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Offline CoinHoarder

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My "explain it like I'm five" attempt
« on: September 19, 2014, 06:05:09 PM »

All criticism is welcome. :)

This is more directed at people that already know about Bitcoin. It is bullish on BTSX but with a touch of realism that respects Bitcoin, yet it still highlights the fact that Bitcoin is not perfect.

BitShares is a family of DACs (Distributed Autonomous Corporations) that analyzes, designs, develops, and operates cryptocurrencies as businesses. The Bitcoin "business" is ran at a huge loss every year due to the amount of coins minted to pay for the security of the network and all the electricity burned in the process. Due to the number of coins minted to pay for the security of the network, it dilutes Bitcoin's value by inflating the cryptocurrency and requires the influx of new money to the tune of millions of dollars a year to retain its value. Even when all Bitcoins will have been mined (around the year 2140), we can only speculate as to whether the transaction fees will be incentive enough for Bitcoin miners to continue to secure the network as the amount of electricity burned makes it expensive. The value will need to go way up and be widely adopted, or the transaction fees raised (which is unfortunately one of the selling points of Bitcoin.)

Whereas Bitshares DACs are profitable for its share holders, or in other words people that own the Cryptocurrency. It makes the Cryptocurrency model profitable by adding features that generate revenue in the form of fees which are subsequently destroyed which creates a truly deflationary money supply, by eliminating the wasteful use of electricity required to keep a PoW network secure by implementing a new PoS variant named Delegated Proof of Stake, and by not printing more Cryptocurrency to pay for others to secure the Blockchain as they are also paid with a percentage of the fees that are generated by use of the Cryptocurrency and its profitable features. The BitShares DAC business model is one of the only truly deflationary Cryptocurrencies and that is how it turns its profit, as no new Cryptocurrency is ever printed and the fees generated from transactions, features and services on the block chain are destroyed.

The first DAC of the Bitshares DAC family is BitsharesX. It has a decentralized exchange allowing the trade of market pegged assets that resemble the value of their real life counterparts which are named Bitassets (read: derivatives.) This allows someone to store their Cryptocurrency without the volatility that goes along with them by storing them in FIAT derivatives, and also allows them to diversify their Cryptocurrency portfolio into commodity and stock derivatives such as Gold, Silver, Oil, Apple stock, and Google stock. Allowing users to store Cryptocurrencies in more stable assets is a good way to hedge against bubbles, and that can help support the price of the Cryptocurrency as no money exits the ecosystem when purchasing Bitassets.

Along with providing stabile assets and allowing diversification, Bitassets allow someone to gain more leverage by going “short” on any of the Bitassets if they are bullish on the short term value of a certain Bitasset. By getting more leverage, you are taking a risk that the value of a certain asset will go up in regards to the collateral you provide. Bitassets also accumulate interest by being granted a portion of the trading fees that are collected by trading each Bitasset. The interest is currently around 1.5% APY, with the ability to grow if BitsharesX and Bitassets are more widely adopted. The Bitassets are backed by 200% of the value of each particular Bitasset in the BitsharesX Cryptocurrency, so there is no fractional reserve banking or printing of Bitassets without collateral. The Bitassets and the BitsharesX cryptocurrency can all be used (sent, received, spent, or traded) in the same way Bitcoin can but with several advantages.

BitsharesX uses as free of a free market approach to keep the Bitassets close to the value of their real life counterparts. It is basically a free market with “training wheels” to protect users from possible market attack vector dynamics and to keep the market pegs as close as possible to their real values. You will also be able to use any Bitshares Bitasset or Cryptocurrency as payment for features and services in other DACs as all Bitshares DACs will be interconnected. There are DACs currently planned for decentralized voting (makes voting fair, open, and honest), domain name services (not subject to domain seizure and domain name squatting deterrent), music (invest in artists you like and own royalties on their music by funding recording and other expenses), and gambling (provably fair gaming and removal of counter-party risk via trusted third parties.)

