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Messages - GaltReport

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Why use smart coins at all? Should the community be encouraging the use of UIA coins? Yield was the reason to buy and hold them in bitshares 1.0 (it didn't make sense to short them in that case, though)

Smartcoins are great invention but you have some good points here. Maybe we should try to get as much UIAs to the exchange first, and after we have more users and better overall liquidity, we'll move to emphasizing smartcoins.
Smartcoins seem to be quite difficult task when we have only few users. Or maybe the whole concept still needs some tweaking to get the incentives right?

I've just had a conversation about BitShares with a friend of mine and we arrived at exactly the same conclusion as Samupaha and maqifrnswa stated above - at this stage UIAs are the key, not SmartCoins.
It sounds like blasphemy, especially to me as I've always thought SmartCoins are the single most important product of BitShares, its raison d'ĂȘtre.

This conclusion came to me as I started to "sell" BitShares to business people. And it turns out they don't really care about bitUSD or bitEUR.
But when I tell them we could have eBay.USD or Apple.USD or your-local-brand.EUR and transfer & trade these assets on one platform - then I get their attention, they immediately start thinking how those UIAs could be used for marketing purposes for their issuers.

For them bitUSD is the same as "BitShares.USD" - an asset backed by an unknown blockchain entity with a relatively low market valuation.

That was a bit of an eye opener for me. Maybe we are currently putting emphasis on the wrong product.
We (the community) value SmartCoins because we think it is such a brilliant invention.
But for the outside world SmartCoins are nothing more than UIAs backed by something which is very strange & risky and additionally has low valuation.

I think time will come when SmartCoins can realize their full potential but this time is not now.
First we need multiple UIAs issued by some established real-life entities to prove BitShares potential as an efficient and safe exchange
And once the BitShares DAC gets a decent recognition and market valuation - then SmartCoins will be able to start playing their (well deserved) role.

So we have the perfect product (i.e. SmartCoins) but we are trying to sell it too early in our business development cycle.
First we need to build our empire as a decentralized exchange for UIAs. And once we are successful with that, SmartCoins will start to shine as the most desired assets on the BitShares platform because they are guaranteed by the platform itself.

Very interesting perspective.  Would like to hear other points of view on this.  BM, Tony etc...

Stakeholder Proposals / Re: Stealth Transfers Worker Proposal
« on: November 21, 2015, 10:46:30 pm »
What good is privacy/anonimity if you don't have liquidity? It's useless. You just wasted precious time and money you won't ever get back while someone else is already working on something better (or trying to).

But perhaps the two are indeed related? Perhaps capitals will not fly into bitshares if everything is 100% public. Perhaps you need some anonymity/privacy features to get some liquidity going.

Would you open a bank account in a bank which makes your whole account and movements public? I know I wouldn't, and most people, I would assume, wouldn't either.

Well, right now that's what we have.

100% agree with this.  If you were a well-heeled investor, would you want to put money into a system where you will be on everyone's radar?

Here is how I described "our" WHY, inspired by spending about two years surrounded by ideas and the persistence of Daniel and many others here. It took a long time to to really stand behing them. If one changes perspectives too quickly he probably never has an own perspective. So stay persistent ;)

We are convinced that hierarchical structures in the form of states and the explicit and subtle form of violence associated is not the only possible (least evil) way to "run society". We are concerned about what technology can do in the hands of centralized power (surveillance). Yet at the same time technology has the potential to make possible a peaceful revolution providing a more effective and less violent way to coordinate interests and regulate society.
Blockchain technology has the potential to not only disrupt the financial industry but to reduce the need for governmental regulation to protect citizens. 
Disrupting the financial industry needs a wider vision about what technology can do for society and in which way it can take over functions of the state because the financial industry and the wider financial and monetary system are explicitly bound to and a part of the state.
It would be fatal to ignore reality if you are serious about the purpose of freedom: In order to have a lasting effect blockchain solutions have to be designed for the masses which implies high scalability, an intuitive user experience (simplicity) and an approach that pays respect to existing regulatory constraints. We are committed to profitability and maximizing capital efficiency in order to reach our goals with the necessary endurance and capital.


