But the part about "insider information" and "might as well be considered part of the team" is complete bullshit.
I confirm. The core team is a fixed group of seven people, and they are not looking for new members. There is/soon-will-be a separate group MEW, Monero Economy Workgroup, similar to foundation that some coins have. The group has tentatively 17 members, including me, and some but not all of the members of the core team. As for inside information, MEW has a chat where Monero-specific news are quickly announced. If this sounds interesting to you, the membership of the group is open for all, as soon as we get some paperwork done. |
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I have further developed the theory of optimal distribution. The general rule is that distribution should be as close to the power law + lognormal economic standard distribution as possible. The free market naturally tends to that outcome, so it is only a part of the optimality. The other part is quality.
Quality means that the large owners should be more established in other spheres of life also than small owners. A coin with large owners who are rich also outside the coin, hold positions of power in the old world, have connections, education and experience, has a much better future than a coin whose large owners are nothing and hold nothing except a large position in the coin in question.
If a coin's majority ownership consists of fanatics who have invested all their savings in the coin, this is not good. Such people cannot, for example, provide buy support to the coin in times of trouble because they are all-in already. Strong hands whose majority of assets is elsewhere, can easily buffer the fluctuations in the coin's value because they are not out of cash and not need to panic.
If a coin does not have sufficient trust and legitimacy, or is too illiquid, it may be that people who otherwise are in good positions, don't want to / cannot easily invest a meaningful amount. This leads to these otherwise valuable investors taking a suboptimal too small position, which does not allow them to do research, leading them to be weak hands, similar as the fanatics.
I believe that in altcoin investing, the best breed of investors every coin should try to attract, are the ones who invest at least 5% but not more than 30% of their net worth. These take the time to really learn about and support the coin, yet have also other resources that enhance their financial solidity. Smaller investors should of course be encouraged, because that is the typical way of becoming a large investor. Larger investments should imo be discouraged, except in case of people who have very little to invest and can easily recoup the losses even if they lost it all.
Then follows the 4 classes of coin owners, by quantity, but keep in mind the quality aspect when reading. The classes are fixed in number/percentage of people, and given an optimal % of total coins. The possible problems if the # of coins is greatly off the optimum are discussed.
First Class - a few owners - optimum 30% of coins
In a coin with 1,000 total owners, the first class consists of 5 largest owners. For 10,000 total owners, the first class is the TOP-13 largest holders. For 100,000 owners, it is TOP-39, for 1,000,000 owners, it is TOP-116. The formula, derived from power law directly, is: [0.1798*(total owners)^0.4682]
Too much coins:
If this class owns too many coins, the problem of centralization is apparent. It is good to try to analyze the ownership from the beneficial owner pov - it may be even more concentrated. There should not be one entity or collective that can rule over the exchange rate, because if there is, the rate is most likely rigged in their favor.
From the economic side, having too large a stash concentrated at the very top, correlates with diminished activity at the lower levels. There is hardly a way to develop a decentralized economy if this is the condition.
My thesis is that this is the problem with most altcoins.
Too little coins:
This is also a problem, although I don't believe there is practically any examples of it in coins (Monero's problems of raising money even for basic development may be indication of this). If the coin lacks large owners, it lacks the leadership and backer of last resort. The backing of course assumes that the large owners have non-coin resources to back it.
Business Class - 3% of owners - optimum 30% of coins
Too much coins:
Is not really a problem. The more coins the "lower nobility" holds, usually the better.
Too little coins:
This is a very serious problem because it indicates that there is lacking rich people / investor / business / speculator interest in the coin. This group of people is capable in developing infrastructure and services around the coin, so without this group or if it is deficient/inoperational, not much will happen.
Middle Class - 17% of owners - optimum 30% of coins
Too much coins:
That the middle class owns many coins is not a problem, rather an indication of widespread interest, but if excessive, it means that the upper classes may own relatively too little, cf. them.
Too little coins:
The lacking middle class is an indication that the coin does not have enough adoption, support or even speculation. I would say this is the worst problem, because the middle class is (among others) a very important testimony of community support, source of additional buys, and a marketing backbone. Also whether the middle class is apathetic (bagholders), passive (speculators) or enthusiastic (activists) is a great way to forecast the future of a coin.
Lower Class - 80% of owners - optimum 10% of coins
Too much coins:
Is a symptom of middle-classization (part of the people classified here as "lower class" actually belong to the middle class). In itself is not a problem.
