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March 24, 2013, 03:36:57 AM |
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Right now (with mtgox) the 2 parties that want to do a transaction are at risk. Person A wants to sell his bitcoins, and needs to send his bitcoins to mtgox first, and is exposed while mtgox holds his btc. Person B wants to buy bitcoins, and needs to send money to mtgox first, and is exposed while mtgox holds his cash.
Person's A's exposure of having to send his bitcoins to an exchange before he can sell them, can be eliminated by creating a new decentralised p2p exchange network, that will run a client which holds Person's A's bitcoins (they never leave his computer).
Person's B exposure of having to send money to an exchange can be 'limited in time' by using a new concept called IOU exchanges. They collect money from person B (through gift cards, wire transfers, ..), and will send this money to Person A when the p2p network confirms the transaction took place. Person A will obviously have to approve/enable this IOU exchange in his client.
This proposal will eliminate the biggest risk: people needing to send their btc somewhere first, to be able to sell them. It will also allow for much easier competition of IOU exchanges, since there will not be an exchange who owns the actual transaction network (which is currently the case with mtgox).
What needs to happen:
- Writing of code/clients that will run the network. - IOU exchanges (or the adjustment of existing ones to support the network)
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