It's a big improvement in terms of functionality but in terms of UX the whole Deposit/Withdraw still looks like a temporary proof-of-concept design.
I think for 80% of users it's completely unclear what's going on there.

(1) I guess most of the users don't know the difference between a bridge and a gateway. There should be some explanation added when you'd need to use either of them.
And ideally there should be two tabs - one for bridges and the other one for gateways.

(2) it's very unfortunate the the name "OpenLedger (CCEDK)" has the same color and style as the labels "Bridge" and "Gateway". It just adds to the confusion.

(3) In the deposit row for BlockTrades the last field displays something like "1HvBRB4dR9YYy4DKSUoJF3tjdQNzedpkqZ updating". What does this "updating" mean?
Someone should re-think how to make this simpler and easier to understand or it's liable to spiral out of control.  Great to have these features just need a way to present/explain them better.

Stakeholder Proposals / Re: Stealth Transfers Worker Proposal
« on: November 20, 2015, 07:08:58 pm »
How do you feel about the bug that caused our "marketing blitzers" to lose almost all of their referral fees??  Maybe they would unleash a blitz and let the "wizards" code if they actually had a functioning referral system from said "wizards".

You can't keep finishing things 80% of the way.  This pie in the sky stuff needs to be put on hold until the exchange and referral system works.  It needs to be put on hold until an actual usable platform is available.  You could have all the bells and whistles in the world, but it wouldn't mean a thing if the underlying exchange sucks.

What is 80% of cutting edge?  That's like the sharpness of a baseball bat...
I was not aware there was an issue with the referral system. Link?

As far as the market.. I've made several trades with no issues, and they are working on the GUI already. It has been updated at least once and the new market view is a step in the right direction.

Let Bytemaster do his thing. The second he leaves the project Bitshares is screwed (that is until the community grows to a certain size.) We should keep him happy and support proposals he thinks are important, as he is usually right and has steered us in the right direction thus far.

I agree with this and think that ANONYMITY is important.  I have "heard" that Dash is now accepted on some of the Darknet sites.  I'm sure that has helped them.  Not that Darknet sites are our target per se...but won't hurt.

General Discussion / Re: [EBM] Get liquidity into BitCNY / BitBTC market
« on: November 20, 2015, 06:45:05 pm »
How to provide liquidity in bridge markets

  • Borrow BitBTC with BTS
  • Sell BitBTC at 1.005
  • Buy BitBTC back at 0.995
  • Repay loan
  • Net 1% profit

Executing this simple algorithm allows individuals that are long BTS to generate a profit of 1% while still remaining long BTS. I would like to encourage anyone, who would like to help Bitshares liquidity problem, to Borrow BTC and begin selling it at less than a 1% spread on one of these bridge markets.

I don't think this is a good idea, people who do this will get ripped off by creating an arbitrage opportunity for other traders. The good thing is that it should help peg the internal markets; the bad thing is that these market makers will be the ones paying the expense. Here's the arbitrage:

I start with 1 real BTC. I use openledger and trade for 1 openbtc (minus small fee). I trade my 1 openbtc for .99 bitBTC (because of the proposed openbtc:BTC market makers). 1 bitBTC is sold for 1.10 times the value of 1 BTC in the BTS:bitBTC market. I sell my .99 bitBTC for 1.089 bitBTC worth of BTS on the DEX. I then take my 1.089 bitBTC worth of BTS to openledger and trade it to BTC.

I start with 1 BTC, I end with 1.089 BTC.
The BTC:BTS market moved closer to peg.
The market maker is now short .99 BTC (and the value of BTC dropped).
No one will sell me openbtc when they can go to openledger and get a better deal, so the market maker will go short forever until the market makers run out of funds or until the spread between settlement and bitBTC < 1%.

