I responded to your PM and also gave you a troubleshooting step for this

Well, I'm going to try and make as much under the hood as possible. Because understanding the technical details requires a high level knowledge of what Bitcoin actually is. I'm not sure if I should explain that here or just save it for people to read somewhere else for the ones who are really curious. There is a few challenges in helping users understand it. There is a question of what basic users need to know. Should they know that different coins freeze at different speeds? Perhaps if they request it in the client, sure but it will not be immediately visible. Minimum liquidity requirements for sending can prevent them from noticing that their coins freeze slightly faster or slightly slower depending on which ones they received. I could explain much more technical details here but perhaps it would be too much. hahaha

At a minimum, they need to know their funds freeze and unfreeze. The end goal is to make that the only new concept for basic users to understand.

Yeah I'm aware of this, however the pegging proposal here is a decentralized fractional system.

So coins are tagged as to how they freeze and unfreeze.

Example, lets say the deflation rate is 50%

And someone had coins that he never spent since it was 100% inflated (0% deflated)

Then he tries to spend.

Miners force him to send 50% back to himself tagged as frozen 100-50 which is basically his coins divisible in 50 parts.
Then the remainder he wants to send is now liquid 50-0 which is liquid coins set to deflate in at least 50 parts.

If the currency inflates again the user can spend some of his frozen coins.
Lets say it inflates 5%
Then he can unfreeze 5/50ths of his frozen coins and tag them a liquid divisible in 5 parts over 5 points.

Merchants will always require good quality coins and this is all going to be done under the hood.

Frozen coins can be transferred when totally frozen under one condition: That you put at least a 3 month time lock on it. At least im leaning towards a 3 month exemption but it should be in the range of 1-6 months.

This is superior to NuBits because its totally decentralized. There is no custodial addresses, there is no sustainability problem, there is no voluntary parking. Nubits suffers from major front running/inflation/centralization problems all of which are solved here.

This creates a series of asset classes based on how much liquidity your coins have. It also allows us to roll prices up and down by controlling the supply. AND it doesnt favor the rich, anyone who held coins that froze will benefit by having them released later.

And also it creates some really interesting possibilities for transfers of liquidity for frozen coins. Similar to loans, trustless bonds and futures, etc.

Thats the core idea, I've been in discussions about how to make it user friendly which is the first priority. This is the basic core principals and we can build on it from there.

Deflation/Inflation per day will probably be 1-2% and might follow a sort of linear curve where that is more of a target rate. Although im still deciding over the minor details.

EXACTLY, if the USD starts devaluing, we wouldn't want to sink with the ship!! The good thing about it being done this way is the price can grow and then stabilize. Of course, we have to make sure not to overgrow it!

Honestly it would be a great success if we can see profits for all of the patient investors.

Blockstream wasnt the first ones to propose it at least I highly doubt it... and the way i had it visualized was different from the one described here...

http://rusty.ozlabs.org/?p=450

The above link was where i first saw it.

And besides, its just an idea, in the end it doesnt matter which company accomplishes it as long as it comes into the market. Ive currently got no time to work on something like that... obviously there is enough work to be completed here. But I hope to see it brought to market by any dedicated coders or company.

Anyways, scalability is still an issue. However with Pegging currencies it might be possible that people can issue their own currencies for each community and peg it to other larger ones. Thus, their blockchain is secured by their community and buying and selling those can be purely based on their resale value.

Im guessing Bitcoin needs to be rewritten entirely and Etherium is making the bloat problem worse. Of course, both those currencies are heading for a centralized future whereas we are looking at a decentralized one. Pegging and lightning networks are a huge step for that. Combined with smart contracts its almost an entirely complete, self surviving economy. It should be noted, the smaller the economy the more likely the trust is broken and the higher the probability for conspiracy to large aggressive groups to take funds from people. The bigger the economy, the more likely the blockchains rules are kept honest however the hard it is to fork and the harder it is to prevent centralization. Technology might get better and help us have bigger hard drives and more bandwidth so there is still hope. There is a sweet spot somewhere here. So we still need to make sure any economy is large and has a good method of P2P fraud prevention and verification.

