Colored Coins and Coinprism takes Bitcoin to a whole new level

[sclaggett]

A great offering to the community.  It will provides a pure colored coin model that can be an alternate to mastercoin and others.

Looking forward to seeing the platform evolve.

[1713941741]

1713941741

[1713941741]

1713941741

[1713941741]

1713941741

[1713941741]

1713941741

[1713941741]

1713941741

[iraszl]

...

The other thing to consider is even you can color coins for futures contracts why would you want to?  Most people who trade futures prefer cash setlled and trade them for speculation.  What they care about is liquidity.  If the colored coin transaction takes 10 mins, the market makers will be forced to widen the spread which will make them unattractive for trading.  Plus there's already mature exchanges for futures.  What is the advantage to using blockchain compared to what we have now?

It has the same problems of bitcoins.  Why bother using it when there are superior options like credit cards and ATMs everywhere.  

You can either rely on a trusted third party to handle your vouchers, futures, stocks, etc. which is expensive because you have to pay for their service. Or you can issue them yourself, but then people won't be able to trade them among each other unless you can create paper notes that are as hard to counterfeit as money (or better).

Colored Coins gives you the option to issue them yourself and it lets people trade them among themselves safely without a third party and all this for a few cents. It gives you the best of both solutions and none of the headache.

[DurbanPoison]

I really wish they had a better name than "Colored Coins". Some might get it confused with Blackcoin, Whitecoin, etc.

[iraszl]

Problem:
How to determine the exchange between Bitcoin and Colored Coins? As you said, Colored Coins can represent real dollars, so when the currency values ​​fluctuate a bit, how to ensure that the value of Colored Coins?

If they represent real dollars than the price is pegged to the real dollars. As an issuer you always buy and sell it at 1:1.

[iraszl]

Ok so when i color some bitcoin, the amount of bitcoin colored is not relevant, right ?
To go back to the applecoin :

If i create 100 applecoin for my apple growing company, can i just color 100 satoshi to trade?
What is the difference if i color 100 bitcoin?


Am i missing something?

You're right, it's not relevant because the amount is so small. But if you had for example 1,000 colored coins incoming transactions than you can uncolor them and recycle them back to bitcoins. Each transaction is 600 satoshis, so you would have 1000x600 Satoshis or 0.006 BTC ($2,64).

[iraszl]

I am not sure how much bitcoin you actually need to make it work, but I assume it is larger than the dust limit but still quite small.  I would like more clarification here too.  

Yes, the dust limit in Bitcoin is now lowered to 540 Satoshi (at Bitcoin v 0.9) from 5,400. In Coinprism it was rounded up to 600 Satoshis. This the amount used to send the transaction and carry your Colored Coins.

It doesn't matter if you send 1 or 10,000 colored coins, you are still technically sending 600 Satoshis to the recipient.

[iraszl]

If anybody wants I can send 1,000 Owl Coins as a test.

It's a Colored Coin that runs on Bitcoin network and the Open Assets protocol.

You will effectively receive 600 Satoshis carrying the Colored Coin meta data.

In order to be able to receive the Colored Coins correctly you need to have a bitcoin address / wallet that understands the Open Assets protocol. In practice this means you need to create an account at Coinprism.com and then give me the address it created for you.

[Peter R]

If anybody wants I can send 1,000 Owl Coins as a test.

It's a Colored Coin that runs on Bitcoin network and the Open Assets protocol.

You will effectively receive 600 Satoshis carrying the Colored Coin meta data.

In order to be able to receive the Colored Coins correctly you need to have a bitcoin address / wallet that understands the Open Assets protocol. In practice this means you need to create an account at Coinprism.com and then give me the address it created for you.

Sure, I'll bite.  I created a CoinPrism wallet and was assigned the address: 1DAXAwYFencj3CXWhcjUg6Fvo3JhjRxrev

So are OwlCoins redeemable for anything real or are they just for experimentation?


I am still interested in the answers to these two questions:

1.  Does the open-assets protocol have a formal and publicly-visible method for an issuer to remove the color from a coin?

2.  Can colored coins using the open-assets protocol be traded via coinjoin transactions?

[bish5555]

Hi iraszl,

Would love some Owl Coins!!  

Coinprism Wallet:

1K2PHavCypCg75VENQYKYuV2c5THz6iZ6H

[Peter R]

OK, I created my own colored coins called "Worthless Tokens" with ticker symbol WTK.



But I can't figure out how to send them to someone (for example to bish5555's Coinprism wallet that he posted above).  Any ideas?

[bish5555]

OWL Received !!

[iraszl]

Sure, I'll bite.  I created a CoinPrism wallet and was assigned the address: 1DAXAwYFencj3CXWhcjUg6Fvo3JhjRxrev

So are OwlCoins redeemable for anything real or are they just for experimentation?


I am still interested in the answers to these two questions:

1.  Does the open-assets protocol have a formal and publicly-visible method for an issuer to remove the color from a coin?

2.  Can colored coins using the open-assets protocol be traded via coinjoin transactions?

Sent it.

1. I think so, when you send it to a new address without the meta tag it becomes uncolored (recycled). I think that's what Coinprism does when it uncolors.

2. Sorry, I don't know.

[iraszl]

OK, I created my own colored coins called "Worthless Tokens" with ticker symbol WTK.



But I can't figure out how to send them to someone (for example to bish5555's Coinprism wallet that he posted above).  Any ideas?

Haha, I will destroy the idea of WTK by offering 0.001 BTC per WTK!

[Peter R]

OWL Received !!

I received my OWL too!

I want to test sending both of you some of my worthless tokens (WTK) but I don't seem to be able to.  Perhaps the wallet needs to wait for several confirmations (as I just issued these worthless tokens 10 min ago).  

[LiteCoinGuy]

interesting project, i will watch it.

[bish5555]

OWL Received !!

I received my OWL too!

I want to test sending both of you some of my worthless tokens (WTK) but I don't seem to be able to.  Perhaps the wallet needs to wait for several confirmations (as I just issued these worthless tokens 10 min ago).  

 

[Peter R]

Here is the public information page that is automatically generated when you color coins to issue a digital asset (I filled in the data and provided the symbol for my worthless tokens (WTK)):




But what I think is missing is the number of WTK outstanding.  I believe it should be public knowledge how many WTK are outstanding, correct?  I'd like to see this here on the information page.  

If someone uncolors their WTK, could the amount outstanding automatically decrement (assuming the uncoloring process is defined by the open-assets protocol)?

[trout]

the obligatory 0.0001 transaction fee is a bit of a pita for playing around with these colored coins,
which are only 0.000006 each

[Peter R]

the obligatory 0.0001 transaction fee is a bit of a pita for playing around with these colored coins,
which are only 0.000006 each

0.0001 BTC is only four and a half cents ($0.045).  The transaction fee is a deterrent from creating a bunch of spam transactions, so it is a very good thing.  

In a practical setting, the value of the "color" transferred should be much larger than the transaction fee.  The fact that only 6 bits actually got sent is not the point.  The point was to transfer ownership of the digital assets.  

It typically costs over $100 to transfer assets such as shares between brokerage accounts--that's at least 2000 times more expensive than transferring shares using open-assets.  

[iraszl]

the obligatory 0.0001 transaction fee is a bit of a pita for playing around with these colored coins,
which are only 0.000006 each

It's not compulsory by Coinprism. You can send with none, but I don't know how fast it will be sent if at all. We can try sending it with 0.00001 BTC (1/10th of the suggested fee).