[Referral Program] Lower Socialist Taxes. Increase Capitalist Opportunities

[Xeldal]

Maybe the referral program can be paused if the network reaches above a certain sustainable market cap? Currently the referral program is really the only thing Bitshares has. There is no other way to earn Bitshares and very little liquidity for trade activity so what do you want to get rid of the referral program for?

If the referral program is truly the only thing bitshares has, there is no reason to have bitshares.  I think bitshares is a good deal more then just the RP.

You can earn BTS by buying them, develop a smart contract or FBA, and collect a fee.  You could also provide a service that people want.  They're plenty of way to earn BTS outside the RP.
No one, at least not in this thread, is advocating getting rid of the referral program.

what prevents me from recompiling the desktop GUI to avoid the extra fees added on top of the fees required by the network.
In case of OpenLedger this hack would mean getting 80% off the transfer price.

Ah, I see. Yeah that's a good point.  Web-base wallet wouldn't have that problem but full-nodes that require open source would.  Services would either avoid having desktop clients or make them closed source.  That might be another reason to go with an account fee set at the blockchain level.

IMO this proposal will require a major code-base upgrade, a snapshot and a full-scale migration of accounts (similar to the upgrade from BitShares 0.9.x to BitShares 2.0).
(I'm not an expert in this area, so this is just my speculation that needs to be confirmed by someone more competent - @abit ?)

I think the change is actually fairly simple and certainly would not require a full-scale migration, but I am also not really qualified to make that determination.  For the most part every aspect of the current RP can remain and function just as it does now.  The only bit that needs a change is where the RP looks for its fee.  Instead of taking 80% from the base fee.  It simply takes 80% of whats paid over the base fee. 

[jakub]

Why should you be able to steal the only revenue the network has from ltm-fee ?!

And BTW the motivation might not be "stealing from the network".
If I have a customer who would buy LTM but only if it cost $10, not $20, it's still better for the network to take this deal than to get nothing at all.
So it's not so black-and-white as you imply.

The network set the price. If you agree with it you can buy it, if not, you don't.

Would you sell me a new iPhone for 100$ only because I will not buy it for 800 but I could for 100?

Sure if Apple gives one to you for free... But why apple should?

Why the network should? We are going to decide the price, other will decide if buy it or not.

Yes, I agree. I just wanted to illustrate that the word "steal" does not fit here.
It could easily turn out that if we had set the minimum price at a different level, the network's income would have been substantially bigger.
So it's not a matter of "stealing". It's a matter of finding the optimal pricing strategy.
We should not treat the current minimum price as something sacred. It's just a choice we've made.

[Bhuz]

Why should you be able to steal the only revenue the network has from ltm-fee ?!

And BTW the motivation might not be "stealing from the network".
If I have a customer who would buy LTM but only if it cost $10, not $20, it's still better for the network to take this deal than to get nothing at all.
So it's not so black-and-white as you imply.

The network set the price. If you agree with it you can buy it, if not, you don't.

Would you sell me a new iPhone for 100$ only because I will not buy it for 800 but I could for 100?

Sure if Apple gives one to you for free... But why apple should?

Why the network should? We are going to decide the price, other will decide if buy it or not.

[jakub]

Why should you be able to steal the only revenue the network has from ltm-fee ?!

And BTW the motivation might not be "stealing from the network".
If I have a customer who would buy LTM but only if it cost $10, not $20, it's still better for the network to take this deal than to get nothing at all.
So it's not so black-and-white as you imply.

[jakub]

The only problem that remains is this: if I wanted to offer a LTM subscription but sell it below $20, I could not do this, could I?
I'm not saying it's a major flaw, I just want to make sure I understand it correctly.

Why should you be able to steal the only revenue the network has from ltm-fee ?!

I think I've put it quite clearly: "I just want to make sure I understand it correctly".

Witnesses would not accept your transaction if it do not have *at least* the fee that the network requires for that operation.

You still could, on the other hand, overcharge the fee if you think it is too low for your business.

I know all this.
But my question was this: what prevents me from recompiling the desktop GUI to avoid the extra fees added on top of the fees required by the network.
In case of OpenLedger this hack would mean getting 80% off the transfer price.

