Jack Dorsey far less decentralized exchange (tbDEX)

[DaveF]

I read the news title about Launching DEX from Twitter, but didn't read in detail nor read the white paper. If OP is right and this is the way to trade in tbDEX then I will call it semi-decentralized exchange. A true decentralized shouldn't have an account nor should ask for the KYC or any other personal details including email but not limited to. There are more DEX to trade, so nothing helpful from Jack Dorsey at all. This is just a business idea, not to help Bitcoin users. What's the problem is I use centralized since here we have to provide KYC to DEX? They also could block funds and centralized also could block the funds. Why we should take more hassle?  Most likely it will be just useless as OP said.

Because they can't block FUNDS they can only block USERS. The funds never leave your wallet till the trade happens. So If you get blocked you still have your coins.
At lest that is the impression I got. Could be totally off. Either way good or bad for what we want as enthusiasts more competition is always better.

-Dave

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[NeuroticFish]

Sounds kind of like Visa / MC. They don't hold the funds the peoples banks do. All Visa/MC do is pass the data along. And takes their cut.

The analogy is not bad, although some could argue this, because VISA/MC work with banks = custodians, which may "confuse" some.
Still, VISA/MC can trust the bank, while a DEX has to do all in its powers to fight the malicious wallets/parties in the transaction. (Of course, this doesn't necessarily mean the DEX has to ask for KYC)

Because they can't block FUNDS they can only block USERS. The funds never leave your wallet till the trade happens. So If you get blocked you still have your coins.
At lest that is the impression I got. Could be totally off. Either way good or bad for what we want as enthusiasts more competition is always better.

I see it pretty much similar:
They can block users/wallets from transacting, but - most probably - cannot seize/lock user funds.
The KYC is necessary because US legislation won't allow them let in people from certain countries, for example. And they can also send all the information to IRS, obviously.

[pooya87]

I see it pretty much similar:
They can block users/wallets from transacting, but - most probably - cannot seize/lock user funds.
The KYC is necessary because US legislation won't allow them let in people from certain countries, for example. And they can also send all the information to IRS, obviously.

What about escrows, how do they work?
The problem is that this project has "traces of centralization" and that's enough to make it hard-to-trust. There is nothing stopping US government to order them to receive the funds but then block it. Pretty much the same thing they are doing with VISA for example, the trade takes place and buyer makes the payment but VISA takes and blocks the money and seller never keeps its end of the bargain since it never received the money.

[NeuroticFish]

I see it pretty much similar:
They can block users/wallets from transacting, but - most probably - cannot seize/lock user funds.
The KYC is necessary because US legislation won't allow them let in people from certain countries, for example. And they can also send all the information to IRS, obviously.

What about escrows, how do they work?
The problem is that this project has "traces of centralization" and that's enough to make it hard-to-trust. There is nothing stopping US government to order them to receive the funds but then block it. Pretty much the same thing they are doing with VISA for example, the trade takes place and buyer makes the payment but VISA takes and blocks the money and seller never keeps its end of the bargain since it never received the money.

You may have a point I didn't think of - I don't know how the exchange would work internally, I didn't use Bitcoin DEX yet and the confirmation times may indeed need an escrow that has the potential to "go rogue" and seize funds in the name of the authorities (or whatever reason actually).
While I hope that you agree that the chances for this are slim, I do agree that the possibility is indeed there.

[Charles-Tim]

I read the news title about Launching DEX from Twitter, but didn't read in detail nor read the white paper. If OP is right and this is the way to trade in tbDEX then I will call it semi-decentralized exchange. A true decentralized shouldn't have an account nor should ask for the KYC or any other personal details including email but not limited to. There are more DEX to trade, so nothing helpful from Jack Dorsey at all. This is just a business idea, not to help Bitcoin users. What's the problem is I use centralized since here we have to provide KYC to DEX? They also could block funds and centralized also could block the funds. Why we should take more hassle?  Most likely it will be just useless as OP said.

Because they can't block FUNDS they can only block USERS. The funds never leave your wallet till the trade happens. So If you get blocked you still have your coins.
At lest that is the impression I got. Could be totally off. Either way good or bad for what we want as enthusiasts more competition is always better.
-Dave

I Iater had to include the last paragraph because we have not known how the exchange (tbDEX) will be operating, but KYC will be mandatory in a way there will not be any privacy. Let the exchange start operating, then we will know if throughly this is true. If no other addresses are involved as intermediary while making transaction, then it will be true of what you are implying. But, yet, no privacy. There can still be so called data breach which can indirectly lead to scam through phishing.

[oHnK]

What about escrows, how do they work?
The problem is that this project has "traces of centralization" and that's enough to make it hard-to-trust. There is nothing stopping US government to order them to receive the funds but then block it. Pretty much the same thing they are doing with VISA for example, the trade takes place and buyer makes the payment but VISA takes and blocks the money and seller never keeps its end of the bargain since it never received the money.

