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« on: October 23, 2014, 06:51:40 pm »
So I've been spamming the forum quite a bit, one second crying out against VOTE and calling I3 dishonest, the next whining for transparency, then insulting those who lost money to DNS while sucking up to BM, and in general just posting walls of text everywhere. Edit: I want to clarify that I don't actually think that I3 are dishonest, I was just pissed off in the moment.
Now is time for my huge wall of text about my thoughts of what BTS will become, and why I think it will grow a lot faster than anyone are expecting.
My premise is this: BTS is more than just a cryptocurrency and it is more than just shares 2.0. It is a completely new paradigm of human corporate organization and it solves some of the fundamental problems that have constrained companies, governments, armies and every other organizational structure for thousands of years.
Economic activity and value growth are the products of capital and labor. The point of trade and organization has always been to specialize labor into the activity that is most useful or valuable (i.e. division of labor), and to allocate capital to the place where it is most beneficial.
The free market blindly fights in an evolutionary game of survival of the fittest to figure out which specific allocation is most valuable for a given individual. As a competitive advantage organizations form within the free market as a method of leveraging the intellect of humans who specialize in leadership to control others into allocating their labor towards what will be most beneficial. This gives the benefit of allowing very specialized division of labor and more intelligent allocation of a combined pool of capital. Due to economies of scale there can be a huge advantage for a company to grow in size in order to leverage specific specialized areas of the capital and labor they control. One example could be marketing - if two factories make the same product it is better for them to unify under a single brand as they can then double their marketing effort for the products of both factories, rather than having two different brands and marketing separately. A more simple example is simply factory production, since when volume is scaled up capital and labor can increasingly specialize and thus give increasing returns. Anyway, using the simple logic of economies of scale, it would be logical for all human economic activity to unified under a single company. As we all know, that isn't the case...
Transaction costs, gatekeepers, imperfect information and diminishing returns on investment.
The reason why all humans are not unified under a single a company are numerous, but the most obvious one, is the reason we all know and hate: corrupt gatekeepers that take advantage of the lack of information to extract value from the company without other stakeholders in the organization knowing it. This means as an organization grows and its organizational structure becomes more convoluted and nested, the opportunity of middle managers or middlemen to loot and unfairly extract value from the organization increase. Because it is so universally rampant, the less severe forms of this are socially accepted; slacking off on the job instead of always seeking to apply yourself to the fullest within the organization technically also counts as looting, since you are essentially stealing the money you're getting paid when you're not working. You've entered a contract that pays you for work, and the organization honors it's own part of the contract by paying you, but you don't honor yours since you're not working. Even though this is clearly breach of contract, and thus essentially stealing private property, it is still socially accepted and even admired when people are able to slack off when they work for a corporate giant. These things are totally unavoidable in a traditional organizational structure because of the opaqueness and imperfect information. There are many economic papers that have tried to nail down the exact ratio with which the effectiveness of an employee decreases with each step of growth in the amount of employees, due to increasing opaqueness and decreasing access to information, and it is actually quite high. No matter the exact ratio we can all agree that the average amount of work done by someone working for a startup is a lot higher than the average amount of work done by, say, an Exxon Mobil employee, and this dimishing marginal return constrains Exxon Mobil's growth in some way. Interestingly, exxon mobil is still able to be huge because it employs another imperfection of the market to its own, unfair advantage: regulatory capture.
Bitshares solves these problems by having strong economic incentives for upholding total transparency across the board.
Bitshares employees are hired a different way than employees of a regular organization. Instead of being hired directly by a singular, trusted person or group of people within a seperated area of the organizational structure, new employees are nominated by these employees and then put to the vote by all stakeholders. It is done simply and frictionlessly simply by including them in their slate. This creates a nested structure of transparent trust where anyone trusting the upper level of an organizational structure is able to trace exactly how that trust is funneled down to employees at the lower levels. Should a stakeholder find proof of any employee being a bad apple, it is extremely easy to put forth this proof to the larger community of stakeholders and have them instantly voted out. Indeed an investigative organizational structure that specializes in analysing the work of other delegates and sound the alarm if an unprofitable, stealing or colluding employee is found could be implemented to have clear economic incentives for professionals to weed out the bad apples. If a bad apple is found the network of transparent trust that delegate slates creates can be used trace who originally nominated or appointed this employee, and they can be investigated to see if they are also malicious, or it was simply a mistake. This gives a strong economic incentive for all existing employees to only ever nominate new employees that they think are fully honest and profitable for the DAC.
