If we build it, I guess we'll find out.

But I'm of the opinion, with good velocity of money it won't be a problem, A Good system will have a good flow of money that rewards everyone participating sooner or later. And things always appreciate in value, you just get more with less. Negative Interest it will be, bets on how valuable it can become.

I figure if it continues at this trajectory it will reach a point where it is measuring the entire economy and any additions and subtractions will be visible according to it's value. Things depreciate in value, Perishable Goods expire, and new things are made all the time, we may be able to see this in real time some day.

Damn I was hoping for some shocking revelation.
Theymos, Underworld Kingpin/mad scientist fighting for freedom.

Well, I really like your idea and I think that it just might work.

Time to Flesh out the Obvious Structure.

The Interface can be Web based, as an App, or Program.

  Web based would require a little work with Javascript, CSS, PHP. I'm thinking it would be a good idea to import a client from C++ to asm.js for web deployment on Firefox and Chrome Nacl; This way we do minimal work and it deploys in a web browser.
  If as an App? will simply have to be built using Android or Apple Tools, Looks like Java though, not sure.
  For Program design we can definitely just use existing code, C++ or Java is fine, though I like Java's portability.

This Interface would require a Login Screen, Statistics page, Financial management screen, Proposal List, and settings.
 
  The login screen can be using Persona, OpenID, or any Social Network 0-auth solution; it can be good to start a Financial Lending Frenzy.
  Can also just use the built in encryption of the Bitcoin Client, you prove you locked it, you can have it.
 
  For Statistics I'm think a broad scope of Formulas and algorithms available for clients would be a good idea. Having a broad scope of Points of View and the ability to share that point of view, secure in the scientific foundations of such assertions... you know, economics. Charts and system metrics to understand what is happening within the DAFNe, i'm sure their is some code out there, something like Gapminder that we can incorporate easily.  This would have to be built with access right to the Core of the Client, to give live update information of every change.

  The Financial Management Screen is where people can check their personal statistics for Investments, Loans, Grants, etc. All financial actions should be available from this Screen,

  Proposals screen, where Members can look up available Investment Opportunities, Requests, Grants, Offers in a well Categorized manner.

  And Settings, places where you adjust your preferences regarding the security of your client, Layout, network security and level of support to Network(Hard Drive space, Memory, stuff like that) 


The Core, where all the work is done; The Blockchain, Infrastructure, API and DAFNe Rules.


The Blockchain is just a Database, I was thinking of swapping out BerkleyDB and putting in Apache Cassandra for a more manageable blockchain, Neo4J, or CouchDB. The Database we choose can be very important for deciding what features we have, Cassandra is distributed and has self management features, Neo4j is just wild to have that level of dynamic association in a Database, CouchDb is a Distributed database, it would be interesting to use any one of these.
  We can merge mine the Blockchain, set it up with parameters to be hashed that will lock decisions in place in the Blockchain Database. As people make their decisions they will enter their Bitcoins to be locked as part of a Investment Trust, releasable or Reversable according to terms... Basically, We take Bitcoins Given to the Lendwallet, Encrypt them, let it manage the Coins Virtually, pledging them to Proposals, but not moving them on the Bitcoin Blockchain until Conditions are met and all these decisions are internally managed by Merge Mined Hashes determining Block Time,(Bitcoin Mining Becomes our Metronome).
 
The infrastructure is how do we connect the database to the client? A web interface can be used for anyone willing to host a server and a web page; Code it with some PHP to a server.
Smart Phone Apps too, will need an interface.
Anyone who has a computer can just run the full client, with the whole Database. I was even thinking that why not make it like a Virtual Private Network? So People could connect to anyone hosting a Full Client from the web.

The API is for anything that wants to connect can connect to grab statistics, authenticate remote sessions or update client information. This can be helpful for people to share information on their social networks, or to gain more insight into investment trends. Someday you may just check Facebook to see how your friends investments are going.

And the DAFNe Rules? those are the rules the Database follows, These are already laid out in the OP, I believe.





Open Source Projects could fund themselves managing funding in an Open Manner from within the DAFNe. By this I mean that as funds are provided to an Organization of any type, that it can link to other members providing Services or sub-divisions of the Organization within the Decentralized Automated Financial Network.
   The CryptoCurrency funds are managed by the lendwallet securely and automatically on it's own Blockchain before commiting them for Proposals and eventual withdrawal from the lendwallet, making a single transaction with possibly thousands of Wallets. The network gives a safe place to manage bitcoins without worrying about the 7tps limit, all the coins are never commited to anything on the Bitcoin Blockchain until someone wishes to withdraw, by which time the DAFNe will give them their Bitcoins.
  In this Safe Virtual playground Bitcoins could have their own rules, organizations can setup payment structures, Individuals Could automate finances, Programmable Finances for any type of Venture at any scale. And we don't have to stick to one currency, since control of the account has been given to the DAFNe, all it's managing are private keys to carry out an operation on the blockchain, It just has to be linked to the appropriate Blockchain for verification.