I posted recently, maybe bitshares UIAs should be the main mechanism for trading... In that case, market making the trade.btc:openbtc markets is more important.

An alternative idea would be to mirror the bts:btc market in the openbtc:btc market with some profit. That requires bots (and to properly map bts to openbtc), but why would someone trade that way when they could directly go openbtc:bts:btc on their own without paying a premium?

Nice Analysis.  Glad we have people here that can noodle this stuff through...

The purpose of this post wasn't to change any short-term direction. It was to simply recognize that optimizing the exchange business is a short-term strategy for a larger long-term goal.

Yes,  it's low hanging fruit but by all means, we should PICK IT!

General Discussion / Re: Turning the page on fees - We need yield back!
« on: November 19, 2015, 02:08:52 pm »
So lately we've been discussing fees a lot. I feel most of the arguments were already said, it's up to people to decide what's best for BitShares.

What I would like to be discussed here is yield/interest. That was - I believe - the key feature that got so much people into BitShares at the beggining. The opportunity of earning free money. Will anyone resist that? What do people do when the markets are just to messed up for them to go in at that point? They get on the ''sidelines'', watch and wait.

What if people could just earn money without having to trade while having their money safe? I'm pretty sure a lot of people would be interest in that. Think the whales that could park their wealth on BitShares earning interest.

I always felt that was the key feature BitShares provided along with stable cryptocurrencies, however with time, we lost it and forgot about it. This post inspired me to start this discussion.

A lot of people don't get it. WIthout interest, without dividends, without yield, Bitshares 2.0 will not be as feature complete as 1.0. We took a step backwards here. Large holders will hold until they find a better opportunity, and there will be plenty going into the future so I don't see these prices in Bitshares holding up unless you keep the whales interested.

Whales chase yield, dividends, interest, and Bitshares at this time offers none of that. The economics of Bitshares 2.0 are wrong and it wont be fixed by fiddling around with the fees. The argument made to switch from Proof of Work to Proof of Stake was no dilution and we still ended up with dilution (the worst part of Proof of Work). The argument was that Bitshares would be profitable, the argument was that burning fees would be promoted and that there would be 5% interest, dividends.

I mean, people could even hate BitShares from the bottom of their hearts but the opportunity of making money while sitting on the sidelines, dont you think they would eventually come? People don't resist 'free money'.

What could we do to have this back? I guess we can't take interest from the fees we generate otherwise the referral program would go to waste, specially since people want to get them lower... Is the bond market really only the opportunity we will ever get to make this again? This is just the biggest marketing tool BItShares could ever have...

I don't recall why it went away.  We got to the point of creating Infographics and talk about Savings/Checking accounts....and we were actually getting "yield" then it went away and I don't recall why.  Was it used to pay developers?

And those who want lowering transfer fees - how many times has this happened to you:

You present the BitShares GUI to someone new (who has never heard of BitShares before).
Under your supervision this person creates a new account and you send her/him some BTS/USD/CNY to start with.
First you show them how quickly and easy it is to send payments back and forth. And how easy it is to find somebody else's account and add it to the dashboard.
Then you show them the explorer page, the witnesses, briefly explain the voting concept, and can even show them the trading page.
Finally, if there is enough interest, you show them how to "create" new USD or CNY out of their BTS.
And at the end of the demo, this person says: "It's pretty cool and quite amazing. But you know what? The transfer fees are way too expensive to me. So it's cool but sorry, I can't afford it."

Sounds pretty absurd, doesn't it?

I've presented our GUI to several people and it generallay comes down to these two cases:
- they're not interested because it's a concept that is too strange for them ("Why would I need this?")
- they are very impressed and raise a lot of issues (e.g. "How come everybody see my account?") but never ever complain about the fees (and I guess it's because they see value in the product).

I would think it depends on who you are talking to.  If you are talking to an average joe  who doesn't really have any need for BitShares (at this point) vs talking to a crypto/trader person.  The latter may be interested in the fees.  First few times you transfer funds to another account, you will think about it...not to mention trading fees.

