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Author Topic: [PROPOSAL] The ticker and the hole (path to bitcoins worth $1M each)  (Read 3986 times)
dacoinminster
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August 11, 2011, 03:55:38 PM
 #1

I had an epiphany last night while lying in bed contemplating targeted currencies as described in other threads.

I have convinced myself that anybody can start their own distributed currency with a set price target (USD, ounces of gold, barrels of oil, Euros, etc), using only the existing bitcoin client and protocol. To easily track and use the new currencies will require some extra UI on the bitcoin client, but no changes to the underlying protocol.

The concept is absurdly simple. You can create such a currency simply by saying that you have done so, and defining the rules for trading it on the bitcoin network.

tl;dr summary:
Anyone can create their own currency within the existing bitcoin block chain by nominating some extra rules. Anybody following those new rules can use the new currency. Anybody can pay bitcoins to a fake address to get that new currency (destroying the bitcoins). Anybody can sell the currency to someone else by following the rules. Some data is embedded into microtransactions to publish information like "I have 30 goldcoins for sale at such-and-such price".


Let's look at how this could work.

You, Joe user, decide you want to create and issue a new distributed USD currency riding on top of the bitcoin protocol. In this case, your currency is targeted to USD. Anybody buying a unit of your currency expects to be able to sell it in the future for around 1 USD.

The first thing you do is create two bitcoin addresses: the ticker and the hole. The ticker broadcasts the current bitcoin price of 1 USD periodically (for instance, once per day, once per hour, or any time it changes). So if 1 bitcoin is worth $30, the ticker sends 1/30 = 0.03333333 BTC. These coins are sent to the hole.

Anybody anywhere who sends 0.03333333 BTC to a fake address specified by you is recognized to hold 1 unit of your new currency (1 USD). If they send 0.06666666 BTC to the fake address, they are recognized to hold 2 units (2 USD). They can buy as many USD as they want, destroying bitcoins each time they do so. (Sorry, destroying bitcoins is necessary - I don't see any way around it. If the person running the ticker and hole keeps the bitcoins, they can create infinite money by buying these coins from themself.)

Now, let's say I bought 50 USD by destroying bitcoins (sending them to the fake address), and later I want to sell them. To do this, I must mark them as "for sale". This requires that I first send 0.00000001 BTC to your hole, meaning "I'm putting up some of this currency for sale". Then I send 0.00000050 BTC to your hole, meaning "I'm selling 50 USD". Then I send 0.00000003 BTC to your hole, meaning "I'm offering 0.00000003 BTC off face value". The whole bitcoin network now knows that I have 50 USD for sale at 0.03333333 - 0.00000003 = 0.03333330 BTC each. Note that all these sends must come from the address which is currently recognized to hold the 50 USD I bought from you.

Enter yet another person. Satoshi wants to buy 25 of these USD coins. He sees that he can buy them by destroying bitcoins for 0.03333333 BTC each, or from me at 0.03333330 each. He of course chooses to buy from me. Of course, he can't just send me the bitcoins, because someone else might try to buy them at the same time. Instead, he sends me 0.00000001 BTC, which locks my USD coins for the next 2 blocks. For the next 2 blocks, nobody else can buy them, and I cannot take them off the market. Once he sees that he was the first to lock my coins, he sends me 25*0.03333330 = 0.83333250 BTC. Satoshi is now recognized to have 25 of the USD coins I bought from you. With the transaction completed, my other 25 coins are now unlocked, and they are still for sale until someone else buys the rest or I remove them from being for sale.

I change my mind and decide I want to keep the other 25 of these USD coins. I send 0.00000002 BTC to your hole, meaning "my coins are no longer for sale. Thanks!" I could have sent this transaction while they were still locked if I wanted to be sure any remaining coins were taken off the market once unlocked before any more could be bought.