Etherium contracts should definitely be stored off the chain. And preapproved by miners as safe. So they are just really making the problem worse unless their end goal is centralized servers.

The peg might not be hard set at a dollar because that (might) require freezing a good deal of coins, we will roll the peg upwards to that target and see when the volume increases and choose the target price by voting. Of course we could set it to a dollar but that might impact volume if the price gets too high we can inflate again. So we should release it and roll it up to the target gradually. The coin itself will be the market maker. It will certainly be much higher than this price though. The only challenge will be making sure the exchange doesnt oversell and runs our API. So the API will return two classes of funds: Frozen and Liquid. (or maybe BitBay and BitBayReserve not sure of the name yet)

Those two classes of funds mind you are on the exact same blockchain, its just that the exchanges need to tell you if funds freeze while on the exchange. It wont impact withdraws since I'm adding an exception to allow transfers of frozen funds with a 3 month time lock.


Blackcoin and Bitbay have similar limits to Bitcoin as the block size i think is the same. However UNLIKE the stubborn Bitcoin foundation we can do whatever the heck we want. So if we need to allow bigger blocks, then we will. If we decide on a lightning network, we will. Lukcily, we dont have to worry yet.

Bitcoin of course has a serious scalability problem. And I'm thinking the lightning network certainly helps take the load off it. Because you can link IOUS through a payment network. It (could) works like this:

My version of the lightning network is a bit different from the Bitcoin foundations... but the theory is the same.

Lets say there are only 5 people in the economy. Bob, Alice, John, Joe and Sara

Bob and Alice set up an account with each other
Sara sets up an account with Bob
John sets up an account with Sara
And Joe sets up an account with John

NOW when you want to make a payment you route an IOU. If Bob owes Joe money, he tells Sara who tells John who tells Joe and they each carry the debt to their neighbor. And this can be done using micropayments.

They do it using locktimes, each settlement clearing every month or so. But they RENEW those debts monthly.

If they dont renew the debt, they report it to the blockchain.

Thus the blockchain is only used to report errors. Accounts are set up so early withdraw is allowed but debts were written to replace old transactions.

Servers can hold on to copies, so can peers. In any case, they might only care about what is relevant to them. They would want to know, how much everyone has and check those balances with their peers.

In the end, the blockchain is only used to report errors and early withdraws or transactions made outside the lightning network. This was one interesting solution to bloat that I've seen. Of course the blockchain can still get bloated but mostly it would get larger to due notary.

Multisignature might get more complicated on a lightning network though. Im sure the theory is the same though since only debts are routed, there is no reason we cant build on it in the same way, multisignature accounts are still just accounts. Each time an account is made, you only need to find a person to pair with. If you are stuck not finding a pair then just do the transaction on the blockchain which would be a last resort.

In multisignature, can a 3 of 3 or 10 of 10 account find itself in default if an angry partner broadcasts early thus allowing their pair to interfere and withdraw? And what if they collude with the pair? So there are legitimate questions about the limits of lightning network. And one might just be certain types of multisignature and notary exchange.

Now with freezing and unfreezing on top of lightning networks things might get really complex. Most likely withdraw transactions will need to have copies that bypass the freeze with 3 month locks for the maximum inflation or deflation predicted in the month.

Bitcoin foundation had the idea of lightning network where everyone shares with a central hub that routes payments. But that solution is pseudocentralized since if the hub goes down everyone needs to withdraw. Whereas in my example, only the effected parties withdraw. And its more decentralized.

Technically the lightning network works because of locktimes. You set a locktime for a payment with a temporary private key and to replace the payment you make another transaction where the lock is sooner so if they try to spend the incorrect one, the key is revealed and you can take their money since you hold a version of the transaction with an earlier lock! Its pretty cool stuff.

it should be oxidian, however, I'm going to update that to my github shortly, ive got better source since oxidians source is missing files... the qt wallet was poorly done, thats why you cant build the daemon from it.

