Author Topic: Have we passed a centralization tipping point?  (Read 9922 times)

0 Members and 1 Guest are viewing this topic.

Offline Empirical1.1

  • Hero Member
  • *****
  • Posts: 886
    • View Profile
I had similar panic concerns fluxer :)

https://bitsharestalk.org/index.php?topic=9539.msg124040#msg124040

To be the winner right now though is all about getting the best talent & marketing. Good devs are clearly worth their weight in gold. I think dilution is the best solution for BitShares. There has also been some limits placed on the dilution.

I do worry that if the market views BitShares as partly centralised already, then I think our valuation is going to be significantly handicapped as a result even in the short term so it's also something I've been keen to address by encouraging more voting as well as not keeping too much BTSX on the big exchanges.

Setting aside the fact that BitShares is far more effectively decentralized than most of its true competitors, that is of little concern.  We are also more decentralized than most companies people routinely do business with.  The demographic we will market to first does not generally care about this any more than they stop to consider the share distribution of Amazon, Apple, Microsoft, or Benny's Car Parts Outlet.

:)

Yeah I can see you guys are envisioning people using a variety of front end applications and the fact that it's BitShares on the back end & how it works may be largely irrelevant to them. Personally I think the main market will be BitAssets. I think the brand image of BitShares, particularly the level of perceived decentralisation could be important.

On the shareholder side, if you're perceived to have centralised weaknesses and/or are ever operating in grey areas then they may value BitShares on a very short earnings horizon vs. a competitor that was perceived to be more decentralised, who could therefore achieve a higher valuation and raise more funds via dilution as a result.

BitShares is pretty decentralised though, and I'm really about encouraging more active voting stake and less on big exchanges than anything else.

If one goes out and approaches 20 random people on the street today and asks them if they are worried about the negative impact of centralization.  I bet you the answer would be no.....they many have never even considered the implications.  And for the few that answer in the affirmative, they would generally believe that there are no practical alternatives to the current status quo anyway.  So the mass market is not clamoring for an alternate. In fact most have not identified the issue.  In this case we in the crypto community are the advance guard.....the riders at the leading edge of the wave, if you will.   

The market we are going after is not the crypomarket.........if all we do is capture the current crypto market this project would be a failure IMO.  There is far more unrecognized demand out there, it is just a matter of the packaging and presentation of the product and getting our value proposition and story in focus .  Since in the wider market the issues we here see as pressing - centralization of control and undue influence in the economic system-  are not yet pressing concerns with clear alternatives (thought they are ever so slowly becoming so), we have time to get our decentralization framework right.   I feel we are moving in this direction.  However, we do not need to rush this transition due to fear of alienating the markets.  The mass markets don't care about decentralization (as we here do).  When WILL they care?  It is really unknown and surely out of our control, but my opinion is that they will not start to really pay attention to the issue of centralization until this whole monetary system begins to swerve into the ditch (ala Cypress).

I didn't say BTS shouldn't market outside crypto. I'm saying there are customers and investors.

Unlike a Facebook/Apple, a DAC operates in grey areas and could be unfairly targeted at any time. There are also no legal restrictions placed on notification of and sale of shares in DACs.  If BTS is perceived to be a DAC that can be targeted or overly influenced via one man or a small group, it will receive a tiny valuation from investors as it would obviously be super fragile. (You may have to bring in 5-10X more users/earnings than a competitor to get the same valuation if you're judged to be weak here.)

On the user side, they will be offered probably a debit card, bonus & yield. Each consumer is different but most will at least look at a rating site, a forum or ask a knowledgable friend about BitUSD/BTS before they part with their cash.
Decentralisation is a key criteria on which a DAC is rated by the market that does understand it, so will strongly define the positive or negative BitShares brand image consumers see when trying to validate the opportunity from a more knowledgable source. They will steer clear of a DAC with a negative brand image, feedback or a low rating whether they specifically understand decentralisation themselves or not.

More importantly the next Cyprus catalyst will be huge and could happen at any time. It will result in a huge loss of trust and confidence in centralised institutions & we will see consumers seriously looking for & evaluating those criteria in DACs in the aftermath.

I think BitShares is fine & competitive in this area, I'm just making the point that I think market perceived decentralisation or lack thereof shouldn't be under rated.