Too little coins:
Indicates that many of the coin owners are in it with such a small stake that it cannot be counted as real adoption or support. This situation may arise eg. as a result of a giveaway distribution model. Does not really matter to the good or bad, but if this is the case, it would be good to rerun the analysis with cutting off a percentage of the dust holders to see a more accurate picture on how the actual ecomony is constructed.
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I sent 25 XMR on July 11th.
don't spend it all on blackjack and hookers!
Just sent another 25 XMR, it's not much but I hope it helps. Every donation, in whatever amount, is 100% appreciated. If that's what you can afford and feel comfortable giving, you have no reason to say anything about its size. Thank you very much! At the suggested 1% donation level, 25 XMR means a donation out of 2,500 XMR. In my distribution/economics calculations, that is not even a small amount/holder, rather ranking about #137 in the 10,000+ holders out there!  Monero's problem is that it is such a small coin with its $6M marketcap that it is generally hard to extract money out of the holders for development. That said, during the recent events I increased my holdings and want to donate the corresponding amount of 200 XMR. You can confirm from the devs that it has been paid. |
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10 % decline in a short term is too much when you consider it should be a store of value.
Monero needs more traders to absorb the dumps, but on the other hand, feed the buyers in pumps.
The dumps were absorbed good enough in my opinion. The problem is that right now we have someone (credible enough for me) who is telling that there is some kind of major problem with the blockchain. But he hasnt give enough explanations. So there is great uncertainty right now and it will stay for a while unless we know more about that or we conclude it was bullshit... I see it as follows: the decline was 10% and half of it could be attributed to the usual beta-leverage of alts diving if BTCUSD takes a hit (which it did the same day). So the effect of this rumor on price was 5%. Now the market is stabilized and it is still 5%+5% lower. So the market is attributing only 5% chance to the scenario that it is true. If you believe it is FUD, you can get a 5% discount. Otherwise you should sell. Of course only those who have XMR can sell. Others need to buy my PUT options to take advantage of this. They were priced very attractively before this event, so if there was any profit motive in this, it's likely someone would have bought them, at least via sockpuppets. (Here it does not matter if it is true or FUD, the price dip was a fact that already happened.) This is one of the strongest circumstatial evidence imo that the whole debacle was more of an accident than anything else. |
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* After conversing with rpietilla I do not think he hired any trolls or is a scammer per say. I do think he has gotten himself into something he didn't expect and is simply trying to build a coin.
I confirm that I haven't (ever) hired trolls, am not a scammer, did not expect these developments and am simply trying to build a coin. |
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Hahem am I the only one that think BCX's findings are worrisome?
What were the findings again? |
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The opposite is more nearly true. The future begins when the mining depletes.
before there is a sharp speculative spike in the XMR/XBT rate.
The market should be able to price the emission schedule in, when determining the price. At this point in the cryptoworld, having shart speculative spikes in a new coin's valuation is far from certain anyway. What IS reality, however, is that some people such as me, automatically reject coins that are too much mined, unless the coin has exceptional merits. This leads to such coins not receiving any investment from the likes of me. If Monero had been 70% mined when I heard about it, and otherwise same coin, same community and all, I would hardly have been interested. |
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Who belongs to it now?
It is not yet established, but we have and initial workgroup of about 15 people, developing the thing, distilling the vision and discussing the practicalities.
Who? When the group is established, the memberlist will be public, although it is possible to be anonymous or pseudonymous. |
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Even the most dedicated (group) of buyers will need to spend some real effort to overcome that pull.
This basically ensures that no artificial pump on Monero will be profitable. If it pumps, the reason must be real outside investment entering in (current holders are already used to these prices and not likely to buy in higher - same as with BTC by the way). I believe the right course of action is to enable the said investment, by several ways, of which I am also involved in some. Not disagreeing here. I still would have preferred if the outcome of the April vote would have elected a curve closer to that of Bitcoin, but what we have is what we have. And one of the advantages is the one you bring up. Exactly. I also lament the outcome of the April vote, but I wasn't there to influence it  well, just consider the fact that some people already bought a few thousand XMR and that their balances would be halved with the changing of the emission scheme... So if you bought 18000 XMR (called BMR back then) because you wanted to own 1/1000th of the total supply, you would have 9000 XMR after the change, while the total supply remained 18 million. Not very fair, imho I don't think that would be the outcome (or even possible). Existing balances and total number of coins stay intact, only the formula how quickly the future coins are generated, changes. It could still be done, since XMR is only 20% mined. And should, imo. The current schedule is inhibiting people from investing in XMR because they believe the coin has no future once it starts to be 70-80% mined, which happens too soon. |
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Regarding donations - we already have about 20% of the Monero owners joining MEW. If we get this number to about 50%, then it will be easier to fund development as a community effort because there is no free riding.
