[ANN][XCP] Counterparty - Pioneering Peer-to-Peer Finance - Official Thread

[MsCollec]

I support sending the BTC to the dev address.

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[jimhsu]

I don't mind BTC sent to the address as counting for XCP, but here are some potentially better (and fairer) ideas:

1. Allow generation of XCP after the burn period through "donations" to the donate address that decays on a linear scale (the easiest idea to implement technically),
2. Institute a vote (through some proof of stake mechanism) to "pay" a 1-2% "bounty" of XCP to the devs (through inflation - no actual XCP will be deducted). Votes would be yea/nay/abstain; stakeholders who don't vote automatically abstain (no quorum required). This could be repeated in the future (again, shareholder votes required). (this is the fairest idea, IMO)
   a. Optionally, addresses that have sent to the donation address (it's all in the blockchain) could be allocated a "piece" of this bounty. Even more proof of stake (yay). No idea how to work this out though.
3. Allow a new asset to be generated through donations (e.g. DON -- note that this is a 3 letter asset. Hence, "special"). Stakeholders of this asset can vote on where to allocate future bounties. (This is the most DAC idea)

It's a matter of aligning shareholder interests with developer interests. I believe people are naturally good ... but respond to incentives.

[sixteendigits]

I have a proposal.

We remove the counterparty burn address and replace it with the dev donation address.

We treat all donations to the dev address as burnt funds.

If we get a consensus could we not do this?

Which pretty much defeats the whole concept of proof of burn? Its not gonna happen..

The proof of burn concept was to remove the burden of trust.
The devs have already demonstrated a working product. We have demonstrated our support for this system by burning almost 1,600 BTC.
At this point there is less than 10 days to claim stake, what little is left should be put toward bounties, not destroyed.
It will only help the project succeed.

If we can put this to a vote, I think we would be hard pressed to find anyone who thinks that it would be better to burn the BTC than to put it toward community bounties and dev support.

Even though I like your argumentation, I think it destroys the reliability of the first real proof of burn project. But maybe the developers can tell their point of view

Let's not pretend that proof of burn is something that should be glorified.
We have already wasted 1.5 million dollars, yet the devs have received a little over 3 btc ($2,400).
You want this to succeed? Lets pay their bills for a few months so they can devote their time to this.

Nice try PhantomPhreak, quite a clever little scam you concocted.  Burn the first 3 weeks worth of BTC to gain our trust, then change the rules last minute so you can rob us blind and disappear.  Brilliant scheme but you aren't getting away with it on my watch!

Now I am joking, and as an approx. 0.5% stakeholder in XCP the idea to stop burning BTC to send to the dev fund instead gets my vote, but I am just illustrating that changing the rules this late in the game does come with a price.  The crypto community is a paranoid and fickle bunch, and for all the negatives that come with proof of burn, at least XCP was primed to be the first IPO with a fair, balanced distribution model that didn't waver until the end.  Proceeding as we are doing now will require no asterisks to be put in the history books on the subject of XCP's birth.  There are sure to be those that will try to stir up some FUD about a rule change now unfortunately.

Is this even possible though?  Can the devs simply change the protocol to issue XCP from a different address?  I too would like to hear from the devs on this because if it is possible, we need to somehow take an emergency vote on this one and get the change made ASAP because with only 10ish days left in the burn period, every BTC burnt is BTC that could be funding development.

[sixteendigits]

I don't mind BTC sent to the address as counting for XCP, but here are some potentially better (and fairer) ideas:

1. Allow generation of XCP after the burn period through "donations" to the donate address that decays on a linear scale (the easiest idea to implement technically),
2. Institute a vote (through some proof of stake mechanism) to "pay" a 1-2% "bounty" of XCP to the devs (through inflation - no actual XCP will be deducted). Votes would be yea/nay/abstain; stakeholders who don't vote automatically abstain (no quorum required). This could be repeated in the future (again, shareholder votes required). (this is the fairest idea, IMO)
   a. Optionally, addresses that have sent to the donation address (it's all in the blockchain) could be allocated a "piece" of this bounty. Even more proof of stake (yay). No idea how to work this out though.
3. Allow a new asset to be generated through donations (e.g. DON -- note that this is a 3 letter asset. Hence, "special"). Stakeholders of this asset can vote on where to allocate future bounties. (This is the most DAC idea)

It's a matter of aligning shareholder interests with developer interests. I believe people are naturally good ... but respond to incentives.