Offline jae208

  • Hero Member
  • *****
  • Posts: 525
    • View Profile

I don't think its a problem, considering that they are actually creating Bitshares, and we need them to develop it.  Without the devs, a coin is nothing.

True, but without users it doesn't matter if you have rock star developers a coin will still be nothing. I am certainly in favor of taking care of developers. I'm not too sure I can say the same about marketing though. I always like to make the comparison with Bitcoin. How is it that Bitcoin became worth several billion dollars without a marketing team and what is it that we can do to improve? In terms of spreading the message I think that with the cheap communication tools we have there is no reason why spreading the message of Bitshares should cost much.
http://bitsharestutorials.com A work in progress
Subscribe to the Youtube Channel
https://www.youtube.com/user/BitsharesTutorials

Offline starspirit

  • Hero Member
  • *****
  • Posts: 948
  • Financial markets pro over 20 years
    • View Profile
  • BitShares: starspirit
DPoS has been sold on the basis of decentralised control, and its important to know that my vote counts. And from BM's figures, its good to have confirmed that it does.

Offline James212

  • Sr. Member
  • ****
  • Posts: 312
    • View Profile
I had similar panic concerns fluxer :)

https://bitsharestalk.org/index.php?topic=9539.msg124040#msg124040

To be the winner right now though is all about getting the best talent & marketing. Good devs are clearly worth their weight in gold. I think dilution is the best solution for BitShares. There has also been some limits placed on the dilution.

I do worry that if the market views BitShares as partly centralised already, then I think our valuation is going to be significantly handicapped as a result even in the short term so it's also something I've been keen to address by encouraging more voting as well as not keeping too much BTSX on the big exchanges.

Setting aside the fact that BitShares is far more effectively decentralized than most of its true competitors, that is of little concern.  We are also more decentralized than most companies people routinely do business with.  The demographic we will market to first does not generally care about this any more than they stop to consider the share distribution of Amazon, Apple, Microsoft, or Benny's Car Parts Outlet.

:)

Yeah I can see you guys are envisioning people using a variety of front end applications and the fact that it's BitShares on the back end & how it works may be largely irrelevant to them. Personally I think the main market will be BitAssets. I think the brand image of BitShares, particularly the level of perceived decentralisation could be important.

On the shareholder side, if you're perceived to have centralised weaknesses and/or are ever operating in grey areas then they may value BitShares on a very short earnings horizon vs. a competitor that was perceived to be more decentralised, who could therefore achieve a higher valuation and raise more funds via dilution as a result.

BitShares is pretty decentralised though, and I'm really about encouraging more active voting stake and less on big exchanges than anything else.

If one goes out and approaches 20 random people on the street today and asks them if they are worried about the negative impact of centralization.  I bet you the answer would be no.....they many have never even considered the implications.  And for the few that answer in the affirmative, they would generally believe that there are no practical alternatives to the current status quo anyway.  So the mass market is not clamoring for an alternate. In fact most have not identified the issue.  In this case we in the crypto community are the advance guard.....the riders at the leading edge of the wave, if you will.   

The market we are going after is not the crypomarket.........if all we do is capture the current crypto market this project would be a failure IMO.  There is far more unrecognized demand out there, it is just a matter of the packaging and presentation of the product and getting our value proposition and story in focus .  Since in the wider market the issues we here see as pressing - centralization of control and undue influence in the economic system-  are not yet pressing concerns with clear alternatives (thought they are ever so slowly becoming so), we have time to get our decentralization framework right.   I feel we are moving in this direction.  However, we do not need to rush this transition due to fear of alienating the markets.  The mass markets don't care about decentralization (as we here do).  When WILL they care?  It is really unknown and surely out of our control, but my opinion is that they will not start to really pay attention to the issue of centralization until this whole monetary system begins to swerve into the ditch (ala Cypress).
« Last Edit: October 26, 2014, 10:42:50 pm by James212 »
BTS: theangelwaveproject

Offline liondani

  • Hero Member
  • *****
  • Posts: 3737
  • Inch by inch, play by play
    • View Profile
    • My detailed info
  • BitShares: liondani
  • GitHub: liondani
we are still on early days...  and I like it!  :D

Sent from my ALCATEL ONE TOUCH 997D


Offline arhag

  • Hero Member
  • *****
  • Posts: 1214
    • View Profile
    • My posts on Steem
  • BitShares: arhag
  • GitHub: arhag
Good devs are clearly worth their weight in gold.