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Even the most dedicated (group) of buyers will need to spend some real effort to overcome that pull.
This basically ensures that no artificial pump on Monero will be profitable. If it pumps, the reason must be real outside investment entering in (current holders are already used to these prices and not likely to buy in higher - same as with BTC by the way). I believe the right course of action is to enable the said investment, by several ways, of which I am also involved in some. Not disagreeing here. I still would have preferred if the outcome of the April vote would have elected a curve closer to that of Bitcoin, but what we have is what we have. And one of the advantages is the one you bring up. Exactly. I also lament the outcome of the April vote, but I wasn't there to influence it |
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Even the most dedicated (group) of buyers will need to spend some real effort to overcome that pull.
This basically ensures that no artificial pump on Monero will be profitable. If it pumps, the reason must be real outside investment entering in (current holders are already used to these prices and not likely to buy in higher - same as with BTC by the way). I believe the right course of action is to enable the said investment, by several ways, of which I am also involved in some. |
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When Monero can have some use for private transaction, so that its usefulness is proven, then it will fly. Before that, it is all speculation.
Sending money between your friends privately is surprisingly reassuring. It's like Bitcoin in the early days when you didn't know that big brother is retroactively watching your every move  |
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...thinking in taking a 5-figure XMR position soon (if he can afford 5 figures when his fiat arrives).
I think it is very gentlemanly of you to share this information. Thank you. I would volunteer to help provide liquidity if it is lacking when the time comes. It's always worthwhile to have more adoption. (Although I could prefer more dispersion!) I forgot to mention that the 3rd person (of only 3 in total that I met today for business) made a semi-strong commitment to invest 100 BTC very soon. (The reason I forgot to mention is that he already owns XMR). So no matter whom I meet, it ends up that he buys XMR.  |
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I seriously doubt rpietila is Moneroman88.
His paid troll that went too far, maybe.
But not him.
~BCX~
So far I have been able to raise a following among actual people, with the merits of the ideas I am propagating. Sometimes it has not been easy (see my post about the frustration that I as a newer account, had to pay first): Hello community,
I am sure this matter has been discussed before, so hopefully you can forward me to some good threads.
The matter is trust. I have for a few months been moderately active in the forum, and Bitcoin itself I know ever since 2010.
I have been doing full-time business for 12 years. My investing experience is 16 years. I have established about 5 companies, been advisor to more, organized tens(!) of financing rounds, and still own, chair and/or run multiple businesses in two countries. Their combined sales are in the range of millions. I am married for 10 years, I have a daughter. One of the companies I lead, has more than 60 shareholders. I have enriched them by selling them silver when it was cheap. They hold several tons(!) of silver in the company's dedicated vault. They have thousands of bitcoins, too. I also have some bitcoins.
I am not old, I'm 32. But I am adult. And I have a hard time with some of the "rules" in this community. Everybody is paranoid as hell. I understand that bitcoinworld is full of scams, but I have a hard time accepting that. Anyone who has been with bitcoin as long as I is sitting on good gains from the value appreciation alone. In the world outside of bitcoin, scamming is not really the modus operandi. I have encountered scammers in my career, yes. One sold me silver-plated trinkets worth € 25,000 with forged documents and an elaborate cover story why they were solid silver. I was relaxed by the appearance of this 60-year old gentleman with his 25-yo son and their family company. Another time I was defrauded of 300 grams of gold. I paid first to a long-time customer. He never sent the product and vanished. Luckily I paid only 50% upfront. Then another one bought 20,000 oz of silver and did not pay. I had quite a diplomacy in canceling the binding order that I had placed with my supplier. That one cost me thousands, and I won in restitution court. The customer paid me most of my damages. One year later he apologized. This may sound like much, but compared to the total volume of business, we are talking about minor setbacks.
It defies my imagination in general, why somebody with enough money would turn to scamming. It must be that bitcoin for some reason is a honeypot that attracts people, who already are scammers, to participate. This concentration of scammers and scam-businesses is unheard of, anywhere in the outside world.
It is well-intended that newcomers should be rigorously scanned if they can be accepted to the web-of-trust. But I tell you something: most newcomers don't have the time and/or dedication for that. They come from already-established networks, and there needs to be a way to incorporate this already existing trust to the community.
