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Idon`t think referral system is a mistake , but I think high fee is the biggest mistake at so low Tx volume.
The bucket shop talk is just an unrelated thing to this thread. Everyone keeps skipping over the main point:"As for the referral system, I stand by my statement that the referral system is currently holding the entire network hostage. 5 to 20 is a 400% increase. No real referral system places such a huge burden on it's base system. Going from 5 to 7 or 5 to 8 I could stomach, but the current system, no way, not ever."If the referral system is going to be legit, it should only affect the base by something like 5-30% max. 400% is absurd. It's like Mark Lyford was given free reign to design it.
Quote from: r0ach on October 20, 2015, 02:42:45 pmIf the referral system is going to be legit, it should only affect the base by something like 5-30% max. 400% is absurd. It's like Mark Lyford was given free reign to design it.So it seems that, contrary to this thread's title, your conclusion is that nothing is wrong with the referral program but just the transaction fees are set too high.I think we've already had this discussion:https://bitsharestalk.org/index.php/topic,19159.0.html
If the referral system is going to be legit, it should only affect the base by something like 5-30% max. 400% is absurd. It's like Mark Lyford was given free reign to design it.
I'm kind of shocked most of you people don't seem to understand what Bitshares actually is. Even Bytemaster doesn't seem to acknowledge it. Bitshares is a decentralized bucket shop (world first?). You are not trading real stocks or assets. You can't compare anything about it to real stock markets. It's a gambling market where you're betting against the somewhat decentralized but non-autonomous house that operates price feeds. You don't own real assets. You're not investing in real assets. All you're doing is gambling.
Quote from: Riverhead on October 19, 2015, 04:55:58 amIn the US Scottrade is seen as a bargain basement trading firm at $7 per trade!! Seriously. Other houses charge $25+ USD PER TRADE!!. Let's get some perspective on what the market will bear.I'm kind of shocked most of you people don't seem to understand what Bitshares actually is. Even Bytemaster doesn't seem to acknowledge it. Bitshares is a decentralized bucket shop (world first?). You are not trading real stocks or assets. You can't compare anything about it to real stock markets. It's a gambling market where you're betting against the somewhat decentralized but non-autonomous house that operates price feeds. You don't own real assets. You're not investing in real assets. All you're doing is gambling.It's virtualy impossible for there to be a situation where there's X dollars invested in Y stock and the same amount of money or higher invested in the Bitshares prediction market of said stock because the prediction market offers you no real legal standing or ownership. You can't compare real stock markets to this because the value proposition of the real stock market is always higher. I'm not saying the market has no value, it's just nothing close to the real stock market.
In the US Scottrade is seen as a bargain basement trading firm at $7 per trade!! Seriously. Other houses charge $25+ USD PER TRADE!!. Let's get some perspective on what the market will bear.
You are not trading real stocks or assets. You can't compare anything about it to real stock markets. It's a gambling market where you're betting against the somewhat decentralized but non-autonomous house that operates price feeds. You don't own real assets. You're not investing in real assets. All you're doing is gambling.
Quote from: Method-X on October 19, 2015, 03:56:02 amQuote from: Tuck Fheman on October 19, 2015, 03:14:46 amQuote from: r0ach on October 17, 2015, 02:13:42 amWhen the outside world looks at this thing, they don't even know the fee rate can be changed over time, so they're thinking, "nice, if this coin hits 3 billion market cap like Bitcoin, I get to pay $15 in fees per transaction! had the same thought the other day Can fees be displayed as USD? Seeing something like 5 cents has a much lower perceived value than 20 BTS.In the US Scottrade is seen as a bargain basement trading firm at $7 per trade!! Seriously. Other houses charge $25+ USD PER TRADE!!. Let's get some perspective on what the market will bear.To put it in context most US trading companies charge between 1500 - 5000 BTS per trade.
Quote from: Tuck Fheman on October 19, 2015, 03:14:46 amQuote from: r0ach on October 17, 2015, 02:13:42 amWhen the outside world looks at this thing, they don't even know the fee rate can be changed over time, so they're thinking, "nice, if this coin hits 3 billion market cap like Bitcoin, I get to pay $15 in fees per transaction! had the same thought the other day Can fees be displayed as USD? Seeing something like 5 cents has a much lower perceived value than 20 BTS.
