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Author Topic: We need a Bitcoin Foundation for more trust  (Read 1610 times)
freeminer
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October 17, 2011, 08:34:10 PM
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Due to the nature of bitcoins they are too speculative. It is really hard to trade using currency with so high level of volatility.

Sad to admit it, but bitcoin society need credible trusted organization, which would regulate the market of bitcoins. Some rich man could take on this responsibility, but it would be much better if it was an open non-profit organization with the Supervisory Board consisting of eminent people with a good reputation.

This organization will accept donations in fiat money and at least guarantees the minimum price on bitcoins. For example, if the organization took donations for the $ 1 million, it can guarantee a price not less than 1/7.5 = $ 0.13 per bitcoin.

I believe that it is possible to imagine a more subtle mechanisms, but they must be clear to all market participants.

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October 17, 2011, 08:40:54 PM
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Due to the nature of bitcoins they are too speculative. It is really hard to trade using currency with so high level of volatility.

Sad to admit it, but bitcoin society need credible trusted organization, which would regulate the market of bitcoins.



Did you here what he said?  regulate the market of bitcoins...  lol,  are you on crack?

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October 17, 2011, 08:41:40 PM
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... which would regulate the market of bitcoins.

Many (most?) of us are involved with Bitcoin precisely because there is no central authority regulating the markets
freeminer
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October 17, 2011, 08:54:40 PM
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Did you here what he said?  regulate the market of bitcoins...  lol,  are you on crack?

Nope, for example, if I had $ 20 million I'd be able to guarantee today's price for everyone. What is this if not a kind of regulation?
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October 17, 2011, 09:02:42 PM
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This organization will accept donations in fiat money and at least guarantees the minimum price on bitcoins. For example, if the organization took donations for the $ 1 million, it can guarantee a price not less than 1/7.5 = $ 0.13 per bitcoin.


It would only guarantee that minimum price if no more Bitcoins were being produced.  In reality, to maintain the guarantee you would need additional donations every day or the value of that guarantee would drop as new coins were produced.

All I can say is that this is Bitcoin. I don't believe it until I see six confirmations.
freeminer
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October 17, 2011, 09:15:07 PM
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This organization will accept donations in fiat money and at least guarantees the minimum price on bitcoins. For example, if the organization took donations for the $ 1 million, it can guarantee a price not less than 1/7.5 = $ 0.13 per bitcoin.


It would only guarantee that minimum price if no more Bitcoins were being produced.  In reality, to maintain the guarantee you would need additional donations every day or the value of that guarantee would drop as new coins were produced.

Yes, but it's not a problem. There are 7.5 millions of coins today, if this organization will guarantee for example $1 for bitcoin ($7500000 needed) then after 1 month with no donations it will be still able to guarantee 7500000/7716000 = $0.972. I think this is enough to ensure some stability. The fall of three percent per month is very different from a fall by 30 percent in one day like yesterday
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October 17, 2011, 09:52:55 PM
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Perhaps we just have to advise people like we would an investment; only convert what you can afford to lose and keep it diversified as you should with cash.
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October 17, 2011, 09:58:47 PM
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Perhaps we just have to advise people like we would an investment; only convert what you can afford to lose and keep it diversified as you should with cash.

I am not sure that idea will sit well with the scammers, and I believe they do make up the majority of the Bitcoin business'.

BillX
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October 17, 2011, 10:07:27 PM
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Sad to admit it, but bitcoin society need credible trusted organization, which would regulate the market of bitcoins. Some rich man could take on this responsibility, but it would be much better if it was an open non-profit organization with the Supervisory Board consisting of eminent people with a good reputation.


I'm sure Matthew Wright would be more than happy to take this responsibility on.
freeminer
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October 17, 2011, 10:13:35 PM
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Perhaps we just have to advise people like we would an investment; only convert what you can afford to lose and keep it diversified as you should with cash.

Yes, but it's not the point. It is very hard to build a business independent of external currencies, as must pay suppliers, pay for rental of equipment and office, etc. Either way will be the bills that you have to pay in USD or other goverment money. Therefore, exchange rate stability is important. Otherwise, businessmen have to include in the final price a large fee for the risks.
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October 18, 2011, 12:07:11 AM
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Due to the nature of bitcoins they are too speculative. It is really hard to trade using currency with so high level of volatility.

Sad to admit it, but bitcoin society need credible trusted organization, which would regulate the market of bitcoins. Some rich man could take on this responsibility, but it would be much better if it was an open non-profit organization with the Supervisory Board consisting of eminent people with a good reputation.