The base Cryptocurrencies that the DACs operate off of are inherently better currencies than Bitcoin and most other Cryptocurrencies. One of these advantages is that it has 10 second block times, which is much better than Bitcoin's 10 minute block times. Even with it being much faster, it has been redesigned from the ground up for that 10 second confirmation to be more secure than 1 Bitcoin confirmation which takes 10 minutes, as one confirmation means it has been confirmed by 60% of the network by its Delegates. This allows them to scale better by being more efficient, and makes transactions faster. The wallet makes users to use "Bitcoin's best privacy practices" by generating a new address for every transaction using deterministic public and private keys, which greatly increases financial privacy whether someone is privy to the best financial privacy practices or not. There is also an optional alias system that allows users to register account names, so the long nonsensical addresses are never seen or used if someone doesn't want to use them. You can send the base currency or any Bitasset to "Coinhoarder", and the network automatically generates a new spending and receiving address for both parties behind the scenes.

In my opinion although Bitshares DACs are revolutionary, at this point in time the features and improvements thus far will likely not be enough to overtake Bitcoin’s network effect, infrastructure, community, and thus its value. I believe that it will still grow to be very large serving niche markets and it is even possible for them to overcome Bitcoin with an expanded feature set more DACs will provide, a fully developed infrastructure, more development on the base currency and features of the DACs, and a larger community and user base. Bitshares DACs are developing at a fast rate with extremely talented and dedicated developers, and a supportive community. If Bitcoin sits back and does nothing to improve upon itself, I think it will likely see its market share slowly dwindle down to the point that it is no longer the Cryptocurrency to beat. I see innovative cryptocurrencies, and the DAC model, as potential Bitcoin killers at some point down the road. That is unless Bitcoin starts improving itself at a quicker rate, and stops criticizing all block chain innovations and features as unneeded gimmicks. Projects like Bitshares DACs are potentially Bitcoin killers, and it may make Bitcoin zealots feel better to call them “scam coins” but they are truly revolutionary. They are certainly a leap in the right direction for Cryptocurrency as a technology, and many would argue that it is a much better solution than Bitcoin already.
« Last Edit: October 01, 2014, 08:49:01 AM by CoinHoarder »
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Online Chuckone

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Re: My "explain it like I'm five" attempt
« Reply #1 on: September 19, 2014, 06:47:54 PM »
Like it!

The only thing I see that might spook a lot of people believing in Bitcoin is what you mention as the kind of inevitable death of Bitcoin in the future if it doesn't reinvent itself and the way you say that Bitshares has already done harm to Bitcoin. I think you're right, but I also believe a firm Bitcoin believer could argue.

I can already imagine the reactions if that was posted on Reddit...

Offline CoinHoarder

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Re: My "explain it like I'm five" attempt
« Reply #2 on: September 19, 2014, 06:54:36 PM »
Like it!

The only thing I see that might spook a lot of people believing in Bitcoin is what you mention as the kind of inevitable death of Bitcoin in the future if it doesn't reinvent itself and the way you say that Bitshares has already done harm to Bitcoin. I think you're right, but I also believe a firm Bitcoin believer could argue.

I can already imagine the reactions if that was posted on Reddit...

Cool, thanks. I guess I have never been one to beat around the bush. Perhaps I should of toned it down a bit. :)

I have been debating Bitcoiners for days now, trying to get them to change their minds about PoW and added features being unnecessary gimmicks. Bitshares is a good example to use to make that point. Maybe we will gain some supporters if I can change some people's minds about things!
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Re: My "explain it like I'm five" attempt
« Reply #3 on: September 19, 2014, 07:04:34 PM »
At some point the superiority of DPOS compared to PoW and the fact that DACs are actually profitable (Bitcoin can't claim that much) will come clear to even the most close-minded Bitcoin believer out there.

In Bitshares I believe!   :)

Offline eagleeye

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Re: My "explain it like I'm five" attempt
« Reply #4 on: October 01, 2014, 05:46:32 AM »
All criticism is welcome. :)

This is more directed at people that already know about Bitcoin. It is bullish, yet with a touch of realism that respects Bitcoin as the innovative cryptocurrency that it is and highlights the fact that it is not perfect as it currently exists today.