Quote from: r0ach on October 17, 2015, 02:13:42 amWhen the outside world looks at this thing, they don't even know the fee rate can be changed over time, so they're thinking, "nice, if this coin hits 3 billion market cap like Bitcoin, I get to pay $15 in fees per transaction! had the same thought the other day
When the outside world looks at this thing, they don't even know the fee rate can be changed over time, so they're thinking, "nice, if this coin hits 3 billion market cap like Bitcoin, I get to pay $15 in fees per transaction!
I love the referral system. It is truly innovative in the cryptocurrency space and will help Bitshares grow via magnified network effects.I do have a question about how it works though. Is is multi-level or single level?If I refer someone I get a portion of their fees, I get that. What if they in turn refer someone? Then that someone refers someone else?Is a MLM affiliate scheme better than a single level affiliate scheme? I have my own opinion, but I am interested in hearing everyone else's. I am thinking I may be in the minority on this... pro MLM. MLM structures promote users to recruit other users that will then recruit other users, and so on so forth. Recruiting mainly other users that will recruit other users is currently in the best interest of Bitshares as we are very early in the game. Magnifying the network affect of the referral system is in our best interest IMO. How many levels deep should it go, or should it ideally be unlimited down to a fraction of a percent?
I love the referral system. It is truly innovative in the cryptocurrency space and will help Bitshares grow via magnified network effects.I do have a question about how it works though. Is is multi-level or single level?If I refer someone I get a portion of their fees, I get that. What if they in turn refer someone? Then that someone refers someone else?Is a MLM affiliate scheme better than a single level affiliate scheme? I have my own opinion, but I am interested in hearing everyone else's. I am thinking I may be in the minority on this... pro MLM. MLM structures promote users to recruit other users that will then recruit other users, and so on so forth. Magnifying the network affect of the referral system is in our best interest IMO. How many levels deep should it go, or should it ideally be unlimited down to a fraction of a percent?
Quote from: fuzzy on October 19, 2015, 05:01:35 amQuote from: Riverhead on October 19, 2015, 04:55:58 amQuote from: Method-X on October 19, 2015, 03:56:02 amQuote from: Tuck Fheman on October 19, 2015, 03:14:46 amQuote from: r0ach on October 17, 2015, 02:13:42 amWhen the outside world looks at this thing, they don't even know the fee rate can be changed over time, so they're thinking, "nice, if this coin hits 3 billion market cap like Bitcoin, I get to pay $15 in fees per transaction! had the same thought the other day Can fees be displayed as USD? Seeing something like 5 cents has a much lower perceived value than 20 BTS.In the US Scottrade is seen as a bargain basement trading firm at $7 per trade!! Seriously. Other houses charge $25+ USD PER TRADE!!. Let's get some perspective on what the market will bear.To put it in context most US trading companies charge between 1500 - 5000 BTS per trade.Yeh but what method is talking about is changing the perception to users...especially with consideration to the demographic. Ironically he came to the same conclusion i did...now if only i hadnt missed his previous post...lol.Method-x has the right of it. I only meant to highlight the absurdity of the debate over fees vs the "real" world.
Quote from: Riverhead on October 19, 2015, 04:55:58 amQuote from: Method-X on October 19, 2015, 03:56:02 amQuote from: Tuck Fheman on October 19, 2015, 03:14:46 amQuote from: r0ach on October 17, 2015, 02:13:42 amWhen the outside world looks at this thing, they don't even know the fee rate can be changed over time, so they're thinking, "nice, if this coin hits 3 billion market cap like Bitcoin, I get to pay $15 in fees per transaction! had the same thought the other day Can fees be displayed as USD? Seeing something like 5 cents has a much lower perceived value than 20 BTS.In the US Scottrade is seen as a bargain basement trading firm at $7 per trade!! Seriously. Other houses charge $25+ USD PER TRADE!!. Let's get some perspective on what the market will bear.To put it in context most US trading companies charge between 1500 - 5000 BTS per trade.Yeh but what method is talking about is changing the perception to users...especially with consideration to the demographic. Ironically he came to the same conclusion i did...now if only i hadnt missed his previous post...lol.