This organization will accept donations in fiat money and at least guarantees the minimum price on bitcoins. For example, if the organization took donations for the $ 1 million, it can guarantee a price not less than 1/7.5 = $ 0.13 per bitcoin.

I believe that it is possible to imagine a more subtle mechanisms, but they must be clear to all market participants.


Therefore, the maximum market cap will be $2.73M? Bitcoin would never become mainstream when priced at $.13 each. I do realized that you're using that amount as the extreme minimum, but even that won't work. At that price, do you realize what a Satoshi would be worth? Guarantee a Satoshi at $.01, then now we're talkin'. I'll leave it up to you to figure out how much a Bitcoin would be worth at this bare minimum.

freeminer
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October 18, 2011, 06:11:18 AM
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Therefore, the maximum market cap will be $2.73M? Bitcoin would never become mainstream when priced at $.13 each. I do realized that you're using that amount as the extreme minimum, but even that won't work. At that price, do you realize what a Satoshi would be worth? Guarantee a Satoshi at $.01, then now we're talkin'. I'll leave it up to you to figure out how much a Bitcoin would be worth at this bare minimum.

The purpose of this organization is not to set market price. It will set some borders and provide guarantees bitcoin sceptics. Everybody will know that they can get some USD for their bitcoins in a worst-case scenario. If it will have $10 millions it'll be able to guarantee more than 1 buck for bitcoin.
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October 18, 2011, 06:48:07 AM
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Did you here what he said?  regulate the market of bitcoins...  lol,  are you on crack?

Nope, for example, if I had $ 20 million I'd be able to guarantee today's price for everyone. What is this if not a kind of regulation?

Nope. That's charity.
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October 18, 2011, 06:54:16 AM
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Alright. Alright. Alright.

I will Confess. I have $10K set aside for bitcoin investing. No kidding!
I will personally guarentee prices will never go lower than 10K/21 Million = 0.047 Cents.
The best part about, it guarentess that I will be buying at the bottom evertime.

Any one care to sell?
worldinacoin
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October 18, 2011, 06:55:54 AM
 #15

What will be the benefits to the guarantor?  Definitely they will want some returns on what they had put forth.   Guarantee still requires funds to be locked up.
freeminer
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October 18, 2011, 10:14:25 PM
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What will be the benefits to the guarantor?  Definitely they will want some returns on what they had put forth.   Guarantee still requires funds to be locked up.

...or just assets and general wealth.

I hereby officially back Bitcoin with 1 goat.

Thank you for your participation. But promises are worth nothing. You can change your decision at any time. But public non-profit organization is a different case. It will accept donations and people who have donated will not be able to change their decision.
LokeRundt
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October 19, 2011, 06:27:16 PM
 #17

With Open-Transactions servers (especially once Fellowtraveler implements federated/no-trust server protocol) individuals should be able to issue their own currencies, backed in bitcoin (for things like commodified trust-tokens) or whichever consumable/commodity they choose

For example, if I have involvement in my community, and people know the amount of fruits/veggies that I bring to the farmer's markets during summer/fall, then I can issue a currency backed in my produce (and dried/canned goods during the off-season).  For larger, non-geographically-local communities, it can be backed in bitcoin (since the blockchain is publicly auditable, the reserves can be verified, but because OT uses blinded tokens, all transactions are untraceable.  Only when one goes to the issuer to redeem the currency token for bitcoin does the exchange show in the blockchain again)

Hippy Anarchy
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freeminer
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October 19, 2011, 07:32:37 PM
 #18

I understand the ridiculousness of backing it with the promise of a goat. I do not understand why anyone would donate to make others richer.

What others? Supervisory Board?
freeminer
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October 19, 2011, 07:51:41 PM
 #19

Everyone holding the currency and especially those exchanging out?

I suppose that this foundation will set a minimum price and regular market price will be several times higher in average. Sometimes, in the case of sharp falls, they will be obliged to buy from the market, but not for profits or make others richer.

Of course this is a charity. But it will be advantageous to the main market participants. If they want to make profits in future they can make some donations for the stability of the foundations of their business.
Bitbird
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October 21, 2011, 04:36:20 PM
 #20

How about we just gathering an equivalent BTCs which enough to setting up a diversification electronic trading operation for hedging BTC's market price? You don't need to give your money to anyone. But you must ensure reinvestment certain proportion of the profit to back up BTC market when these operations generated any revenues (otherwise you'll be just another pure "speculator" who don't care BTC's long-term sustainability.).

This would be what I want to do, and I have no problem in agreed these operations must supervising by some kind of "BTC Foundations (or committees)" if we'll have one.

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