I would say options 1 and 2 are a non-starter simply because it breaks a very crucial part of the contact that was sealed as soon as the first BTC was burnt, and that is that no more XCP will be created after the burn period.

Option 3 is ok, but I wonder just how much will be able to be raised through it.

[TheMightyX]

I don't mind BTC sent to the address as counting for XCP, but here are some potentially better (and fairer) ideas:

1. Allow generation of XCP after the burn period through "donations" to the donate address that decays on a linear scale (the easiest idea to implement technically),
2. Institute a vote (through some proof of stake mechanism) to "pay" a 1-2% "bounty" of XCP to the devs (through inflation - no actual XCP will be deducted). Votes would be yea/nay/abstain; stakeholders who don't vote automatically abstain (no quorum required). This could be repeated in the future (again, shareholder votes required). (this is the fairest idea, IMO)
   a. Optionally, addresses that have sent to the donation address (it's all in the blockchain) could be allocated a "piece" of this bounty. Even more proof of stake (yay). No idea how to work this out though.
3. Allow a new asset to be generated through donations (e.g. DON -- note that this is a 3 letter asset. Hence, "special"). Stakeholders of this asset can vote on where to allocate future bounties. (This is the most DAC idea)

It's a matter of aligning shareholder interests with developer interests. I believe people are naturally good ... but respond to incentives.

I like 1, but I understand that this is a potentially polarizing suggestion.

Wouldn't 2 give more voting power to those with the most money? You are essentially saying Joe Shmoe with his 1,000 XCP is less important than Ronald Shrumpf with his 10,000 XCP in this scenario.

[cityglut]

It is important to make a strict distinction between the developers of Counterparty, and the Counterparty protocol itself. Burning BTC is only secondarily a demonstration of trust in the developers, it is primarily a demonstration of confidence in the protocol, whereas, by sending BTC and XCP to the Counterparty donation address, the community is trusting the Counterparty team to deal honestly and competently with funds meant for bounties. Faith in the protocol does not necessarily imply faith in the developers, and it is unreasonable to force those who want to invest in the former to donate to the latter. In the long run the protocol and the current developers aren't tied together.

In our view, the short term benefits gained by more donations are outweighed by the medium- to long-term benefits of sticking with proof-of-burn. Counterparty's long-term success depends on it being maximally trustless and decentralized throughout the entire initialization-of-balances period.

The value of the Bitcoins burned is the price paid for a fair launch.

[TheMightyX]

I have a proposal.

We remove the counterparty burn address and replace it with the dev donation address.

We treat all donations to the dev address as burnt funds.

If we get a consensus could we not do this?

Which pretty much defeats the whole concept of proof of burn? Its not gonna happen..

The proof of burn concept was to remove the burden of trust.
The devs have already demonstrated a working product. We have demonstrated our support for this system by burning almost 1,600 BTC.
At this point there is less than 10 days to claim stake, what little is left should be put toward bounties, not destroyed.
It will only help the project succeed.

If we can put this to a vote, I think we would be hard pressed to find anyone who thinks that it would be better to burn the BTC than to put it toward community bounties and dev support.

Even though I like your argumentation, I think it destroys the reliability of the first real proof of burn project. But maybe the developers can tell their point of view

Let's not pretend that proof of burn is something that should be glorified.
We have already wasted 1.5 million dollars, yet the devs have received a little over 3 btc ($2,400).
You want this to succeed? Lets pay their bills for a few months so they can devote their time to this.

Nice try PhantomPhreak, quite a clever little scam you concocted.  Burn the first 3 weeks worth of BTC to gain our trust, then change the rules last minute so you can rob us blind and disappear.  Brilliant scheme but you aren't getting away with it on my watch!