[Bhuz]

The only problem that remains is this: if I wanted to offer a LTM subscription but sell it below $20, I could not do this, could I?
I'm not saying it's a major flaw, I just want to make sure I understand it correctly.

Why should you be able to steal the only revenue the network has from ltm-fee ?!

And the other problem is this: what prevents me from modifying and recompiling the desktop GUI to avoid the fees?

Witnesses would not accept your transaction if it do not have *at least* the fee that the network requires for that operation.

You still could, on the other hand, overcharge the fee if you think it is too low for your business.

[jakub]

IMO this proposal will require a major code-base upgrade, a snapshot and a full-scale migration of accounts (similar to the upgrade from BitShares 0.9.x to BitShares 2.0).
(I'm not an expert in this area, so this is just my speculation that needs to be confirmed by someone more competent - @abit ?)

[jakub]

I want to be sure I'm on the same page. 
There is only 1 mode or model.  one requirement.  You pay the minimum fee. Period.
When using a 3rd party service/wallet, they may elect to require a fee higher then this minimum.
Any such fee paid over the minimum is subject to the rules of the RP (%split according to referrer/registrar values, vesting etc)
A registrar can charge any amount not less then ~20USD for LTM
Network fee on LTM registration is ~20USD or 20% whichever is greater

OK, once again I misunderstood you idea but I hope I got it right this time.
(I thought you meant two modes working in parallel, but now I understand you propose to have just one mode)

The only problem that remains is this: if I wanted to offer a LTM subscription but sell it below $20, I could not do this, could I?
I'm not saying it's a major flaw, I just want to make sure I understand it correctly.

And the other problem is this: what prevents me from modifying and recompiling the desktop GUI to avoid the fees?

If all LTM are exactly the same in function.  Why will anyone pay more then $20 for LTM?

For the same reason people pay different prices for similar airline tickets, when the quality of service is more or less the same.

I feel like this was discussed before but I don't know the answer.  Is there something that requires users to setup a new account for every service?  Will I need to buy a LTM at every service, or can my 1 account with LTM status be used everywhere?  I suppose there is nothing preventing a service from accepting outside accounts but if they are using the RP or selling LTM they may be incentivized to force new members to create a newly registered account with them as registrar/referrer.

I guess you can move your LTM accounts from service to service, I cannot see a reason why you could not.
Thus you don't need to buy LTM at each service provider.

I may not be clear on what you're saying.  The idea is,  If a transaction is made with only the minimum fee nothing is returned via RP. 
If a fee over the minimum is included, 80% of that amount is returned to LTM via RP.
Are you saying-  If the LTM subscription fee is 10,000 BTS, that is a minimum fee so nothing would be returned?  Is that what your saying?  If so 20% of that(the network portion) can be set as the minimum fee and you can pay whatever amount you want, and 80% will be returned.   

Never mind. I did not have a clear vision of your concept when I asked those questions.

One point though:
- the current approach is this: we charge high fees by default and then offer discounts.
- your approach is this: we charge low fees by default and facilitate adding profit margins for businesses on top of that.
That turns the whole thing upside down.
Looks like major changes in the Graphene code-base would be needed to achieve that.

[luckybit]

Maybe the referral program can be paused if the network reaches above a certain sustainable market cap? Currently the referral program is really the only thing Bitshares has. There is no other way to earn Bitshares and very little liquidity for trade activity so what do you want to get rid of the referral program for?

[luckybit]

I think bitshares operating as a for profit business is a turn off to other business as it adds to baseline cost. 
Instead I think bitshares should operate as a non-profit neutral platform for business to make their own profit.
Collect what is necessary to pay operating cost and that is it. IMO.

Why would anyone want to develop and maintain BTS as a non-profit platform?
The one thing that BitShares is really good at is a strong incentive structure for maintaining and expanding the chain. I absolutely don't get why we would want to kill that off.

To drive the price down obviously. Some people think a BTS should be much cheaper.

[yvv]

tl;dr : 
Less socialism, more capitalism.
fewer taxes, more freedom
less grub grub grub, more pew pew pew

Oh, boy. You messed everything up. Capitalism is exactly about grub grub grub, never pew pew pew. This is how bitshares is set up. Political flame is offtopic though, but you started it in your OP, so I feel invited to continue it.

