MasterCoin: New Protocol Layer Starting From “The Exodus Address”

[Tachikoma]

So let's talk smart assets.

A few questions I had by reading the current specs.

Currently it looks like you don't have to spend any funds to create an asset. Wouldn't this indirectly mean that if I made a small script I could register all possible currency identifiers and break the system? Perhaps setting a required mining fee amount would fix this issue.

I expect most smart-properties to be some kind of dividend paying security. With his in mind it would be great if we could explicitly supply a bitcoin-address when using the "Purchasing a Currency Offered For Sale" method to buy shares, to keep it simple we could also define that when buying smart-properties the default dividend address is the Mastercoin address used for the payment.

 

I agree that smart property is more important than distributed e-commerce (which would effectively make a distributed silk road). Note that I've previously mentioned that I plan to add a "pay dividend" command to the spec. I agree with Tachikoma that we ought to add some friction to creating smart properties. Rather than pay the fee in bitcoins to the miner, I think we should destroy a small number of MasterCoins (increasing their value).

How about we set the minimum fee to:

Property Name Length	Minimum Fee
1	5000 MSC
2	2000 MSC
3	1000 MSC
4	500 MSC
5	200 MSC
6	100 MSC
7	50 MSC
8	20 MSC
9	10 MSC
10	5 MSC
11	2 MSC
12	1 MSC
13	0.5 MSC
14	0.2 MSC
15	0.1 MSC
16	0.05 MSC
17	0.02 MSC
18	0.01 MSC

. . . and so on . . .

In this way, most people will register "Quantum Miner Shares Class B" rather than "QM", but if someone wants to burn a lot of money on a short name, they can

This is just one way we could do it - if you guys have suggestions, I'd like to hear them. My main goal is to keep it as simple as possible without creating a single hard-coded value that we'll have to change later.

Incidentally, if two people DID register "QM", the second one would be displayed as "QM[2]". There's no enforcement that names must be unique - only currency identifiers, which are assigned in the order currencies and properties are created.

Why base the price on name length?

[dacoinminster]

Why base the price on name length?

Well, I was trying to address the concern you raised about someone hogging the namespace. How would you set the fee?

[Tachikoma]

Ah, with namespace I was actually talking about the amount of user based currencies that could exist until the unique identifiers run out. If the creation is free you can just spam creations until you fill up the 4-bytes that are reserved for identifiers.

[dacoinminster]

Ah, with namespace I was actually talking about the amount of user based currencies that could exist until the unique identifiers run out. If the creation is free you can just spam creations until you fill up the 4-bytes that are reserved for identifiers.

Ah. Using up all 4 billion identifiers would require 4 billion transactions and would cost hundreds of millions of dollars at today's prices, even with no extra fee attached. That's the sort of attack that only a government could contemplate. If we also destroy 0.0002 MasterCoins every time a currency is created, we'll run out of MasterCoins before we run out of currency IDs

I guess that would be a good minimum fee, since it guarantees we'll never run out!

[Tachikoma]

0.0002 MasterCoins seems like a plan. Let's do that

[dacoinminster]

vokain made us a nice ledger of expenses from the Exodus Address so far: https://docs.google.com/spreadsheet/ccc?key=0AtCyUJvk_IyNdGpVcnpBN2tOczFmbVRnck5TWjZuRFE&usp=sharing

Let me know if you see any problems. I'll link to it from the OP.

[zathras]

I've setup a VM to play around with masterchest-wallet but I think I might be missing a dependencies:

See the end of this message for details on invoking
just-in-time (JIT) debugging instead of this dialog box.

