No thanks, no one needs Protoshit scams this year
Hmm ok, I wasn't planning on talking about Protoshares at this one, but here's an explanation of the history behind it from the wikipedia.org draft for BitShares I've been contributing to:
History: BitShares was conceptualized by Daniel Larimer, founder of Invictus Innovations Inc. (a.k.a. i3) which was incorporated on July 4, 2013. Dan set out to create a decentralized exchange that would be able to mitigate the potential for hacking or internal thefts (such as the infamous MtGox. exchange default) by minimizing the trust required when using services to trade and hedge Bitcoin. He realized lower counterparty risk could be achieved by moving those services onto the blockchain protocol directly.
Protoshares Protoshares (PTS) 1.0 was a Bitcoin clone created by an independent developer named FreeTrade. PTS began mining on Guy Fawkes Day, November 5, 2013. The genesis block was mined by super3 of the Storj project. The purpose of PTS was to provide supporters a fair way to obtain a stake in BitShares before it was launched. Initially, the plan was to distribute 10% of the BitShares supply across all of the holders of PTS, with the remaining 90% to be mineable when BitShares launched. However a few weeks after PTS launched, mining PTS became unprofitable to mine for users with ordinary CPUs due to the presence of professional mining rigs and pools which had directed their hashing power at PTS. The distribution of PTS was centralizing in favor of the largest mining operations, concentrating it into the hands of the those with commercial grade mining capital, contrary to the intention of a fair distribution. This event led i3 to reconsider using the proof of work algorithm altogether to achieve consensus and secure the BitShares blockchain, taking them on a 6 month detour to analyze alternative consensus algorithms. Daniel Larimer forked and iterated on Proof of Stake used by NXT to create Transactions as Proof of Stake (TaPOS). TaPOS improved blockchain security by making secret chains impossible to stake on (
http://bravenewcoin.com/assets/Uploads/TransactionsAsProofOfStake10.pdf), however the block confirmations weren’t fast enough to facilitate a decentralized exchange. The search for faster confirmations would eventually lead him to invent Delegated Proof of Stake (DPOS) six weeks later (
https://bitsharestalk.org/index.php?topic=14019.msg182304#msg182304). Since then, PTS 1.0 has been snapshot and share dropped onto PTS 2.0, a DPOS DAC run by developers unaffiliated with i3. This upgrade was done in order to decrease the energy costs of maintaining the PTS chain into the future. Miners of the original PTS have shut down their rigs and new block production has effectively stopped.
Angelshares Angelshares (AGS) was proposed on December 24, 2013 in order to secure funding for the continued development of BitShares as well as provide a fair distribution with a low barrier to entry. These were initially the objectives of PTS until centralized mining made it unprofitable to do so. AGS was simply a public ledger of addresses controlled by donors to i3’s development fund. Similar to PTS, it was suggested that future DAC developers snapshot AGS and sharedrop at least 10% of the initial allocation to the AGS holders. These minimum initial allocation percentages became known as the social consensus, an unwritten rule suggested by i3 that all future DACs should sharedrop at least 10% to PTS and AGS holders in order to attract the support of donors who have helped to fund the initial development of BitShares. (
https://bitsharestalk.org/index.php?topic=14019.msg182303#msg182303)
Snapshots and Sharedrops Now that BitShares was using delegated proof of stake instead of proof of work, mining was no longer an aspect of the consensus algorithm design. Thus, a new process for fairly distributing the remaining 80% of the share supply was needed. i3 came up with the concept of taking a snapshot, which is saving the state of a blockchain at a specific instant in time. The snapshot would be used later to perform a sharedrop, which is initializing the genesis block of a new blockchain with balances that correspond to the balances on the snapshot chain. The wallet corresponding to a snapshot could be imported into the new DAC client in order to claim the allocated shares in the genesis block for that wallet. Today you can also use a more secure method of claiming your allocated stake, whereby instead of importing the wallet file, you can import a message signed by the wallet that the snapshot was taken for instead. (Check if this was merged)
So what really happened was changing protoshares to be 1/2 of the sharedrop allocation instead of 100% because of realizations by Dan Larimer about mining. More like a traditional startup pivot and less like a scam, in my humble opinion.
Of course you are entitled to your opinions as well, it's a free country.
If you're in the area you should come convince us that Protoshares was in fact a scam if that's what you believe. I'd love to have a nice little debate about it!