You may have a point I didn't think of - I don't know how the exchange would work internally, I didn't use Bitcoin DEX yet and the confirmation times may indeed need an escrow that has the potential to "go rogue" and seize funds in the name of the authorities (or whatever reason actually).
While I hope that you agree that the chances for this are slim, I do agree that the possibility is indeed there.

Last week, I made a transaction with a well-known DEX but after a few days without disconnecting from that DEX I suffered a loss because I lost all my BNB balance.  I suspect that someone has structurally taken the assets that I own.  Indeed, the value is not that big, but we understand how it feels if using DEX even threatens your own wallet.

[witcher_sense]

We are at a crossroads in our financial system. The emergence of trustless, decentralized
networks unlocks the potential for a future where commerce can happen without the permission,
participation, or benefit of financial intermediaries.

However, since this bright future has not yet come, commerce taking place on tbDEX will be with the permission, participation, and benefit of Jack Dorsey.

Globally, 1.7 billion adults lack access to the banking system, yet two-thirds of them own a mobile
phone that could help them access financial services [1]. The reasons for their exclusion vary, but
the common threads are cost, risk, and lack of infrastructure.

The main reason for their financial exclusion is that they were born in "wrong" countries or they simply don't have the necessary ID to open a bank account. Correspondingly, they also won't be able to create an account on Jack Dorsey's DEX so it will have little to no impact on the problem of financial inclusion.

Decentralized and trustless systems create a world that empowers individuals — one in which the right to engage in payments is
neither subject to proving creditworthiness and the ability to pay account fees, nor subject to
censorship when an intermediary’s values do not comport with the payer or payee. It’s also a world
where internet access is the only fundamental infrastructure required to participate

However, on tbDEX individuals will be completely powerless: they won't be able to engage in payments if they don't prove creditworthiness, they definitely will be censored by the owner of tbDEX if he doesn't like the KYC documents they sent to him.

An open, decentralized financial system will enable all people to exchange value and transact with
each other globally, securely, and at significantly lower cost and more inclusively than what
traditional financial systems allow. Beyond reinventing money itself, smart contracts also have the
ability to fundamentally reshape how the financial infrastructure of the future can work.

"An open, decentralized financial system" cannot be built on closed centralized platforms that only give access to the elite from allowed countries. Naturally, there will be nothing "global" in such a payment system, it will be even more exclusive than it is today.

tbDEX was formed out of a desire to enable everyone to realize this vision of the future. The
current state of Bitcoin and other crypto technologies is still beyond the reach of everyday people.

Apparently, it is so because there has always been a lack of decentralized exchanges that would require KYC to transact.

[yazher]

Then this is not a decentralized exchange at all. These days, we are not going to see a full decentralized exchange that would really pass on the real definition as even before when Binance launch their own DEX, we thought it's decentralized but we were just disappointed.

Jack Dorsey the CEO of Twitter is a very influential man, he won't risk his reputation by running a full DEX without following the government regulatory requirements, so this is just to hype his new project and to mislead people, the word DEX should never exist when there are some restrictions and rules to follow.

That's right! after we surpassed the $20,000 mark, every exchange is starting to change its definition of a decentralized exchange to something like the centralized exchange where you will no longer stay unanimous with the exchanges. Now they start to oblige the KYC on the exchanges we thought of not gonna ask it if we only make small transactions on their exchanges but guess what? right now it's mandatory for us to do so if we still wanted to use their service just like what happened to Binance.

[dkbit98]

It's still early stages for this tbDEX exchange but when you have Jack Dorsey investing in this than you know it's going to be something serious.
They posted whitepaper on guthub page and it's open for any suggestions and changes, but I would like for them to keep verifications levels like in centralized exchanges, enabling people to trade even without kyc with lower limits.
Jack also promised that Square will make hardware wallet before dex exchange, so let's wait and see if he is keeping his word.

[oHnK]

After read this news, I know there is no clear correlation between the content with this thread. But I just wanna share something which is strange, Jack Dorsey has step down from CEO Twitter and this is the same strategy which is chosen by Jeff Bezos. I guess this happens because of his future plan who wanna start a new bussiness in crypto field. I dont surprise if in the future, he realize his plan.
https://www.coindesk.com/business/2021/11/29/jack-dorsey-expected-to-step-down-as-twitter-ceo-report/

[fiulpro]

I do think that the CEO did not know the meaning of the terms : Decentralized, Private. I do like the fact that you did read their terms and conditions since most of us usually do not go though that.

- There cannot be any decentralized exchange for sure which is more private than the already existing exchanges and them as well are being advised by the government to start taking the documents of the people using them and now to even go through a simple step, you might have to submit a lot of your documents, otherwise you won't be able to look at the rates as well.