Code:

************** Exception Text **************
System.IO.FileNotFoundException: Could not load file or assembly 'System.Data.SqlServerCe, Version=3.5.1.0, Culture=neutral, PublicKeyToken=89845dcd8080cc91' or one of its dependencies. The system cannot find the file specified.
File name: 'System.Data.SqlServerCe, Version=3.5.1.0, Culture=neutral, PublicKeyToken=89845dcd8080cc91'
   at Masterchest_Wallet.Form1.SQLGetSingleVal(Object sqlquery)
   at Masterchest_Wallet.Form1.lnkwcont_LinkClicked(Object sender, LinkLabelLinkClickedEventArgs e)
   at System.Windows.Forms.LinkLabel.OnLinkClicked(LinkLabelLinkClickedEventArgs e)
   at System.Windows.Forms.LinkLabel.OnMouseUp(MouseEventArgs e)
   at System.Windows.Forms.Control.WmMouseUp(Message& m, MouseButtons button, Int32 clicks)
   at System.Windows.Forms.Control.WndProc(Message& m)
   at System.Windows.Forms.Label.WndProc(Message& m)
   at System.Windows.Forms.LinkLabel.WndProc(Message& msg)
   at System.Windows.Forms.Control.ControlNativeWindow.OnMessage(Message& m)
   at System.Windows.Forms.Control.ControlNativeWindow.WndProc(Message& m)
   at System.Windows.Forms.NativeWindow.Callback(IntPtr hWnd, Int32 msg, IntPtr wparam, IntPtr lparam)

WRN: Assembly binding logging is turned OFF.
To enable assembly bind failure logging, set the registry value [HKLM\Software\Microsoft\Fusion!EnableLog] (DWORD) to 1.
Note: There is some performance penalty associated with assembly bind failure logging.
To turn this feature off, remove the registry value [HKLM\Software\Microsoft\Fusion!EnableLog].



************** Loaded Assemblies **************
mscorlib
    Assembly Version: 4.0.0.0
    Win32 Version: 4.0.30319.18051 built by: FX45RTMGDR
    CodeBase: file:///C:/Windows/Microsoft.NET/Framework/v4.0.30319/mscorlib.dll
----------------------------------------
Masterchest_Wallet
    Assembly Version: 1.0.0.0
    Win32 Version: 1.0.0.0
    CodeBase: file:///C:/Users/Animazing/Documents/wallet/Masterchest_Wallet.exe
----------------------------------------
Microsoft.VisualBasic
    Assembly Version: 10.0.0.0
    Win32 Version: 11.0.50709.17929 built by: FX45RTMREL
    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_MSIL/Microsoft.VisualBasic/v4.0_10.0.0.0__b03f5f7f11d50a3a/Microsoft.VisualBasic.dll
----------------------------------------
System
    Assembly Version: 4.0.0.0
    Win32 Version: 4.0.30319.18022 built by: FX45RTMGDR
    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_MSIL/System/v4.0_4.0.0.0__b77a5c561934e089/System.dll
----------------------------------------
System.Core
    Assembly Version: 4.0.0.0
    Win32 Version: 4.0.30319.17929 built by: FX45RTMREL
    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_MSIL/System.Core/v4.0_4.0.0.0__b77a5c561934e089/System.Core.dll
----------------------------------------
System.Windows.Forms
    Assembly Version: 4.0.0.0
    Win32 Version: 4.0.30319.18037 built by: FX45RTMGDR
    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_MSIL/System.Windows.Forms/v4.0_4.0.0.0__b77a5c561934e089/System.Windows.Forms.dll
----------------------------------------
System.Drawing
    Assembly Version: 4.0.0.0
    Win32 Version: 4.0.30319.18022 built by: FX45RTMGDR
    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_MSIL/System.Drawing/v4.0_4.0.0.0__b03f5f7f11d50a3a/System.Drawing.dll
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System.Runtime.Remoting
    Assembly Version: 4.0.0.0
    Win32 Version: 4.0.30319.17929 built by: FX45RTMREL
    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_MSIL/System.Runtime.Remoting/v4.0_4.0.0.0__b77a5c561934e089/System.Runtime.Remoting.dll
----------------------------------------
Masterchest
    Assembly Version: 1.0.0.0
    Win32 Version: 1.0.0.0
    CodeBase: file:///C:/Users/Animazing/Documents/wallet/Masterchest.DLL
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Microsoft.VisualBasic.PowerPacks.Vs
    Assembly Version: 10.0.0.0
    Win32 Version: 10.0.40219.1
    CodeBase: file:///C:/Users/Animazing/Documents/wallet/Microsoft.VisualBasic.PowerPacks.Vs.DLL
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System.Data
    Assembly Version: 4.0.0.0
    Win32 Version: 4.0.30319.17929 built by: FX45RTMREL
    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_32/System.Data/v4.0_4.0.0.0__b77a5c561934e089/System.Data.dll
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System.Xml
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System.Numerics
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    CodeBase: file:///C:/Windows/Microsoft.Net/assembly/GAC_MSIL/System.Numerics/v4.0_4.0.0.0__b77a5c561934e089/System.Numerics.dll
----------------------------------------