These incentives combine to form a system where every new employee added to the company, DO NOT have diminishing marginal returns due to an increasing lack of information, but rather have INCREASING returns because they are able to leverage their own output onto the entire network; a combination of economies of scale and metcalfes law. The result of this is that any currently existing organizational structure or company that is smaller than bitshares will ALWAYS benefit from integrating itself into the bitshares organizational structure, since it will be able to create higher value, leverage a larger network, and even have more efficient employee management due to the effective transparency and governance that the bitshares delegate system creates. For every person or organization that is integrated into bitshares, the speed and ability with which new organizations can be integrated and new employees can be hired will increase with no diminishing returns. If all this reasoning turns out to be fact, then the only logical conclusion is that bitshares will eventually integrate every single structure of currently existing human economic organization. It will be a company that does all economic activity, owns all assets and employs all employees on the entire planet, and is in turn jointly owned by all humans. I even think that it will take over the non-profitable duties of governments and charities, such as protecting the innocent, caring for the poor and misfortunate, funding basic research, supporting and protecting art and historical relics, protecting the environment and biodiversity, and space exploration. This is because most humans are willing to allocate a certain percentage of their spending power to altruistic measures, and will thus in some situations vote for things that are not profitable, but rather charitable. A organization-wide compromise will be reached between pure profits and pure charity, and i suspect that this consensus will eventually be much higher than the current charitable rate of even welfare states, since people will become increasingly generous once the indoctrinations of the incumbent system are gradually phased out.
Here's how I see the timeline playing out assuming absolutely best case scenario:
November: BTS is created, and we start to mess around with the funding of delegates and try to figure out the best practices for voting and oversight and such. Once we get that sorted out, the marketing push begins.
December: The on and offramps are revealed, and the big marketing push for bitUSD begins. A big push to hire every single developer in the crypto space that is currently working for free, and thus donating their labor, will begin autonomously. This includes things like bitcoin developers, the OB developers, wallet devs such as mycelium and darkwallet, and others. Some of the developers will be so strong in their beliefs that they will insist on refusing payment out of loyalty to the bitcoin blockchain, but some of them will invariably recognize the great advantage getting paid for their work will give them.
January/February: we begin talks with NXT and etherium to buy them and their userbase out, mainly to get our hands on their developers and to cause a huge scene in the crypto space and diversifying our stakeholder base. This integration will eventually happen no matter what, but the time it takes before it's done is hard to judge since it depends not on economic factors (which are 100% in favor of integration) but rather on pride, confusion and fear by the current NXT and ethereum stakeholders.
Spring 2015: We reach 101 profitable employees, with more employees looking to join. Stakeholders vote to increase the delegate cap rather than kicking out an incumbent profitable employee. This will continuously happen and the amount of delegates will eventually increase exponentially.
Summer 2015: We buy out a midsize bitcoin infrastructure company, such as skyhook. This newly acquired company will integrate all its employees directly as delegates in the bitshares organization, and it will change its business model to hire new employees as delegates that are responsible for maintaining internally owned ATM's in a specific area (ie they will no longer sell the ATMs to others, because it is more profitable to have them owned and applied by bitshares). Skyhook will then begin mass producing ATMs at highest capacity and the network will initally subsidize placing them EVERYWHERE, as this will be extremely profitable over time and will be a very profitable long term investment.
Winter 2015: We buy out bitpay, and probably surpass bitcoin in market cap. We've probably also hired all the current bitcoin and altcoin developers at this point, and integrated almost every altcoin into our system. The only blockchains we will be competing with at this point are clones of bitshares that are attempting to refine our organizational structure or strategy in some way, or specializing the blockchain to an extreme degree in some area where our scale work against us.
This is the best of the best of the best case scenario imaginable. It's probably not gonna happen but I don't consider it completely outside the realm of possibility. Interestingly, only the first few months actually depend on I3, the rest will be done in a decentralized manner due to the independent alignment of economic incentives, however I3 will probably lead the effort in whichever way they consider more profitable. The important thing is that this train will run on its own once it gets the tiniest bit of momentum, and our fortunes will be pretty much secured.
Does this sound scary to you? It's definitely scary to me. When I first started to draw these conclusions I panicked because I thought of the massive danger if this system somehow gets corrupted along the way, just like every other large human organization that has ever existed. It will be like the nuclear bomb, once this thing is invented and unleashed on the world there is no taking it back, even by the creators. However, corruption doesn't arise spontanously in a system, it either exists at it's creation, or it enters later on. And that is the KEY, because WE are this seed, and I choose to believe that every person on this forum is a good human being, in fact more than just a good human being, I believe the vast majority here are EXTREMELY committed to fight corruption and evil in all its forms, because my impression is that the majority of people were brought here exactly because of that, rather than profit.
Because our system is completely transparent, and because we are the early adopters and majority owners, we can trust each other to always be on the lookout should any corruption attempt to enter the system. If a bank attempts to buy us out, we will revolt and it will never happen. If a delegate attempts to argue that transparency isn't needed we will refuse them. If a group of delegates collude to attempt to turn the voting process into a political shitshow, we will see through their deceit and kick them out.
Okay, now you have it, this is why I'm honored to be an early adopter, and this is why I'm honored to be here with you all - because from the short time I've known you all on this forum, I have overwhelmingly seen the desire to do good be prioritized over everything else, even profits. It's as if running this thing in a way that benefits humanity is more than just our collective desire, it's our purpose.
And that is why I now believe, contrary to what I wrote earlier, that we not only are the right people to take this amazingly scary and wonderful project off the ground, we deserve it.
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