Later I decide I want to transfer my remaining 25 USD to my friend Bob. First I send 0.00000003 BTC to the hole, meaning "I'm going to transfer some USD to someone else", then I send 0.00000025 BTC to Bob's bitcoin address, meaning "I hereby transfer 25 USD to this address". Note that almost no bitcoins changed hands, even though $25 of USDCoins are now under Bob's control.

After watching the wild success of your USDCoins for a few days, I think to myself "screw USDCoins, I'm making my own currency: doublecoins". I define doublecoins to start out at 1 USD, but they slowly grow in value such that their value doubles every year.

I create my own ticker and hole. Many sheeple agree that a coin which grows in value at a rate of 100% per year is MUCH better than owning USD coins. Bitcoins are destroyed in a frenzy as everyone buys doublecoins. For awhile things are going great, but then some people start to worry that they won't be able to find a bigger sucker to buy these doublecoins from them. Prices start to sag. When my doublecoins have a face value of 1.0 BTC, people are selling them at a 10% discount. The seller only gets 0.8 BTC because 10% of the USD coins are destroyed as a penalty for selling 10% below face value and the buyer only gets 0.9 of the 1.0 doublecoins put up for sale. 10% of doublecoins are also destroyed anytime they are transfered while doublecoin prices are 10% low. Eventually there is a panic, prices collapse, and all that are left are bag-holders. I buy a yacht and sail off into the horizon, having sold all my doublecoins at the peak, profiting from the ponzi scheme.

Other tickers are created, some sustainable, and a few more crazy ponzi schemes. Eventually there are tickers for every major stock, currency, and commodity. Tickers are churning, holes are filling up, and needless to say, bitcoin prices are in the stratosphere.

Oh wait, now everybody wants to create a ticker. There could be 362 tickers claiming to be THE ticker for gold alone! To prevent this, ticker creation must have a limited supply and a cost, determined by supply and demand. The first ticker can be created once we reach block 142000 (because it has "42" in it. Current block is 140554, so this is about 10 days from now). The price of creating the first ticker starts at 100 BTC (way more than anyone will pay). The price goes down by 1% with each block, until someone purchases the first ticker.

Any time someone purchases a new ticker, the price doubles, then continues to come down at 1% per block, eventually reaching the price of the previous purchase after about 69 blocks (heh).

Payment for a new ticker would go to a fake address, again destroying bitcoins. Something like:
1NewTickerRegistrationForYourMommy

Once you have purchased your very own ticker, you need to specify the ticker address, the hole address, name the ticker, describe the ticker, etc.

This can be done with a series of special transactions combined with the characters you choose when creating the fake bitcoin address used for destroying bitcoins when the new currency is created.

First, send 0.00000002 BTC to the ticker address from the address which purchased the ticker. If they are the same address, you can skip this step
Then, send 0.00000001 BTC from the ticker address to the backup ticker address (this address would be in a second encrypted wallet. If somebody hacks your computer, and you lose access to the wallet with your ticker, you can unencrypt the wallet containing this backup ticker and keep going with uncompromised ticker updates)
Next, send 0.00000002 BTC from the ticker to a second backup ticker in another encrypted wallet
Then 0.00000003 BTC to a third backup ticker, and so on, until your paranoia is satisfied
Then send 0.00000001 BTC to the hole address
Finally, send 0.0000001 BTC to the fake address that will be used for destroying bitcoins exchanged for your new currency.

Now the whole network knows the address of your ticker, backup tickers, hole, and fake address. Next it is time to add some metadata for your ticker. We will put as much of it as we can in the characters of the fake address.