************** JIT Debugging **************
To enable just-in-time (JIT) debugging, the .config file for this
application or computer (machine.config) must have the
jitDebugging value set in the system.windows.forms section.
The application must also be compiled with debugging
enabled.

For example:

<configuration>
    <system.windows.forms jitDebugging="true" />
</configuration>

When JIT debugging is enabled, any unhandled exception
will be sent to the JIT debugger registered on the computer
rather than be handled by this dialog box.

Any idea what I need to install Zathras?

Sorry guys, bit rushed last night and I forgot to include a referenced DLL for the local database.  Also corrected a minor config issue.  Please download MasterchestWalletBinaryAlpha.zip again and see how you guys get on.

Thanks for testing Tachikoma

[maxmint]

Note that I've previously mentioned that I plan to add a "pay dividend" command to the spec.

Yes, I think this would be very important!

I'm wondering how much information should be embedded in the genesis of a smart property. E.g., when creating a new property, would we need to have a "pays dividend" field? And do we need to define the currency in which dividends are paid right from the start when creating the smart property?

[dacoinminster]

Note that I've previously mentioned that I plan to add a "pay dividend" command to the spec.

Yes, I think this would be very important!

I'm wondering how much information should be embedded in the genesis of a smart property. E.g., when creating a new property, would we need to have a "pays dividend" field? And do we need to define the currency in which dividends are paid right from the start when creating the smart property?

Nah. Pay dividend will just be something like "Pay X amount of currency Y evenly distributed among people holding currency Z"

[ripper234]

As usual these days I sadly have little time to following the super exciting progress you guys are all making...

I did want to share a small idea of my own, regarding to the backed currencies feature.

Implementing IndexCoin on top of MasterCoin

(Please reply on that thread so we can track it, I'm copy-pasting here to save you a click)

We are building an investment platform that specializes in crypto-currencies and other crypto-assets. A major part of our offering is the ability to purchase composite assets that automatically diversify into the various alt currencies, AKA "IndexCoins".

What occurred to us is that soon, using MasterCoin backed currencies feature, we could implement such indexes as trustless independent assets! (assuming the whole backed currencies feature works, which still remains to be seen).

We could program the creation of an asset, backed by a Trust Fund, that aims to track the index itself.
This is how it could work:

1. We would publish price feeds of the various alt currencies on top of the MasterCoin blockchain.
2. We would then create a new backed currencies, backed by Mastercoin for example, that tracks the weighted average of the top 10 currencies in our feed.

Regulatory wise, this might mean that we are no longer "creating an index" on an ongoing basis, because what we'll be doing is just publishing a price feed of the alt currencies, not managing the composition. The price of the new index coin will be automatically calculated by the Mastercoin blockchain (or rather the clients implementing it), and the fund would purchase or sell coins based on the discrepancy between the price of the new coin and its underlying assets, just like any other backed currencies.