  I was thinking even a market for templates of an organizations structure, A Business can have templates for managing a construction company, a store or Open Source Project. The DAFNe simply provides structures to manage the accounting... yes brother: Distributed Accounting Software linked to the market.
  Why chase around after Invoices with phone calls, e-mails and letters? Just link the damn systems together to save time... accounting is hard, no need to make it harder.
  Managing a fully open system is not that hard, For a Store Investors could see the inventory and view purchases in real time; A corporation may have multiple divisions categorized according to their focus and location with individual expenses and purchasing. It may even function as a CrowdSourced Business model, investors able to see operations live can dictate Business Focus through Suggestions or mutual agreements.
  These can further be linked from within the DAFNe, each Corporation, Business, Charity, Institution having it's own ability to exchange products and services within the directory. The DAFNe could begin acting as a product service database providing services on request from Affiliated Organizations.

It's Interesting structure is very similar to a Traditional Bank, Coins are held in a safe vault, Invested and loaned, deposited and withdrawn, businesses manage payroll, credit, etc but everything is Open to prove the funds exist while  never ever moving. Yeah someone may just spend the coins in the wallet but the lendwallet will be looking out for that, taking appropriate measures to prevent releasing funds by confirming Account balance. or the wallet may be encrypted locking the coins, but if you give the password to the DAFNe it can manage your wallet directly.

It always comes down to the Taxes and license costs. Municipalities are charging those licenses according to how much they would have earned through public transport. They are going to fight for their cut of the pie, unless Uber realizes this they will be fought all the way can't cut out the Governments Transportation Cash Cow.

They have to incorporate a way of allowing these municipalities to earn something from the work of their citizens, it would ease the Rhetoric.

I made a Paraphrasing of the OP's post to present the ideas in a high level for scope and implementation focus.




   
Reply with quote  #1
Primary assumption for the following: The protocol is imagined for a post-fiat world, where only cryptocurrencies exist.

The Problem: Bitcoin (and most other cryptocurrencies) is a deflationary binary currency system in which fractional reserve banking is not possible because a bank can’t create bitcoins out of thin air.

Both of these aspects make it difficult for bitcoin to integrate into our contemporary financial system as a currency.

Fractional Reserve Banking is not possible because all coins Are visible at all times; They Uncover the underlying movement of Funds.

A deflationary currency might decrease money velocity because of the increasing value of the currency discouraging spending (yes, this is a debate and experiment that we have all just embarked upon). Also, a deflationary currency may negate the incentive to invest. Why risk your money if your moneys going up in value anyway?

Coins that are in an upward value trend tend to have incentives to be held, throttling spending; This can be worked with by providing Investment and Spending services simultaneously like Traditional Banks, but with a system that allows it in CryptoCurrencies with no Fractional Reserves.

Thus, I present the Decentralized Autonomous Lending Protocol
(and Granting and perhaps payroll and automatic payments why not)

This is presented in a fashion where the underlying technology is only roughly sketched. Instead I focus on the user experience and the fundamentals of the system in the hopes that someone with expert knowledge of coding and what-have-you can make this into reality.

The idea is to create a lending protocol for the bitcoin network that works within the currency - no creation of a new coin or asset required.

The network gets its security from the same technology that bitcoin does - the blockchain.

A Protocol for CryptoCurrency to be moved from Investors, to Businesses and projects, using a Blockchain to Record Records and lock Funds in place.

However, unlike bitcoin, a lending protocol requires something to mitigate risk - that is, if I lend bitcoins to someone, how do I know they’ll pay me back. The protocol will utilize 3 components - 2 of which are algorithm-based, and the 3rd of which is human-dependent.

The protocol primarily mitigates risk by distributing the risk.
A secondary mitigation is a decentralized autonomous reserve
Finally, the protocol allows for a trust network to be built.

The protocol will exist as a blockchain on an alternate chain - a blockchain completely separate from bitcoin, however utilizing the exact same technology in order to capitalize on the network power of bitcoin. To be described later is how participating in validating the Lendchain will provide rewards to miners.

Because this will exist on a seperate blockchain, this protocol requires a secondary wallet, called the lendwallet. This lend wallet ultimately communicates with both the bitcoin blockchain and the lendchain.

Risk Mitigation by Dividing Investment  Sources, maintaining a
Withdrawal Reserve and  Rating System on a Merge-Mined Coinless Blockchain DataBase synchronized with the Bitcoin Blockchain.

How the lending process works:

Jane wants a loan for 100 BTC. In order to take out a loan, she must participate in the network by installing a lendwallet. She must also transfer into the lendwallet some amount of bitcoin. In one variation, we can imagine that you are only permitted to borrow 10X the amount of bitcoin you have placed in your lendwallet. Think of this as a minimum deposit required in a bank.

Proof of Stake Hedging by Borrower, Funding limits by Account Amount.

So after Jane deposits 10 BTC into her lendwallet, she selects “request loan” and fills out the details - mainly, the amount, the repayment period, and the interest she will offer. Additionally, there is space in the loan application to provide more information - what the loan is for, or space to include a web address or phone number such that lenders can further investigate the loan request.

She then submits the loan application out to the network, and this is stored on the blockchain. Other people with lendwallets are notified of this loan application, and they can choose to invest in it.

Borrower Funding Terms and Offer Application submission to Blockchain.

