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I think we should have an exchange, and put a MASSIVE sell order with all the coins.
As people buy them, we use the bitcoin they give us to put a buy order at 0.99* the sell order.

Everyone can easily convert back and forth, just by paying a 1% fee.
It is backed by bitcoin, and they have to trust the centralized organization to uphold this promise.
Eventually, truthcoin community outgrows the centralized institution. All the coins are purchased.
Then the price of truthcoin floats freely against bitcoin, and the centralized institution stops existing,
the investors keeping all the bitcoins as profit.

The centralized institution needs to decide on it's total profits from day one. 1,000 bitcoins? 10,000 bitcoins?

If you aim too high, a different centralized institution could undercut.
If you are too low, then your community wont be big enough to have stable truthcoin/bitcoin exchange rate.

Price-fixing is never good. Traditional IPO model is totally broken. You can establish a market price in the presale by doing a AGS-style fundraiser. That way you actually get the money, and get however much money people were willing to invest.

10%/10% means 10% to PTS and 10% to AGS, for a 20% preallocation.

The nature of open source and easy copyability is an argument *for* honoring AGS/PTS. It represents the lion's share of DAC early adopters and you are always at risk of a fork to a different distribution which could get a network effect faster. Read the link in the OP for a more in-depth argument.

If you have full control over your chains then there is no reason to go with sidechains. IMO the sidechain proposal is a power grab by large BTC holders and double-sha256 miners. Once you get over the idea that a higher hashrate is always worth the "extra security" it provides, you'll see there is no benefit over just making your own chain.

How exactly should branches be created? (One basic idea is to use a colored coins concept, and split a small amount to individuals as desired. This is nice because colored coin technology has already been invented. Absolute care must be taken to make sure that fees are never paid with a share [a colored coin] and always with the basic coin layer).

The bts toolkit will let you have user-issuable assets that are tradeable on an embedded exchange and that pay fees in the underlying asset right from the get go, a la coloredcoin/MSC/XCP.

This is one of the most exciting applications of PMs and the main reason I joined bitshares (bitshares X is essentially what paul is describing in the OP on a special purpose blockchain).

Sorry, could you clarify? I tried to find the coins vs shares in the whitepaper and couldn't.
From what you just described, both the coins and the shares are the "voting shares" used for outcomes. What is used for what? What charges fees for what?

I recommend an AGS-style fundraiser be used to get money for this project and allocate part of the initial supply.

For those that don't know, AGS are the "virtual" shares represented by addresses of people who sent money to special fundraising addresses for the bitshares ecosystem. It is similar to how Mastercoin raised money, except that instead of fixing a price per BTC and letting the supply be variable, the supply is fixed and the price per share is determined by splitting the fixed shares-per-day among all the donators from any particular day. (Personally I think you should count time in terms of blocks instead of days, but whatever).

Of course if we're going with bitshares_toolkit we should allocate 10%/10% AGS/PTS.
There is also value in dropping a fraction onto BTC or MSC/XCP.
Maybe 30%-50% allocation for "Proto-Truthcoins" (the virtual TC fundraiser share)?

I do *not* recommend distributing shares to miners. Mining has not been "fair" or "decentralized" for like a year now. Even if you go with POW, their rewards should be paid explicitly from the network's income rather than implicitly via coin/share dilution. Miners are subcontractors for your network.

I do *not* recommend a dev premine. That's the point of this type of fundraiser.

There is also a question of coin distribution vs share distribution. Whichever is the one that pays fees is the one that should be preallocated to AGS/PTS/"PTC".

Source: https://github.com/psztorc/Truthcoin

Whitepaper and FAQ: https://github.com/psztorc/Truthcoin/blob/master/docs/README.md

[Advantages]

Typically *coin projects extend the Bitcoin source. I'd like to make the case for building on the bitshares toolkit instead. I've talked to James and Paul about this and they seem mostly on board, but some extra public discussion can't hurt.

BitShares is a project to help build Decentralized Autonomous Companies, which is a metaphor for describing blockchains+cryptequity that provide a service. Truthcoin is a DAC. bitshares_toolkit provides a "shell" DAC, basically a bitcoin clone. Several other projects are already being built with this toolkit, which you can read about on bitsharestalk.org

Advantages

* bitshares_toolkit is specifically designed to be extended with custom business logic. Bitcoin's "input/output" style transactions get pretty hairy for complicated functionality compared to what is essentially traditional transactional DB transactions in the toolkit.
* The feature set is a strict superset of Bitcoin's functionality. Named stealth addresses, forced client-side best practices, and functionality from any of our other DACs (most significantly the Truthcoin <-> Truthshares embedded exchange) will be available *right from the start*. All that's left to develop is your PMs.
* There is not much collaboration between Bitcoin core devs and altcoin developers. Bitcoin devs do what is best for them and then altcoin devs adopt it if it is helpful. In the bitshares ecosystem, "core bitshares devs" do not have their own DAC and are specifically maintaining the toolkit on behalf of all the DACs derived from it.
* Our GUI wallet and block explorer also follow the same philosophy and so it will be much easier to get up and running from the end user's perspective.

Non-disadvantages
* "DPOS is not a proven security model!" -> We can use POW. The toolkit makes it easy to swap out parts as you see fit. POW is very easy to implement. Alternate POS models aren't too bad either. (I also think POW has already been proven to be dangerous especially for blockchains with markets, but we can discuss that when we get there).
* "Truthcoins aren't shares, they're coins!" -> facepalm... not being facetious, I've actually heard an argument like this before IRL
* "You'd be forced to preallocate 10%/10% to AGS/PTS!" -> Read this: https://bitsharestalk.org/index.php?topic=2876.0

Actual disadvantages
* Bitcoin has obviously had much more time to become battle-hardened simply by being older. We don't know about bugs we don't know about. (However, only bugs related to stuff outside of the "hard parts" matter for this - the rest is up to you anyway).

So what's with the pitch?
I'm part of the Bitshares team, we are working full time on getting as many DACs bootstrapped as possible. We align our incentives by giving DAC devs good reason to honor AGS/PTS. I own AGS/PTS, and so I want to make TC succeed and give a share to the bitshares community in exchange for our enthusiastic support on all levels (development, marketing, anything in between).


Happy to discuss concerns and suggestions about the toolkit here.