TL;DR - if "backed currencies" can be used to implement GoldCoins, they can be used to implement IndexCoins.

[Racer8]

I've tried searching this thread for the answer to my question so apologies if this question has already been asked or indeed answered in the specification but..

I'm not savvy enough to understand the technical concepts so I'm happy to ask the dumb questions so - where does the Mastercoin itself derive its value from?.  I.e. what role does it perform - if I understand the spec correctly the parent currency can be any currency?  Can an escrow be any currency?  Why does this very promising protocol need Mastercoin currency?

[ripper234]

I've tried searching this thread for the answer to my question so apologies if this question has already been asked or indeed answered in the specification but..

I'm not savvy enough to understand the technical concepts so I'm happy to ask the dumb questions so - where does the Mastercoin itself derive its value from?.  I.e. what role does it perform - if I understand the spec correctly the parent currency can be any currency?  Can an escrow be any currency?  Why does this very promising protocol need Mastercoin currency?

Great questions, I added an answer to the FAQ.

Where does Mastercoin derive its value from? Why is it valuable?

The initial value for mastercoins came out of the fundraiser "anchoring". People were willing to "sacrifice" 1 BTC in exchange for about 100 MSC, so it anchored the initial value of MSC in at least 0.01 BTC per MSC.

The more general answer is that Mastercoin provides a set of features that only work with mastercoins or Mastercoin-based currencies, and there is a limited number of them. So, in order to enjoy these features, you have to own some mastercoins, giving them an independant value. The more real world usage Mastercoin sees, the higher the value of each mastercoin can get. In addition, as always, a lot of its value is currently driven by speculators executing a price discovery process.

Can escrows / backed currencies be made using any currency? Why are mastercoins required?

Backed currencies work with mastercoins or any currency derived from mastercoins. The value of the backing currencies must be high enough, or the backed currency will fail. Mastercoin are required as the root of the new hierarchy of currencies, bitcoins themselves cannot be used as the root, and since the backing-backed relation requires a root currency, a "mastercoin" root is needed.

[Racer8]

Great answer - got it!

[HammerFist]

Great answer - got it!

I don't think that is a good answer at all.

So, we can make new currencies with new wonderful functions based upon this 'mastercoin' protocol.  But there are only 500000 MSC.  So, what currency is going to be based upon something only having a unit of 500,000?  Of course, one MSC is very highly divisible - so you only need one MSC to make a million CoolCoins - each worth about $100 lets say.  Then another guy takes 1 MSC and makes two million SuperCoolCoins with even better functions - these are worth $500 each.  Well, there isn't much demand at all for the other 499,997 MSC because CoolCoins and SuperCoolCoins and maybe two or three others are all we really need.  Nobody wants the other MSC.  OK - now we have 'smart properties' and 1000 companies each buy 1 mastercoin, divide it into 1 million shares, and use that for their stock issue.  I am still holding my 100 MSC and nobody wants them because there are 499,000 still doing nothing.  They are easy to buy until they become scarce.  But because we'll never have 500,000 projects each of which consume one MSC and divide it down to one million (or more) pieces, they will never be worth much.

Specifically, MSC holders do not own this sexy protocol being developed.  The protocol will be free to copy by anyone and they can run their copy right on the same BTC blockchain.  Even if demand for MSC does finally get high enough to make them worth $5 - Anyone can 'relaunch' an identical protocol and create a Billion MSC2 leaving MSC holders with nothing.

It is important to note - MSC holders bought those coins with good money and that money is being used to devo the protocol.  When it is all wonderful and developed, JR has done nothing to maintain ownership of that protocol.  A competitor will just come in, scoop it up, restart it on a parallel effort and MSC holders will have nothing.  

JR says the big guys won't be able to do that because they will be too 'far behind'.  Ask Microsoft how they felt when everyone laughed at Internet Explorer in view of Netscape.  Netscape was sure that Microsoft was just way too far behind.  Netscape was out of business about ten minutes later.