Hmm... That sounds nice but is it true? Using a typical career length of 40 years and a median weight of 158 lbs for a US citizen, I would conclude that yes, indeed, a dev is worth at least their weight in gold:)


Offline toast

  • Hero Member
  • *****
  • Posts: 4001
    • View Profile
  • BitShares: nikolai
- There is no distinction between 'I3 funds' and 'personal funds of I3 members' as far as voting is concerned.

This is false. Spending/voting decisions for "I3" is done by Dan, not all of I3 collectively. You can be sure there are several I3 members who would not have made the same hiring/spending decisions as Dan.
Do not use this post as information for making any important decisions. The only agreements I ever make are informal and non-binding. Take the same precautions as when dealing with a compromised account, scammer, sockpuppet, etc.

Offline Empirical1.1

  • Hero Member
  • *****
  • Posts: 886
    • View Profile
I had similar panic concerns fluxer :)

https://bitsharestalk.org/index.php?topic=9539.msg124040#msg124040

To be the winner right now though is all about getting the best talent & marketing. Good devs are clearly worth their weight in gold. I think dilution is the best solution for BitShares. There has also been some limits placed on the dilution.

I do worry that if the market views BitShares as partly centralised already, then I think our valuation is going to be significantly handicapped as a result even in the short term so it's also something I've been keen to address by encouraging more voting as well as not keeping too much BTSX on the big exchanges.

Setting aside the fact that BitShares is far more effectively decentralized than most of its true competitors, that is of little concern.  We are also more decentralized than most companies people routinely do business with.  The demographic we will market to first does not generally care about this any more than they stop to consider the share distribution of Amazon, Apple, Microsoft, or Benny's Car Parts Outlet.

:)

Yeah I can see you guys are envisioning people using a variety of front end applications and the fact that it's BitShares on the back end & how it works may be largely irrelevant to them. Personally I think the main market will be BitAssets. I think the brand image of BitShares, particularly the level of perceived decentralisation could be important.

On the shareholder side, if you're perceived to have centralised weaknesses and/or are ever operating in grey areas then they may value BitShares on a very short earnings horizon vs. a competitor that was perceived to be more decentralised, who could therefore achieve a higher valuation and raise more funds via dilution as a result.

BitShares is pretty decentralised though, and I'm really about encouraging more active voting stake and less on big exchanges than anything else.
« Last Edit: October 26, 2014, 07:22:09 pm by Empirical1.1 »

Offline Ander

  • Hero Member
  • *****
  • Posts: 3506
    • View Profile
  • BitShares: Ander
I3/devs have a lower percentage of Bitshares than Satoshi has of bitcoin. 

I don't think its a problem, considering that they are actually creating Bitshares, and we need them to develop it.  Without the devs, a coin is nothing.
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads

Offline Geneko

  • Full Member
  • ***
  • Posts: 187
    • View Profile

When delegates get paid with new share reciepts, that is exactly what is happening.  They are getting credit for their added contributions.

So, if you are tempted to use the word "inflation" with respect to BitShares, stop.  Go back to first principles and be happy. :)

Nobody is arguing here because of purpose for this marriage of Voting-Inflation but because of the way it will work.

Big problem arises with this marriage of Voting-Inflation and I think nobody is able to grasp future consequents. Voting and inflation is meant as substitute for free market forces engaged in hiring and pricing for developers work.
 
The problem arises because of know Parkinson's Law: a project will cost whatever there is available to spend.

But the cost is not the main problem. Set aside inflation problem and lets focus on Voting.
How am I, as average stake holder, going to evaluate quality and cost of developers work, and how could I predict market value of this work. Here we come with another Parkinson’s Law of triviality known as "bikeshedding":

Committee whose job is to approve plans for a nuclear power plant spent the majority of its time with pointless discussions on relatively trivial and unimportant but easy-to-grasp issues, such as what materials to use for the staff bike-shed, while neglecting the less-trivial proposed design of the nuclear power plant itself, which is far more important but also a far more difficult and complex task to criticize constructively.

Obviously this marriage of Voting-Inflation is suggested in a hurry I beg for some more serious considerations of its implications. The fact that Ethereum team come up with idea doesn’t mean it is considered carefully. 