When a loan application first enters the network, it is clearly high risk - some random person wants you to send them some BTC. If you find the application convincing enough, you can choose to be the First into the loan. Being the first provides some bonus, because you have taken the most risk in this loan.

So Bill sees Janes loan application and decides to be the First. He doesn’t have much BTC to invest, so he only claims 1 BTC of the loan. Because he can only provide 1/100 BTC towards the loan, he can only claim some % of the First reward. Besides, its in his interest to share the First reward with other initiators, so that they will initiate.

So now the blockchain has stored that Jane sent out a loan request for 100 BTC, and Bill has put 1 BTC towards it and claimed X% of the First reward.

The blockchain has been updated. On Donna’s screen, she sees the loan and a “1% backed, 90% First Remaining””, and now Donna sees that the loan has some backing. Donna thinks “maybe Bill trusts Jane”, so she decides to put 5 BTC in and claim 20% of the First reward.

Now, when Bill and  Donna put their BTC into this loan, what they are doing is sending their BTC to a script that will only release BTC to Jane if the loan is fulfilled. So in Bill and Donna’s lendwallet, they are -1 and -5 BTC respectively, although the BTC haven’t been transferred yet.

This continues, and the information keeps getting added to the blockchain for Jane’s loan application.

By 40% fulfillment, the First reward is probably gone. A lot of members on the network see the loan is 40% backed, and think its a worthy investment, but they don’t want to risk much. So lets just assume for simplicities sake that the remainder of the loan is filled with people putting up 0.001 BTC each….

thats 60,000 people investing into this loan.

Which is totally doable.

Because its decentralized and autonomous and its all stored in the blockchain!

Investment Management Screen integrated into a Investor Social Network transcribing Loan Applicatioins and Commitments to the Blockchain.

So the loan is filled. The blockchain script recognizes that the loan has been filled and activates the transfer on the bitcoin network and tens of thousands of transactions occur in order to fill Jane’s loan request. 100 BTC shows up in Jane’s Lendwallet. Jane transfers the 100 BTC to wherever and does whatever she needs to do. And she starts paying the loan back every month.

To make payments, she transfers BTC to the lendwallet, and then goes to “make loan payment”. She clicks on the loan that she wants to pay, and submits a payment.

The payment activates the loan transaction in reverse. When Jane hits “submit payment” button, this information is sent to the blockchain. The transaction that was initiated upon filling Jane’s loan is then found and the transaction occurs in reverse, with Jane’s payment being split 10’s of thousands of ways… because hey, its digital currency!

Secure Borrower Lender Blockchain Based Escrow with Repayment Distribution

Lets assume Jane’s loan was for a car, and she asked for 5 years. To keep things simple, lets just say she offered 5% interest (and I won’t compound it because I don’t feel like finding that excel function). So she pays 1.75 BTC per month. So the interest in each payment is 0.0875.

Here’s how the interest would get broken down.

10% to the miners (split evenly between lendchain and bitcoin blockchain)
5% to the Decentralized Autonomous Reserve (DAR)
10% to the Firsts
Remaining 75% go to lenders.

So, the lendchain miners will get a reward for every new block mined. This reward will be funded by some of the interest rate.

5% of the interest rate will go into the BTC transaction for the transaction costs of BTC.

10% goto the Firsts based on how it was divied up, and the remaining 75% goes back to the lenders based on their stake in the loan.

Payment Distribution using Bitcoin Merge-Mined Coinless Block-Time; Re-embursement for support through Interest.

The Decentralized Autonomous Reserve is a mechanism for the network to provide insurance for lenders. Additionally, it is a means of revenue for those participating in the network (DAR Dividends). In a nutshell, the DAR is a pot of money that can be used to pay back lenders some percentage of a defaulted loan. How much insurance is provided is dependent on how many people have backed the loan.

This prevents any exploitation of the reserve by exploiting the fact that collusion decreases as you increase the number of people involved.

Decentralized Autonomous Reserve loan insurance Dividends.

How the Decentralized Autonomous Reserve works. How the loans are insured based on the community backing.

< 100 people backing : 0% loan insured
100% insured occurs at 500 000
Insurance rate is exponential from 101 - 5,000 lenders for 50%

For 5,000 at 50%

X = 0.459308

percent insured = (# of lenders)^0.459308

101 = 8.329%
1000 = 23.874%
2000 = 32.8%
3000 = 39.5
4000 = 45.12
5000 = 50%

Then 100% at 500,000
x = 0.29834

percent insured = 50% + (# of lenders - 5000)^0.29834
6000 = 57%
10 000 = 62.69%
100 000 = 79.5%
400 000 = 97%

So here you can see that the loan is only fully insured when 500,000 people have backed the loan. In the Jane / Bill / Donna example above, with roughly 60,000 people backing the loan, only 75% of the loan is insured. And the numbers above can be modified or made to float based on participation in the network.

For example, if the network contains 300 million lendwallets, then the 50% would be at 500,000 and 100% would be at something like 5 million. And perhaps the lower threshold should be 500 or something.

This prevents this type of collusion: Jane goes to Bill and Donna and says “Hey, I’m going to take out a loan application for 100 BTC and totally never pay it. You two should back the loan, and then when i don’t pay it, the DAR will totally put money in your lendwallets!” In the basic plan outlined above, if Jane, Bill and Donna can convince 97 of their friends to collude with them to screw the system, they would only get 8.3% back, split between 100 people.