Bitshares is a family of DACs... Distributed autonomous corporations that looks at cryptocurrencies as a business. The Bitcoin "business" is ran at a huge loss every year due to the amount of coins minted to pay for the security of the network and all the electricity burned in the process. Due to the number of coins minted to pay for the security of the network, it dilutes Bitcoin's value and requires the influx of new money to the tune of millions of dollars a year to retain its spending power. Whereas Bitshares DACs are profitable for its share holders, or in other words people that own the Cryptocurrency. It makes the Cryptocurrency model profitable by adding features that generate revenue in the form of fees which are destroyed, eliminating the wasteful use of electricity required to keep a PoW network secure, and by not printing more Cryptocurrency to pay for others to secure the Blockchain as they are also paid with a percentage of the fees that are generated by use of the Cryptocurrency. The DAC model is truly deflationary and that is how it turns its profit, as no new Cryptocurrency is ever printed and the transaction fees and fees collected by services on the block chain are destroyed. Whereas Bitcoin will be inflationary for the rest of our lives and requires the influx of new money in order to maintain or grow its buying power.

The first DAC of the Bitshares DAC family is BitsharesX. It has a decentralized exchange allowing the trade of market pegged assets that resemble the value of their real life counterparts. This allows someone to store their cryptocoins without the volatility that goes along with them, and also allows them to diversify outside of cryptocoins in commodities like gold, silver, or oil. The assets and the Cryptocurrency they are backed by can all be used in the same way Bitcoin can, but with several advantages. Furthermore, these features will be shared by all Bitshares DACs, and you will be able to use bitUSD, bitGOLD, or any Bitshares asset or token as payment for features in other DACs. There are DACS planned for voting, DNS, music, and gambling. It is basically combining the Bitcoin ecosystem into the block chain and eliminating the need for trusted third parties. With Bitcoin trusted third parties are relied on to do a lot of the core services, and not so core services (gambling etc), by requiring the use of trusted third parties it subjects the users of Bitcoin to unnecessary counterparty risk.

I already briefly mentioned the volatility and diversification possible, those are a couple of the biggest advantages of the BitsharesX DAC. Along with the advantages building services on top of the block chain will bring, if you ignore the new features that are built on top of DACS, the base currency that DACS operate off of is inherently a better currency than Bitcoin. One advantage is that it has 10 second block times, which is much better than Bitcoin's 10 minute block times. Even with it being faster, it has been redesigned from the ground up for that 10 second block time to be more secure than 1 Bitcoin confirmation that takes 10 minutes, as one confirmation means it has been confirmed by 60% of the delegate nodes. It also forces people to use "Bitcoin's best practices" by generating a new address for every transaction using deterministic public and private keys, which greatly increases financial privacy whether someone is privy to the best financial privacy practices or not. There is also an optional alias system that allows users to register account names, so the long nonsensical addresses are never seen if someone doesn't want to. You can send the base currency or any asset to "Coinhoarder" and the network automatically generates a new spending and receiving address for both parties behind the scenes.

In summary, although the features and improvements thus far may not be enough to overtake Bitcoin, it can and has certainly hurt it by taking away market share, community members, and developers. It is possible that the feature set (more DACS) and improvements to the base currency are expanded upon enough so that it could overtake Bitcoin at some point in the future. It may not be there as of today, but these projects are developing like crazy and constantly improving upon themselves. Even if it doesn't overtake Bitcoin, it still hurts it as I said by taking away market share, community, and developers. If Bitcoin sits back and does nothing, they could see their market share slowly dwindle down to the point that they are no longer the Cryptocurrency to beat. I see innovative cryptocurrencies and the DAC model as potential Bitcoin killers at some point down the road, that is unless Bitcoin gets off its ass, starts improving itself at a quicker rate, and stops criticizing all innovations as unneeded gimmicks. Projects like this are potential Bitcoin killers, it may make Bitcoiners feel better to call them scam coins, but they are truly revolutionary within the Cryptocurrency ecosystem and many would argue a much better solution than Bitcoin.