[yvv]

Benefits:
.........
BitShares is more Capitalist and less Socialist

This is funny. How bitshares being more capitalist is a benefit to users? How can bitshares be more capitalist, than it is now?

[Xeldal]

If I wanted to use the in-built subscription model but just sell it at a different price - I could not do it with your setup.
These are my only options:
- use the existing subscription model priced globally by the committee
- skip the subscription model
- build my own subscription model outside the blockchain

You can, just like today.  I can offer up-to 80% off the price of LTM without any cost to me, by giving the 80% I earn from the upgrade back to the user.

OK, that's true.
So maybe ideally we could combine my approach with yours, as the they seem to be quite complementary after all.
I would add this option: for the subscription model, instead of charging $100 and giving back $80, just let the registrar set the price at $20.
And if we had your solution in place, we could enforce the minimum price for LTM at $20 and give it no upper limit.

This way we would have the best features from both solutions:
- if a business was able to sell LTM above $100, it could do so and make more money for itself and the network.
- if a business wanted to sell LTM below $20 or did not want to use subscription at all, it could easily switch to your subscription-less model.

It's quite complex but I think it makes sense.

I want to be sure I'm on the same page. 
There is only 1 mode or model.  one requirement.  You pay the minimum fee. Period.
When using a 3rd party service/wallet, they may elect to require a fee higher then this minimum.
Any such fee paid over the minimum is subject to the rules of the RP (%split according to referrer/registrar values, vesting etc)
A registrar can charge any amount not less then ~20USD for LTM
Network fee on LTM registration is ~20USD or 20% whichever is greater

If the above is what you have in mind.  I have a few questions.
If all LTM are exactly the same in function.  Why will anyone pay more then $20 for LTM?
I feel like this was discussed before but I don't know the answer.  Is there something that requires users to setup a new account for every service?  Will I need to buy a LTM at every service, or can my 1 account with LTM status be used everywhere?  I suppose there is nothing preventing a service from accepting outside accounts but if they are using the RP or selling LTM they may be incentivized to force new members to create a newly registered account with them as registrar/referrer.

@Xeldal
After rethinking, I've come to the conclusion that your model does not leave any space for in-built subscriptions after all.

Subscriptions require the base fees to be set a bit higher and offer 80% discount if you buy the subscription.
Whereas your model assumes setting the base fees at the lowest possible level, so no 80% discount is possible from this lowest level.

I may not be clear on what you're saying.  The idea is,  If a transaction is made with only the minimum fee nothing is returned via RP. 
If a fee over the minimum is included, 80% of that amount is returned to LTM via RP.
Are you saying-  If the LTM subscription fee is 10,000 BTS, that is a minimum fee so nothing would be returned?  Is that what your saying?  If so 20% of that(the network portion) can be set as the minimum fee and you can pay whatever amount you want, and 80% will be returned.   

@Xeldal  I agree with the general proposition and something like what you suggested is a good long term solution.  Also wouldn't it be easier to someone allow business accounts to charge a fee on the blockchain?  Isn't that being done for FBA assets already?   If fees can be set on an account-by-account basis in addition to assets that might work even better.  I think this is a better approach than adding a fee on the GUI because that may open up more vulnerabilities.  At least you can verify fees on the blockchain.    That way businesses can more easily earn money charging a %-based fee or 20 cents first and use whatever proceeds to fund a referral program. 

That's an interesting idea.  Who sets the accounts fee though and can it be changed?  If I use you as a registrar and you set the fee on my account, does this fee apply no matter where I go, or where I use the account?  Can you later change the fee to something else?  I think if the GUI is hacked we have a lot more to worry about then the attacker changing the fees.  I hope I've understood you correctly.

[jakub]

I think this is a better approach than adding a fee on the GUI because that may open up more vulnerabilities.  At least you can verify fees on the blockchain.

That's valid point. If the UI decides about the fees, sooner or later the UI will be hacked.

[jakub]

@Xeldal
After rethinking, I've come to the conclusion that your model does not leave any space for in-built subscriptions after all.

Subscriptions require the base fees to be set a bit higher and offer 80% discount if you buy the subscription.
Whereas your model assumes setting the base fees at the lowest possible level, so no 80% discount is possible from this lowest level.