I would like to see people's opinion on this. Sometimes in the past it seemed BitShares got lost on what to do and it seems it might happen again. Why you ask? well,

Fact: People don't know what BitShares is about.

BitShares is obviously a platform with a great potential that could reach many businesses, but first we need to start somewhere. The fact people don't know what BitShares is about clearly shows there's a lack of focus on the path we should take and only adds to the uncertainty around the markets.

Let's see things how they are. CNX whether you like it or not is the backbone of BitShares. Without it, development would be affected. Fortunately we've slowly start to gather small groups of people willing to take the risk and develop their own tools as well,  +5% for them. However, my point is, being directly responsible for the future of BitShares, imo, they should focus on one thing and let BitShares evolve around that rock solid pillar.

Originally BitShares was an exchange and I believe it still is. That's its main purpose. BitShares is in the exchange business. I've seen people extremely worried about fees, because it will affect BitShares and payment services and that as a consequence it won't attract new users. Pardon my language: that's bullshit.

The average joe won't use BitShares to his family in Africa. A dad with a family to take care of won't use BitShares as their bank account. Even if we build it for that, they won't use it. We're still years away of that becoming a reality. Look at bitcoin. It will take quite a while yet. The one's who are already into that space and are someone which no crypto can compete with atm is Ripple. Yeah, it's centralized you may claim, so what? It has all the connections and funding they have. They're set. It's just a matter of time.

Now what do I mean with this? It's not that BitShares won't ever be able to compete with Ripple for example. It's the fact that we should focus on our core objectives and be pragmatic. We're in the exchange business and we are the best in crypto for that. That's another fact. We have the best technology, let's take advantage of that.

If you want to build a house, you don't start with the roof, do you? You start by building a foundation. That's what developing BitShares as an exchange is. Building a rock solid foundation. Be the best at it.

"But by ignoring the payment services business you are ignoring bilions of users". Bilions of users that won't start using this kind of technology in the next 5-10 years. It's a waste of time and resources worrying about them now. They won't use BitShares, they won't undertand what BitShares is, they won't bring any income. Zero.

"Well, you're letting one of the core principles of crypto out of the picture, which is, people being able to own their own money". I did that on purpose to give emphasis to my point that we need a rock solid foundation first. You know what happens when a company has 10000 different and awesome ideas and wants to purse them all? Fails. It's not focused. That's why BitShares should be focused right now on building the best exchange infrastructure. But I have good news for you, I'm not despising payments services or remmitance businesses at all, in fact, I agree that they're useful. They're just not a priority right now. What's the solution then? Let businesses get into the payment services business.

BitShares is about that exchange that will shake the NASDAQ to the core. Then, around BitShares, business will sprout, adapt and grow. Those same businesses will be into the payment services stuff and will adapt. Of course we can make they're life easier right? Otherwise they might not be able to adapt! Of course. However that doesn't mean our priority should be debating how lower/higher fees won't attract new users.

The ultimate individual being damaged by the fees is not users. It's businesses. It's business that attract users. Not BitShares itself. BitShares is about getting traders and businesses (exchanges, PSPs, etc). Then those businesses will bring new users. Not BitShares. Get that into your head ffs. BitShares with lower fees as it is wont be used by someone in Somalia. That's wishful thinking.

We're loosing focus and sight of what's our objective. We need a rock solid foundation first. Being the top exchange and place where exchanges work on.
BitShares isn't in the payment services business. 3rd party business on top of BitShares are.
This means we must support every business who wants to to build something on top of BitShares.
Those businesses will then atract new users.
Then we can worry about other stuff. Once we have a bigger (way bigger) user base that are not traders.

Rock solid foundation >> Traders and Businesses and Volume
Businesses >> Utility >> New users >> Profit

That was needed !!!

Clear, simple and very true !

 +5% +5% +5%

 +5% +5% +5% - Seems like a reasonable plan.

