now.

It all depends on if you take the strict definition of a DAC or a loose definition. In the strictest definition MaidSafe lacks transparency because we cannot see all the transactions but it fits everything else.

Why do you need to see all the transactions? In fact that's why it's the perfect solution - it solves privacy concerns as well. So long as you have proof that you own your amounts, why do you care to see other transactions?

Offline fuzzy

Re: DACs vs. Firms (Are DACs useless?)
« Reply #11 on: June 10, 2014, 11:35:14 AM »
To me a true DAC is not controlled or owned by any legal entity. It is owned and controlled by voted delegates. Delegates in turn are incentivized to do what is expected of them, and even punished if they do what isn't expected.

If I am correct (and obviously I think I am :P), Invictus is a Central entity that formed to create the DAC toolkits and develop their own DACs to start and compete in the market.  I do not recall them ever saying anything about being a DAC themselves, though.
+Invictus/Bytemaster/Stan stated several times that invictus is a part of the bitshares ecosystem
+AGS/PTS is just their way of distributing initial shares, legal issues have nothing to do with DACs in general but with invictus holding the keys for the Angel addresses!

Being part of the bitshares ecosystem does not make Invictus a DAC does it?  I thought they focused specifically on building the toolkit and then creating their own DACs (Bitshares brand). 

Interested in clearing this up. 
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Offline bitmeat

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #12 on: June 10, 2014, 12:01:17 PM »
Let me clear something up as well - I am looking at how I would do things differently, had I been starting BitShares from the beginning.
It is clear that Invictus is doing exactly what they promised to do, and they have not set the expectations this high.

So here is how I would do it:

1. I would make the funding only a % pledge amount. Say 5%. I.e. you pledge 5% of your donation, but only buy the full amount once the system is up and running (within 3 months of the start). Yes, this would require actually building a DAC that allows cross chain decentralized exchange. Yes, it is possible. However I wouldn't even expect donations, I'd probably do a proof of burn instead. This also gives better incentive on making my own asset worth something.

2. Then I would create projects and proposals for bettering the system, which would be funded by the owners. I would NOT accept "donations" in PTS or BTC. (let's face it, that's just a term masking the fact that they are doing an IPO). It would be all through assurance contracts, and the funds would not only be available to spend as I see fit. Yes, Invictus has stated that they will spend the funds AS THEY SEE FIT. My opinion is that this is still old school mentality.

3. I would also build restrictions in the system, such that any funded project has limits on spend. i.e. it has predefined milestones, and limits on how much you can spend per day, unless voting approves it (sometimes there is a need)

In any case, I might just have to get these prototypes to a more complete stage and present them for peer reviews. Because until people see what my vision is and how it works, I'm just my own echo chamber and come off as FUD, when really I'm just looking at how I would improve things. I see so many possible improvements, but it is clear that Invictus is not willing to make drastic changes, and perhaps that is a good thing, as it is risky, and also clear that the investors in Invictus don't want them to make changes. So, Invictus will deliver on what they set out to do. And I should shut up and go back to the drawing board. :)


Offline gamey

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Re: DACs vs. Firms (Are DACs useless?)
« Reply #14 on: June 10, 2014, 01:20:03 PM »
I'd like to see a system in which the keys of a DAC don't need to be held by a centralized entity. That's all.

What Invictus is doing is good, but not great. Things can be improved 10x. But anytime I raise the questions I'm tagged as a "non-believer" and a FUD spreader. I'm just looking at the natural progression of the space. Nothing wrong with expecting more, especially, when I see it is possible.

I'm not in a position to go work on these ideas full time at the moment. But may be I should. So far every experiment I did for fun is showing promising progress. I even have a prototype for a quantum computing resistant coin.

 DACs don't have centralized keys held by centralized entities. AFAIK.  If so then it wouldn't be a DAC ?

I'm curious about your quantum computing resistant coin.  Any details on how you achieved it ?
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