Bitshares 3.0 - It Is Time

[xeroc]

Can i remind you of this concept: http://bitshares.eu/blog/2016/04/01/Decentralized-Exchange-Union/

[tbone]

I've put some thought into a bitcoin sidechain peg. One major challenge: it turns Bitshares into a high-trust environment. Here's why:

1) We create the two-way peg
2) Various users transfer a large amount, for example 25000 BTC, onto the BTS chain
3) Those bitcoins are held in the BTC chain, controlled by Bitshares witnesses in case of "withdrawal request"
4) This creates a huge bounty for witnesses to go rogue and steal the bitcoins.

Any large-enough group of witnesses could claim to be hacked and steal all the sidechained bitcoins. This isn't possible on the network today, I mean, witnesses can't steal your BTS. Using this would be very scary for me, just because I'm trusting that 20 or 30 people won't be tempted to steal 25 million dollars that they collectively control.

Another potential attack: a majority-by-votes BTS holder can vote in new witnesses for himself. Before, it was scary enough, as he could mess with our blockchain somewhat, with double-spends, etc. But with this sidechain, now he can steal all the bitcoins.

Thoughts?

I think instead of a bunch of anonymous witnesses, the node operators in this scenario could be known entities such as OpenLedger, Blocktrades, Blockpay, Transwiser, BitKapital, etc.  Maybe a few witnesses can be added to the mix, perhaps with a requirement to ID themselves and/or put up a security deposit.  A solution like this would not be trustless, but it would be far less centralized than the current setup and it would ensure that there are never fractional reserves.  This would give users far more confidence.

[bitcrab]

I've put some thought into a bitcoin sidechain peg. One major challenge: it turns Bitshares into a high-trust environment. Here's why:

1) We create the two-way peg
2) Various users transfer a large amount, for example 25000 BTC, onto the BTS chain
3) Those bitcoins are held in the BTC chain, controlled by Bitshares witnesses in case of "withdrawal request"
4) This creates a huge bounty for witnesses to go rogue and steal the bitcoins.

Any large-enough group of witnesses could claim to be hacked and steal all the sidechained bitcoins. This isn't possible on the network today, I mean, witnesses can't steal your BTS. Using this would be very scary for me, just because I'm trusting that 20 or 30 people won't be tempted to steal 25 million dollars that they collectively control.

Another potential attack: a majority-by-votes BTS holder can vote in new witnesses for himself. Before, it was scary enough, as he could mess with our blockchain somewhat, with double-spends, etc. But with this sidechain, now he can steal all the bitcoins.

Thoughts?

I feel what you are talking is still multisig gateway, not trustless sidechain, however I am not 100% sure.
I just heard steem already began their sidechain work(maybe also peerplays?), big change to bottom infrastrature will be introduced, but I am not clear about the detail.

[天籁]

I've put some thought into a bitcoin sidechain peg. One major challenge: it turns Bitshares into a high-trust environment. Here's why:

1) We create the two-way peg
2) Various users transfer a large amount, for example 25000 BTC, onto the BTS chain
3) Those bitcoins are held in the BTC chain, controlled by Bitshares witnesses in case of "withdrawal request"
4) This creates a huge bounty for witnesses to go rogue and steal the bitcoins.

If the market cap of Bitshares is low, nobody will transfer a large amount, for example 25000 BTC, onto the BTS chain.

[tbone]

I think this is a very important issue and I thank @bitcrab for resurrecting the discussion.  To add my 2 cents, here's what I posted in Telegram as part of a discussion on the matter there.

"(Graphene + Bitcoin + Ethereum) sidechains would be amazing.  but i can't imagine that happening within a year.  perhaps in the meantime we should consider the multi-sig gateway approach.  even though it's not a trustless solution, it would be less centralized than what we currrently have, which would give users more confidence, especially if there's a proof-of-reserves component. also, it would give us a single BTC asset to focus on, which should help with liquidity and hopefully also help simplify matters for DEX users"


From Stan in Telegram RE: sidechains between Bitshares, Steem, Peerplays, Bitcoin and Ethereum:

I've discussed it with several community leaders over the past few months.  It's one I'd like to see happen in the coming year - no promises yet.

