Method for decentralized crypto-exchange (Not Ripple!)

[timeofmind]

obviously, I've spent no time thinking about the technical details of this, only that it ought to be possible somehow to work a decentralized network that can verify that payments took place on other networks.

maybe I'll focus first on how a decentralized network could verify that certain payments took place on other networks and nodes could agree on that, and then go from there...

[🏰 TradeFortress 🏰]

This could be done with SPV (for coins that have a substantial amount of nodes/peers). It could cost a certain amount of base coins to add a new network magic number / port to listen to. If the TX fees are below a threshold for a threshold, then the port/coin is dropped and users will no longer listen to those ports / attempt SPV verification.

For example, a new coin has just came out that listens on port 9553, with [network magic numbers]. Supports of that coin pay 250 BSC to get it included in the decentralized trading chain, and users now listen to those ports. If over a retarget period there isn't 50 BSC of transaction fees for trade on those coins, then it is dropped and users don't need to listen to those ports anymore.

Users/miners of basecoin are not required to download the whole blockchain, although it would automatically look for existing blockchains to act as another node for SPV.

[Sukrim]

Similar to ETFs for physical metals.

In fact, if some "trusted" entities were to introduce crypto currencies backed by physical metals and some commodities, in the same way ETFs work, those could be used by people in the basecoin network to establish prices of crypto coins relative to physical assets. Maybe even such entities could allow you to withdraw those physical assets....

Hey, lets say some business operates like a bank, allowing you to deposit US dollars for some special crypto coin they hold, that exists on a 1:1 relationship with the amount of dollars it holds... then people could totally use this crypto coin to do exchanges in the basecoin network. In order to redeem the dollars from this business that releases these US dollar-cryptos, you just just send them the cryptos back.

you just described a limited version of ripple by the way, just to point this out...

Anyways:
"Best" worst case currently in inter chain trading is that you can freeze someone's coins for some time. Still annoying but not too bad.
Someone suggested including branches of blocks as proof in the trading chain, still the easiest solution is with 3rd party trust or at least escrow.

As a starter for coming up with a solution, think what would have happened at the big 0.8.0 fork event that changed more than 6 blocks in the past in your scenarios. Also there are traders (who want to trade as fast as possible) and buyers (who just want to trade once or a few times to get what they want) who might have different needs and requirements.

[vokain]

This would definitely work! However, it cannot be used to exchange fiat through - only decentralized cryptocurrencies.

There is also the issue of figuring out double spends. For this to succeed, you'll need to build a light node that connects to multiple ports, support for multiple network magic numbers, etc. Cryptocurrencies would be associated with their magic numbers.

Agreed. I have no interest in fiat exchanging here. This is just a crypto-exchange network.

Maybe some entity/institution could release a fiat-backed, or gold-backed cryto currency, with an amount in circulation that is distributed by the entity equivilant to the amount they hold. They could then use this currency to exchange with other currencies which would allow the basecoin network to also price all these crypto currencies relative to physical currencies. ie. we would not longer need to rely on centralized exchanges in order to figure out the US dollar amount of bitcoin

Similar to ETFs for physical metals.

What is the regulation concerning creating a forex marketplace? How can we connect an exchange to the forex market, or if better, how can we work with a bank to join on to an FX market? Can Blueseed have some role in this? Silicon Valley Bank? I don't know enough yet to connect the dots

The foreign exchange market (forex, FX, or currency market) is a form of exchange for the global decentralized trading of international currencies. Financial centers around the world function as anchors of trading between a wide range of different types of buyers and sellers around the clock, with the exception of weekends. EBS and Reuters' dealing 3000 are two main interbank FX trading platforms. The foreign exchange market determines the relative values of different currencies.

Surely there's a way to piggy back onto the existing infrastructure