So for the DDR, its a matter of identifying certain #’s that will provide people security and deter collusion.

An insurance payment will be made based on some TBD set of rules - if a loan goes unpaid for over X amount of months, the DDR kicks in to start paying back on a monthly basis up to the insure point.

Variable DAR Insurance based on Risk Mitigation Threshold.

How is money in the DAR stored?

This is where some of the folks with more knowledge of the technology would come in handy, but I imagine it as this:

In the lendwallet there will be two balances - the balance of your personal funds in the lendwallet, and the balance of your share of the DDR. Your share of the DDR is determined based on the amount of BTC you have loaned.

So, if you have loaned out 50 BTC, and the DDR is currently at X BTC, the amount of BTC in your personal lendwallet DDR is at least 50 / X. For simplicities sake, lets say its 1 BTC.

This 1 BTC is stored locally on your computer but is not accessible by you - you can’t spend that 1 BTC, only the network can.

However, because the information associated with that bitcoin is on your computer, the reserve protects itself from being robbed - its decentralized. It also protects itself from being manipulated, because its autonomous.  

Bitcoin Blockchain separation of Risk by Transcribing bitcoins to Lendwallet Blockchain Control; Funds are Encrypted by Local Wallet, Fund Access is Separated by Loan Application Encryption. i.e. All levels of Transactions are encrypted into their respective Categories and Requests for maximum security.

What is a DAR Dividend?

The purpose of the DAR is to provide insurance against people defaulting on their loans so that people will actually invest in loan applications from strangers. The purpose of the DAR is not to accumulate massive amounts of wealth. Thus, there will be some algorithm that calculates how much money is required in the DAR based on the amount of loans currently floating in the loanchain. If total DAR funds exceeds what is necessary, the difference between these two values will be distributed to lenders in proportion to the amount of money they currently are lending (averaged over the month). This again provides incentive for individuals to participate in filling loans.

Investment Incentives through DAR Dividend, Better Risk Management equals better Return Dividend Bonus to Discerning Lenders.

Why did all of those idiots buy into Jane’s loan for 0.001 BTC? Surely they won’t get that much back on their investment!


Indeed, they won’t get back on the single investment they made into Jane, but these individuals may have made thousands of different investments. In theory, they could split 1 BTC into 100 million satoshis and thus have 100 million loans out to people. By distributing these small amounts of currencies, these individuals are able to diversify their risk and thus mitigate the risk.

Individual Risk mitigation through Micro-financing a diversity of Loan Requests.

Other network features:
Automatic credit history - all of your actions are recorded on the loanchain, so lenders can get an immediate picture of what kind of borrower you are. No more magic numbers from strange companies.

Grant function - the same mechanism for loan applications can be utilized for grants (a.k.a. crowdfunding). In this case, the BTC are simply not expected to be paid back.

Emergent trust networks - If Jane is a good borrower, Jane might know people in the real world that also need to borrow money that may have no history on the network, such as Ralph. So Ralph puts his loan app on the network, and Jane backs 50% of it immediately. Alternatively, if jane doesn’t want to front the money, Jane can just put the loan app out herself, and then its up to her to get Ralph to pay back the loan. In a way, trusted borrowers on the network may be able to charge a commission to non-trusted borrowers.

Lending and Borrowing Social Network Block Explorer.

The Spread The Wealth loan - Someone could put out a loan app with the explicit intention of distributing a portion of the DAR to those that claim a stake in the loan. For instance, one could request a 1 BTC loan for this purpose, and theoretically 100 000 000 people could claim a 1 satoshi stake in the loan. The borrower never pays, and 100 000 000 people get 1 satoshi each from the DAR.

One could create a countermeasure by including a “ban” option in the lendwallet, and if the network reaches a simple majority ( > 50%), the loan could be denied. Alternatively, the number of backers required for insurance could be increased substantially.

Loan Risk Flagging

Alternatively, the STW loan could be utilized as a decentralized autonomous crowdsourced way to ease difficult financial times - essentially, create liquidity (essentially what the fed does by printing money, but in this case the money isn’t being printed, its just being released). However, the borrower now has 1 BTC. So if it were used in this manner, the backers of the STW loan would have to trust that the borrower would similarly distribute the loaned bitcoin.

A strength of the system: Autonomous “quantitative easing” - type liquidity measures.

If STW loans are filled, and the DAR is drained, this might causing a decrease in lending, which ultimately decreases the DAR.

However, the decrease in lending would reduce the amount of loans that need to be insured, so the dividend payments for network participants would skyrocket, essentially distributing the DAR anyway.

In general, if market conditions get to the point where lending is decreasing, the amount of money required in the DAR will naturally decrease (because there are no loans to insure), thus causing an increase in DAR Dividends, which would spread the money around and potentially encourage lending.

Social Welfare based Risk Mitigation by removing Investment Incentives and DAR Dividend Recalculations: Those with excess funds can donate Interest Free Loans on a flexible re-payment plan for Social Welfare.




Yes OP, using your system as a Business Deployment Platform... Business Templates could be provided to members; This would facilitate forming successful investments by taking a few steps out of the equation, things that we can provide.