When the outside world looks at this thing, they don't even know the fee rate can be changed over time, so they're thinking, "nice, if this coin hits 3 billion market cap like Bitcoin, I get to pay $15 in fees per transaction ! "
Look at it this way:1. User issued assets can set any core-exchange-rate they like and lower the fees for users of the UIA to close to 02. UIAs can charge market fees similar to exchanges 3. $0.10 for a normal user or $0.02 cents for a lifetime member are so close to $0 that few would even think about it for a transaction over $104. BTS is not meant to be payment currency. How many people buy less than $10 worth of stock in a company? What is the transaction fee on that?In other words, the ability of users to do "price discrimination" falls apart at values this low. Unless you are executing 1000's of transactions there is almost no perceivable difference. Most people won't even bend over to pick up a DIME on the ground. In other words from a customer perspective $0.01 and $0.10 are effectively the SAME in low volumes. At high volumes the price approaches $0.02 for lifetime members which is cheaper than Bitcoin. While the difference in price is insignificant to individual users, it is HUGE for the network. The network is a party to every transaction and thus sees a 5x increase in revenue while the user perceives almost no difference in cost.
Quote from: Akado on October 16, 2015, 09:25:52 pmWould it be good to have something display the number of bitshares being burnt per day?Yes, that would be awesome.Honestly, this number (and the corresponding inflation or deflation rate) probably matters to investors more than anything else. Show people that their ownershake stake is no longer being diluted, and that in fact they are owning a larger and larger portion of BTS every day that they hold, and they will want to buy more and hold their BTS!
Would it be good to have something display the number of bitshares being burnt per day?
20 BTS is too scary number for people.
Quote from: Ander on October 16, 2015, 09:05:20 pmI disagree with reducing fees for two main reasons:1) It makes the referral program a lot less interesting if you dont expect the users you bring in to generate much of any fees. So then it will fail.2) A big reason why the BTS price has been trending down for a year is that the supply is increasing, that is, the blockchain is operating at a loss instead of being profitable. As soon as we can demonstrate a blockchain making a profit over a reasonable period of time, even a small profit, it will attract a lot of attention. Everyone is used to inflating blockchains that hemmorhage money (through PoW or whatever), but if you change that around and are actually making a profit, then a lot of investors will want to jump on board. And helping the price break its downtrend is going to help adopting a LOT, because a major inhibitor to adoption right now is that everyone who buys in loses money and gets disillusioned. If we could advertise ourselves as being profitable more people would join in as holders. Would it be good to have something display the number of bitshares being burnt per day? or if we are operating at a profit or at loss? It sounds nice while we're operating at profit, but at a loss it seems it could create some psychological panic, I dunno. But showing the fees burnt per day or month would be nice I guess
I disagree with reducing fees for two main reasons:1) It makes the referral program a lot less interesting if you dont expect the users you bring in to generate much of any fees. So then it will fail.2) A big reason why the BTS price has been trending down for a year is that the supply is increasing, that is, the blockchain is operating at a loss instead of being profitable. As soon as we can demonstrate a blockchain making a profit over a reasonable period of time, even a small profit, it will attract a lot of attention. Everyone is used to inflating blockchains that hemmorhage money (through PoW or whatever), but if you change that around and are actually making a profit, then a lot of investors will want to jump on board. And helping the price break its downtrend is going to help adopting a LOT, because a major inhibitor to adoption right now is that everyone who buys in loses money and gets disillusioned.
Quote from: botfund on October 16, 2015, 04:17:22 pmQuote from: xiahui135 on October 16, 2015, 03:52:47 pmI think the fee for placing/cancel of an order and transaction should be very cheap. But the fee for trade success should be more, such as 0.0005 of the liquild.People are willing to pay when trade success, because both seller and buyer feel earn something at the moment they trade.I think that the current market fee should be split into maker fee and taker fee. So we have order placing fee, cancel fee, maker fee and taker fee where [maker fee percentage]+[taker fee percentage] >= 0. The order placing/cancel fee should be as low as possible just to avoid spamming. To improve the liquidity, we can set the maker fee to -0.2% and taker fee to 0.2%, or maybe -0.1% and 0.2% to get some profit from trades like normal exchanges.The fee to place an order is high, I am unwilling to place an order, because the order may not make a deal. Lower the fee, can attract more people place order to make a stronger and deeper order book.