[Chronos]

I've put some thought into a bitcoin sidechain peg. One major challenge: it turns Bitshares into a high-trust environment. Here's why:

1) We create the two-way peg
2) Various users transfer a large amount, for example 25000 BTC, onto the BTS chain
3) Those bitcoins are held in the BTC chain, controlled by Bitshares witnesses in case of "withdrawal request"
4) This creates a huge bounty for witnesses to go rogue and steal the bitcoins.

Any large-enough group of witnesses could claim to be hacked and steal all the sidechained bitcoins. This isn't possible on the network today, I mean, witnesses can't steal your BTS. Using this would be very scary for me, just because I'm trusting that 20 or 30 people won't be tempted to steal 25 million dollars that they collectively control.

Another potential attack: a majority-by-votes BTS holder can vote in new witnesses for himself. Before, it was scary enough, as he could mess with our blockchain somewhat, with double-spends, etc. But with this sidechain, now he can steal all the bitcoins.

Thoughts?

[kingslanding]

the lightest idea here is to introduce real asset to trade in DEX.
in other words, to connect Bitshares and Bitcoin via sidechain.
the topic has been discussed deeply in https://bitsharestalk.org/index.php, and seems BM has put it into to-do list.but...
I wonder is it possible for the team to develop this without BM?

I agree a sidechain between bitcoin & bitshares would help a lot.

I believe Peerplays is planning to do a sidechain into bitshares.  Maybe this could be adjusted for bitcoin without much problem.  I'd keep an eye on Rootstock as well.  They're using a federated peg with bitcoin.  This should work well w/ bitshare delegates.

[bitcrab]

the lightest idea here is to introduce real asset to trade in DEX.
in other words, to connect Bitshares and Bitcoin via sidechain.
the topic has been discussed deeply in https://bitsharestalk.org/index.php/topic,21263.0.html, and seems BM has put it into to-do list.but...
I wonder is it possible for the team to develop this without BM?
 

[karnal]

I appreciate the effort put into the OP, but I have to disagree with most of it. The one thing I do agree with is point 2: the liquidity proposals. I do think some kind of liqudity incentives need to be implemented, but we probably need some more discussion and some concrete proposals by developers able to implement them (@abit ?) before we decide what to do here.

Otherwise, I'm happy to finally see some stability in terms of features for Bitshares, and will not support any kind of 3.0 involving a change in the supply or IPO. We now have Ronny from Openledger stepping up to support development of the GUI, and many other projects taking advantage of the recent stability of BTS, let's not jeopardise that.

I also have no problems whatsoever with DPOS as the consensus model, it's been working very well and there's no point changing it if you ask me. While implementing a queued mining system like Steem has might be possible, I don't really think it's worth the effort. Mining will slowly disappear from crypto if you ask me so we would be adding support for a legacy, wasteful, soon-to-be obsolete system. Keep in mind I'm not saying it will disappear soon here, but over time I think it will become less and less important.

  Well said SVK. Good points.

[Yao]

Guys, before you even consider doing anything, just do those two little things which are really obvious:

- Make the GUI finally free of bugs
(Yes, there are still terrible bugs in the GUI - no errors show up but the UI often gets stuck and needs to be reloaded in the browser)

- Upgrade the website to make it look like you actually want a new user to try out your product
(Yes, when you sell some software it's usually a good idea to show a screen-shot)

Fix bugs first. Please!
I'm a shareholder, but now i'm more of a user, I have a bug to report here.

Have you guys used the asset's Whitelist?