The loans can go to high level ideas and trust that it will be Re-paid or The Businesses Structure could be routed through the DAFNE to pay employees or Divisions within a Corporation. This would give investors real time access to how their funds are being used... giving Investors greater Security.

A fully running system would have Templates for different Businesses, providing a structure dictating what skills, resources and equipment are needed. Since these Templates run through The DAFNE Investors can monitor their funds being allocated in real-time, even allowing them to see as individual purchases are being made by customers.  

You've laid out most of the structure so now, we have to develop a work flow

The Interface for Lenders and Borrowers
Investment directory
Secure Blockchain to send Bitcoins for Consolidation and Distribution
Investment Contracts
System Statistics
Ratings Service
API for DAC support(for monitoring operations by investors and secure Transfer of funds)

Thanks to Bitcoin amazing things are about to happen one of them is the advent of Decentralized Automated Corporations.
Since we know these structures will emerge from the Internet, I jumped to the ultimate conclusions: This will follow a structure by which we will use our Bitcoin to purchase Products and Services created by a DAC that in turn will invest in other DACs of interest.

DAC Designs

Types of Investors and Operators.

Single Operator DAC, Services or products are provided by a single entity but the Business software is Automated hence the moniquer of DAC.

Multiple Operator DAC, Provides Income to multiple people invested in the structure of the DAC.

Platform Operator DAC, Investment is managed by a Independent Investor Management DAC  supplying funds and Crowd Sourcing Tools to manage the DAC.

Fully-Automated DAC, The DAC is designed to manage all levels of operations, it runs Services for it's Customers, funneling funds into operations according to automated architecture.

DAC Operations System

Open DAC, It is managed by Investors and the Community on how it should operate

Semi-Private DAC, Major Investor controls majority Stake but provides public updates on operations and accepts improvements on Provided code.

Private DAC, Operations run Dark, service is provided by one entity dictating total control of operations

Encrypted DAC, System runs Hidden operations accessible only by authorized Customers and Suppliers, forming hidden webs.

Manufacturing, Service, and Design

Pure DAC, Operations are all Automated combining AI, Machine Learning, Robots and Consumer Interfaces(Internet).

Platform DAC, Operations are run by a mixture of Product and Service providers running the same Work Allocation Software, can be other DACs, Individuals or Businesses; Builds Products and provides Services through Internet and Store Fronts.

DAC Income models

Customer Based: DAC provides services and Products, receives funds for Re-investment, Operators and investors. Cryptocurrency flows through the Corporation, funding Operations.

Coin Based, DAC forms it's own Coins to measure work done by members, organically expanding it's operations according to available resources on it's work schedule(Block Time), The more demand the higher the interest to work in it's favor, funding Operations through Coin Value.

Charity Based, DAC runs from the support of Volunteers and Donations of Processing power, Hard Drive space, and Network Access to Machines, Experts and Resources.

Malicious DAC, Extorts, Threatens, Hacks and generally exploits the Internet to maintain operations running.

Investment DAC, Invests in other DACs, people and services, monitoring economy to target beneficial loops in Investment and funding, generates revenue by making good investment choices.

Barter DAC, Funds Operations by trading for Parts, Equipment, Services and Materials from a Pool of Trade-able Resources; We put items we have to this DAC and it finds things that we need at equal value while trading things for itself... Good trade expands it's operations.


and I am sure there are more, I am just impressed at what we could potentially build soon if these models for these Businesses, Services and DACs are provided openly for Drop-In Deployment on a standard API architecture. DACs requesting work from DACs through Back-end interfaces hiding the entire process from Customers, both Individual and Business. All anyone sees is the Interface.

I love the detail, wow and I guarantee you someone is already building it, somewhere out there thinking of setting it up for revenue and others completely decentralized systems with share distribution.

You know you can mitigate risk if you link some businesses together in a completely open manner using a DAC.

If the DAC is completely open it can simply route the money through the Corporation Digitally, marking costs and revenues in Real-Time.

Setting up a good flow for the Coins is essential to fund all facets of a DAC along with labels and metrics for work being done. If this flow is visible to everyone it can be Crowd Sourced, providing revenue for 1000's of investors in Real-Time using your idea. It is quite powerful, when you completely automate it with a Transparent Structure.

I hope everyone understand that a Business is nothing more than a Dispersal of Money to Job Assignments, It is a channel by which money travels through from Customer to Businesses and Investors. To create a Business is to merely understand it's requirements, setup people or machines to carry out work, pay or maintain them to continue that work, observe it being done and provide a Product or Service that channels those Coins effectively through the Corporation; The fact we can automate it is quite impressive, but creating a Market is far more Interesting. A well organized structure can be a platform to bring people and machines together to offer services, forming spontaneous Conglomerations; bringing Consumer and provider into a integrated Directory of Purchasing, Investing and Production.

I think we may soon see Drop in corporations appearing on the web, selectable and openly available for anyone to deploy as a service; The structure is already designed for you, you just have to fill in the positions and advertise it, instant business deployment in any part of the world with a Distributed Investor Structure.

This is quite terrible, I don't think that they understand what they are doing.

Are people who Carpool going to require a license from now on? Do they need background checks?
Maybe we should shutdown the government because of individual politicians indiscretions.