We might fork early for staking to move entirely to the markets wallet but i need to test the new staking commands first.

We all think it is, actions will speak louder than words soon. I've got faith that the coins with real utility will have to rise above the ones that don't do anything eventually. Maybe now that crypto is getting more popular this will change. Also, the rest of the features should be finished this year.

Well i dont think you were talking about BitBay but if you were here are the things that have happened since last year.

Completely new user interface, detailed panels for history.
Advanced payments such as joint accounts, automated joint accounts fully automated and complete
Pay to email with steganography (coins hidden in images) completed
Partial refactor of the Halo source, massive improvements to core
Email and Bitmessage stability greatly improved, no more lost messages, support added for different email encoding
DECENTRALIZED MARKETS released, first coin/software in the world to have them.(including Bithalo and Blackhalo)
Installation wizard made, multiple user friendly features
Many small user friendly features, reminders and hints integrated seemlessly
More improvements made to decentralized markets
Reputation system added, fully trustless checking of contracts and their success rate
Database management improved tremendously, (some) issues with memory and automated backup improved
Fixed a lot of random things
Major improvements to contracts such as time of agreement, modifications to negotiation
Fee calculation improved per kilobyte for large transactoin
Many scalability features added to source
TRANSLATIONS to 92 languages, autotranslator added to code with a User Interface for improving those translations(via google translate)
As above, entire UI adjusted to morph with translations AND UI changed to morph with coin switching
Entire User Interface developed for TEMPLATES
First Template "Cash for coins" made, massive update
Cash for coins included with TRUSTLESS price tracker, negotiation and verification of any market fluctuations
Full communication of price alterations between clients
Improved Custom contracts user interface
Automatic acceptance made with better contract verification totally immune to hacking
Contract hashes verified, hashing function made for unordered json dictionaries
Other exotic contracts and bitcoin scripting tested, functions added in back end for later use
Basics of "cold staking" multisignature staking added, was waiting for POS 3.0 to implement
Personally FIXED Qt client that was not properly forked and recompiled daemon
Wrote scripts for getting staked multisig coins out of Qt wallet if mixed
Released MAC and Linux versions of Halo for the first time(working on 75% of systems), however later withheld to enhance compatibility
Released obfuscated source
Full markets UI, improvements for wallets such as steganography for keys
Offer/Counter-Offer system massively enhanced including for autoaccept and backwards compatible with old counteroffer system

Other:
New graphics for UI as requested
Better organization on slack
Slack group ran multiple events, promotions, givaways too many to list
new logo designed social media improved
met multiple slack members in person
customer support for many different people
Fawcet made thanks to slack
Massive modifications to the pegging protocol (proposal) thanks to good advice on slack
Brand new website
Lots of promotional materials made
Several articles mentioning bay (a nice improvement from previous PR)
New OP with really nice graphics made for it
And even stickers, and t-shirts were made


I highly doubt you were talking about this coin. And thats the short list.
There was also changes to BitHalo and BlackHalo. They both have new sites, more articles etc. And I had several
months of down time from moving. This also excludes any networking done and side projects and personal stuff of course. The changelog in Bitbay has more technical details too, there is currently a list of things im working on.

I would like to say THANK YOU to everyone who is still here supporting this project and thanks for your patience. We have accomplished more in one year than entire teams accomplish in 3. Its not a sprint, its a marathon. And once this is all done hopefully we can market it harder too. And the sooner i finish the sooner i can take on more work. So I'm looking forward to releasing more frequent updates this year.

What exactly are you talking about? 

Well, dumpprivkey is useful for spending from an old wallet.

Anyways, the MAC client is currently disabled until I have them updated. Ive been coding updates to the MAC and Linux client to make them more compatible with more versions.

Thanks, there is only the qt and markets client but yeah would be nice to have a pi tutorial. Ive never used one, but i think they would be useful for cold staking also.

