BitShares Forum
Main => General Discussion => Topic started by: bytemaster on May 11, 2015, 02:00:11 pm
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Someone proposed this idea to me and I wanted to present it for general discussion:
1. Assume a worker was elected and had a fixed daily budget
2. Assume the worker used their daily budget to pay people to lock up their funds for 1 year.
3. Assume the worker prioritized users by who was willing to lock up the most funds for the least reward
Under such a system, funds are taken out of circulation increasing the price in the short term. Everyone who is a long-term holder should be competing to lock up their funds leaving only those who value liquidity more than the reward holding the liquid coins.
In general this should lock up 10 to 20x more funds than it would release via dilution and if the program is "maintained" would certainly reduce the liquid supply for many years. In effect, it could more than counter all dilution for at least 1 year after the program is voted out.
The key points are this:
1. No extra dilution
2. Everything shareholder approved
Those that lose under this program are those who "hold for years" but don't participate. Everyone else benefits. In other words, those who "might want liquidity but never use their liquidity" end up slightly diluted after many years.
Anyway, I just wanted to remind everyone of the policy of all such spending being subject to shareholder approval and that I am committed to not increasing the dilution rate or long term supply. Merely trying to give us tools to empower you all.
Feedback appreciated.
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I think most of the people, who preferred liquidity, already left. People, who want BitShares to succeed, will hold anyway. Do we need to reward them (us)? Would it help the market if known amount of BTS was locked?
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I know little about financial instruments but is this not just an idea to create fix term 'Bonds'?
What price for a short term price rise?.. Is that just another 100% delegate, created to pay those rewards?.. All very well for the whales but us mere mortals curse at the FED for similar.. might that be then seen as a solution Ben Bernanke would endorse.. how about fixing the economy rather than printing mo money eh?.. perhaps we can do better than rewarding the rich, so the rich get richer? BitShares already suffers from a perception that those with delegates are accruing a tonne of BTS.
I'd prefer to see solid steps that build confidence, rather than reward loyalty and frankly those who are for the most part insiders. I'll keep suggesting put in place those elements that instil confidence.. a regular robust review of who is getting paid delegates - and making those business cases highly visible; milestones; a clear list of what is unique about BitShares; a Mission statement; a Vision statement.. etc etc. Once you've got those, they'll act as a great attractor and a catalyst that will make any marketing more effective.
Price rises follow from an influx of investment. If current investors are tapped out, then find new audiences or expand on the types of audience you already attract.
Such change as will affect investment are solid change - get some new devs on board - partner with some project that is struggling and make both sides stronger.. Omni/Mastercoin looks weak, I don't know if they have devs looking to jump or partner. Other tough steps will make a difference too.. legislation .. partnering with ambitious forward thinking tech like Overstock.
The idea in the OP might help if that is proposed as something familiar like Bonds.. perhaps that is a very good idea.. sell long term 2;3;5;10 year bonds.. but then I wonder those who might be interested, could be those who would support you for free.. angels.. do they exist? :)
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This sounds similar to a fixed term deposit.
- Like a fixed term deposit, charge a hefty early withdrawal penalty fee which will help offset the cost to the DAC
- If possible incorporate a voting requirement in the lock + unlocking process so that it also has the benefit of increasing voting participation
Most importantly allow BitAssets to take part in the loyalty rewards program too.
https://changemoney.org/ As BitReserve understands, investors are primarily evaluating & extrapolating the BitAsset adoption trend.
Third party services and merchants will also be looking primarily to the size and growth of BitAssets to determine whether it's worth integrating and interacting with BitShares.
Locking up supply is positive but if you were to use dilution in this manner increasing voting participation and most importantly driving existing shareholders to maximise their BitAsset use would be far more valuable.
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Does "Worker" mean an elected delegate being paid in inflated "new" shares?
If so, you are just paying an inactivity interest while supply still increases. Thus changing nothing in terms of price perception to a BTS.
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A real "loyalty Program" would be something like the more you use BTS and the Assets the cheaper your fees get.
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This feels like a gimmick to me. Imagine if it were proposed on the bitcoin blockchain. People would say, "That isn't what bitcoin is for."
I say, "This isn't what BTS is for."
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Maybe consider following through on the other program (https://bitsharestalk.org/index.php?topic=13031.0) you started 4 months ago. Besides the paid delegates, the other referrers on the list (https://faucet.bitshares.org/refscoreboard) have been loyally getting new accounts signed up and have not been rewarded.
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Someone proposed this idea to me and I wanted to present it for general discussion:
1. Assume a worker was elected and had a fixed daily budget
2. Assume the worker used their daily budget to pay people to lock up their funds for 1 year.
3. Assume the worker prioritized users by who was willing to lock up the most funds for the least reward
Under such a system, funds are taken out of circulation increasing the price in the short term. Everyone who is a long-term holder should be competing to lock up their funds leaving only those who value liquidity more than the reward holding the liquid coins.
In general this should lock up 10 to 20x more funds than it would release via dilution and if the program is "maintained" would certainly reduce the liquid supply for many years. In effect, it could more than counter all dilution for at least 1 year after the program is voted out.
