Ethereum: 2nd gen cryptocurrency with contract programming, "dagger" hashing

[que23]

http://www.ursium.com/ethereum-white-paper-updated/

Important update on numbers.

1000 ether for 1BTC?  Lame

I thought the IPO price was going to be $0.08 USD per ether?

It doesn't matter whether the Ethereum people make it 10000 BTC per ETH or

If it doesn't matter then why did they increase the price from $0.08 to $0.82 ?

-B-

In one way it appears not to matter: "Oh well if we increase the price there will just be less ETH outstanding.  If we decrease the price there will just be more ETH outstanding"

The swindle here is subtle, and I am going out on a limb just theorizing how it will work:  There will be a fixed fee for transferring ETH just like there is with Nxt.  By increasing the price, the people with more ETH get more from proof of stake mining by way of transaction fees. 

What really matters is how much it costs to run useful contracts. Obviously, if only a few can run the contracts, then the whole system is worthless. If anyone can run contracts and can create infinite loops, then the system is worthless. There will have to be a balance.

If the scheme you propose could be carried out, then it would indeed be shady. But ethereum is being created by some very well respected bitcoin community members. I don't see them trying to pull one over on everyone.

[msin]

http://www.ursium.com/ethereum-white-paper-updated/

Important update on numbers.

1000 ether for 1BTC?  Lame

I thought the IPO price was going to be $0.08 USD per ether?

It doesn't matter whether the Ethereum people make it 10000 BTC per ETH or

If it doesn't matter then why did they increase the price from $0.08 to $0.82 ?

-B-0

+1  You guys keep saying ETH per BTC doesn't matter.  Then why are you changing it from the initial whitepaper #'s?  It matters when we are talking about fees and it matters when we are talking about mining vs IPO purchase.  The whole announcement thing was BS and it seems like this 19 year old doesn't really know which directions he's going.  Is it POW or is it POS?   

[Apostle4444]

So how do you mine it?

Good question... anybody... from what I could find you can put together a client from MSI files Etc but still can't mine... When will there be a Wallet of sorts released for solo mining?

[lonsharim]

So how do you mine it?

Good question... anybody... from what I could find you can put together a client from MSI files Etc but still can't mine... When will there be a Wallet of sorts released for solo mining?

Crowd sourcing starts end of the month and from what I understood earlier on, runs for 2 months.

Mining will not start before that has completed. I would expect a wallet and mining software to be available to the public only after that. If you like to set up the current Golang based code on your machine and run on the testnet it should be possible now but remember the code is in Alpha stage and will be unstable. The links to setting them on various OSes can be found either on this thread or elsewhere on the internet.

[lonsharim]

http://www.ursium.com/ethereum-white-paper-updated/

Important update on numbers.

1000 ether for 1BTC?  Lame

I thought the IPO price was going to be $0.08 USD per ether?

It doesn't matter whether the Ethereum people make it 10000 BTC per ETH or

If it doesn't matter then why did they increase the price from $0.08 to $0.82 ?

-B-0

+1  You guys keep saying ETH per BTC doesn't matter.  Then why are you changing it from the initial whitepaper #'s?  It matters when we are talking about fees and it matters when we are talking about mining vs IPO purchase.  The whole announcement thing was BS and it seems like this 19 year old doesn't really know which directions he's going.  Is it POW or is it POS?   

It's not cool to keep dragging the man's age into the discussion. If you think he is too young and unpredictable then the best course of action is to stay away from this project. Also he is but one among 4 officially stated founders and perhaps one among a larger group of developers involved in this project.

Why did they reduce the number of ETH you can get from a BTC? I don't know but perhaps a reasonable explanation will be forthcoming. We can only speculate. The start value of ETH is actually irrelevant as has been explained by other members previously in the thread. 100 apples at a dollar each or 10 apples at 10 dollars doesn't really matter. The bottom line does not change.

Maybe the dev group felt they should be working with a smaller post IPO number since a large fraction of raised ETH will be mined for years to come. A larger number may psychologically inhibit forward price movement. Just maybe they sat down with all kind of scenarios with their spreadsheets and felt a smaller number is better. I am sure they didn't pull it out of a hat.

Also all aspects of the project are subjected to change until the project is open to public. Surely they have that much liberty. To join or not is of course your right and mine.

[stuhlman]

Actually they changed the main coin from Ether to Wookiedoo. So you will be buying Wookiedoos.

quote from redit

vbuterin  1 day ago*
It's not a price increase. It's a redenomination. We are renaming the ether the wookiedoo, we are saying it's 20000 wookiedoo for 1 BTC, and we are introducing a new unit called an "ether" where 1 ether = 10 wookiedoo. Everyone gets 10x less "ether", INCLUDING the premine.

So in short you will be buying Wookiedoo

[PGPpfKkx]

wtf noone will want to make million dollar (or btc) contracts in wookiedoos or coolwizoos

[Tonza]

Yeah that name is something else...

[Revelations86]

Wookiedoo?   Honestly, this sounds right out of a future SouthPark episode parodying bitcoin. 

[mercenar1e]

they should name it wookie-doo-doo after the valuation lol

[lihao1989311]

when

[robinf]

What time do you start the IPO?

[stuhlman]

crowd funding starts in seven days according to new countdown on website, so I guess some selected people will get 2x coins this week, rest got to wait.

[kovand11]

There is SO much confusion here about the initial price. Molecular has explained previously that the price relative to BTC does not matter, and he is correct. The only thing that matters is the total amount of BTC that is raised. Let me try to explain, by analogy to how startups raise money in Silicon Valley and elsewhere.