What about all the Crimes commited by Taxi Drivers? Maybe we should protest in the same way, I don't remember such background checks ever being done by Drivers that rent vehicles with Taxi licenses.

  The simplicity of Proof of Work has been that it is hard to accomplish the work but easy to prove that it has been done.

  Primecoin solved this for Prime calculations; Hard to Find but easy to prove that you have actually found something interesting, but not all things are this easy to do.

  Most work done today, always requires Supervisors, Managers that have moved up the ranks by proving their skills at lower levels of an organization to monitor the quality of work done. This type of work is always plagued by incompetent staff that have to be replaced, or inconsistent members that provide impressive work when submitted; It is a game of Post Analysis corrections, there is no Just in Time Proof of Work, and no potential without Trust of achieving a Ahead of Time POW.

  Anything at the cutting edge of Science is in a particular dilemma since this type of work has no known parameters to Qualify the solutions submitted, it is always a long drawn out process of Hypothesis Proving and Consensus Building among a enormous cadre of Scientists and Engineers integrating it's methods and repeating experiments till they are flawless... not exactly simple to accomplish.

  We are dealing with Probabilities, with Inexact Variables and Unexpected outcomes: ie. How do you convince a Person, Machine or Computer that Quantum Leaps made by Electrons, which would be like you or me jumping instantaneously to another Solar System, are Truly Possible?
An observer, a trusted entity, would be required at the moment of Causation of the event to Prove it has been Accomplished.
  This would require a tremendous leap to accomplish without Trust, One would need to Predict the Future and be there to witness the event unfold, but this would have to be done as a Group Consciousness to accomplish instantaneously; A million Direct Observers acting as One Simultaneously Ahead of Time.

  This can only be acquired by setting the right parameters.

1: Broad Scope of Observation
2: Verified Sensors
3: Multiple Observation Points through Space and Time
4: Varied Resolution Algorithms to pinpoint Possible POW Solutions
5: Post Analysis Verification and Extrapolation
6: Evolutionary Algorithm adaptation of Sensors, POW, and Equipment Calibration
7: uncensorable Open Information at all levels of Deployment

  An example of this would be a Proof of Work with 100 algorithms proving work done; Any and All solutions are applied at all times. This is naturally being evolved by the Cryptocurrency movement but,... I wish to accelerate this for scientific work loads.

  This would be like observing a Forest Ecosystem; To observe it properly we would have to monitor Temperature, Water Quality, Air Quality, Organism health, Seasonal changes, Weather, Soil samples, meta-observation, and a myriad of other Observations. The Sensors themselves would be quite simple, but the complexity comes from observing all levels of change and extrapolating this information to develop predictive models that would either prove or disprove a solution. If a solution is successful then those who participated in that line of thought would be rewarded with Tokens/Coins/Shares. This is a Proof of Work using Reality to resolve the solution, it's like rewarding someone not for finding a hash, but figuring out exactly who will find that hash among those working to solve it.
  The question relevant to this proof of work would be multistage: someone involved in Fungal Analysis gets rewarded for predicting it's development, another involved in weather prediction gets rewarded for successful results, Those involved in sensor fault analysis get tokens for predicting failure; and those analyzing the entire system and successfully predicting it's future state get the most reward since that is the culmination of all the other Sub-POW algorithms, even the equipment manufacturers get rewarded for good effective designs that prove the models.

Yes, a Proof of Work Hierarchy Web: It copies the same structures used in our society and rewards successful Evolution of that Hierarchy.
It does use the foundation of the Bitcoin Hashing structure, but no need for a central authority to distribute the coins like in Devcoin or Curecoin anymore.

A Billion Minds Blossoming into the Future.
 

  Not necessarily if the products, services and jobs provided to these people are right we can begin a small economic loop, where we provide some capital and have products on hand to enhance them.
We pay them for something we want from them, information and we provide services and products that they can use to gain more Bitcoin in our little closed system. Think of it as gamifying the system.
All the products and services we will offer give them a chance to earn more money in one single consolidated location.

  The products can be simple, pencils, pen paper to complete assignments; Low end Smart phones for access to the network where they can begin doing work online for others or train them in skills like home building, cooking, garment repairs, Shoe repair anything to increase use re-use recycle methods... making them efficient with what they have. Since everyone is being paid in Bitcoin through paper wallets we can create a closed loop system slowly garnering support and capabilities from the community till they are capable enough to afford, high end Smart Phones, quad rotors with wi-fi hot spots using cjdns, technical skills advancement using Open Badges to guarantee the communities participants are being serviced in the best way, in a verifiable way so that the community always knows who to go for, for best services.

  Sensors so they can monitor their crops and products for hydroponics within shanty town communities for local fresh efficiently produced foods. We begin helping them, we show them how to get it all done, and then we train people from the community to manage it, once we are sure they can do it efficiently and are earning a good wage, they have access to the communities index of needs and they are being met consistently we move on to the next community and leave supervisors to monitor the last ones development.

