I was following you until you said Bitcoin is not vulnerable to copycats because there's a lot of hash power behind it already.
Hi, thanks for the reply.
I do actually see hashpower as quite significant. I realise that in theory it isn't, but in practice the difference between the Bitcoin network and any other is so colossally huge that it almost renders them non existent by comparison through sheer force of presence.
By all accounts we should not be watching video, playing games, listening to music or chatting over http protocol because back in the early nineties it was "condemned" as being wildly unsuitable for any of these media. And yet here we are. It just was "made to work" because the protocol had become too prolific and had gathered enough network effect to make it commercially viable to work round the problems without going back to the drawing board. Now that I've watched Bitcoin see of a flotilla of 1000 competitors, many of them with vastly superior tech, I suspect it is on its way to the same destiny whatever theoretical issues people see with it.
All the same, the Bitshares concept is unique. I can see it being an essential element in a crypto-economy with its ability to address directly the need for exchange rate stability. I'm just not sure that it isn't more like a business than a crypto currency in the sense that the concept can be easily produced, owned and branded by existing corporate dominant entities.
Your remark that "BTS actually has to provide more value than its competitors" kind of endorses that perspective - i.e. that it's a question of branding and that we do not have something unique here. I actually don't think that its a question of providing more value than competitors because the value is academic and deterministic based on algorithms. I think it's a question of adoption.
The market is the commercial trading and retail world. The thing I like about this concept is that (for example) retailers could be easily convinced to accept Bit-USD and hold it since it has a guaranteed exchangeability with the dollar (as long as the peg works - lets see). The more Bit-USD (and other DACs) gets borrowed into existence, the more value the underlying collateral will have.
So it's the BitUSD adoption curve that will determine the BTS value (as I understand it), not the other way around. Traders are also not going to care much which "brand" of Bit-USD they adopt. It won't be according to "which network provides most value" it will be which provides them most exposure to their own potential customer base.
That's where I see the problem.
Visa just have to bring out a "Bit-USD" type product and those potential adopters have then got instance exposure due to Visa's vast brand recognition, thereby driving adoption through the roof overnight with appropriate implications for the underlying collateral of their brand of "Bitshares" network.