Coin with a smoothly variating price - "stable coin" but not really

[UmaPessoa]

Do not reply to this thread. The discussion was moved here: https://bitcointalk.org/index.php?topic=5085237 because this seems to be the wrong section.

I wrote a paper with two ideas for a coin with a stable price. By that I mean a price that does not change so abruptly as of now. None of those ideas involve a central authority or oracle, they work more or less the same way as current block-chain implementations.
It's a short paper, 6 pages. I hosted the pdf on github.

https://github.com/UmaPessoa69/coin-smooth-price

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[cellard]

I wrote a paper with two ideas for a coin with a stable price. By that I mean a price that does not change so abruptly as of now. None of those ideas involve a central authority or oracle, they work more or less the same way as current block-chain implementations.
It's a short paper, 6 pages. I hosted the pdf on github. I will make no other replies.

https://github.com/UmaPessoa69/coin-smooth-price

You should post this on the development section, other boards are way too fast and your post may get lost. I know the Development & Technical Discussion is for bitcoin but sometimes posts that are a bit meta are allowed it seems. There are big threads for alternative PoW approaches there for instance.

As far as stablecoins, im very skeptic about these. You would need constant manipulation of the price to get a thing to stay stable, thing which is measured against a million other things (all other fiats, gold and other metals...). I still didn't look at it but IMO for something to be stable it just must achieve global reserve asset status organically.

If someone has the time to look into OP's whitepaper can someone resume it?

[UmaPessoa]

I changed my mind on the no reply thing, since your post was not blatantly s**t post, as I was expecting. One of the approaches uses convertible coins and arbitrage. The other uses hash-rate changes to estimate price variations, the more expensive the coin the more people want to mine it. Neither relies on an oracle or share-holders that receive more coins for nothing. The paper is short and easy to understand, please do read.

[cellard]

I changed my mind on the no reply thing, since your post was not blatantly s**t post, as I was expecting. One of the approaches uses convertible coins and arbitrage. The other uses hash-rate changes to estimate price variations, the more expensive the coin the more people want to mine it. Neither relies on an oracle or share-holders that receive more coins for nothing. The paper is short and easy to understand, please do read.

I would like to read your whitepaper, however I don't trust .pdf files. Could you upload the whitepaper in plain text somewhere? Or you can use a pdf to jpg converted. Pdf files are known to be able to contain exploits. Maybe im too paranoid but that's how it goes.

Have you posted before the in development or altcoin section? I remember reading something very similar to your proposal.

I would definitely need to read the full thing because I don't understand how you would be able to keep price stable against all other things which have prices in a decentralized way.

[stompix]

If someone has the time to look into OP's whitepaper can someone resume it?

The main idea



Basically, you stabilize one coin by printing a shitload of other coins and doing arbitrage.
The whole idea requires so much centralization and so much control over mining, exchange, coins supply that you'd rather be using tether.

[cfif123]

If someone has the time to look into OP's whitepaper can someone resume it?

The main idea



Basically, you stabilize one coin by printing a shitload of other coins and doing arbitrage.
The whole idea requires so much centralization and so much control over mining, exchange, coins supply that you'd rather be using tether.

the problem with the stable coin depends on the user, because the more people use the coin and the greater the amount used it can make the coin stable and experience price increases so on

[UmaPessoa]

Basically, you stabilize one coin by printing a shitload of other coins and doing arbitrage.
The whole idea requires so much centralization and so much control over mining, exchange, coins supply that you'd rather be using tether.

the problem with the stable coin depends on the user, because the more people use the coin and the greater the amount used it can make the coin stable and experience price increases so on

No, that's not it. There are two different approaches and only one uses arbitrage. The other estimates price variation by the variation in hash-rate. If the price goes up there are more people wanting to mine, if it goes down there are less. You can regulate coin supply by increasing the reward per block and destroying transaction fees.

the problem with the stable coin depends on the user, because the more people use the coin and the greater the amount used it can make the coin stable and experience price increases so on

Sorry, I didn't understand your post. If you increase supply for a certain demand the price goes down.

I would like to read your whitepaper, however I don't trust .pdf files. Could you upload the whitepaper in plain text somewhere? Or you can use a pdf to jpg converted. Pdf files are known to be able to contain exploits. Maybe im too paranoid but that's how it goes.

Have you posted before the in development or altcoin section? I remember reading something very similar to your proposal.

I uploaded jpg to the repo: https://github.com/UmaPessoa69/coin-smooth-price
I made the same post on reddit and 4chan a few minutes before this one, no replies and shitpsot respectively. Besides that never posted anything about it anywhere.

You should post this on the development section, other boards are way too fast and your post may get lost.

I will if the thread here doesn't go anywhere.

[futile-resistance]

I wrote a paper with two ideas for a coin with a stable price. By that I mean a price that does not change so abruptly as of now. None of those ideas involve a central authority or oracle, they work more or less the same way as current block-chain implementations.
It's a short paper, 6 pages. I hosted the pdf on github.

https://github.com/UmaPessoa69/coin-smooth-price

Basically a crypto savings account of sorts. Just like tether or circle but instead of staying at the same price forever, it will be just getting a sort of "interest rate" that keeps it going higher and higher in value. However there are couple of stuff that would prevent such a thing, who would be backing this increase in price, if there is something that is making money forever and with a guarantee people will buy it right away and that might create an off balance budget for the token that would make it worth more than what it suppose to, there were times when USDT was less than 1 dollar each and more than 1 dollar each as well. Someone needs to pay the increase for it and that won't be the users for sure. Hence it would be really difficult for anyone to guarantee such a project and back it with their own money for it.

[UmaPessoa]

Basically a crypto savings account of sorts. Just like tether or circle but instead of staying at the same price forever, it will be just getting a sort of "interest rate" that keeps it going higher and higher in value. However there are couple of stuff that would prevent such a thing, who would be backing this increase in price, if there is something that is making money forever and with a guarantee people will buy it right away and that might create an off balance budget for the token that would make it worth more than what it suppose to, there were times when USDT was less than 1 dollar each and more than 1 dollar each as well. Someone needs to pay the increase for it and that won't be the users for sure. Hence it would be really difficult for anyone to guarantee such a project and back it with their own money for it.

That's not it. Suppose we had a central authority that regulates the coin supply and wants to keep it, say 1:1 with USD. If the coin gets too expensive the authority prints more coins, increasing the supply and making the price drop. If it gets too cheap, it destroys coins, decreasing the supply and raising the price.

Up to now, attempts of this kind have either involved an actual central authority buying and selling coins(dumb) or an oracle that feeds price data to the network(not dumb but not great).
Ideally we would like the network to magically guess, only from that within the block-chain, the price on the exchange. This is not possible.

BUT you can use the hash-rate to estimate price changes. If the coin gets more expensive, more people want to mine, the hash-rate goes up. If the coin gets cheap, less people want to mine or they have to turn less efficient machines off, the hash-rate goes down.

You can then use this variations to change coin supply without a central authority. How so? By variating the coin reward per block(which lasts forever) and the transaction fee(which is destroyed). Since block reward lasts forever there will never be a time when transaction fee is miners only reward, so destroying it is not a problem.