could an alt chain use the nash equalibrium to solve prisoners dilema?

[Anon136]

So let me start off by saying i was inspired by this thread. https://bitcointalk.org/index.php?topic=195012.0

The question is instead of relying on a centralized system could we use an alt chain to serve the same function as nashx. nashcoin lets call it =D. Basically, each party supplies a public key and these are combined to create a shared address, which they then both send funds too and this is recorded on the blockchain and those coins will remain forever trapped on that address that neither person really owns unless both parties publish their private keys. If they do both publish their private keys than the funds could be released to previously specified address.

inorder to protect against the depletion of the money supply we could just have a never ending block reward.

What this allows us to do is solve the prisoners dilemma. We can change the incentives so people who are questioned by the cops are literally and actually no longer self interested in rating out their partners. Just think of the implications! You could do blind trades with people on the internet, no trust required!

Ill go ahead and start a bounty of 1 btc for anyone who can create this altcoin but the opportunities for early adopters would be great since this would provide much needed coin with legitimate utility to the copy coin market. Anyone who knows how to make this shouldnt need my financial support as incentive to do it!

[Ignore@YourPeril]

A colored coin for freicoin is in the works, from what I have heard. I hope something like this is going to be a part of it. Freicoin is especially suited as it has demurrage which keeps the money supply stable over time, regardless of how many coins are destroyed or trapped in coin-prison. I would like to add the option of both agreeing to withdraw the trade also, with yet another pair of private keys published.

[mmeijeri]

If I understand things correctly, you can already do this with Bitcoin. The protocol supports it, but not all clients / miners (or any at all) support it.

[Anon136]

If I understand things correctly, you can already do this with Bitcoin. The protocol supports it, but not all clients / miners (or any at all) support it.

Super awesome, i just need to find a client that supports this then.

[digitalindustry]

I emailed the maker of Nashx a while back  - as i thought it was great - i told him to come onto this forum

he signed up so i just forwarded this topic to him  : )

so if you have questions for him his name is Nashx and his name on the forum he will likely respond  to  them here if asked.

Cheers.

[mmeijeri]

Super awesome, i just need to find a client that supports this then.

Turns out the Satoshi client does support it, but only through the command line / JSON-RPC interface. Geek-only for now.

[Anon136]

Super awesome, i just need to find a client that supports this then.

Turns out the Satoshi client does support it, but only through the command line / JSON-RPC interface. Geek-only for now.

ok so what happens if this becomes a popular thing and so coins become regularly destroyed from disputes like this. It could cause bitcoin to be FAR more deflationary than we had originally imagined. If this were the case than what would this mean for the future utility, rate of adoption, price and stability of bitcoin.

[mmeijeri]

Why would there be regular destruction? If it works, that ought to be rare.

[digitalindustry]

Super awesome, i just need to find a client that supports this then.

Turns out the Satoshi client does support it, but only through the command line / JSON-RPC interface. Geek-only for now.

ok so what happens if this becomes a popular thing and so coins become regularly destroyed from disputes like this. It could cause bitcoin to be FAR more deflationary than we had originally imagined. If this were the case than what would this mean for the future utility, rate of adoption, price and stability of bitcoin.

better question .....

How did we survive the 80's?

[digitalindustry]

Why would there be regular destruction? If it works, that ought to be rare.

+1

see comment about 80's

[Anon136]

Why would there be regular destruction? If it works, that ought to be rare.

We should expect that only irrational actors would cause coins to be destroyed unnecessarily. Sometimes though people might have weird ideas of whats profitable, think ultra wealthy sadist who gets a kick from destroying poor peoples money. Also sometimes parties who were actually innocent would appear guilty, so i send a package but it gets lost in the mail and you just think that i didnt send the package.

[seongyupyoo]

Hi. This is Seong Yup Yoo from NashX. Let me know if you have any questions.

