Author Topic: What is a DAC?  (Read 1050 times)

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Offline santaclause102

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I know it's all about BitAssets atm but I think we should communicate as consistently as possible  in general and in particular what a DAC is.

I can think of three definitions:

1) A DAC is anything which uses a blockchain and has tokens which define the public ledger which is managed by the blockchain
+ is not centralized (with POS coin distribution is flat enough, with POW hasing power sufficiently distributed; overal: block production has to be open to everyone and actual block production has to be sufficiently distributed)
 + blockchain has some utility / blockchain provides a service.

2) Criteria of (1)
+ has to be profitable in sofar as expenses (e.g. in terms of share dilution with POW) must be lower than profits. This is (THEORETICALLY) also possible with POW if all expenses are paid by tx fees (exception: dilution is used to grow the ecosystem through software developement or marketing and not only for security)
+ has to be able to compete with other DACs in terms of the offers it makes (offer mainly defined by height of tx fees).

3) Criteria of  (2)
+ has to be able to give back a profit to token holders. This is only possible with POS. Regarding the crossed out: I guess you could also have a POW blockchain that pays miners solely from tx fees and x% of tx fees are burnt which is hardcoded into the DAC.

I would prefer definition (2) because this one makes it most obvious that POW can not compete with a working POS DAC. It incentivizes Bitcoin believers to analyze Bitcoin as a DAC.

This also means that there is no DAC without a blockchain and no DAC without a public ledger. Anyone wants to disagree here?
« Last Edit: September 25, 2014, 03:37:43 am by delulo »