Author Topic: 5% annual fee. What is the point?  (Read 7478 times)

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Offline mas

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Vote for removing the 5% fee. It's burdensome for people that want to support the ecosystem long term by buy and hold.

Offline teenagecheese

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The market will price in lost funds on its own.  Perhaps removing this fee will help.  It will make my life easier.

I think you're right. What you need to consider is if this rule overall makes Bitshares better or worse. Since the market WILL price in lost funds on its own, there is no reason to have it, and the rule is making Bitshares worse.

Bitshares needs to have as few restrictions on use as possible. The less restrictions, the more use cases it is opened up to. More utility = a better product = a larger and stronger network.

Bitshares should also be as easy to use as possible. Having to move my funds around to avoid a fee is just one more thing that I have to research, learn about, and deal with to own some form of bitshares. If there are enough small annoyances I just give up and use some easier form of money. In fact, that brings me to another point that Bitshares should be intuitive to use. With a good product, you just know how to use it. I shouldn't have to browse the internet for hours to figure out how to trade on the market, or what the shorting restrictions are, or how to find the right way to open an account without already having funds to register, etc. It should just be obvious. I understand some of these simplifications are probably in progress, but the point is still valid.
« Last Edit: September 14, 2014, 04:07:43 pm by wmvatis »

Offline Gentso1

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As a point of data/use case. 

My sister invested some $$ in BTSX after reading some promotional material.  I was happy to help her, because I'd just keep her funds with mine.

Then her bf who I don't particularly like told her he wanted to invest.  Well...  I wouldn't mind but this whole 5% thing means that I have to teach him something and someone has to maintain it.  I can't just help him buy it and put it in cold storage with a few copies of the private key and instructions.  So I basically told her I really didn't want to mess with it.

To argue for the other side, BTSX is not just like holding some shares. You are expected to take part in maintaining the network health, and if you can't take the trouble then we don't want you.

For multisig cold wallets, I think there might be an option where you can sign that address to show that you are still the owner of it and still active. I think we need some feature like that anyway so that I can show my balance to somebody if I want; its currently not possible due to TITAN.

Off topic, but I would like an armory type wallet, which I can keep on an unconnected laptop for ever.
This is a good point. We want holders of btsx to be active and participate in DPOS so if they can't participate then we kinda don't really want them. What good is a board of directors if they aren't around to vote? I have changed my stance, btsx should keep a inactivity fee bit the rest of bit assets should be allowed to store at will.   

Offline bitmarket

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I dont think reclaiming lost funds is very necessary, however reclaiming lost/stale votes does have some merit.   Enough to warrant the 5% fee probably not.

With regards to being active in the community, it would frustrate me to have to go around the world and assemble my multisig just to change my vote.  IT would make me not vote except in an emergency.

Am I correct in assuming votes cannot be changed under any circumstances without a transaction? Not sure how the web of trust thing works or the automatic bad delegate detection works.

Either way, what would be nice is if the private key created a derivative key, that I could vote with but not send a transaction.   I can put the private key in cold storage and voting key I could keep on my computer.

If my voting key got stolen and votes were cast not to my choosing, I could use the private key to reset a different voting key and the stolen voting key would be useless.

Seems well down the list of things to work on, but I think it would be a nice to have if at all technically possible.
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sumantso

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As a point of data/use case. 

My sister invested some $$ in BTSX after reading some promotional material.  I was happy to help her, because I'd just keep her funds with mine.

Then her bf who I don't particularly like told her he wanted to invest.  Well...  I wouldn't mind but this whole 5% thing means that I have to teach him something and someone has to maintain it.  I can't just help him buy it and put it in cold storage with a few copies of the private key and instructions.  So I basically told her I really didn't want to mess with it.

To argue for the other side, BTSX is not just like holding some shares. You are expected to take part in maintaining the network health, and if you can't take the trouble then we don't want you.

For multisig cold wallets, I think there might be an option where you can sign that address to show that you are still the owner of it and still active. I think we need some feature like that anyway so that I can show my balance to somebody if I want; its currently not possible due to TITAN.

Off topic, but I would like an armory type wallet, which I can keep on an unconnected laptop for ever.

Offline Riverhead

-5% only on btsx but not on bitAssets?


That's my thinking.  BTSX is the crucial one I feel but I also don't have the same economic theory background others have.

Offline liondani

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-5% only on btsx but not on bitAssets?

Offline Riverhead

The market will price in lost funds on its own.  Perhaps removing this fee will help.  It will make my life easier.


What about an asset like bitGLD that doesn't get the 5% fee. People can then have cold storage full of gold or silver. Then the market's primary liquid asset (BTSX) would have the controlled supply and recovery channel and people can store as much bitASSET in cold storage as they like. If they want to store BTSX they either have to refresh the keys or keep it topped up.

Offline gamey

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As a point of data/use case. 

My sister invested some $$ in BTSX after reading some promotional material.  I was happy to help her, because I'd just keep her funds with mine.

Then her bf who I don't particularly like told her he wanted to invest.  Well...  I wouldn't mind but this whole 5% thing means that I have to teach him something and someone has to maintain it.  I can't just help him buy it and put it in cold storage with a few copies of the private key and instructions.  So I basically told her I really didn't want to mess with it.
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Offline bytemaster

The market will price in lost funds on its own.  Perhaps removing this fee will help.  It will make my life easier. 
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 Riverhead

That makes sense. So the once a year thing is proof of control. Hmm...so the ability for people to have long term cold storage vs the network's ability to reclaim lost supply. Of course there's nothing stopping people from sending 5%/year to their cold storage account to keep it topped up.

Offline bytemaster

5% isn't the cost of storage, it was a reclamation of lost funds strategy. 

Voting doesn't apply to bitusd

Long term storage isn't that much of a burden with dpos. 
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 Riverhead


It might be that 5% inactivity has too much of a marketing cost.  It prevents people from just sitting on their BTSX which is usually desirable to other holders.
What about providing a single one time fee as a "storage cost". This would help keep the system profitable  and give users the option of paying a single one time fee and not having to worry about moving their holdings. You could offer it in 5 year increments and give them a discount on the 5% since they are paying the fee upfront. The beauty of this is that some users will sign up for a 5 year hold, then say we get a price spike and they want to cash out. The system gets to keep the fee and if they want to put their btsx in storage they must pay the fee again. It creates options and another avenue for the system to earn.


Or what about the option to flag an account as cold storage and have the 5% come out of another account. Command could look like

wallet_account_flag_coldstorage <account_to_flag> <account_to_pay_inactivity_fee>

Then as long as the maintenance account had BTSX in it there'd be no problem. It'd be easy to calculate out how much 5%/year would be for your cold storage accounts.

Offline yellowecho

If the point of the 5% fee was to encourage delegate voting, why couldn't there be an exemption for accounts linked to active slates?  For example, if my voting slate said "cast my votes based on Bytemaster's votes" then would it even matter if my shares were in cold storage as long as Bytemaster was active?  Or am I misunderstanding the slate feature in the web of trust? 
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Offline Gentso1

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It might be that 5% inactivity has too much of a marketing cost.  It prevents people from just sitting on their BTSX which is usually desirable to other holders.
What about providing a single one time fee as a "storage cost". This would help keep the system profitable  and give users the option of paying a single one time fee and not having to worry about moving their holdings. You could offer it in 5 year increments and give them a discount on the 5% since they are paying the fee upfront. The beauty of this is that some users will sign up for a 5 year hold, then say we get a price spike and they want to cash out. The system gets to keep the fee and if they want to put their btsx in storage they must pay the fee again. It creates options and another avenue for the system to earn.