  Give them access to 3D printers like the Rep Rap so they can produce small goods for their community and recycling stations to separate and grind up plastics for 3D printing within the community.

the Key elements within a shanty town would be, food, shelter, tools, skills and education, and which ever needs they may have, we provide the closed loop economy for them to thrive. Build up their health so they can work and think effectively, teach them to build better homes so that they are safe and secure, provide them skills to make the tools they need and sell them to other entrepreneurs, train them to teach others and spread the system. We build the economy for them and train them to run it.

We have to figure out a way to make it private...
Do we change the camera technology? do we only accept certified data from equipment with Encryption chips?

I know the Neuromorphic chips can do some of this work automatically but they are still in their infancy stage and even the data they process would have to be encrypted; It would have to be done distributedly using Hadoop clusters so that only pieces of the information are provided to any one computer and measures taken so computing servers could not piece together that information.

And tagging vehicles could be done by the owner by simply hashing their Vin numbers loading it up to a blockchain, taking a around the Vehicle video and allowing Software to create a perfect 3D image of their vehicle that when the owner pays to scan the network would begin data analysis of video to find the vehicle and reconstruct it's path along all the cameras rebuilding the 3D image and comparing it... the more customized your ride the more likely it would be found. And all the equipment would have to be Geo located to make sure our reconstruction is accurate.

It has to be done without compromising privacy... that is the problem for sure.

unless you give the government your private key they don't have access, the people must be in control at all times. For Provider and Customer.
The only way government could take control would be to provide their own cameras to be analyzed by the network, but they would be under our rules and could only look for their own property.

The whole data stream must be encrypted end to end, if their your cameras you can watch but you can't watch your neighbors without their private keys to those cameras.

I figure the cameras would need to have exact calibrated millimeter accuracy GPS co-ordinates to process the image exactly at point of contact with the ccd chip along with a encryption chip on a distributed mesh network.

I can imagine it to be a public private partnership where Camera owners always have access to their video streams, customers only... can initiate a search for their property, no one but a person can initiate a personal scan... for security in-case they need protection, they can guarantee that if they are a victim of violent crime they are monitored of their own accord. Property owners can pay to have distributed security monitoring by the network. If your house is broken into, the system automatically begins saving the last 24 hours of footage.... neuromorphic chips can do this... they can recognize people who belong where they are and who is an unkown.

The whole point is to create income for people, people who need security and people to provide security for them in a distributed manner, so our equipment becomes useful to society.

This is more than security, what if we monitored conditions in forests, oceans, jungles using quad rotor drones, generating scientific information and income for their operators...? a decentralized economy!

The best plan is to use what you got closest to the source. It's hard to separate the scammers from legitimate aid organizations.
and monetizing the effort can be hard, but I'm sure Bitcoin makes that a little easier.

We would need to create a economy within the community, injecting a means of exchange among the poor... Bitcoin someday when everyone has Smart Phones.
But now we begin providing them income then services, Pay people to find out about their community, make it Open Source so we have information about the community and from there
we can begin to assess what the community needs to begin a proper business model creating a looping system to accelerate the velocity of money in the community.
The model could follow a Distributed Corporation model where people are paid for their meaningful assistance, creating another loop within the corporation to drum up support.

With this model we can authenticate and distribute the available support for the project globally, paying for transcripts of Interviews, translations and work confirmation, separating
every team member into different work allocations every other week, regardless of location, pay for good work done and monitor it by dedicated immediate members of your business team.
Start an investment fund, and turn it into a for-profit Aid organization, injecting money into these communities to find out about them, know them, help them, analyze their conditions by a paid
Global Distributed Crowd Sourced Professional force

First find out about the communities, choose the one that is closest to access to the Internet and Smart Phones.

Hire people locally to begin taking interviews, pay people for their time so they leave with a little money, hire them to find out about their community.

Make partnerships with local exchanges and Businesses to accept Bitcoin, provide them with a means of making their own Paper Wallets which they can give to customers as change in different denominations.
This way they can start a mini economy moving Bitcoin around, with self-employed individuals with Smart Phones verifying the Paper wallets for people around the community and exchanging paper wallets for them.

Begin Crowd Sourcing Work to these people and provide qualified individuals to train them in skills that they need to bring their communities out of poverty. We follow the distributed model completely with Verified Designated Staff monitoring the process and work.

Trust me if someone learns a new language because they can get paid for translation services that is a plus, they learn to fix shoes, they get paid in Bitcoin and can redeem them at the exchange for cash.
transportation, rental services, the amenities that we take for granted and giving them the skills, knowledge, systems and monitor the communities development as we perfect the process and begin to monetize the system we expand along the Internet and Power infrastructure; by the time it reaches the communities most in need our method is perfected, we will be able to provide them with a healthy starter engineered economy.

Further develop the economy by providing tools to get what the community needs done. We sell it to them hiring locals, phones, tools, equipment as the economy develops.

If we crowd source this on our end here, we can get professionals to perform vital analysis. Finding connections Items and Services needed by the community to make it grow always in touch and injecting money into their community, Because People cannot live on Bread alone, they need much more assistance than we can imagine.

In the end we can Begin Monetizing Economy development, our success determines our pay.

Well... the deeper answer I'm looking for is: Should we even try? do the cons outnumber the pros? and what is interesting about a world with Privately connected Security Systems?

The Technology is available, guaranteed. I follow the technology trends as best that I can, and I've seen what is on the horizon.