General Discussion / Re: First Organized Mutually Agreed Proposal
« on: November 18, 2015, 11:33:12 am »
Big mistake. This seems like a half-assed political solution. I like consensus and I'm glad that the committee role functioned well in reaching a decision, but I have a strong feeling this is a temporary solution and we're going to find in a few months that it's wasted precious time.  ???

I am NOT convinced that:
(1) the low-fee crowd will be happy enough, given that the fees remain higher than they want for them to spread BitShares' use, or that
(2) the system will be profitable enough to drive any real marketing, or that
(3) we are serious about attracting any meaningful trading business, given the fees there.
a profitable system is needed , but not now ,  it is in future ,  BTS have potential profitable capacity,  do you know Amazon? I think you must know ; this company had been loss for many year , but it had about 100~200 B US dollar  market value,
investor is not for current profitable  but for potential profitable,
    it is so difficult to understand many fans of BTS want  BTS is profitable currently . I think the only reason  is lack business common sense.
we can increase the fee to 0.2$ when the TPS reach to  200,  it will been profitable , but not current , 


I would have suggested picking a side and giving one of these groups what it needs to add a ton more users. We even could have pleased two out of three. Instead, what we have is a compromise that does not give any of these groups the tools it needs to succeed. In a few months, we're going to have to change this again, and by then we might be really sorry we wasted this time.

Hey, what's done is done. Everyone should come together now and help promote BitShares.

Low-fee group, are you happy enough? If so, then get out there and bring us some users! :)
low fee is a not a sufficient condition to get more user,  just a requirement.

I agree with bolded parts above.  I thought the plan was to go with BM's proposal(s) except what was retracted? Probably I missed something.

General Discussion / Re: [EBM] Exchange Business Management Team
« on: November 13, 2015, 02:05:25 am »
I would like to have all people working on trading bots for bitshares and external exchanges to contribute to the EBM team as their technical knowledge will be extremely beneficial.

Additionally, a large part of this initiative that I did not thoroughly highlight is the management of market makers both on the internal as well as external exchanges. People that are working on trading bots should contribute to the market maker portion of the group. This subgroup will provide technical solutions for market makers with capital but without coding knowledge, as well as breaking down the profit incentives for being a market maker. It may also be a good idea to submit a proposal for capital from bitshares if we have come to consensus on the best market maker bot.

I may be interested in running market-maker bot(s)...depending on the details (mainly capital and bot monitoring/babysitting required).

Would you supply capital if someone supplied easy to use software for market making?

Potentially yes.  I would need to know more details (how much, how to manage the funds/bot etc..).  I'm assuming this would make a small profit or break even at worst.

General Discussion / Re: [EBM] Exchange Business Management Team
« on: November 12, 2015, 09:31:00 pm »
I would like to have all people working on trading bots for bitshares and external exchanges to contribute to the EBM team as their technical knowledge will be extremely beneficial.

Additionally, a large part of this initiative that I did not thoroughly highlight is the management of market makers both on the internal as well as external exchanges. People that are working on trading bots should contribute to the market maker portion of the group. This subgroup will provide technical solutions for market makers with capital but without coding knowledge, as well as breaking down the profit incentives for being a market maker. It may also be a good idea to submit a proposal for capital from bitshares if we have come to consensus on the best market maker bot.

I may be interested in running market-maker bot(s)...depending on the details (mainly capital and bot monitoring/babysitting required). 

Focusing on a million different projects at once is what killed hurt bitshares. It would be very unwise to go back in that direction.

absolutely agreed - stay focused .. and go step by step .. not get overhelmed of all possibilites, ideas and so on ...

I agree with this if you just change "killed" to "hurt".  I do also agree that experiments are important but they need to be kept separate and integrated when/if ready.

General Discussion / Re: Ldger - Marketplace Lending Is Exploding
« on: November 12, 2015, 01:47:48 am »
 +5% to all of this.  There is the whole micro=lending business as well as companies like prosper:

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