Offline jsidhu

  • Hero Member
  • *****
  • Posts: 1335
    • View Profile
jsidhu, I know you were an excited supporter of the idea, but I have come to realize that the burning mechanism is economically flawed. There are ideas in that proposal worth salvaging, and I will get around to it, but I think this is more important. I'm actually almost done...
Flawed economically? Why dont you post a message about it there?
Hired by blockchain | Developer
delegate: dev.sidhujag

Offline speedy

  • Hero Member
  • *****
  • Posts: 1160
    • View Profile
  • BitShares: speedy
bitUSD, bitCNY, et. al, are the currencies.  They are the stable units of account pegged to other currencies.

This is a good point - anyone who thinks that issuing new shares is going to reduce the value of their holdings is free to convert them 100% into BitUSD. But no one is going to do that because Im sure we are all fairly convinced that you will only get hired by the DAC if you add more value than you consume.

Offline Stan

  • Hero Member
  • *****
  • Posts: 2908
  • You need to think BIGGER, Pinky...
    • View Profile
    • Cryptonomex
  • BitShares: Stan
I had similar panic concerns fluxer :)

https://bitsharestalk.org/index.php?topic=9539.msg124040#msg124040

To be the winner right now though is all about getting the best talent & marketing. Good devs are clearly worth their weight in gold. I think dilution is the best solution for BitShares. There has also been some limits placed on the dilution.

I do worry that if the market views BitShares as partly centralised already, then I think our valuation is going to be significantly handicapped as a result even in the short term so it's also something I've been keen to address by encouraging more voting as well as not keeping too much BTSX on the big exchanges.

Setting aside the fact that BitShares is far more effectively decentralized than most of its true competitors, that is of little concern.  We are also more decentralized than most companies people routinely do business with.  The demographic we will market to first does not generally care about this any more than they stop to consider the share distribution of Amazon, Apple, Microsoft, or Benny's Car Parts Outlet.

:)
Anything said on these forums does not constitute an intent to create a legal obligation or contract of any kind.   These are merely my opinions which I reserve the right to change at any time.

Offline Stan

  • Hero Member
  • *****
  • Posts: 2908
  • You need to think BIGGER, Pinky...
    • View Profile
    • Cryptonomex
  • BitShares: Stan
Quote
author=fluxer555 link=topic=10583.msg139218#msg139218 date=1414332467]

Quote
Firstly, inflation is not "capital infusion". It's a redistribution of wealth. No new money is entering the system, and the market cap does not increase as a result.

The "inflation" is not just given away. It is traded for performance of the devs which adds value to the DAC,  which ,yes, should/will result in increase market cap.

Two people agree to form a company.
One has money, the other has time.
They agree that time is worth money.
So they split ownership of the company according to the amount of time or money each contributes.

Over the years, as they each contribute more time or money to the company,
They are issued receipts, denominated in USD, for their contribution.
At any point in time, ownership percentages are determined by the sum of receipts each person holds.

That is what we are doing here.
BitShares are nothing but receipts for contributions made to the company.

So any concept of inflation here is a non sequitur.
It is a holdover from bitcointhink and does not apply.

BitShares are receipts reflecting ownership originally derived from contributions made to the growth of the company.
bitUSD, bitCNY, et. al, are the currencies.  They are the stable units of account pegged to other currencies.
     They cannot be inflated (although they will faithfully track any inflation in the currency to which they are pegged.)

Anytime anybody brings a contribution of money, or something worth money, to the company, they should be recognized with receipts (shares) for that contribution.  As the company's shares go in value, it takes fewer shares to recognize new contributions than it did to recognize the same contribution made earlier.  Thus, early founders profit from growth in value of their shares but new contributors get credit based on relative value at the time they made their contribution.

When delegates get paid with new share reciepts, that is exactly what is happening.  They are getting credit for their added contributions.

So, if you are tempted to use the word "inflation" with respect to BitShares, stop.  Go back to first principles and be happy. :)
Anything said on these forums does not constitute an intent to create a legal obligation or contract of any kind.   These are merely my opinions which I reserve the right to change at any time.

Offline Stan

  • Hero Member
  • *****
  • Posts: 2908
  • You need to think BIGGER, Pinky...
    • View Profile
    • Cryptonomex
  • BitShares: Stan
Anything said on these forums does not constitute an intent to create a legal obligation or contract of any kind.   These are merely my opinions which I reserve the right to change at any time.