Yeah you are correct, if he is a buying a lot or selling alot. But look at it this way. If you sell 10 items per day then you are probably making very good money, If each item nets you 100 dollars, and turn around time for your deposits is daily, you only need 100-1000 dollars tied up at once. Which is okay. If you make 1000 per week, its reasonable to think you had 1000 to insure your business.

Think of it like free business insurance.

I should mention, you should read Halos documentation. The part about the "change management" system. Its breaks up the outputs to denominations for buyers and vendors who want to do large volumes.

So it breaks it up 1 5 10 50 100 500 1000 etc...
This allows you to do many contracts at once with multiple denominations.


So actually I think the custom deposits is more of a concern with low volume sellers, not high volume. Because someone new to the markets will have to take a guarantor contract in order to buy their "first coins". Or if they are not making a lot of money either, they are more poor, coming up with a deposit might be a little bit harder.

The same is true for pegging. Because a person who is always tight on funds will have subpremium liquidity(set to freeze faster) since they will spend any funds that were frozen almost immediately.

dde doesnt require effort though, when you use the templates all of the game theory is handled by the client based on the type of business you are doing. Most people have enough to cover deposits for their volume

Well, thats a good idea. However, the full details can get really technical for someone who is still new to crypto or new to finance. Imagine it this way: The entire supply is freezing and unfreezing 1-2% a day (this can't be linear though, it has to be linear but slightly parabolic to present large amounts of funds being locked at once). Chunks of the total supply can be sent from person to person relative to how they were broken down in the first place. And so, there are pieces of the total which are premium and subpremium liquidity (a diagram would really help to explain this one). Some liquidity would deflate/freeze faster than others. Some frozen assets would be more valuable than others. Very similar to a trustless futures market.

The entire system is fractional. If you have 100,000 coins frozen to be released over 50 points, and want to send 3/50ths of it, then you get the next group divisible in 47ths.

Everything is under the hood, so you will probably not realize this is all happening in the client (other than knowing what is frozen and what is liquid)

I'm not sure publishing a white paper early is a good idea since it only fuels competition. However for those that really want a technical breakdown, you will get one pretty soon.

Yeah good point, if he lists it im sure someone will get one just to to test it out.

Is there a link where we could order one? 

If you are a seller, since the buyers money is advanced to escrow if you put zero the risk is still somewhat smaller for the buyer. 3r was saying that its close to zero but actually the guarantor contracts allow for zero deposits. Which is useful the new users of the markets. The buyer in a guarantor contract can then put a smaller deposit with the seller having zero or smaller deposits. In the end even with a small deposit, you don't want to lose money.

For example, seller is selling guitar worth $100 he doesnt have much to deposit so he deposits $10

buyer deposits $20

In the above case would seller forfeit $10?! Probably not, people don't throw money away for no reason. Although sure, there is a small risk he stops caring.

When the buyer receives the guitar and needs to sign for it does he want to forfeit the $20 deposit?
No why would he? Besides, he received the item, is he really willing to destroy 120 dollars not to pay for the item received?

So the idea of forfeit in a small deposit use case would still be illogical. Combine this with a reputation system like we have and i think the odds of default are still LOWER than the odds of getting scammed on E-Bay. (Because in e-bay there is a way to PROFIT from a scam whereas in the above scenarios its only a LOSS).

Besides, the hope is that honor and the "hand shake deal" will finally be restored to society. Back in the days before stupid laws and frivolous lawsuits, people used to use their word literally as their bond. Honoring your word meant everything. In this case we have the added bonus of a penalty built into any contract. Reinforcing trust.

And if crypto was to take off and be popular its hard for me to imagine business being done any other way.

Because if you use traditional escrow, on international contracts where laws vary from country to country there is literally nothing stopping people from default or theft. (Mt Gox)

Even laws in the most developed countries are not very effective and maybe its because there is no deterrent inherently built in to our contracts.

In any case, shouldnt there always be a small penalty or incentive built into every contract?!

Thanks for the post! This is the second time in a month we have been mentioned! Great news.