The key points are this:
1. No extra dilution
2. Everything shareholder approved
Those that lose under this program are those who "hold for years" but don't participate. Everyone else benefits. In other words, those who "might want liquidity but never use their liquidity" end up slightly diluted after many years.
Anyway, I just wanted to remind everyone of the policy of all such spending being subject to shareholder approval and that I am committed to not increasing the dilution rate or long term supply. Merely trying to give us tools to empower you all.
Feedback appreciated.
I endorse. It looks like a good idea if you believe you can implement it.
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In short - totally useless idea.
1. The hodlers are holding anyway, locked or unlocked.
So you will end up where you started - the holders are now holding (just in a lock state) and the sellers are selling just as before.
2. The hoped for 10x-20x of the dilution is totally overstated. Obviously you mean the delegate produced dilution and not the merger one. The latter is the important one, but 10x of it is more than 100% of total shares so you are not talking about it obviously.
So the aim is 50-100Mil BTS locked? First the number is insignificantly small. Second, For what interest rate do you expect this result. 1 delegated will 'absorb' the dilution of 33 full pay delegates at 3.33% annually. Right now anyone interested in that can short bitUSD to themselves and the interest is for very flexible terms => this interest is not attractive at all.
So to sum it up - putting development time and effort (much needed elsewhere) to give unattractive yield to he one that already holding long term (and to change nothing about the sellers/bears), so you can show a small amount held long term is a totally unnecessary exercise.
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Do no come up so many idea. focus on develop
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This feels like a gimmick to me. Imagine if it were proposed on the bitcoin blockchain. People would say, "That isn't what bitcoin is for."
I say, "This isn't what BTS is for."
I am surprised you do not like it?! It is one for one how Nushares pays interest for holders to park their Nubits....so I expected more enthusiasm from you... :)
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Do no come up so many idea. focus on develop
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He didn't come up with the idea, just presenting it on behalf of another so we could review it and bytemaster could avoid thinking about it after we dismantle it.
Sent from my iPhone using Tapatalk
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sounds like the nubits idea... don't know if that's what we need right now.
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Doesn't sound exciting or attractive.
Lets move on to another idea.
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Do no come up so many idea. focus on develop
从我的 iPhone 发送，使用 Tapatalk
He didn't come up with the idea, just presenting it on behalf of another so we could review it and bytemaster could avoid thinking about it after we dismantle it.
Sent from my iPhone using Tapatalk
My initial response was:
This is a gimmick and provides no value to stakeholders. It is a wealth transfer from short term holders to long term holders. It can only be done with stakeholder approval. Then I thought through it some more and came to some more conclusions:
1) The prospect of "earning" by holding is being used by Proof of Stake competitors and encourages people to hold irrationally because they feel like they are gaining something. This extra irrational holding represents a decrease in sell pressure. I say it is irrational because any rate of return that could be offered by such a system would be insignificant next to the daily volatility. If you were going to sell then no amount of interest should change your long-term prospects.
2) Some people *want to be buy and hold* and will sign up today, but then the going gets tough or something new comes out and they "change their mind". You cannot presume that everyone who thinks they will be "buy and hold" will actually follow through. End result is that this process will actually create more "buy and hold" demand than would actually exist without it.
3) Some people try to day trade and momentum trade but would become "buy and hold" if offered the incentive.
4) It could be implemented manually by any paid delegate without any trust.
Given that it is already possible I thought a discussion on its merits would be interesting and engaging.
This could also be viewed is financing development without short term dilution. In other words, rather than diluting today to pay developers, we opt to dilute years from now after the market is more secure and the amount of extra dilution this represents is meaningless.
The downsides are how it could be spun for negative effect.
Like I said before, I only want to give the community tools and options to use the resources at your disposal. The time to implement such a proposal is relatively small (days).
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this idea has many "if's and maybes".
i am on tonyks camp. We has better things to do. Move on this are not the solutions you are looking for.
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Unless there is a significant flaw in the current plans, lets worry about getting them complete. We can always test other things later.
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This is a gimmick and provides no value to stakeholders. It is a wealth transfer from short term holders to long term holders.
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4) It could be implemented manually by any paid delegate without any trust.
Given that it is already possible I thought a discussion on its merits would be interesting and engaging.
This could also be viewed is financing development without short term dilution.
I sure don't see how the last item could be true. How much of the delegate's pay for devs is being sold vs held? It begs the question, is BM involved in this primarily to address concerns expressed by the dev staff? Should a distinction be made for dev staff and other paid roles, like essential / should have / nice but not necessary roles?
How do the changes proposed affect existing (non-dev staff) delegates like fuzzy, methodx or bitscape? Or the standby's like cryptosmith?
I agree 100% with davidpbrown and 90% with tonyk. DSN and others don't think this proposal has much merit. I too see it as incentivizing those that don't need it and that it will not be effective in the short term. It's definitely not worth BM's time to deal with this. Why doesn't the author of this idea present it themselves?
If this can be implemented right now why hasn't it been? The answer is obvious: b/c the delegates don't want to. Isn't implementing this proposal essentially forcing them to do what they clearly don't want to do? How is that a good thing?