I mean, of course I can start to use escrow in my dealing with forum people. It is not a big deal really. I do pay taxes, and that is far more expensive and difficult.. But if you really require that (instead of you sending first because I am an established, incorporated business and don't have the luxury of anonymity), I cannot count being part of the community an asset, rather a liability because it worsens my terms of doing business. I hope that there could be a solution. Otherwise I will consider that this is a risk vector to the whole Bitcoin: established people don't want to join because the community is full of scammers, people that are paranoid of scammers, and kids screaming to multimilliondollar businesses that they should use escrow when dealing with them. Phew. I am in first-name terms with the largest bullion dealer in the U.S. and there was a month in 2011 when I was their largest customer in the best-selling product. I can lock-in $500,000 with one phone call of 1 minute and get 7 days to pay. Beat that.
This coin thing is a good one, because the world needs more privacy. How can the community accommodate established people? Or do you turn us down, so that there needs to be another coin for people in good standing?
The troll war is getting out of hand. I have never needed to buy trolls. Afaik no one in Monero side does it, and I cannot see a reason for doing it. What I can see, is summarized in the last paragraph of the quote. I am disgusted of what is happening, and getting more resolved to use only the coins where the developers and the activists play fair. |
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It might help to have some funding goals, so that as a community, we can work to certain points more rapidly. Maybe the Monero Committee (or whatever is called) can do something with this?
The MEW will be donating at least 1,650 XMR to the developers next week, maybe more depending on the exact membercount. When our membership opens to everyone (asap), the sum will be even higher. It is correct devs are operating at a loss currently, but at least we are getting a structure in place to support them. |
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The only way for Bitcoin to lose now is by being overtaken by another cryptocurrency. So, the question now is, what do you think the odds are of Bitcoin failing (let's say going to a market cap <100 Million).
Well that is very unlikely to happen. Also I don't want to be losing 99% of my wealth so I would jump out first, much before. This jumping out, if it for some reason gains traction, could make the air (market cap) go from one balloon to another really fast. Nobody can be complacent. Risto, You pointed to the SSS strategy for raking a % in case BTC/USD climbed at a given price range, a strategy I fully agree to. You also pointed to hedging BTC position with an equivalent position in XMR, wich I also agree. I'm interested to know about your exit strategy in case Bitcoin values come below certain USD values. I mean, what percentage of BTC would you sell (for USD or XMR) at each price range? Thanks. Bitcoin has a long history of steep dips, yet it has always gone higher. I think it is prudent to never sell below ATH. Same applies to Monero of course. Don't invest in BTC/XMR any money that you cannot lose. And sell so much in the tops that you can take the dips to zero if need be, without getting tempted to sell at the bottom. |
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There are probably many security flaws in this. Is this what you were thinking of?
My idea is very basic, you need just provide your orders (every time you want to participate), in the following format: BUY_XMR
Price BTC Quantity XMR
0,00383000 1 000,000
0,00379000 2 000,000
0,00377000 3 000,000
0,00370000 5 000,000
0,00360000 7 000,000
0,00350000 10 000,000
SELL_XMR
0,00000000 0,000
0,00394490 1 000,000
0,00401740 2 000,000
0,00405000 2 500,000
0,00410900 3 000,000
0,00420000 3 500,000
0,00430000 4 000,000
Or if you are not a marketmaker, just in a very simple format like this: BUY_XMR
Price BTC Quantity XMR
0,00383000 1 000,000
. Everything is just copypasted to the operator excelsheet and operated there. With the proposed operating mode, it does not need to be rigorous, because what the operator essentially does is: "I promise to sell to all who bid higher, and buy from all who offered lower, at the one matching price, which I choose." |
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Had an impromptu business meeting with two guys I knew but haven't had contact with for months.
As a side effect, both are now holders of Monero. One had used BTC before, the other not. The one with previous experience in crypto is thinking in taking a 5-figure XMR position soon (if he can afford 5 figures when his fiat arrives).
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Last night I by the way made the Excel package for:
- submitting the orders (automatic calculation of 3%, 6%, 9% limits for optimization of points) MEMBER SHEET
- collecting the orders in one sheet for aggregation to the orderbook (final points for the day) OPERATOR SHEET
- the matching of the orderbook is currently done manually by copy-paste and then running a simple procedure.
The time requirement from an operator is about 1 hour of actual work (or even less) per matching day, and you need to be glued to computer for 4 hours. With 20 members, the exchange would make you 300 XMR per month in fees.
I am currently in a position to start it after a few more hours of finalizing the procedures.
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