Now I am joking, and as an approx. 0.5% stakeholder in XCP the idea to stop burning BTC to send to the dev fund instead gets my vote, but I am just illustrating that changing the rules this late in the game does come with a price.  The crypto community is a paranoid and fickle bunch, and for all the negatives that come with proof of burn, at least XCP was primed to be the first IPO with a fair, balanced distribution model that didn't waver until the end.  Proceeding as we are doing now will require no asterisks to be put in the history books on the subject of XCP's birth.  There are sure to be those that will try to stir up some FUD about a rule change now unfortunately.

Is this even possible though?  Can the devs simply change the protocol to issue XCP from a different address?  I too would like to hear from the devs on this because if it is possible, we need to somehow take an emergency vote on this one and get the change made ASAP because with only 10ish days left in the burn period, every BTC burnt is BTC that could be funding development.

you are a .5% stakeholder!!?
I only got a measly .06% =(

[TheMightyX]

It is important to make a strict distinction between the developers of Counterparty, and the Counterparty protocol itself. Burning BTC is only secondarily a demonstration of trust in the developers, it is primarily a demonstration of confidence in the protocol, whereas, by sending BTC and XCP to the Counterparty donation address, the community is trusting the Counterparty team to deal honestly and competently with funds meant for bounties. Faith in the protocol does not necessarily imply faith in the developers, and it is unreasonable to force those who want to invest in the former to donate to the latter. In the long run the protocol and the current developers aren't tied together.

In our view, the short term benefits gained by more donations are outweighed by the medium- to long-term benefits of sticking with proof-of-burn. Counterparty's long-term success depends on it being maximally trustless and decentralized throughout the entire initialization-of-balances period.

The value of the Bitcoins burned is the price paid for a fair launch.

This is sound logic.
But it would be nice wouldn't it, if both the burnt and donated BTC resulted in XCP. So people could make the choice for either or, and still receive stake.

[jimhsu]

I would say options 1 and 2 are a non-starter simply because it breaks a very crucial part of the contact that was sealed as soon as the first BTC was burnt, and that is that no more XCP will be created after the burn period.

Is this even possible though?  Can the devs simply change the protocol to issue XCP from a different address?  I too would like to hear from the devs on this because if it is possible, we need to somehow take an emergency vote on this one and get the change made ASAP because with only 10ish days left in the burn period, every BTC burnt is BTC that could be funding development.

Yea, this is the primary criticism that I anticipated with those two ideas. Part of what motivated people to burn that many BTCs was the contract and immutability of burning; take that away (even for a good cause, such as donations) and you have cracks below the foundation, so to speak. Hence why I proposed the DAC idea -- not sure how to make that "attractive", but it's a start. Also, why #2 comes with a voting stipulation (even if it does technically "break the contract"). Furthermore, proof of stake is the only fair way to do such a vote, because of Sybil effects.

It's good to have this discussion now, though. I haven't seen for any other "IPO coin" (or any altcoin, period) a concern whether or not the developers are getting their fair share.

[qtgwith]

The dev donation is another thing!!!  Don't involve it in XCP creation!!! Otherwise the project may become a scam!!!

[qtgwith]

The dev donation is another thing!!!  Don't involve it in BTC burn and XCP creation!!! Otherwise the project may become a scam!!!

The announcement of XCP is actually a contract between the devs and investors. The rule is absolutely not allowed to be changed. Otherwise the investors will really lost their money forever!!!

[Luckybit]

I think maybe you've misunderstood my sentiment. Those btc represent a real world value or service today, that I or you could buy. Instead of using them for a common good and also receiving stake, we are sacrificing the buying power of this commodity for that stake. I believe that is a very valid concern. I don't believe saying that everyone elses bitcoins absorb the value of the burnt bitcoins adequately addresses this concern.

I don't believe anything was sacrificed. Buying power is now dispersed. We donated it to the Bitcoin network and all who hold Bitcoin benefit. So if you didn't give 100% of your stash to Proof of Burn then you actually didn't lose any buying power. The coins don't exist anymore so you still have the same buying power. If you give the coins away then you just dilute your buying power because the coins still exist.