Post this on reddit

Offline CoinHoarder

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Re: My "explain it like I'm five" attempt
« Reply #5 on: October 01, 2014, 06:49:22 AM »

Post this on reddit

Ehhh. I'd like to rewrite it a bit. I was a little inebriated while writing it and am a bit embarrassed by the way I worded some things haha. It is a little too confrontational and blunt for an EILI5.  ;D
« Last Edit: October 01, 2014, 06:51:35 AM by CoinHoarder »
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Re: My "explain it like I'm five" attempt
« Reply #6 on: October 01, 2014, 07:08:36 AM »
Post this on reddit
good idea

/r/BitShares would be a good start

on r/Bitcoin you will probably be downvoted like hell
mabye x-post in
/r/cryptocurrency
/r/Rad_Decentralization
Give BitShares a try! Use the http://testnet.bitshares.eu provided by http://bitshares.eu powered by ChainSquad GmbH

Offline CoinHoarder

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Re: My "explain it like I'm five" attempt
« Reply #7 on: October 01, 2014, 08:38:30 AM »
I just pretty much rewrote the whole thing. I added some things I hadn't mentioned before, and toned it down a little bit by making it less confrontational and less blunt.

What do you think now?  :D
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Offline davidpbrown

Re: My "explain it like I'm five" attempt
« Reply #8 on: October 01, 2014, 08:56:59 AM »
First sentence is too complex.

BitShares is a family of Distributed Autonomous Corporations (DACs) that allow cryptocurrencies to move beyond simply being currency and operate as trading businesses.

The remainder of the first paragraph just looks like insecurity. Attacking others is not the actions of those in a confident position. Don't sweat the small stuff and do not worry about the competition, focus all your efforts and attention on what you have to offer.

I haven't time atm for the rest.. which suggests perhaps consider formatting bold of paragraph header bullets that act as a tldr;

Consider all audience's perspectives and reread from their context not from your own.
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Offline CoinHoarder

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Re: My "explain it like I'm five" attempt
« Reply #9 on: October 01, 2014, 09:00:05 AM »
Thanks for the feedback. I am headed to bed, but I will likely edit again tomorrow.

Cheers
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Re: My "explain it like I'm five" attempt
« Reply #10 on: October 01, 2014, 09:49:52 AM »
This is more directed at people that already know about Bitcoin. It is bullish
on BTSX but with a touch of realism that respects Bitcoin, yet it still
highlights the fact that Bitcoin is not perfect.
I totally agree on 'respecting' bitcoin, thought the technology is 'obsolete'.

BitShares is a family of DACs (Distributed Autonomous Corporations) that
analyzes, designs, develops, and operates cryptocurrencies as businesses.
BitShares does not analyze nor does it operate cc as business. You are mixing
up BitShares and DACs here.

BitShares(.org): develops
3rd parties such as DSL: deploys and operates
DACs: analyze, designs and DEFINES businesses

Whereas Bitshares DACs are profitable for its share holders, or in other words
people that own the Cryptocurrency.
I'd start like: "In contrast to the Bitcoin "business", BitShares "businesses"
(ie. DACs) are profitable ...
[/quote]

You also need to distinguish between the TOKENS (ie. BTSX) and the crypto
currencies (ie. bitUSD) because the "business" for those are different regarding income!

It makes the Cryptocurrency model
profitable by adding features that generate revenue in the form of fees which
are subsequently destroyed which creates a truly deflationary money supply, by
eliminating the wasteful use of electricity required to keep a PoW network
secure by implementing a new PoS variant named Delegated Proof of Stake, and by
not printing more Cryptocurrency to pay for others to secure the Blockchain as
they are also paid with a percentage of the fees that are generated by use of
the Cryptocurrency and its profitable features.
BTSX = Token ... NOT Crypto currency!
bitUSD is the CC!

The BitShares DAC business model is one of the only truly deflationary
Cryptocurrencies and that is how it turns its profit, as no new Cryptocurrency
is ever printed and the fees generated from transactions, features and services
on the block chain are destroyed.
Only true for the TOKEN .. not for the bitASSET (ie, currencies)

Just replace cryptocurrencies with TOKENS in all of the above and we are fine
.. maybe also add that difference between tokens and currencies.
Tokens are more like 'shares' in the company/business than currencies that
should be used to pay for a coffee!