[HammerFist]

Put a bounty on a marketing package of sorts.

JR - Please don't listen to this nonsense.  Zero marketing is correct.  If it works, it works.  That is all.  It will be wildly popular without marketing if we get it working.  Just get it working.  We don't need a fancy logo and a pretty paint.  Save that crap for project without merit.

[bitwhizz]

Put a bounty on a marketing package of sorts.

JR - Please don't listen to this nonsense.  Zero marketing is correct.  If it works, it works.  That is all.  It will be wildly popular without marketing if we get it working.  Just get it working.  We don't need a fancy logo and a pretty paint.  Save that crap for project without merit.

I  have to agree with this, no marketing is needed if this works in my opinion, its usefulness will market itself, after its working, then marketing can always be an option but i think funds would be better spent on mastercoin development and just let the power of free journalism and word of mouth spread be the driving force for a viral effect (which i'm sure will happen). However a good introductary video for master coin is imperative such as the one's made for color coin, bitcoin and ripple.

[murraypaul]

Put a bounty on a marketing package of sorts.

JR - Please don't listen to this nonsense.  Zero marketing is correct.  If it works, it works.  That is all.

Marketing might be useful once there is an it.
At the moment there is nothing but a set of ideas.

Mastercoin is to XRP as Ripple is to ...?
At some point someone will need to fill in the blank.

[bitwhizz]

However a good introductary video for master coin is imperative such as the one's made for color coin, bitcoin and ripple.

= Marketing.

I'm not talking about spending 50K on a big fancy pro deal. But do something to keep the wheels spinning and get the word out. Despite what many of you may think, marketing DOES matter. Most people don't have a clue that mastercoin even exists, let alone what it is supposed to accomplish. There is a serious lack of talent interested in this (not saying those involved aren't talented, but we need more, specialized, and project dedicated/full-time) which translates into a lack of momentum, direction, progress and general cohesion. Anyone (useful) in management knows you don't hobble together the product, then try to find a team. You put together a great team, then the rest will follow. That requires selling your passion for the idea and making others believe in it.

I agree with what your saying, yes of course marketing matters..... But the point which your not getting is that first you need a product to market (not an idea), before even thinking of spending funds on marketing. Right now its kind of obvious that  allocation of funds should go primarily towards master coin protocol program development, not marketing. After theirs a functioning mastercoin, then sure marketing expenditure should definatley be considered. And yes i know an introductory video is a marketing tactic, my point is really that i believe thats the only marketing tactic that is needed at this stage.

Edit

When you stated 'There is a serious lack of talent' (from what i've read on this thread, their is definately talent working on this) thats not such a marketing issue, thats more of a headhunting issue which shouldn't require marketing, it requires incentives such as monetary gains and other rewards, which JR willet is doing through competitions etc. Perhaps J.R willet should be speaking to universities and announcing the competition  within computer science graduates to help develop this protocol, or other ways of fishing more talent apart from bitcoin talk forum (i'm not sure if he is doing this or not), thats my suggestion in getting more talent involved

[dacoinminster]

The talent we have attracted has far exceeded my expectations, and the progress they are making is way more than I had hoped for. I'm not looking for new talent at all (although more are welcome to join if they are interested in participating).

I figured it would take us maybe three or four months to get as far as we have gotten in one month. I couldn't be happier. Our guys are absolutely rocking this project, and I think everyone invested in MasterCoin should be glad we have them.

[bitwhizz]

The talent we have attracted has far exceeded my expectations, and the progress they are making is way more than I had hoped for. I'm not looking for new talent at all (although more are welcome to join if they are interested in participating).

I figured it would take us maybe three or four months to get as far as we have gotten in one month. I couldn't be happier. Our guys are absolutely rocking this project, and I think everyone invested in MasterCoin should be glad we have them.

Good to hear, the quick progress of this project has made me think that searching for new talent wasn't an  issue, for the record