Edit: On a related note, all though the value of other peoples bitcoins may rise, instead of giving that money to a charity or cause and making a difference, savings lives, cleaning up an oil spill; you are giving a few cents value away to a bunch of people who don't and won't notice/care about it.

So the people who barely have a Bitcoin wont notice it? They won't use their new buying power to solve problems in their own life? Why should you give to charity? Charity is not sustainable, and if you don't believe Bitcoin is helping people then why are you using it?

"wow, someone destroyed a bunch of bitcoins, that affects the current value of my BTC 0% but the future/hypothetical value of my coins by ((total BTC before burn * BTC value) / total BTC after burn) etc etc."

It depends on how many BTC get burned. If enough BTC get burned that it negates the inflation caused by mining then that would have an extremely positive impact on the buying power of people who hold. It's not all that different than the effect from the block reward halving. If you are in Argentina right now you'd definitely care about the inflation rate of Bitcoin.

I'm not sure why you've used infinitecoin as an example of something successful that will continue to be successful and has some sort of brilliant design. It was not created by economists or financial experts. It's been out for a very short period of time and its success (if you can call it that) could be attributed to the rabid environment we have today where everyone is trying to get in on the ground floor of practically everything, even stupid joke coins like doge. This environment is leading to the (at least short-term) success of every scamcoin under the sun.

Financial experts? Economists? At this point the opinions of such experts are less than helpful. Those experts don't believe Bitcoin is real, and don't have any innovation or ideas to offer. There are different schools of thought as to how money should be and one school of thought is that it should be deflationary while another school of thought believes it should be based around inflation, credit, and debt.

At this point in time deflationary currencies make more sense. Buying power should increase over time. People should be encouraged to save. Bitcoin is actually not a good store of value precisely because of miners inflating the currency. It's just so much better than the fiat currencies that it seems like it's a good store of value.

A truly deflationary currency is the perfect store of value to put your life savings into because each year it becomes more scarce. Mining is a necessary evil to secure the Bitcoin network and that makes inflation a necessary evil to pay the miners. If we can have an inflation proof Bitcoin that would actually be better than what we have.

1500 coins isn't going to make much of a difference and wont put much of a dent in the inflation rate but let's not pretend like inflation is what we want. It's just a side effect from mining and no one actually wants inflation. If you do want inflation there is infinitecoin and the dollar.

[Luckybit]

I have a proposal.

We remove the counterparty burn address and replace it with the dev donation address.

We treat all donations to the dev address as burnt funds.

If we get a consensus could we not do this?

Absolutely not. What of all the people who burned their BTC?

Also now you're centralizing development around one BTC address controlled by anonymous developers. So now we have to trust them?

I think you're missing the point.

I have a proposal.

We remove the counterparty burn address and replace it with the dev donation address.

We treat all donations to the dev address as burnt funds.

If we get a consensus could we not do this?

Which pretty much defeats the whole concept of proof of burn? Its not gonna happen..

The proof of burn concept was to remove the burden of trust.
The devs have already demonstrated a working product. We have demonstrated our support for this system by burning almost 1,600 BTC.
At this point there is less than 10 days to claim stake, what little is left should be put toward bounties, not destroyed.
It will only help the project succeed.

If we can put this to a vote, I think we would be hard pressed to find anyone who thinks that it would be better to burn the BTC than to put it toward community bounties and dev support.

Proof of Burn is how the coins are "mined" without causing any inflation. If they were just going to do an exodus address then it's just a clone of Mastercoin only without us actually knowing who they are.

Proof of Burn is a way to simulate mining and is not just a way to make the developers rich. If you give to the developers and they get rich they could run off with the coins and also giving them 1000 coins would never make much sense since they are anonymous.

Someone who has a lot of coins can donate and not feel like they are sacrificing much while someone with a little bit of coins wont be able to donate at all. Proof of Burn allows someone with a little bit of coins to donate and not lose.

