Author Topic: Dividends 2.0 - A Simplified Implementation of Dividends and Honest Blockchains  (Read 13172 times)

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Offline jumelB

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Many are having a hard time solving math problems. Not everybody loves math. But, we all know that we always use it in our daily living, especially when it comes to investment.  Therefore, we need to know the difference between simple and compound interest, and how to compute each. Likewise, those seeking to invest need to know how to calculate dividend returns. Read more: Calculating interest and dividends.

Offline julianP

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Every entrepreneur or investor knows how to do the math. However, not everyone knows how to calculate interest and dividends. To be able to make good financial decisions, we need to know the difference between simple and compound interest, and how to calculate each. And for those seeking to invest, the same can be said of dividends. Learn more: Calculating interest and dividends.

Offline bytemaster

In order to appease both sides, why not display both the actual money supply and the number of coins?
I am having difficulty wrapping my head around buying something for X%.

You will not have to think in terms of X% you will just see X BTS... from the user's perspective it is just a number.  The only place shares matter is under the hood, but that is an implementation detail. 
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline barwizi

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In order to appease both sides, why not display both the actual money supply and the number of coins?
I am having difficulty wrapping my head around buying something for X%.
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Offline bytemaster

BitShares will pay dividends... this thread is just about simplified implementation, user experience will be the same.  They will see their balance go up over time.
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline theoretical

I still think dividends should be implemented.  Consider two subsets of users:

(a) Internet savvy crypto-anarchists and economics nerds

(b) Ordinary people who just want to buy and sell stuff online

Everything I've read about Bitshares suggests that, while (a) will be an important part of the userbase for Bitshares (or any new altcoin that launches in the near future), we want to eventually break into (b).  And, while some subset of the users in (a) may well care more about inflation honesty, the people in market (b) really get more excited by things like "earn better interest than any bank will pay!" and "a piece of the action for every transaction!"

An individual user might theoretically be interested in the purchasing power of their money.  But this depends on more than the total amount of coins that have been created -- it's a dynamic equilibrium affected by the velocity of money, hoarders that keep coins for long periods of time and/or don't trade on the markets you care about, and the total amount of goods and services being exchanged.  Unlike the total number of coins that have ever been minted, the purchasing power of money is not something that could be automatically computed by the network.

And besides, there's a BitAsset for that :)  -- users who care can just convert their money to BitUSD (or later we might have some asset that's pegged to a basket of goods or something).
BTS- theoretical / PTS- PZxpdC8RqWsdU3pVJeobZY7JFKVPfNpy5z / BTC- 1NfGejohzoVGffAD1CnCRgo9vApjCU2viY / the delegate formerly known as drltc / Nothing said on these forums is intended to be legally binding / All opinions are my own unless otherwise noted / Take action due to my posts at your own risk

Offline stuartcharles

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I see there is a great benefit if this gets the idea to market quickly but given the choice with the same implementation date, i would by far prefer to see coins in my wallet that don't shrink if i don't participate. I think it would feel like i had to work to stand still.

I fully understand the argument made and it is right, but, human psychology is a powerful thing and you will be making a gamble on the average investor's reaction.

It would also leave room for someone else to put in the extra development time a come up with something more palatable to the human psyche.

Lets face it who enjoys opening there freicoin wallet and watching coins evaporate?

In BitShares you will watch your coins accumulate which is why I want this feature.

So your bitshares will grow only your % ownership of the DAC will change?

A BitShare is a percent ownership of the DAC... which will grow.

your the main brain and driving force here, if you think its the way forward then go for it. Like i already said the quicker you get to market with the first DAC the better.

Offline bytemaster

I see there is a great benefit if this gets the idea to market quickly but given the choice with the same implementation date, i would by far prefer to see coins in my wallet that don't shrink if i don't participate. I think it would feel like i had to work to stand still.

I fully understand the argument made and it is right, but, human psychology is a powerful thing and you will be making a gamble on the average investor's reaction.