When a startup raises capital, they set a "pre-money" valuation for the company. All this means is a value for the company that the founders and the investors agree on, BEFORE the new money goes in. If the company raises $2 million on an $8 million pre-money valuation, then the post-money valuation is $8+2 = $10 million, because you have the existing value of the company, plus the new cash. Since the investors paid $2 million for their stake in a $10 million company, they own 20% of the company. If the company raises more money in the future, new shares are issued, and the first set of investors owns a smaller % of the company (i.e. they get diluted, as do the founders).

Now, let's leave aside mining for a moment and look JUST at the IPO for Ethereum. After the IPO, if investors put in X BTC, there will exist a TOTAL of 1.5X BTC worth of Ether (the units don't matter, just look at it in BTC or percentage terms). Let's simplify for a second and assume the founders retain the entire extra 0.5X (they don't technically own all of it, but they do control all of it -- see (*) below). This means the investors will own 2/3 of the resulting "company," while the founders will own 1/3. So, regardless of how much money is raised, the founders are selling exactly 2/3 of their company.

But this means that the valuation they're raising at is NOT fixed. Since the post-money valuation is 1.5X BTC, and the investors put in X BTC, the pre-money valuation must be 0.5X BTC. But that's not a fixed number: the more interest in the IPO, the higher the resulting valuation they raise money at (in direct linear proportion). If 1000 BTC of money wants to get in, then investors are collectively valuing the existing company at 500 BTC. But if 10,000 BTC wants to get in, then it must mean the company was worth 5,000 BTC initially. That's definitely not the way startups typically raise money, but it is not completely absurd, either. The more VCs that are competing to put money into a startup, the higher the valuation is going to be. The difference here, though, is that all the money doesn't go in at once. Only the people who invest BTC at the very end of the 60-day window will know approximately the actual valuation at which they're investing. The people who invest early on, might think they're getting 1% of the resulting company, but end up only getting 0.1% of the company.

If they chose to, the founders could address this in two ways. One way is to have an explicit pre-money valuation cap, of, say, 5,000 BTC. Then, the founders would receive min (0.5X, 5000) BTC worth of Ether, but they could end up owning less than 1/3 of the company. The other way would be to put a cap on the amount they're willing to raise in the IPO. If they committed to raise no more than 10,000 BTC, then the pre-money valuation is capped at 5,000 BTC, but the founders also guarantee they will still own 1/3 of the resulting company. This would be easy to do: simply return investments once 10,000 BTC had been reached. The benefit of both these approaches is that ALL investors, early and late, know the maximum they are paying for the company.

I do think it would be wise for the founders to do something of this nature, since it strains the imagination that a company which hasn't actually yet launched a product should be worth more than about $10 million (and even by Silicon Valley standards, that's a stretch). There's also a limit to how much and how quickly a large amount of capital could actually be effectively used. If they somehow raise $100M of BTC, it'd be awfully tempting just to split it up and go sit on a beach in a non-extradition country somewhere...  So, just spare yourselves the temptation, guys. :-)

Ideally, the investors would also effectively have preferred shares. For instance, let's say that BTC value skyrockets, and the foundation is sitting on more BTC than they could ever use effectively. They decide to issue a BTC dividend proportionately to all Ether holders (somehow). In a perfect world, the investors would have to first get their BTC back before the founders' Ether got paid any dividend. That's exactly how it works for startups, but I'm guessing it may not really be that feasible here. However, I do think it's important that the founders can't simply pay the BTC to themselves. They should publicly commit to never use the IPO BTC to pay themselves beyond a basic salary -- but ideally, even their salaries should be almost entirely in Ether.

(*) I assumed above that the founders own 0.5X BTC, or 1/3 of the resulting company. Actually, they only own 0.225X, and 0.275X is reserved for paying employees, issuing bounties, etc. You can think of this 0.275X as more analogous to the employee stock option pool of a company. It's not actually in the hands of the employees yet, but the company can issue it later to pay for services. This doesn't really change the pre-money valuation calculations above, but it does mean that the founders themselves actually only own 15% (0.225/1.5) of the resulting company, not 1/3 as used above. The "company" owns the other 18.3%.

(**) All this is before mining starts. Think about mining as ongoing employee stock option issuance (payment for services rendered). Of course one can certainly argue whether 0.4X per year is a reasonable amount for mining or not. Or whether PoW is better than PoS, yadda yadda yadda.

This concept simply not a working one. Its like someone would sell 50% of something, and later an another 50%, and so on. In this case its not 50%, but X%. The later investments, will not increase the overall value of the sytem, but inflate the share of early investors.

A very simple way to exploit this system:

The founders can reduce your share (which you paid already for), only by "investing" in their own company. This is absurd.

[kovand11]

A working distribution modell:

-fixed number ethers
-investors make bids: x btc for y ether
-accept the best offers

[dzarmush]

Are they still going to lock investors' coins for a year or it was reconsidered?

[superresistant]

Apart from :

this absurd and complex IPO for a locked inflationary currency
the maker is in high school

What is the point of investing in this coin ?

Does the lego of crypto-finance functions have anything to do with buying at IPO ?

Why do people need to send ten thousand Bitcoins to the developers when it is not adding anything valuable to this system ?

IMO, if no one is using the lego of crypto-finance features, then the currency have no value apart from the pump & dump classic scheme.


I hope I am wrong though.

[Manwe]

What! 1000 ether for 1BTC?
I will never buy it.

[mercenar1e]

What! 1000 ether for 1BTC?
I will never buy it.

Nobody will ever break even with that amount... Or pay that amount on an exchange. I'd like to hear how they came up with that evaluation. Ask yourselves if Vitalik wasn't apart of this project would the coin be priced the same?

[riot319]

WTF start in 7 days?? why?