Let's not pretend that proof of burn is something that should be glorified.
We have already wasted 1.5 million dollars, yet the devs have received a little over 3 btc ($2,400).
You want this to succeed? Lets pay their bills for a few months so they can devote their time to this.

We get it. You don't understand Proof of Burn. The fact that you are measuring in dollars proves that you don't know what you're talking about.

Dollars weren't actually wasted. Do you think the price of Bitcoin is based exclusively on the cost of mining it? In that case if we go to Proof of Stake then we'd save so much dollars which could be given to charity. So why aren't you against mining? Mining generates the actual waste.

Proof of Burn is a way to mine without environmental damage caused by using GPUs, without the centralization caused by ASICs, and it's fair. Anyone can give up some Bitcoins and mine by Proof of Burn. If you don't give up any Bitcoins then the coins you have are worth more.

At this point in time 1500-1600 BTC have been burned. If you change the terms now then you're screwing over the people who burned their BTC in order to get XCP.

That is why you cannot change the terms. It's set in stone just like Bitcoin has it's block reward halving set in stone. If you don't like that then go count dollars.

[qtgwith]

The dev donation is another thing!!!  Don't involve it in BTC burn and XCP creation!!! Otherwise the project may become a scam!!!

The announcement of XCP is actually a contract between the devs and investors. The rule is absolutely not allowed to be changed. Otherwise the investors will really lost their money forever!!!

[Patel]

The dev donation is another thing!!!  Don't involve it in BTC burn and XCP creation!!! Otherwise the project may become a scam!!!

The announcement of XCP is actually a contract between the devs and investors. The rule is absolutely not allowed to be changed. Otherwise the investors will really lost their money forever!!!

This is absolutely important.

Stop bringing up the idea we should replace the burn address with a donation address.

[led_lcd]

Announcement: The Counterparty team will be paying out a bounty on February 14th, at 00:00 UTC (three weeks from today, midnight on Saint Valentine's Day) for work on a desktop GUI Counterparty client built on top of counterpartyd. The size of the bounty will be the balance of our donation address, 12J1YFvsWHDCU5HNAWNLNy1Q9nZo8Q4Xgs (both BTC and XCP), at the time that the bounty is closed, and the winner(s) will be chosen, thereupon, by a consensus of PhantomPhreak, xnova and myself. N.B. We prefer, but will not require, that clients be cross-platform.

Also, xnova is hard at work on a Counterparty web client, which should be available for preview in the next couple of weeks. More bounties will be offered in the near future.

This announcement was cross-posted from https://bitcointalk.org/index.php?topic=430998, where formal submissions should be made.

That's great news. Perhaps a little bit more information in the bounty thread. For example, a link back to this official thread and some information about Counterparty to get some people thinking.

[Luckybit]

The dev donation is another thing!!!  Don't involve it in BTC burn and XCP creation!!! Otherwise the project may become a scam!!!

The announcement of XCP is actually a contract between the devs and investors. The rule is absolutely not allowed to be changed. Otherwise the investors will really lost their money forever!!!

This is absolutely important.

Stop bringing up the idea we should replace the burn address with a donation address.

What is also interesting is people are suddenly willing to trust completely anonymous developers and want to encourage other people to send all their Bitcoins to them?

If you want to crowd fund it properly then get any developers to do it. Set some bounties up and crowd fund it that way. Why send all your money to a centralized donation address and hope they do the right thing when you can just set bounties for the features you want and reward the developers for doing it?

That shifts the burden of trust onto you and off of the developers. Will you pay the bounty? If the right foundations are involved or the right non-anonymous individuals then we can organize a proper bounty with accountability.

Agreed.

MasterCoin has 8 to 10 Million Dollars.
Protoshares is raising Millions, so will ethereum and others.

We have burnt 1.5 Million dollars, but our development fund has only $2,400. If we are to succeed long term we need to set up a fund or set aside 2% of inflation for paying bounties, marketing etc... The funds would be controlled by a community foundation, which can at a later stage switch over to proof of stake voting.

They definitely need to raise funds, no doubt about that. But the crowd funding process should be entirely separate from mining. One good thing about Mastercoin is it has 0% inflation. All Mastercoins that will ever exist already exist and that is important if you're trying to use Mastercoin as a store of value or unit of measurement.

