So the DAC will allow flexibility is amount of artistcoins issued, and the % of income going to artist and artistcoin holders.
Is that necessary? Why not just have all of the income go to the artistcoin holders and have the artist decide the percentage they get by holding on to the appropriate percentage of the artistcoin? So an artist can issue an artistcoin with some supply, keep 50% for themselves, sell the other 50% on the open market. Now when the income from the music sales buys the artistcoin, the artist should get 50% of the effective dividends from the buyback. To realize these gains as BitUSD, they simply sell the appropriate amount of artistcoins on the exchange (they sell only enough to maintain 50% ownership of the new reduced supply of artistcoins). Maybe they can even get away with paying long-term capital gains taxes on some of their earnings instead of income taxes if they can hold off selling some of the artistcoins for over a year (I don't really know for sure, I am not a tax attorney).
I second that. The knowledge that the artists will actually receive their income through the same artistic coins that the investors are buying will lead to much more interest by investors/sponsors and much higher price, than if they buy some artistcoin that will be producing some unclear returns and the artists' interest how big such returns are is pretty uncertain (and even potentially opposite if % of music sales goes to artistcoins' holders and the rest to him/her).
Well the artist will have some of his own coin as well.
So far, when a song sells for say 1BitUSD.
0.8 bitUSD could go to the artist's wallet paying him in a liquid form. Without him having to liquidate anything.
say 0.05BitUSD was the fee
And 0.15 BitUSD goes to the buy back mechanism.
I know you understand this already.
Now the thing to realize is that the artist might have kept say, 50% of the artistcoins. So he still has a stake in it's value.
As an analogy, we can look at the artist profile as a company.
You have income = 1 BitUSD
You then have 2 expenses
1. the 0.05 BitUSD in fees (service/network/bandwidth)
2. The artists salary 0.80 BitUSD
The "company" is left with 0.15 BitUSD of PROFIT
This profit is what is distributed to the "shareholders" (Artistcoin holders).
Now in a company, say Apple, Steve jobs has a CEO salary. A liquid form of weekly spendable income. But he also held shares in the company, incentivizing him to make the shares worth more and more.
This is the approach we are taking SO FAR.
I do like the simplicity of having 100% going to the coin, and nothing as an artist salary. I can see some band's cashing out and selling off all their coins accidently. There is no Undo button for that. The band basically just gave up 100% of stake in their own profile "company".
To introduce the non-trader world to this tech, we are taking baby steps. User experience first. That can change over time when people WANT to go into the "advanced settings"