I just released the 3rd revision with significant improvements, so go check it out.

http://nashx.com

Also, just to chime in on some topics discussed here, bitcoin does have protocol in place for multi signature, but this doesn't solve the problem who sends first. There has to be a third party to prevent one party from harming another for no reason.

Also, I just made a new bitcoin trading simulation game yesterday called Million Dollar Portfolio Challenge at http://milliondollarportfolichallenge.com where everybody gets $1,000,000 and make fake trades against BTC-e rates for fun, strategy practice, and competition between friends for bragging rights and what not.

[Anon136]

bitcoin does have protocol in place for multi signature, but this doesn't solve the problem who sends first.

Surely there must be a way to work to-gather outside of the bitcoin network to prepare the transaction and then one of the two of you could publish it.

[seongyupyoo]

bitcoin does have protocol in place for multi signature, but this doesn't solve the problem who sends first.

Surely there must be a way to work to-gather outside of the bitcoin network to prepare the transaction and then one of the two of you could publish it.

There is, but in the end one party will have to sign first and that party is at risk of the other party never signing the other tx afterwards.

[Anon136]

bitcoin does have protocol in place for multi signature, but this doesn't solve the problem who sends first.

Surely there must be a way to work to-gather outside of the bitcoin network to prepare the transaction and then one of the two of you could publish it.

There is, but in the end one party will have to sign first and that party is at risk of the other party never signing the other tx afterwards.

What if one person signed it off network, then passed the signed transaction onto the other party outside of the bitcoin network and he was expected to sign it as well and publish it?

[seongyupyoo]

bitcoin does have protocol in place for multi signature, but this doesn't solve the problem who sends first.

Surely there must be a way to work to-gather outside of the bitcoin network to prepare the transaction and then one of the two of you could publish it.

There is, but in the end one party will have to sign first and that party is at risk of the other party never signing the other tx afterwards.

What if one person signed it off network, then passed the signed transaction onto the other party outside of the bitcoin network and he was expected to sign it as well and publish it?

I don't think doing it off network changes anything about one party always being exposed to risk of having to sign first.

[mmeijeri]

I don't think doing it off network changes anything about one party always being exposed to risk of having to sign first.

There's no risk of signing first. Both signatures have to be valid before the transaction is accepted by the network. There is of course still the risk of sending any physical goods first however.

[Impaler]

If your trying to design proper escrow then you really want 3 parties, buyer, seller and broker.  Each party could put in funds and then they can be be dispersed by any 2 consenting signatures.  Ideally their should be some means to guarantee the broker is compensated so maybe their should be some minimum and maximum outputs specified at creation so only resolutions that conform to those limits are valid.  This would prevent a broker from absconding with escrow funds themselves.

[Anon136]

I don't think doing it off network changes anything about one party always being exposed to risk of having to sign first.

There's no risk of signing first. Both signatures have to be valid before the transaction is accepted by the network. There is of course still the risk of sending any physical goods first however.

thanks mmeijeri if we dont have a signing first problem than we dont have a sending first problem either. Lets say that i want to send you 1 bitcoin and you want to send me 100 ltc for it (lets just say thats the exchange rate). So what we do is we both send 3 bitcoins to be trapped up in this multisig transaction. If either person fails to honor his end of the deal than the other person fails to release the funds. Now if you sent but i didnt than i would lose 3 bitcoins in exchange for 100 ltc, 3 times the exchange rate, a very bad deal indeed. If i sent but you didnt than you would get my 1 bitcoin and lose the three leaving you with a loss of 2 bitcoins, not at all in your interest either.

i really love the service you are providing seongyupyoo the one thing that i would ask is that you try your hardest to implement what we have been discussing in this thread instead of trying to offer a centralized service. There would still be plenty of use for your sight in matching up buyer and seller and trying to find innovative ways to use this service for price discovery, potentially even the development of an api.

if you need help with the technicalities check out #bitcoin-dev on the IRC

[ondratra]

Another con is that key lost possibility is doubled - if any party lost it's key both parties lose coins.