The metadata we want for this ticker is as follows:
"USD" (the ticker name)
"US Dollars" (the ticker description)
http://bitcointalk.org/?topic=7985.0 (the forum thread for discussing this ticker)
http://www.usd.foo (some website associated with the ticker)
0.7% (new coins will actually be sold at face value times 1.007, allowing our USDCoins to fluctuate above the correct price and therefore have an effect on real-life currency markets)

So the fake address we nominate is:
1USD7985US1Dollars0usd1foo0a700000

This fake address can contain some or all of the meta data describing the ticker. In this case:

1 USD (ticker name) 7985 (forum thread number) US1Dollars (ticker description of "US Dollars") 0a7 (0.7% spread) usd1foo (URL "usd.foo") 000000 (filler)

Any other similar metadata could be defined and included as above. If we need more characters than is allowed by a bitcoin address, we can send additional transactions to the fake address representing the rest of the data describing the new ticker.

Do you think I'm crazy? You're correct on that point, but what am I missing? Perhaps I'm missing an important detail which makes this not work at all, but if I am right, bitcoin price increases are just getting started.

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August 11, 2011, 04:03:35 PM
 #2

Pretty cool idea, but it'd take a lot of work to get people to use it.

Import new address/private keys with ease: https://bitcointalk.org/index.php?topic=101161
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August 11, 2011, 05:37:45 PM
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Pretty cool idea, but it'd take a lot of work to get people to use it.

This works even if most bitcoiners don't adopt the new code, since it doesn't require the protocol to change.

Update: I just realized that the issuer of a new currency cannot be allowed to collect the bitcoins paid in exchange for that currency when it is created. If the issuer got the bitcoins paid to generate the new coins, he could generate infinite coins by paying himself over and over again.

Instead, the bitcoins paid by a user buying new coins like USD need to be destroyed. Yes, I'm actually suggesting that those bitcoins be destroyed. For instance, to purchase coins described by the USD ticker in my original post, you could send your bitcoins to a fake address:

1USD7985US1Dollars0usd1foo0a700000

This fake address can contain some or all of the meta data describing the ticker. In this case:

1 USD (ticker name) 7985 (forum thread) US1Dollars (ticker description of "US Dollars") 0a7 (0.7% spread) usd1foo (URL "usd.foo") 000000 (filler)

I can't think of any way to avoid destroying bitcoins. I don't have time to update post #1 right now, but I will later.

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August 11, 2011, 05:44:21 PM
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THIS was an epiphany??? I'd hate to be around when you have a nightmare... Grin
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August 11, 2011, 06:03:56 PM
 #5

I haven't read it all. Can you explain it in a shorter way?
What's the main difference from a coin backed by bitcoin (reserveCoin in the list on my sign)?
Also, I don't understand why people have to send satoshis to express numbers. That alone seems to me a terrible idea. Destroying bitcoins doesn't seem like a good idea neither.
I think you're confused about what you can do and cannot with an alternative chain.
Read this:

https://en.bitcoin.it/wiki/Alternative_Chains#Paying_for_resources_on_alternative_chains_with_Bitcoins

You can establish a market paid for in bitcoin for your new currency (exchangeChain/middlecoin) and also make escrows (of your new currency and also in bitcoins) that are released following some rules of the network.
If the collateral is in bitcoins, the coins can only be redeemed by the sender and whenever he wants. But if the collateral is in escrowcoins, they can be "sent automatically by the system" to other addresses in the contract-transaction just following the rules of the chain.
Note that the currency can have at the same time the properties of both middlecoin and escrowcoin (the later is a generalization of the former).
The contract-transactions containing the escrow can be as flexible as you want, as long as the information to needed to redeem it is in the chain.
A simple example of a transaction:

1) "I sign with this address ec1 containing 50 EC that I sell them for 1 BTC to this other address (btc1)"
2) "I sign with this address btc2 that if I send from it 1 btc to btc1 within the next 5 bitcoin blocks the 50 EC contained in ec1 will belong to the address ec2"
Both sub-transactions are included for free (or for a fee) in the chain at different times but the commit or rollback of the whole transaction depends on what happens in the bitcoin chain. Escrowcoin miners must have the bitcoin blocks to know what escrowcoin blocks are valid.
For the option market for btc/ec prices you don't need data from outside, because the market is inside the network, but the escrows must be in ec. If you got external data about the dollar, gold or oil price, you can also have an option market for btc/dollar, btc/gold, btc/oil, ec/dollar, ec/gold, ec/oil. you can also have a nmc/ec market and based on that exchange, options for all the other commodities and coins against nmc.
The hardest part is to get data from outside without attacking the network integrity.
You can issue your "pegged" currency at will paid for escrowcoins at current prices plus 0.01 USD cent worth of ec and sell them at current prices minus 0.01. But again that doesn't warranty that your reserve of ec for that purpose is going to be enough. It depends on how well ec performs against usd. The same reserve can short usd through ec/usd options to protect itself, but nothing warranties that there's going to be enough buyers of that puts/calls (Although I understand the functioning I'm still confused with the options terminology) to keep the network reserve solvent.
You can't create a no-matter-what-stable currency.

2 different forms of free-money: Freicoin (free of basic interest because it's perishable), Mutual credit (no interest because it's abundant)
dacoinminster
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August 11, 2011, 06:25:34 PM
 #6

I haven't read it all. Can you explain it in a shorter way?
What's the main difference from a coin backed by bitcoin (reserveCoin in the list on my sign)?
Also, I don't understand why people have to send satoshis to express numbers. That alone seems to me a terrible idea. Destroying bitcoins doesn't seem like a good idea neither.
I think you're confused about what you can do and cannot with an alternative chain.
Read this:

https://en.bitcoin.it/wiki/Alternative_Chains#Paying_for_resources_on_alternative_chains_with_Bitcoins

You can establish a market paid for in bitcoin for your new currency (exchangeChain/middlecoin) and also make escrows (of your new currency and also in bitcoins) that are released following some rules of the network.
If the collateral is in bitcoins, the coins can only be redeemed by the sender and whenever he wants. But if the collateral is in escrowcoins, they can be "sent automatically by the system" to other addresses in the contract-transaction just following the rules of the chain.
Note that the currency can have at the same time the properties of both middlecoin and escrowcoin (the later is a generalization of the former).
The contract-transactions containing the escrow can be as flexible as you want, as long as the information to needed to redeem it is in the chain.
A simple example of a transaction:

1) "I sign with this address ec1 containing 50 EC that I sell them for 1 BTC to this other address (btc1)"
2) "I sign with this address btc2 that if I send from it 1 btc to btc1 within the next 5 bitcoin blocks the 50 EC contained in ec1 will belong to the address ec2"
Both sub-transactions are included for free (or for a fee) in the chain at different times but the commit or rollback of the whole transaction depends on what happens in the bitcoin chain. Escrowcoin miners must have the bitcoin blocks to know what escrowcoin blocks are valid.
For the option market for btc/ec prices you don't need data from outside, because the market is inside the network, but the escrows must be in ec. If you got external data about the dollar, gold or oil price, you can also have an option market for btc/dollar, btc/gold, btc/oil, ec/dollar, ec/gold, ec/oil. you can also have a nmc/ec market and based on that exchange, options for all the other commodities and coins against nmc.
The hardest part is to get data from outside without attacking the network integrity.
You can issue your "pegged" currency at will paid for escrowcoins at current prices plus 0.01 USD cent worth of ec and sell them at current prices minus 0.01. But again that doesn't warranty that your reserve of ec for that purpose is going to be enough. It depends on how well ec performs against usd. The same reserve can short usd through ec/usd options to protect itself, but nothing warranties that there's going to be enough buyers of that puts/calls (Although I understand the functioning I'm still confused with the options terminology) to keep the network reserve solvent.
You can't create a no-matter-what-stable currency.



Yeah, I should have posted a tl;dr summary. Here you go:

Anyone can create their own currency within the existing bitcoin block chain by nominating some extra rules. Anybody following those new rules can use the new currency. Anybody can pay bitcoins to a specific address to get that new currency. Anybody can sell the currency to someone else by following the rules. Some data is embedded into microtransactions to publish information like "I have 30 goldcoins for sale at such-and-such price".