WHITELISTS AND BLACKLISTS
Some 3rd party service providers may want to select which customers are allowed to hold their assets , e.g. after verified their identity for KYC/AML. Those services can use so called whitelists (or, alternatively, blacklists) of their assets that will prevent unauthorized participants to use this particular asset.
In BitShares 2.0, account names (life-time members only) and also user-issued assets have their individual whitelists. Hence, if you issue an IOU on the blockchain, you can define who can hold and trade your tokens, if you wish.
User whitelists on contrast can be used by independent KYC/AML providers to state proper verification. An asset issuer may then use those providers to oursource identity verification completely.

us-in (an account name ) issued an asset called UIATEST , and enabled all the flags:

Require holders to be white-listed   
Issuer may transfer asset back to himself
Issuer must approve all transfers
Disable confidential transactions

and add uiatest (an account name) to the Whitelist of us-in (an account name ), then us-in sells UIATEST in the market, uiatest can buy it, usin（not a whitelist account of us-in）can buy it too, Where is the problem?

[mike623317]

I appreciate the effort put into the OP, but I have to disagree with most of it. The one thing I do agree with is point 2: the liquidity proposals. I do think some kind of liqudity incentives need to be implemented, but we probably need some more discussion and some concrete proposals by developers able to implement them (@abit ?) before we decide what to do here.

Otherwise, I'm happy to finally see some stability in terms of features for Bitshares, and will not support any kind of 3.0 involving a change in the supply or IPO. We now have Ronny from Openledger stepping up to support development of the GUI, and many other projects taking advantage of the recent stability of BTS, let's not jeopardise that.

I also have no problems whatsoever with DPOS as the consensus model, it's been working very well and there's no point changing it if you ask me. While implementing a queued mining system like Steem has might be possible, I don't really think it's worth the effort. Mining will slowly disappear from crypto if you ask me so we would be adding support for a legacy, wasteful, soon-to-be obsolete system. Keep in mind I'm not saying it will disappear soon here, but over time I think it will become less and less important.

  Well said SVK. Good points.

[tbone]

I think @CoinHoarder's idea to introduce PoW could make sense as a marketing ploy.  But as the primary consensus mechanism, I think it is becoming more and more clear that PoS is superior.  And PoS is increasingly being accepted within the crypto community.   After all, everyone knows ETH will be switching to PoS, and aren't all of the recent ICO projects using PoS already, including Lisk which is specifically DPoS?  We really don't need to go down this road, except maybe to have token mining for marketing purposes.  But even then, I think we have much higher priorities, namely taking steps to incentivize liquidity providers. 

Speaking of which, I think we should have a liquidity pool that shareholders can participate in and earn returns.  Returns can be funded not only by trading profits, but also by blockchain sponsored liquidity provider rewards that anyone or any entity (including the liquidity pool) can compete for. 

Also, perhaps we can introduce some form of @Empirical1.2's yield harvesting to simultaneously incentivize both BitAsset creation and participation in the liquidity pool.  We really need to start taking real measures to increase liquidity. 

Thank you @CoinHoarder for helping to shine the spotlight on the critical issue of liquidity again.

[R]

I don't think we should be introducing POW to DPOS at all, POW is figuratively the cancer killing cryptocurrency.

[kokojie]

I think PoW should no be more than 50% share of block generation, otherwise the "soul" of Bitshares is become PoW.

[lil_jay890]

but disdain for idea #1 should not be a reason to write off the other ideas.

Absolutely. Bootstrapping liquidity is very important. And for the DEX to actually be decentralized, we really need something better than OPEN.X assets which have all the counterparty risk that centralized exchanges have. Multisig sidechains are one way of solving that. Can you explain what the  SuperNext and B&C Exchange model for solving the counterparty risk problem is?

Great.. we need liquidity... how?

maker/taker rewards?

What does that look like?

What would be enough to attract traders?

How much liquidity is enough liquidity?

I've posted dozens of times about how to get traders. Kind of getting tired of typing it over or digging up the threads since it never seems to go anywhere...

I'll try to dig up the threads though.