Quote from: xiahui135 on October 16, 2015, 03:52:47 pmI think the fee for placing/cancel of an order and transaction should be very cheap. But the fee for trade success should be more, such as 0.0005 of the liquild.People are willing to pay when trade success, because both seller and buyer feel earn something at the moment they trade.I think that the current market fee should be split into maker fee and taker fee. So we have order placing fee, cancel fee, maker fee and taker fee where [maker fee percentage]+[taker fee percentage] >= 0. The order placing/cancel fee should be as low as possible just to avoid spamming. To improve the liquidity, we can set the maker fee to -0.2% and taker fee to 0.2%, or maybe -0.1% and 0.2% to get some profit from trades like normal exchanges.
I think the fee for placing/cancel of an order and transaction should be very cheap. But the fee for trade success should be more, such as 0.0005 of the liquild.People are willing to pay when trade success, because both seller and buyer feel earn something at the moment they trade.
1. User issued assets can set any core-exchange-rate they like and lower the fees for users of the UIA to close to 02. UIAs can charge market fees similar to exchanges
1. Referral system is great, but fees should be lower. 2. 20 BTS is too scary number for people.3. 10 cents now seem low, but with price increase it would be higher. In crypto 2x times price increase is nothing, we could jump 10x, but we won't, because nobody will use system when. Eventually we will be forced to lower it , why don't do this now?4. By lowering the fees we could increase our marketcap, hence - more publicity.5. By lowering the fees we could show everyone that our governance model superior than Bitcoin.6. Maybe people in USA tolerate fees, other regions have different views. But they have difficulties articulate this. We could debate for a long time or we can show the world our new feature: governance by voting.My proposal:Lets reduce all fees by the factor of 4. Our system very good, we should be able to grow by 4x in short time if there will be no such resistance as high fees for people to use Bitshares.
Quote from: jakub on October 16, 2015, 01:44:46 pmOur competition is not other crypto. It's legacy payment processors like PayPal and on-line usage of debit cards.This. Exactly this.
Our competition is not other crypto. It's legacy payment processors like PayPal and on-line usage of debit cards.
Quote from: Empirical1.2 on October 16, 2015, 02:01:39 pmYour argument that other users will use alternatives is not backed up by the facts. Most including BTS have had very low fees for nearly two years and new user growth is stagnant. One of the reasons new user growth is stagnant is because there's no incentive to market and promote it. Bitcoin is backed by the odds of the legacy financial system collapsing because systems tend towards homeostasis and people aren't going to change from one pyramid scheme they're familiar with to a new pyramid where risks are unknown. Having low fees isn't a benefit when 500 other coins exist with low fees. Having high fees when 500 other coins don't is a problem though. Eventually there will be many PoS coins with deterministic node selection using things like the collateral bid system I proposed, or a Tendermint type solution, or transparent forging, or what Darkcoin is doing. They will all have lower fees and high TPS and it will definitely be a problem. You can't simply choose to not compete in the fee market.
Your argument that other users will use alternatives is not backed up by the facts. Most including BTS have had very low fees for nearly two years and new user growth is stagnant. One of the reasons new user growth is stagnant is because there's no incentive to market and promote it.
if non BTC alt-coins were actually gaining adoption on the basis of low fees and no marketing (Which hasn't happened yet) BTS can adjust the programme.
Having high fees when 500 other coins don't is a problem though.