XCP is supposed to be a unit of measurement from which other assets are generated. If XCP is constantly inflating then there will be no reason for anyone to want to hold it long term when they can sell it for Mastercoins which aren't inflating or for Bitshares.

So inflation is really bad for this purpose and the developers should have figured out how to fund their bounties before they launched. A certain amount of coins could be set aside for development but they didn't do that.

The ideal way to do it would have been if they did it exactly like Mastercoin and mint the reward XCP as part of the Proof of Burn process. That way no one would lose and there could be no inflation. Offering the possibility of inflation makes no sense for what XCP seems to be used for because inflation really does dilute the shares.

[TheMightyX]

The dev donation is another thing!!!  Don't involve it in BTC burn and XCP creation!!! Otherwise the project may become a scam!!!

The announcement of XCP is actually a contract between the devs and investors. The rule is absolutely not allowed to be changed. Otherwise the investors will really lost their money forever!!!

This doesn't make sense. A contract can be changed if both parties agree.
Thanks for the double post though.

[BitThink]

It is important to make a strict distinction between the developers of Counterparty, and the Counterparty protocol itself. Burning BTC is only secondarily a demonstration of trust in the developers, it is primarily a demonstration of confidence in the protocol, whereas, by sending BTC and XCP to the Counterparty donation address, the community is trusting the Counterparty team to deal honestly and competently with funds meant for bounties. Faith in the protocol does not necessarily imply faith in the developers, and it is unreasonable to force those who want to invest in the former to donate to the latter. In the long run the protocol and the current developers aren't tied together.

In our view, the short term benefits gained by more donations are outweighed by the medium- to long-term benefits of sticking with proof-of-burn. Counterparty's long-term success depends on it being maximally trustless and decentralized throughout the entire initialization-of-balances period.

The value of the Bitcoins burned is the price paid for a fair launch.

This is sound logic.
But it would be nice wouldn't it, if both the burnt and donated BTC resulted in XCP. So people could make the choice for either or, and still receive stake.

You did not get the point. The key is to separate the protocol with the developer. Therefore, anyone can use this protocol to develop their application. If XCP can be generated by sending to a certain person or organization, then others will not respect this protocol and will try to create their own protocol with their own address.

[TheMightyX]

This is longwinded but please take the time to read:
I feel like some of you are being close-minded; somehow equating giving a few cents more buying power to everyone who holds bitcoins, to saving starving human beings in africa. They are not the same, they are not equally beneficial. There are roughly 12.3 million bitcoins in circulation (not accounting for lost or deleted coins). Taking 1600 out of 12,300,000 is a difference of 0.000130081300813%


....


You increased the value of everyones coins by not even a fraction of 1%
Wow, woopdie friggin doo it's so much better that we got that .01% increase than we saved some lives. Good call dudes.


Saying I don't understand proof-of-burn because I don't agree with it is childish.

So everyone who "understands" proof-of-burn is immediately in love with it? Like understanding old world eugenics makes it a good idea?

understanding != accepting

And the comments of "it's so the developers don't run off with it!" are baseless because we already discussed the concept of DAC's and/or bounties.
The funds don't have to go to the developers, but they could be used to fund future bounties by a community system.

This is going up against Ethereum.
Ethereum with its big public flashy IPO, which will have millions of dollars to hire, develop and promote a very similar system.
You want this coin to succeed? Well you aren't making a very good case for it.

I'm not saying that handing money over no-strings-attached to the developers is a good idea.
But at least I'm trying to think of ways to help. Unlike some asshats who think the original devs were infallible in their logic behind proof-of-burn and that we should never question anything because everything was created perfectly. They are humans, they don't have crystal balls, people make errors in judgement.

I'll leave you with this tidbit:

They won't use their new buying power to solve problems in their own life? Why should you give to charity? Charity is not sustainable-

lulz, their new .01% increased buying power is surely going to solve a few problems in many lives.
Why should you give to charity indeed... how dare other people or animals find themselves in need of help.