The first DAC of the Bitshares DAC family is BitsharesX. It has a decentralized
exchange allowing the trade of market pegged assets that resemble the value of
their real life counterparts which are named Bitassets (read: derivatives.)
... Theses are cryptocurrencies!!!

Along with providing stabile assets and allowing diversification, Bitassets
allow someone to gain more leverage by going “short” on any of the Bitassets if
they are bullish on the short term value of a certain Bitasset. By getting more
leverage, you are taking a risk that the value of a certain asset will go up in
regards to the collateral you provide. Bitassets also accumulate interest by
being granted a portion of the trading fees that are collected by trading each
Bitasset.
Maybe add that usually (in the traditional sense) these trading fees are income exclusively to the exchange!!!

The interest is currently around 1.5% APY,
  .... on bitUSD!! (AFAIK)

... with the ability to grow
if BitsharesX and Bitassets are more widely adopted. The Bitassets are backed
by
(at least) 200%

BitsharesX uses as free of a free market approach to keep the Bitassets close
.. dont get it .. typo? are we talking 'fees' here?

The base Cryptocurrencies that the DACs operate off of are inherently better
currencies than Bitcoin and most other Cryptocurrencies. One of these
advantages is that it has 10 second block times, which is much better than
Bitcoin's 10 minute block times.
That not really a 'feature' of the currencies but of DPOS in which the
transactions for bitAssets are confirmed.

You can send the base currency or any Bitasset to "Coinhoarder", and the
network automatically generates a new spending and receiving address for
both parties behind the scenes.
Base currency = token, or DAC token .. but not currency
account names are lower case!!

In my opinion although Bitshares DACs are revolutionary, at this point in time
the features and improvements thus far will likely not be enough to overtake
Bitcoin’s network effect, infrastructure, community, and thus its value. I
believe that it will still grow to be very large serving niche markets and it
is even possible for them to overcome Bitcoin with an expanded feature set more
DACs will provide, a fully developed infrastructure, more development on the
base currency and features of the DACs, and a larger community and user base.

Puh .. overcoming btc really depends on what metric to use .. marketcap? of
btsx? or "market cap" of bitUSD. Once more DACs are out we will see different
market caps of bitUSD, one in btsx .. and one in MUSIC .. another one in PLAY and so on.
But they are all the same value? So sum them up!? Not sure.

IMHO it's not clear how to "really" compare btsx with btc.

Bitshares DACs are developing at a fast rate with extremely talented and
dedicated developers, and a supportive community. If Bitcoin sits back and does
nothing to improve upon itself, I think it will likely see its market share
slowly dwindle down to the point that it is no longer the Cryptocurrency to
beat.
Enough said ... kill the following lines.. you just repeat yourself:
I see innovative cryptocurrencies, and the DAC model, as potential
Bitcoin killers at some point down the road. That is unless Bitcoin starts
improving itself at a quicker rate, and stops criticizing all block chain
innovations and features as unneeded gimmicks.

Projects like Bitshares DACs are
potentially Bitcoin killers, and it may make Bitcoin zealots feel better to
call them “scam coins” but they are truly revolutionary. They are certainly a
leap in the right direction for Cryptocurrency as a technology, and many would
argue that it is a much better solution than Bitcoin already.
I would avoid spreading the FUD about scam in relation to bitsharesX .. unless
you cite their concerns and reasoning

Further, in general:
The correct capitalization for bitshares is BitShares (cap. S in the middle)!!

Besides that it was a nice read! +5%
Give BitShares a try! Use the http://testnet.bitshares.eu provided by http://bitshares.eu powered by ChainSquad GmbH

Offline hpenvy

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Re: My "explain it like I'm five" attempt
« Reply #11 on: October 01, 2014, 01:59:07 PM »
I'd love to see it broken up into smaller chunks with headers.
=============
btsx address: hpenvy
Tips appreciated for good work

 

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