Author Topic: Nxt Rollback & Bitshares - Just an Idea for Consideration  (Read 11189 times)

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Offline lucky331

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do what Nxt did and keep the integrity of the project intact.

Offline xeroc

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I think if you are going to attempt to proactively address the issue then a "frozen funds account" would be best.  An account where funds can be frozen by 51% majority and unfrozen later.  People complain all day about this being abused, but it can always be done by 51% regardless of whether it is proactively supported.
This ... together with the 5% inactivity fee sounds extremly selfish .. wouldn't advice to do so

Offline gamey

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I think if you are going to attempt to proactively address the issue then a "frozen funds account" would be best.  An account where funds can be frozen by 51% majority and unfrozen later.  People complain all day about this being abused, but it can always be done by 51% regardless of whether it is proactively supported.

It would be nice if you could just freeze all the funds from a certain transaction going forward.  Not addresses, but portions of the funds, etc.  So if I steal 100 btsx, and give 1 to 100 different addresses, well each of those new addresses will have 1 btsx frozen.

The problem with rollbacks is there is an opportunity for people not even directly involved.  I expect a rollback - I can take my funds, switch them over to BTC.  Now whoever bought my NXT gets screwed.  So a generic rollback invites abuse by sharp and dishonest parties.  It punishes smaller operations at the cost of the big guys.  This is definitely what we do not want.

I speak for myself and only myself.

Offline mf-tzo

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Hmmm... this might be a dumb idea but...

What if there was a process in place where users could vote to burn stolen BTSX or automatically transfer stolen BTSX to an insurance account?  If 51% consensus is reached, the registered account could be flagged and any BTSX sent from the account would be automatically redirected into the insurance fund.  In the event that the flagged account tries to distribute the stolen funds to other accounts, the other accounts could also flagged and fined based on the transaction amount.

I was thinking of something similar. For example if funds are stolen then these are burned as dividends or keep them in an insurance account.

But you cannot flag the account and the accounts that the stolen funds are redirected since the thief can start sending funds to everyone in order to further mess up with all the accounts and we end up hurting ourselves.

I am not in favor of a rollback either. what if in the meantime I make a huge deal with someone in bitusd and then we have a rollback and the other party realises that the deal he has done is not in his favor? we will  lose credibility in case of rollback and no serious business is going to accept this if there is this possibility of an "undo" button.. I think NXT got really away because they didn't do the rollback. I believe that if they had done so they would in vericoin's position now.

I don't understand very much how these things work, but in case of a theft and if there is very good proof that this is actually a theft and delegates vote 70% that this is a theft can't we just freeze these money completely and decide later how to proceed? i.e could be burned as dividends, could be sent to a charity, could be used as insurance fund, or we just find the hacker and make him return the funds?



Offline bitmarket

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ByteMaster with regards to your one click hardfork as a protection against delegate takeover, have you not effectively already created this?   I guess you are talking about the ability to add "Motions" to be voted on.

A motion could be "Do we want to hard fork to undo a theft"   Or a Motion could be, "Do we want to create new shares (diluting ours) and pay a Marketing company to Market the Chain?"   Or "Do we want to dilute our shares and pay Oprah 1 million shares for an endorsement?"

Is that were this eventually must get to?
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Offline bitmarket

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Key is competition... there can be many competing BTSX chains... you can sell shares in one and move to another with smarter owners.

Maybe i am getting soft and mushy. I am trying to protect the fools from themselves.
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Offline Brent.Allsop

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No matter what types of rules you set up, where there is a will, someone will find some new way to game the system.  What you need is a system that can improve and react, instantly, in an amplification of the wisdom of the crowd way, so things can constantly dramatically change and improve rapidly, handling all possible threats instantly, in a non bureaucratic leaderless way.  All this is possible with systems like that being developed at Canonizer.com.  With canonizer.com systems, millions of people can change dramatic directions on a dime, even faster than 24 hours, and you can be sure you have buy in by everyone. or know now, concisely and quantitatively how many people will leave, if you do, and so on.

Offline oldman

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No rollbacks.

The moral hazard is simply too great, particularly in the long term.

Having an 'undo' button will also encourage complacency.

Humans are by nature greedy and lazy... to pretend otherwise is inviting disaster.

Ie. current global banking complex.

Do it right.

Offline tonyk

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Now that my BTSX are safely out of bter.com....

I have NO IDEA which is the smaller of the 2 evils.

On that day if it was BTSX instead of NXT I know what I would have done. Be it wrong or right in the long run....
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.

Offline bytemaster

We have the power to elect Congressman and they have the power to bailout.   How did that work for us?

Key is competition... there can be many competing BTSX chains... you can sell shares in one and move to another with smarter owners.