It's still early stages for this tbDEX exchange but when you have Jack Dorsey investing in this than you know it's going to be something serious.
They posted whitepaper on guthub page and it's open for any suggestions and changes, but I would like for them to keep verifications levels like in centralized exchanges, enabling people to trade even without kyc with lower limits.
Jack also promised that Square will make hardware wallet before dex exchange, so let's wait and see if he is keeping his word.

I do not think any long term exchange would be working legally without them having verification now since the government takes these things very seriously and they are quite serious about being able to regulate the crypto market.

Therefore for once and for all we can understand that the regulations would always be there. We might have to submit the documents to make sure we are able to use it. Hopefully they are able to provide competitive rates.

[DarkDays]

When I read the news that Twitter CEO has been planning to build a decentralized bitcoin exchange, I was thinking it would be like those that utilized trustless service. The white paper for the decentralized exchange (tbDEX) was released on the 19th of this month, yesterday. The far more decentralized bitcoin exchange known is Bisq while thinking tbDEX will be the second, but when I glanced through the white paper yesterday, it was completely otherwise.

On the fourth page of the white paper is verifiable credentials, which means anyone or any organization that will make use of the exchange service will have to go through verification and most likely identity verification. Which means the credential verification will consists of name, address, photo, identity cards like drivers license, nation ID card and international passport, or more.

Users that want to make use of tbDEX service would be able to connect their noncustododial wallet after passing KYC and be able to exchange one coin for the other with bitcoin, but only after KYC credentials have been submitted by users before they can be able to make use of the service. I do not see this other than what was proposed some months back in US, for US citizens that is making use of an exchange (centralized exchanges) to register their noncustododial wallet address.

Although, the advantage is that many people can use this means to exchange bitcoin to another altcoin, or exchange altcoin to bitcoin. And just after exchanging, the coin will be on trader's noncustodial wallet address on blockchain which still means, it is still someones keys and it is still the person's coins, but no privacy. Anyone that wants privacy will never make use of this exchange (tbDEX) for his privacy aspect.

But while making use of this type of KYC DEX exchanges like tbDEX, aside that having privacy is not possible, also very likely and possible that coins can be seized during trading just like on instant exchanges.

Interesting insight... I wonder if this matter is what drove Jack Dorsey to resign from his CEO position???

For sure this is a matter that requires the minds of many to discuss and then agree...and given the subject of privacy it may well be that some people including Jack didn't sit right by those

Only moments ago, he became the former CEO of twitter. Source here: https://twitter.com/jack/status/1465347002426867720

[tbct_mt2]

Interesting insight... I wonder if this matter is what drove Jack Dorsey to resign from his CEO position???

For sure this is a matter that requires the minds of many to discuss and then agree...and given the subject of privacy it may well be that some people including Jack didn't sit right by those

Only moments ago, he became the former CEO of twitter. Source here: https://twitter.com/jack/status/1465347002426867720

Possibly. Jack can not build up a decentralized exchange or be part of core team and still want to keep centralized power in Twitter. People will look at his position in Twitter and are doubtful of his statement about new projects he is involving with.

This decision to departure from CEO position is smart and again shows that he has great minds and how he successfully built up a great Twitter. Jack does not restrict himself to Twitter only and he invested in other companies too. He is very ambitious and want to explorer new things technically.

[NeuroticFish]

Jack can not build up a decentralized exchange or be part of core team and still want to keep centralized power in Twitter. People will look at his position in Twitter and are doubtful of his statement about new projects he is involving with.

This decision to departure from CEO position is smart

Interesting thinking. I like it, it's a very good point.
Of course, it's risky too, since if Twitter will now be more restrictive against users/freedom of speech/hot topics, o will start getting less successful, it will also be seen as a problem of @jack, even if it's maybe indirectly so.

He is very ambitious and want to explorer new things technically.

The new directions may also need closer attention and more of his time until they get on the right track, and that's not only from profit point of view, also their public image has to be good and this may mean good decisions and close look on the teams and their (general line of) work.

[tiCeR]

I still think will this be his private business or under his company?  Indeed, there is no clear connection between Twitter and the DEX project, but here it seems that Jack Dorsey as Twitter's CEO and his CFO have significant differences of opinion and views.

This problem has already been encountered elsewhere. Often, supposed problems suggested independence and then everything was different.  You just have to have confidence in this business. Basically, however, it is good, the more people are committed.

[Osmium Naka Moto]

Did a quick reading of tbDEX whitepaper. It mentions KYC, but that is not part of the protocol. From my interpretation, the protocol merely defines identifiers, and allows 3rd party VC issuers to verify it, and give the DID credentials. The VC issuer can give it credential by KYC. But can just as well be credential via a reputation system without linking the DID with any real world entities.

PFIs on the other hand can set their own rules of engagement. Some might only want to work with DIDs that have real world KYC credentials. But it seems to me that the protocol does not preclude, and I assume will not have backdoors, to prevent PFIs that does not require KYC credentials. In the latter case, then it'll be basically like Bisq, where the counterparty that accepts fiat does not require KYC, but relies on the Bisq based reputation system instead.