There. Can anybody prove me wrong?

I've spent weeks contemplating alternative chains, and have read every thread and wiki I can find about it. I think I might have something big here.

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August 11, 2011, 06:32:11 PM
 #7

Your system requires an incredibly intricate set of transactions that independently must be consistent.  You are creating uber-transactions that span multiple bitcoin transactions, none of which are guaranteed to occur in a timely manner or at all, or in the right order.  Remember that blocks can invalidate when there is a forked block chain and when that happens, your carefully constructed sequence of transactions could get fubar'd.  To protect against this a client would have to wait for the normal 6 blocks for each step of the transaction sequence.  I think your maximum transaction sequence is 3 separate transactions, which would be 3 hours to complete.  This breaks some of your transaction chains that require successive transactions in 1 or 2 blocks, but assuming that that problem could be worked around, do you think that users would be happy with their trades in the external commodity taking 3 hours minimum?  Maybe they would, but I suspect that competing trading systems would win on the merit of faster transactions alone.

Another issue is that your requirement that multiple sends come from the same bitcoin address ticker and hole requires people to initiate transactions that send change back to the same address.  I personally would accept this but most people with technical knowledge have decided that it's better to never use the same bitcoin address twice for security purposes, and I am not sure you'd be able to convince people to go along with your scheme against the judgement of the majority of those with technical knowledge of bitcoin.

Another issue is that, in my understanding, you are marking the current USD equivalent value of bitcoins in a hole by the value of the most recent send to that hole from the ticker address associated with that hole.  It would seem that there must be a way to identify the ticker address associated with a hole to distinguish between ticker announcement transactions and other transactions from unassociated peers who are making trades with that hole.  How exactly does anyone tell the difference between the ticker address and an unassociated address?  You'd need some way to tie the hole and ticker addresses together and there is no way to do that within the bitcoin protocol.

Additionally, the system doesn't scale; it requires so many ticker announcements that every participant would be sending 20 or more transactions per day, which is very costly in number of transactions.  These small value transactions would add huge load to the bitcoin network, and certainly would require transaction fees that would eat heavily into the profitibility of this scheme.

Furthermore, I ask you again to think about exactly how peers would validate transactions in this environment.  You are making bitcoin transactions have secondary values (i.e. keeping track of the USD value that was associated with any particular transaction in order to maintain a balance for that hole).  How in the world will any peer ever be able to validate any transaction in this complex framework?

As an aside, I have to wonder why you keep coming up with these schems to try to make bitcoin into a proxy for some other currency.  If you want to trade in that other currency, why not just do so?  There already exist tons of proven ways to trade currencies, commodities, stocks, etc, etc.  What bitcoin offers is a few things:

1. A decentralized currency with (ultimately) zero inflation.
2. Pseudoanonymity.
3. Low transaction fees (in theory, although this remains to be proven).

I can't understand why you are trying to saddle this beautiful system with complex secondary rules just to try to turn it into a vehicle for other market systems that already exist and are well served by pre-existing transaction mechanisms.

However, if you are insistent upon trying, I recommend that instead of these crazy schemes you just get the bitcoin client developers to agree to re-institute the full set of script operations, some of which allow you to embed arbitrary data into bitcoin transactions, and then use that arbitrary data mechanism to tag whatever complex data you want into a bitcoin transaction without requiring multiple transactions to effect the same thing.  If you're going to require peers to implement a complex transaction validation scheme then you might as well also expect them to understand formatted message data embedded in data blocks within transaction scripts.  Of course no miner will bother unless there are huge transaction fees involved, so enjoy paying those ...