You don't want any crypto to get to the size of the USD.
For the latest updates checkout my blog: http://bytemaster.bitshares.org
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Offline gamey

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THis *really* needs to be discussed.  As far as we know, this was a test by bter to see what would happen. 

If an exchange sees that there will be no rollback, there is a huge incentive to take the bank and run.  This happens so often.  Rollbacks go against the idea of what cryptos are for and blockchains etc, but IMO it is really needed.  Yes, we need our own bailouts to protect users.

For bter.com a rollback protects users from a malicious exchange, even if it is put forward as a 'bailout' for the exchange.  In fact, it might not even be a bailout for an exchange, it could be something that hurts their plan. (fake hack)

If it is possible with Titan, there definitely should be a plan of action here.
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Offline BldSwtTrs

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What would prevent a government to pay delegates to retrieve funds identified as tax evaders' possession?

Their is always the option to hard-fork if delegates are corrupted in such a manner.  Delegates can be voted out as well.  Also, the amount in question must be above a certain threshold before it can even be considered.  Ie: a government couldn't bribe delegates to go after the little guys.
Right now we are between people who understands that government are evil, but that's situation is temporary.

Let's suppose Bitshare is mass adopted, a delegate who comply with a western government query will not be perceived by the majority as corrupt, not more than a corporation is perceived as corrupt when it abides by the law of its country.

Historically people are voting to make taxes higher, there is no reason to assume that in a world where BitshareX is mass adopted their opinion regarding taxation will change.

If you implement this kind of tool within the system, people and government will use it.

PS: the treshold is not a security either, let's say it is 10%, if I am a politician who want to redistribute wealth, I can propose to take 10% of the XTS from the richer to give to the poorer.
 
« Last Edit: August 18, 2014, 09:29:38 pm by BldSwtTrs »

Offline bitmarket

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We have the power to elect Congressman and they have the power to bailout.   How did that work for us?

Plus the cost of security is transferred from the ones who should pay to the innocents (cost of software updates). 

The too big to fails are not properly incentivized to have security, because they are likely to get bailed out.

Lets not start singing Kumbaya and get all soft and mushy now.   Because if we do, 200 years later the constitution of this great experiment will falter.
« Last Edit: August 18, 2014, 09:28:52 pm by bitmarket »
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Offline yellowecho

Hmmm... this might be a dumb idea but...

What if there was a process in place where users could vote to burn stolen BTSX or automatically transfer stolen BTSX to an insurance account?  If 51% consensus is reached, the registered account could be flagged and any BTSX sent from the account would be automatically redirected into the insurance fund.  In the event that the flagged account tries to distribute the stolen funds to other accounts, the other accounts could also flagged and fined based on the transaction amount.
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Offline luckybit

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There comes a point in every crypto-currency's life where a major hack threatens the health of the system.   It is always possible for major stakeholders (miners) to hard-fork in order to correct the problem, but hard-forks are messy and ugly.

The options for a network are:

a) never reverse transactions, to hell with the share price
b) permit bailouts with consensus

If the BTSX on BTER had been stolen, what would we do?   It would certainly be within our power to reverse it with a single update pushed to the delegates.  It could potentially "fork" the network if the delegates disagreed with the process.

Given that forks are "difficulty but possible" it sets a certain threshold that must be reached before it would be considered.  I think that it may be best to recognize that sometimes a network needs to come to consensus about this stuff and design it in ahead of time so that there are no hard forks.   

Fortunately we have delegates and thus we can design a process something like this:

Step 1)  Pay a large fee to propose reallocating funds from a set of addresses to a new set of addresses.
Step 2)  Delegates have 48 hours to approve the reallocation during which time the funds are frozen.
Step 3)  Require 51% of the delegates to approve it.
Step 4)  Like the pay-rate, delegates can campaign on a platform of always voting NO and this campaign promise can be enforced.
Step 5)  The amount in question must be greater than X% of the shares, and the fee should be very high.

Potential Problems:
1) Someone could attempt to "bribe the delegates" by proposing a massive reallocation to the delegates as part of approving the process....
   a) someone could also do this to bribe miners, forgers, etc to mine on the fork

Bottom line is this:  if it is possible to implement via a hard fork and there are cases where people would choose to hard fork, then perhaps we should formalize the process and prevent the hardfork and overall disruption.   The mere presence of such recourse is likely to prevent many large thefts in the first place.

Thoughts?

Permit bailouts with consensus. Our network has delegates which we select so we have the power do to do it democratically. But it should require 70% yes vote to do it and it should be very limited in how far it can roll back. No more than 48 hours.

What if the nightmare scenarios happen where hackers or even governments confiscate our digital property?

I think it's something worth debating for a while. We should spend a few months debating the political consequences and find a way to do it in a way which makes it harder for property to be confiscated by Mallery or Gordon.

« Last Edit: August 18, 2014, 09:12:07 pm by luckybit »
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