It would also leave room for someone else to put in the extra development time a come up with something more palatable to the human psyche.

Lets face it who enjoys opening there freicoin wallet and watching coins evaporate?

In BitShares you will watch your coins accumulate which is why I want this feature.

So your bitshares will grow only your % ownership of the DAC will change?

A BitShare is a percent ownership of the DAC... which will grow.
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline stuartcharles

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I see there is a great benefit if this gets the idea to market quickly but given the choice with the same implementation date, i would by far prefer to see coins in my wallet that don't shrink if i don't participate. I think it would feel like i had to work to stand still.

I fully understand the argument made and it is right, but, human psychology is a powerful thing and you will be making a gamble on the average investor's reaction.

It would also leave room for someone else to put in the extra development time a come up with something more palatable to the human psyche.

Lets face it who enjoys opening there freicoin wallet and watching coins evaporate?

In BitShares you will watch your coins accumulate which is why I want this feature.

So your bitshares will grow only your % ownership of the DAC will change?

Offline bytemaster

I see there is a great benefit if this gets the idea to market quickly but given the choice with the same implementation date, i would by far prefer to see coins in my wallet that don't shrink if i don't participate. I think it would feel like i had to work to stand still.

I fully understand the argument made and it is right, but, human psychology is a powerful thing and you will be making a gamble on the average investor's reaction.

It would also leave room for someone else to put in the extra development time a come up with something more palatable to the human psyche.

Lets face it who enjoys opening there freicoin wallet and watching coins evaporate?

In BitShares you will watch your coins accumulate which is why I want this feature.
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline stuartcharles

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I see there is a great benefit if this gets the idea to market quickly but given the choice with the same implementation date, i would by far prefer to see coins in my wallet that don't shrink if i don't participate. I think it would feel like i had to work to stand still.

I fully understand the argument made and it is right, but, human psychology is a powerful thing and you will be making a gamble on the average investor's reaction.

It would also leave room for someone else to put in the extra development time a come up with something more palatable to the human psyche.

Lets face it who enjoys opening there freicoin wallet and watching coins evaporate?

Offline bytemaster

If you charge interest to short, the next day someone is going to fork the project and offer a "free interest" version that everybody will prefer.

You aren't directly charged interest to short, but you do lose the rights to the dividends on your collateral

Would everyone prefer it?  I am sure the savers (those holding BitUSD) would want interest on their savings and to compensate them for the risks. 
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline phoenix

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If you charge interest to short, the next day someone is going to fork the project and offer a "free interest" version that everybody will prefer.

You aren't directly charged interest to short, but you do lose the rights to the dividends on your collateral
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Offline liberman

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If you charge interest to short, the next day someone is going to fork the project and offer a "free interest" version that everybody will prefer.

Offline theoretical

I think that this idea doesn't reduce the implementation complexity; it merely moves the complexity to the part of the code that deals with short sales.

Traditional investment brokerages charge interest to people who short stocks.

I thought from reading the whitepaper that the BitShares equivalent is implemented by denying the dividends from collateral to short sellers.  And I also thought this was not an optional feature, but an important market mechanism to maintain price stability, since any downward price movement will cause existing short positions to want to buy, covering the short and taking the profit, and possibly (but not necessarily) enter a new short position with less collateral.

So with Dividends 2.0, what would fulfill this role?

To put it a different way, a simple UI change suffices when the dividends are being delivered "fairly" to everyone who owns BTS.  But it's not obvious what should happen with short sellers.

Also, if transaction fees are destroyed instead of uniformly distributed, won't that eventually interfere with divisibility?
BTS- theoretical / PTS- PZxpdC8RqWsdU3pVJeobZY7JFKVPfNpy5z / BTC- 1NfGejohzoVGffAD1CnCRgo9vApjCU2viY / the delegate formerly known as drltc / Nothing said on these forums is intended to be legally binding / All opinions are my own unless otherwise noted / Take action due to my posts at your own risk