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August 11, 2011, 06:40:54 PM
 #8

Piggybacking on the bitcoin blockchain seems awfully slow. Why should anyone prefer your toy currency when they have the actual bitcoins ? Also, the bitcoin blockchain will not enforce the rules of your meta-currency, anyone can encode a transaction declaring he has meta-currency for sale; correct implementation will ignore such transactions but there is no way to achieve global (Byzantine) consensus, there is no representation of the global state. Each client has it's own view and that coincides with all other clients only if the code they run behaves identically - it's entirely conceivable for you to acquire meta-currency that some other person's client will reject.

Since it needs customs clients anyway, it seems better to have it's own blockchain. You can broadcast coin generation every time you get some BTC to a designated adress in the main blockchain.
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August 11, 2011, 06:55:45 PM
 #9

I've read this whole thread (amfg, my life...).
If you were to back this via a website (yes, I know. The whole idea for this was to get away from "trust" and establish a non-needed-trust system), then instead of sending micropayments that MAY or MAY NOT arrive at a timely fashion can just be established on the site.

{I'd like the ticker to say USD}
U:0.00000085;S:0.00000083;D:0.00000068;
+ 0.00000003 Ticker NAME fee
Have that on the website, and send... 0.00000239 to set the name.

{also have one for description....}

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August 11, 2011, 07:02:33 PM
 #10

bji - I knew I could count on you to think through this!

Your system requires an incredibly intricate set of transactions that independently must be consistent.  You are creating uber-transactions that span multiple bitcoin transactions, none of which are guaranteed to occur in a timely manner or at all, or in the right order.  Remember that blocks can invalidate when there is a forked block chain and when that happens, your carefully constructed sequence of transactions could get fubar'd.  To protect against this a client would have to wait for the normal 6 blocks for each step of the transaction sequence.  I think your maximum transaction sequence is 3 separate transactions, which would be 3 hours to complete.  This breaks some of your transaction chains that require successive transactions in 1 or 2 blocks, but assuming that that problem could be worked around, do you think that users would be happy with their trades in the external commodity taking 3 hours minimum?  Maybe they would, but I suspect that competing trading systems would win on the merit of faster transactions alone.
99% of these currency transfers would be  purchases from one user to another. That takes two transactions: one to lock out other buyers, and another to make the purchase. That's double the time for a normal transaction, but a small price to pay to be able to store my bitcoin wealth denominated in gold, oil, or soy beans.

Another issue is that your requirement that multiple sends come from the same bitcoin address ticker and hole requires people to initiate transactions that send change back to the same address.  I personally would accept this but most people with technical knowledge have decided that it's better to never use the same bitcoin address twice for security purposes, and I am not sure you'd be able to convince people to go along with your scheme against the judgement of the majority of those with technical knowledge of bitcoin.
The person running the ticker/hole would have to keep the same address. Other users would not. Under this scheme, I can't send you a USD coin directly. The only way for you to get it is if I sell it to you for bitcoins.

Another issue is that, in my understanding, you are marking the current USD equivalent value of bitcoins in a hole by the value of the most recent send to that hole from the ticker address associated with that hole.  It would seem that there must be a way to identify the ticker address associated with a hole to distinguish between ticker announcement transactions and other transactions from unassociated peers who are making trades with that hole.  How exactly does anyone tell the difference between the ticker address and an unassociated address?  You'd need some way to tie the hole and ticker addresses together and there is no way to do that within the bitcoin protocol.
I describe how to register a ticker address in post #1.

Additionally, the system doesn't scale; it requires so many ticker announcements that every participant would be sending 20 or more transactions per day, which is very costly in number of transactions.  These small value transactions would add huge load to the bitcoin network, and certainly would require transaction fees that would eat heavily into the profitibility of this scheme.
The ticker sending 20 transactions per day would be dwarfed by the transactions based on the data that ticker would provide. The ticker itself would be a tiny percentage of the load placed on the system by everyone using the ticker.