Frankly I need a summary of this new "worker proposal" that appears to be eminent (not this one the "other" one). I haven't been able to follow the discussion, tho I've tried.
My understanding is that the essence of the new delegate proposal is they will be split into two roles, workers (block producers) and a manager? Not sure how either will be paid. Will the manager role pay the worker? Are they elected as a team i.e. 1 delegate = worker + manager? If that is the case, and the delegate team can decide for themselves what they will do with their pay I'm OK with it. Beyond that I want to see all of the requirements, rules and the reasons for them spelled out in black & white. I don't get that from the discussion, perhaps b/c it's ongoing. Yet I hear people refer to it as changes that will take place very soon.
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Unless there is a significant flaw in the current plans, lets worry about getting them complete. We can always test other things later.
+5%
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Locking up BTS and then releasing that BTS + interest later on doesn't seem helpful at all, it just results in inflation in the long run.
The ones that will lock up their BTS are the ones who already didnt plan to sell, so it doesn't actually relieve much selling pressure.
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partner with some project that is struggling and make both sides stronger.. Omni/Mastercoin looks weak, I don't know if they have devs looking to jump or partner. Other tough steps will make a difference too.. legislation .. partnering with ambitious forward thinking tech like Overstock.
this^
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Unless there is a significant flaw in the current plans, lets worry about getting them complete. We can always test other things later.
+5%
http://dilbert.com/strip/2015-04-21
http://dilbert.com/strip/2015-04-22
:P
I agree this is not necessary to think about right now if at all. I'm all for focus and keeping everything as simple as possible. If the core features are robust, I would rather have core devs look to simplify, refactor & optimize then add anything new no matter how easy it is. Heck I would rather devs take a vacation with their pay than add any more features or options. Complexity is a value-killer.
BTW I would rather give all workers the option to sell. If we place restrictions on pay, we'll get a smaller pool of workers and will reduce the competition in quality workers. In startups, a lot of early employees are stuck with a lot of shares with no liquidity. They end up having difficulty with cash flow, buying a home, paying for their children's school, and end up taking loans with all this value trapped in restricted shares. Restricted stock is an unnecessary regulatory burden imposed by the SEC. In a free market, if you allow employees to sell shares at anytime, employees and investors should be happier. It creates liquidity.
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sounds like the nubits idea... don't know if that's what we need right now.
exactly. Except I'm pretty sure that we don't need that. I've always considered nubits a broken concept.
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I like it. The first thing that came in my mind was ripple. They show on coinmarketcap c32 bil XRPs and a market cap of $236 mil and people think that ripple is cheap and should be worth billions. Many people forget that total XRPs are 100 bil. and therefore XRPs market cap is in reality close to 750 bil.
Remember when we passed ripple market cap for 1 day? They immediately increased their supply so they don't seem to be left behind..
Although this tactic doesn't appear to be fair play I like it and I think could increase BTS demand is suddenly people see a market cap of $5 mil due to reduced supply. ..
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We dont need gimicks to temporarily inflate the BTS price, we need useful products with a good user experience that make people want to buy and use BTS.
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We dont need gimicks to temporarily inflate the BTS price, we need useful products with a good user experience that make people want to buy and use BTS.
+5%
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I seem to be one of the few people who like the idea.
Is it going to be game changing? Of course not. And I agree with many people who said we have to focus on more important issues. But if it can be implemented with little effort then go for it. IMO the advantages stated by bytemaster, especially concerning the "irrational" holding should outweigh the disadvantages.
A big factor in Bitcoins adoption was that mining is interesting and fun. Maybe we can bring some of this fun to BitShares as well.
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A big factor in Bitcoins adoption was that mining is interesting and fun. Maybe we can bring some of this fun to BitShares as well.
Indeed. Mining made people want to run the bitcoin client.
What things can we do to make people want to use the Bitshares client on a regular basis? That is what we need to think about.
The way I understood this proposal, it wouldnt cause people to use Bitshares more. It would cause them to lock away their BTS, and then leave for a year, doing nothing at all.
Instead, we should look for ways to reward people for using BTS on a regular basis. (In ways that arent just inflationary to the supply of BTS).
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As a core developer I think the first thing is developer product.
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Loyalty Rewards can be used for Backed system.
https://bitsharestalk.org/index.php/topic,15957.msg208256.html#msg208256
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I like the current free market where any delegate proposal can get voted up by stakeholders. But I would not vote for this. As owners, we should not be looking to reward our own loyalty - we should look at rewarding the loyalty of customers who will generate value for us.
I would prefer time spent on complementary non-dilutive solutions to funding development work. Bounties, angel funds, project shares, etc...
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BTS price falling down, But the problem is not the delegate voting system.
And in my opinion , the bts price falling down lead to cannot pay for delegate, It is good for BTS DAC.
It is punishment to BTS system, for the system performance not good enough.
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I think we should support this idea. It is something like POS. If this true, our system will combine advantage of POS and DPOS.
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It should be noted that by locking up BTS of long term holders it will not be available for other areas of adding value in the system. For example, it will not be available as collateral for bitAssets, and potentially restrict growth there, especially as many shorts are actually long term holders.