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April 28, 2013, 12:38:20 AM |
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A business becomes a corporation by joining a stock market where its shares can be bought and sold by anyone at free market prices, whatever people think the shares are worth at the time.
Owning shares in a corporation gives you votes for its top level board of directors and in many cases dividend payments which are a fraction chosen by the board of directors of the profits given to share holders. This affects the trading price, so usually you just want to buy and sell the shares and let others do those things.
Its a simple and effective strategy. Those who make good predictions and risk their money on it earn more money, and bad predictions lose money. Its close to gambling but not exactly, because its a positive sum game. It has an overall positive effect on the world, more than just learning math from the gambling on combinations of numbers moving. It strengthens the economy and flows money to those who are predicted by free markets to most effectively use it.
But stock markets only work on large complex structures called corporations.
The world could very much use the same strategy of prediction and risk on smaller things like how ideas fit together.
Think about how fast Wikipedia can be edited by anyone, and despite some spamming or making bad edits, more people use page history to return to the last good page content or part of it. There is prediction in how people usually only edit a page when they think others will not revert from history, but theres no risk and reward of money or any store of value other than the page content itself. Imagine a shared Internet space containing a variety of tools to represent thoughts and processes and organize things, which anyone could invest in using Internet money like Bitcoin or simpler faster kinds of numbers or other math to count and flow value. What effect would that small granularity investing have on the flow of ideas globally?
Instead of a corporation being the smallest unit of investable process, we should have stock markets for parts of the Internet, bits, words, ideas, processes, and every kind of content and interaction, especially parts of games and simulations as that's how we've found people interact with eachother most strongly. Games can be scientific and useful, like FoldIt. Ideas spread on social networking, but would they spread faster with evolving free markets of investment-like systems backing their small parts?
But there are some puzzles we must solve first.
Stock markets are backed by the accurate reporting of profits by businesses, which drives government teeth into them and bottlenecks many processes. Any kind of regulation in small granularity investing in ideas and parts of the Internet will bottleneck it with the same strength, but since its by definition smaller pieces, that bottlenecking will drive it into the ground harder. Only open source can work here. We have to find a way to measure value, in a way investors can trust, of the "bits, words, ideas, processes, and every kind of content and interaction" invested in.
The other big puzzle is how we build a "shared Internet space containing a variety of tools to represent thoughts and processes and organize things", so there will be small parts to invest in, from which larger parts of the Internet can be built.
To avoid bottlenecks, we must be careful to avoid the biggest bottleneck of all, which is Patents. Bitcoin is open source (no patents) and still became a billion dollar economy, so it can be done.
What we need is simple, a small granularity set of tools in a shared Internet space in which predictions are made about combinations of them, how ideas will fit together globally, and good predictions are rewarded proportional to how much value is risked. Its the next logical step from corporations being the smallest unit of investable process.
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