Furthermore, I ask you again to think about exactly how peers would validate transactions in this environment.  You are making bitcoin transactions have secondary values (i.e. keeping track of the USD value that was associated with any particular transaction in order to maintain a balance for that hole).  How in the world will any peer ever be able to validate any transaction in this complex framework?
Old bitcoin clients will still work just fine. The don't care that people are creating extra transactions, micro-transactions, and destroying coins willy-nilly. Only people who care about a certain type of new coin need to track who bought them originally, and who they sold them to, the same way they track every bitcoin in existance now.

As an aside, I have to wonder why you keep coming up with these schems to try to make bitcoin into a proxy for some other currency.  If you want to trade in that other currency, why not just do so?  There already exist tons of proven ways to trade currencies, commodities, stocks, etc, etc.  What bitcoin offers is a few things:

1. A decentralized currency with (ultimately) zero inflation.
2. Pseudoanonymity.
3. Low transaction fees (in theory, although this remains to be proven).

I can't understand why you are trying to saddle this beautiful system with complex secondary rules just to try to turn it into a vehicle for other market systems that already exist and are well served by pre-existing transaction mechanisms.

However, if you are insistent upon trying, I recommend that instead of these crazy schemes you just get the bitcoin client developers to agree to re-institute the full set of script operations, some of which allow you to embed arbitrary data into bitcoin transactions, and then use that arbitrary data mechanism to tag whatever complex data you want into a bitcoin transaction without requiring multiple transactions to effect the same thing.  If you're going to require peers to implement a complex transaction validation scheme then you might as well also expect them to understand formatted message data embedded in data blocks within transaction scripts.  Of course no miner will bother unless there are huge transaction fees involved, so enjoy paying those ...
I keep trying to find a way to do this because I believe there are trillions of dollars out there that would like to use such a system. Existing systems are NOT sufficient because they require everyone to disclose who they are so they have to pay taxes, big fees, etc. There is nothing that does what I want, and if something like this idea works and catches on, the whole world will take notice.

There are a number of problems involved with creating different block chains and exchanging coins between chains. This solves all those problems, and doesn't require any extra fancy scripts. It doesn't require permission from existing bitcoin users. It allows me or anyone else to make my own currency WITHOUT getting my own block chain, using whatever rules I dream up.

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August 11, 2011, 07:19:55 PM
 #11

Piggybacking on the bitcoin blockchain seems awfully slow. Why should anyone prefer your toy currency when they have the actual bitcoins ? Also, the bitcoin blockchain will not enforce the rules of your meta-currency, anyone can encode a transaction declaring he has meta-currency for sale; correct implementation will ignore such transactions but there is no way to achieve global (Byzantine) consensus, there is no representation of the global state. Each client has it's own view and that coincides with all other clients only if the code they run behaves identically - it's entirely conceivable for you to acquire meta-currency that some other person's client will reject.

Since it needs customs clients anyway, it seems better to have it's own blockchain. You can broadcast coin generation every time you get some BTC to a designated adress in the main blockchain.
The bitcoin blockchain doesn't need to enforce my rules - it just needs to process normal bitcoin transactions. Only people who want new currencies use new rules.

dacoinminster
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August 11, 2011, 07:34:47 PM
 #12

I've read this whole thread (amfg, my life...).
If you were to back this via a website (yes, I know. The whole idea for this was to get away from "trust" and establish a non-needed-trust system), then instead of sending micropayments that MAY or MAY NOT arrive at a timely fashion can just be established on the site.

{I'd like the ticker to say USD}
U:0.00000085;S:0.00000083;D:0.00000068;
+ 0.00000003 Ticker NAME fee
Have that on the website, and send... 0.00000239 to set the name.

{also have one for description....}
Yes, this could be done with a website too, but as you say, then there's no decentralization, and no point.

The goal would be to clutter the bitcoin block-chain as little as possible. Once a ticker is in place, to offer coins to sell could happen in one transaction if desired (combining the number of coins for sale with the price desired). The purchaser can buy the coins in two transactions (lock + payment). A small price to pay for what is achieved (I assert).