Neuromorphic chips that can scan video using only 70mV; what would take hundreds of servers it can do with one chip.

The Coins themselves are a marker of how much interest there is, working as a continuous Crowd Funding Platform for a specific cause.

and the Servers? Have you seen Hadoop lately? wow we can do this now.

Of course I say these ideas publicly because I do not have the technical knowledge to carry it out, but I do know the technology is out there.
Why not find out how much public support is out there for a project of this nature? some people do these things for free as well.
And I'm worried that in the future everything will be done by robots, so why not create a revenue stream for people supporting public security?

Hi I had another great idea recently, unfortunately due to misfortune: A family member got their 2014 Jeep Patriot stolen and I got frustrated that there was no cameras to monitor where I live to look out for the vehicle.

So I came up with a solution that isn't going to help me, but it hopefully can help others; This is using Blockchain technology
It involves Cameras, Microphones, GPS, Object Recognition Software and Strong Privacy Control.

  Bitcoin is a gateway currency to a world of value that we have never dreamed of; Once we cross that gateway we enter the web of value, unimpeded by regulations and controls.
This can be used for ether Good or Bad, but if done properly it can be a force for good.

  We live in a world connecting everything to each other, why not let cameras talk to each other and know what they are looking at? Living in the worlds most Privately monitored countries, One would
expect there to be security, but like many things there is no Consensus, Co-ordination or Collaboration, what one Business knows and what people know is never truly shared.

What would happen if our security systems where connected, Monitoring our collective well being? Could we stop crime by shaming the perpetrators?

I propose we create a merge mined coin for Community Property Secuirty, an Open Security System for Humanity. 

  We will connect the cameras, microphones and security systems across the globe that we currently possess in our homes, networking them under a strong privacy umbrella using smart contracts, smart property and many new innovation that have yet to be thought of. Add Facial recognition and Object recognition technology to monitor these security devices and provide incentive for people to participate by paying them
for their collaboration in joining the security network. Those that provide Processing, Cameras, Microphones, Security Systems, GPS systems, and many other yet to be thought of technology to stop crime forever.
Under a properly built system all the cameras are encrypted securely and only visible by the owner of those Security Systems, except when they notice a Stolen Vehicle or Crime in Progress. Then the owner can choose to make the information public for further analysis by real Human Beings, comparing, Vin Numbers, Vehicle identifying marks and other criteria. The systems automated recognition software would then begin scanning the video footage matching the criteria and following automatically the crime in progress, everything would need to be Mesh networked to guarantee that to take the system down you'd have to black out the whole city.
  there are multiple problems I know: How do you guarantee that the vehicle is truly owned by the right person? integrate it with the Businesses so they mark on a private blockchain who owns what to guarantee that no one can track you or your property without your say so, only the owner or kin of the victim could initiate a tracking request or the Security System Owner.
  How do you guarantee that the people who are fact checking get the right incentives? Everything has to be open so we can further evolve the system, it is the only way, the more Feed back loops we have the more we can learn and evolve.
  How do we make sure that the cameras are truly live? and not fooled? well We'll have to figure that one out later.

I am asking to have a conversation about our public security, will you consider it?

Oh man, this is going to be a lot of fun.
Etherium will probably be pretty powerful, a Turing complete Scrypt can get some amazing things done, but just wait till the bugs start showing up, or hackers begin picking at the Blockchain, injecting values into those blocks to cause havok.

It's serious business when you censor viruses and trojans or malicous programs living on the Blockchain. This thing is starting to look like a strand of DNA with all it's infused codes and integrated viruses and programs. wow.

I was at work and started thinking about this and thought... wow. Education is the beginning.

If This little money was applied in this way, considering that us Humans are the corner stone of our world.

giving people access to the network is just the beginning.

Add OpenBadges technology to it and now you have a Education Blockchain using Cryptographic tokens to verify peoples skills... these tokens are like the blockchain.
OpenBadges are Cryptographically sealed Tokens that contain Identification information, Credentials and the Criteria involved to gain that token. They did work to prove their skills and got a COIN. lol

which means that everyone's skills can be verified and searched.
So If your starting a business and need some skilled employees, you just add your Badge criteria and see all available candidates without ever having to search your local area through classifieds.
It works with people too, the system can automatically look for employers or projects that need your Badged skills.

Start this up and it shortens the down time involved in searching for new employees or work, in a poor community this could be invaluable since it takes a lot to make a poor community work,
but if you know what you have and what is needed in the community, people can train for those skills and improve the lives of everyone.

I've also been looking at this project called Open Transactions... this is a game changer business programs to go with those Smart Phones! wow! Mind blowing!
Now people can create a proper economy to use all their available resources.

I love it. One step closer to global Direct Democracy.

I believe Sergei Burkov was analyzing this and determined that there was no mining after Satoshi reached 1 million coins.
The network hashing it went cold, but wow, that's a lot of coins. someone would have to do a comprehensive analysis of the hashing power to know for sure.
But it's likely they didn't, things were starting to get rolling back then.

Yeah I figure it would be a good hedge.

Besides most of the hashing power can be used for other coins as well, But I think it works as a great security system, specially with side-chains... people will need side-chain security.