I've seen lots of "hooray referral system" posts like it's the new cure for cancer. I have the exact opposite thoughts about it. Before any pro-referral people post in opposition, let's define exactly what the referral system is. It's an artificial increase in transaction fees to subsidize the equivalent of a bunch of Avon ladies. Artificially increasing transaction fees is the last thing you would ever want to do in a cryptocurrency. One of Bitcoin's main selling points was low transaction fees. Now people are suddenly pretending like transaction fees don't matter. Sure, you may now end up with some additional people trying to spread Bitshares, but most people view cryptocurrency as a zero sum game where the act of using it is just making someone else rich at their own expense. This isn't far from the truth since any currency that exists whether it's fiat, gold, or crypto is all a pyramid scheme in nature.Dan talks about how he doesn't like coercion, but the referral system obviously is where you're trying to swoop up people under your influence into a system to enrich yourself. An example would be an employer forcing employees into Bitshares as a payment processor. The employee now has to pay some arbitrary fee to become "a member" or pay large transaction fees instead. Currency doesn't need any more pyramid scheme aspects than it already has. Besides the fact that it's philosophically an abomination, it makes Bitshares less competitive in the free market vs other coins that will have lower fees.Unless Bitshares became huge, it's not like many people are even going to pay the member fee anyway. It just drives people to other coins due to big transaction fees. If Bitshares became world reserve currency, probably everyone on earth would pay it, but the only function it serves then is an additional pyramid scheme aspect on top of the already pyramid nature of all currencies. Whether you're trying to make a profitable business or a more "fair" world, it's probably bad on both fronts.
I think you have to consider that every successful enterprise needs a sales force.. and you need a method of compensation.. and there are plenty of companies, even fortune 500 that are performance based like what we are doing.
Eventually there will be many PoS coins with deterministic node selection using things like the collateral bid system I proposed, or a Tendermint type solution, or transparent forging, or what Darkcoin is doing. They will all have lower fees and high TPS and it will definitely be a problem. You can't simply choose to not compete in the fee market.
Our competition is not other crypto. It's legacy payment processors like PayPal and on-line usage of debit cards.I think BM's approach makes a lot of sense:QuoteA well-balanced business model must have a cost of user acquisition that is much lower than its ability to monetize its customers. In the case of BitShares, this means setting transaction fees that are high enough to cover all costs, including the cost of customer acquisition, while still being low enough to compete against real competitors. Most cryptocurrency networks barely charge enough in transaction fees to cover the cost of running the network. They attempt to attract users with low fees. While low fees are important, undervaluing the service provided is counter productive. For this reason, BitShares charges a price that is much higher than competing cryptocurrencies but much lower than traditional exchanges and payment networks like Dwolla or PayPal.
A well-balanced business model must have a cost of user acquisition that is much lower than its ability to monetize its customers. In the case of BitShares, this means setting transaction fees that are high enough to cover all costs, including the cost of customer acquisition, while still being low enough to compete against real competitors. Most cryptocurrency networks barely charge enough in transaction fees to cover the cost of running the network. They attempt to attract users with low fees. While low fees are important, undervaluing the service provided is counter productive. For this reason, BitShares charges a price that is much higher than competing cryptocurrencies but much lower than traditional exchanges and payment networks like Dwolla or PayPal.
Artificially increasing transaction fees is the last thing you would ever want to do in a cryptocurrency. One of Bitcoin's main selling points was low transaction fees. Unless Bitshares became huge, it's not like many people are even going to pay the member fee anyway. It just drives people to other coins due to big transaction fees.
Your concerns have merit. It goes both ways. Either you cut costs or you bring something new to the table. WIth Bitshares we can charge more right now because you offer greater financial services (dex exchange, hedging, hopefully bond markets). The differences in fees have to be competitive. A consumer is willing to pay more in fees because they gather more services from bitshares. I don't think they will go to lesser transaction altcoins unless they offer the same quality in services. This is the hypothesis at least. So the referral is not the flagship feature, but a additive one that brings more value when bitshares already has value to offer to begin with. Simply put, referral system cannot work alone as a stand alone feature, but needs the other value additive features of bitshares to bring out the best of the two.
The classic example is the telephone. The more people who own telephones, the more valuable the telephone is to each owner. This creates a positive externality because a user may purchase a telephone without intending to create value for other users, but does so in any case. Online social networks work in the same way, with sites like Twitter and Facebook becoming more attractive as more users join. (Wikipedia)