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August 11, 2011, 07:42:49 PM
 #13

I've read this whole thread (amfg, my life...).
If you were to back this via a website (yes, I know. The whole idea for this was to get away from "trust" and establish a non-needed-trust system), then instead of sending micropayments that MAY or MAY NOT arrive at a timely fashion can just be established on the site.

{I'd like the ticker to say USD}
U:0.00000085;S:0.00000083;D:0.00000068;
+ 0.00,000,003 Ticker NAME fee
Have that on the website, and send... 0.00000239 to set the name.

{also have one for description....}
Yes, this could be done with a website too, but as you say, then there's no decentralization, and no point.

The goal would be to clutter the bitcoin block-chain as little as possible. Once a ticker is in place, to offer coins to sell could happen in one transaction if desired (combining the number of coins for sale with the price desired). The purchaser can buy the coins in two transactions (lock + payment). A small price to pay for what is achieved (I assert).

You could also just use 3 spots for each letter [ http://www.ascii-code.com/ ] (as for the name) to make less transactions.
USD + fee would be...
850.83068003
I take that back...horrible idea.

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August 11, 2011, 07:57:24 PM
 #14

I don't know exactly what to think about this...    I sort of love the idea...  it's complicated from a client standpoint... but it's doeable ...




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August 11, 2011, 08:14:44 PM
 #15


I've spent weeks contemplating alternative chains, and have read every thread and wiki I can find about it. I think I might have something big here.

cocaine is a hell of a drug


<luke-jr> Catholics do not believe in freedom of religion.
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August 11, 2011, 08:17:37 PM
 #16

Me thinks thou thinketh too much

Why does Bitrebel have 65+ Ignores?
Because Bitrebel says things that some people do not want YOU to hear.
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August 11, 2011, 08:21:53 PM
 #17

cocaine is a hell of a drug

I haven't tried cocaine, but I've found sudden increases in net worth to be a bit addicting. I've got to get another hit of that stuff, even if I have to drag all of you with me!

Me thinks thou thinketh too much

No argument there.

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August 11, 2011, 08:30:54 PM
 #18

Some data is embedded into microtransactions to publish information like "I have 30 goldcoins for sale at such-and-such price".

There's no need for this at all. You don't need to move value with data. You're using satoshis because you don't want to move much value with the messages, but why move any value at all?

Anyone can create their own currency within the existing bitcoin block chain by nominating some extra rules. Anybody following those new rules can use the new currency. Anybody can pay bitcoins to a specific address to get that new currency. Anybody can sell the currency to someone else by following the rules.

What set of rules do you expect people to define to make those centrally issued currencies better than bitcoin or to have any value at all?

2 different forms of free-money: Freicoin (free of basic interest because it's perishable), Mutual credit (no interest because it's abundant)
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August 11, 2011, 08:45:18 PM
 #19

Why would I want to buy your USD coins with my bitcoins when I could just buy USD?

https://www.bitcoin.org/bitcoin.pdf
While no idea is perfect, some ideas are useful.
12jh3odyAAaR2XedPKZNCR4X4sebuotQzN
dacoinminster
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August 11, 2011, 08:53:10 PM
 #20

Why would I want to buy your USD coins with my bitcoins when I could just buy USD?

Bitcoins denominated in USD can't be seized. Also you can be a currency speculator anonymously!

Also, we're not just talking about USD here. You could speculate on Google stock, oil futures, and anything else that someone creates a ticker for. There's nobody collecting your financial information or tracking your trading profits to tax you.

What if you think bitcoins are overpriced (some day in the distant future) and are going to crash, but you don't trust the exchanges? Just convert some bitcoins to USD, then sell the USD for bitcoins again after the crash. The USD coins will hold their value while bitcoin prices are dropping.

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