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Author Topic: How will/could Mt.Gox's "decentralized exchange" work?  (Read 683 times)
pjce
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July 04, 2011, 01:45:19 AM
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In the Bitcoin Show interview with Mt.Gox, Mark Karpeles talks about how the next version of Mt.Gox will allow for "decentralized trading".

Link (it's at exactly the 34:00 minute mark): http://www.youtube.com/watch?v=-0XvP841jaM&feature=related

Can someone explain me how such a system would work in practice?

I fail to see how you will decentralize depositing and withdrawing money while still being an "exchange" that guarantuees a bitcoin seller the buying party has the USD/EUR funds available (rather than just being a matching place like bitmarket.eu).
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adamstgBit
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July 04, 2011, 02:52:54 AM
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i have no idea but i'll give it a try... here gose:

the client will be on your computer and you load it with USD$  and / or BTCs
there is a "order filling computers" which constantly looks to match buyer to seller  (ex. kinda like the miners, processing transactions)

and then!

you have a client which has a asking price of 15.50$
I have a client which has a selling price of 15.50$

an "order filling computer" finds the match and takes your USD$ sends it to me, and takes my bitcoins and sends it to you

the "order filling computer" that process this transaction will be rewarded with a 0.5% fee on both side... 0.5% of the bitcoins and 0.5% of the USD$

Maybe we could have each client act as a "order filling computer" (ex. kinda like the bitcoin client can generate coins) in which case there should be no fees..


Throw in a Block Chain....

DONE!

lol you have to give me credit for trying...


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July 04, 2011, 05:14:07 AM
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Maybe they will develop some exchange members, and the exchange members all run their own exchanges, nonetheless, the members can trade with each other at very low cost under an established exchange protocols. In such circumstances, any bitcoin trader have a market depth not on only one exchange, but on all exchanges over the world.

But this mechanism will have lots of legal issues and financial risk issues to get over. Good luck you guys and wish you a great success in such a great innovation!

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