Messages

 I'm just throwing this idea out here. Assuming it even makes sense, it certainly wouldn't be in version 0.1.

The design incorporates Markets that have a 'Beta', which adds liquidity to the Market at some upfront cost.

Its possible that someone (Alice) will see a market, and say "I'm interested in learning about this, I wish that market were more liquid." Currently, Alice can donate $ to the Market to increase its Beta, as easily as making a share purchase.

However, it might be better to reward Alice for doing this (more of "I think that more people would trade if the Beta were just a little higher."). Perhaps she can get a tiny fraction of any future trading volumes, if the original owner agrees? If some other condition is met? Any ideas?

Cool

[more]

I really appreciate what you have done. I'm not a coder. What can I do to help you?

Hey, thanks! One thing I wish people would do more is just submit pull requests to the central FAQ, instead of just email/forum their questions. You could do that, or make a list so that I could do that more easily (message or email it to me). Also, I've been advised to go on the podcast "Let's Talk Bitcoin", you could find the guy running it and see if he's interested. You don't by any chance go to / know anyone at Princeton? Many of the items here will require, at some point, careful attention from Bitcoin-dev-experts. Just spreading the word is nice, would like to get (smart) people talking about it so that we can get the criticism we need to produce a viable implementation. Answer people's questions. That's all I can think of right now.

Refocusing here:

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).

I'm having trouble with this, is it like this: http://en.wikipedia.org/wiki/Dutch_auction#Public_offerings If not, it seems you'd want to wait until a day when few people are donating.

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.

If you read Satoshi's whitepaper, you'll see the blockrewards were distributed to miners for two reasons. Firstly, they provided subcontracting, but secondly they "[provided] a way to initially distribute coins into circulation". Kaldor-Hicks (profitability) is not enough, a value network must be a Pareto Improvement (incentive compatible for a critical mass) to get people to switch and re-create the network effects of money (which are paramount). This second reason contributed more to Bitcoin's success, in my view, than the first "subcontractor" reason. If Satoshi had given (not mined) any coins to himself, he would invite an immediate fork(s) of the project, and critical mass and network effects would never have emerged.

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".

I still think the Coins should go to Bitcoin holders (for the allocation reason above), yet the first branch of Votecoins, with many held by / publicly endorsed by me (as I think that I can most inspire trust, after doing all of this work) should be distributed to developers/funders/contributors/etc. But its hardly a settled issue.

Again, the Votecoins are not "free", one must do the work of Voting (for which you are paid). This is a little inconvenient, I don't know how people would feel about this.

In the ancient past, shareholders did a lot of work, monitoring their corporation and electing its Board and Executive Managers. Today, people just kick back and do nothing. In my opinion, this is the source of much of today's economic failure (huge firms with none of the owners knowing or caring about what's going on).

[no other coin-types have done similarly]

This coin will be mined "Proof of Work" (PoW) as designed by Satoshi, for several reasons.

Firstly, PoW is the optimal mining scheme from a technical perspective. As PoW coins have run for several years now, while being (a) Functional (no crashing), (b) Decentralized (without required checkpoints), and Secure (no huge reorgs or trust problems), and no other coin-types have done similarly, the burden of proof is on those who oppose PoW. If you think your mining scheme is so great, you're welcome to prove it (prediction markets, developer consensus, or empirically by running your software for several years).
To clarify, I would change my mind, and agree that X is technically superior to Proof-of-Work mining, if:

• One or more 'knowledgable individuals' (defined as "those who have a track record of exposing previously-undiscussed flaws in alternatives to Proof of Work", including but not limited to: gmaxwell, andytoshi, and DeathAndTaxes), signed off on your idea as potentially viable. If they decide that they are too busy to look into your idea, then they would be too busy to sign off on it, which would be signedoff(idea)=FALSE.
• You ran your coin's software for a few years, with a level of centralized interference comparable to Bitcoin (ie, negligible). Peercoin does not satisfy this requirement, and if you don't know why, ask yourself "Am I really sufficiently qualified to examine, assess, and propose new mining protocols?" .
• Some horrible flaw were demonstrated in PoW, such that almost anything else would be desirable. I would expect a flaw of this nature to destroy, or nearly destroy, the Bitcoin network. Complaining about someone-who-owns-better-miner-hardware-than-you, or mining pools (which have existed for years without causing any problems), are examples of items which would not satisfy this condition.
• Of course, I would also accept a reputable prediction market (as in, I personally believe it is viable enough to attract traders) whose price testifies to the future-confirmation of any of the above conditions.

Secondly, this coin will attempt to use merged-mining (ie double SHA-256, the same as Bitcoin), as it gives the coin a high degree of security for free. If you think you have a better way of doing things, again, you're free to attempt to prove it (see above).

Thirdly, this coin is already attempting to do new things (prediction market transactions), so even if a better mining algorithm were found, it would be unwise to attempt two experimental ideas at the same time. First we would establish PMs under the most conservative avenue possible (the existing avenue: PoW), secondly (much later) we would switch that system from PoW to X. To do otherwise would be to put the PM part of project (aka "the project") in jeopardy for no real reason.

Again, if you feel you have an alternative, first indicate which of the above criteria you've satisfied (ie which number, 1 through 4), then indicate the possible benefits that might result from a completely perfect, bug-free implementation of your scheme and it's interaction with reality, assuming everything goes completely as expected.

I was envisioning it would work like that, you could submit a pair of trades, linked to each other. This should be possible under SIB trading.

Another reason I don't like branching...
I think that a prediction market should be able to use decisions from multiple juries. (from multiple branches.)
If one jury handles who is president, and a different jury handles predicting the future tax rate, a market should be able to combine decisions from those two juries.

It can, actually. Branches handle the Decisions, not the Markets themselves, which are coordinated by time (ie block number) so it will probably be possible.

By "it", I mean the new colored-coin-way. You're right in the old way it would have been impossible.

How would this work? 
Let's say Bob has one Truthshare with three separate colors: Original Genesis Truthshares (colored red).  FinanceTruthshares (colored blue).  And PoliticsTruthshares (colored white).  Because his Truthshares are colored these three colors, he can vote on all three markets.  However for one week Bob votes on Genesis and Finance Market, but forgets to vote on Politics Market.  Now he faces losing his Truthshares, even though he missed out on one market.  Instead of getting punished for one market, its like he's getting punished by all three. 

Moreover, who will this three-toned coin go to?  Will it go to someone with 5 colors?  Or some lucky fellow who only has one red color?

No, no, that's not what I'm thinking. By the way I've attempted to rename your "Truthshares" as Votecoins..I realize that changing names is like the worst, but the current names aren't working. Bob would only get punched for his PoliticsTruthshares (PoliticsVotecoins), some of which would be redistributed to other PoliticsTruthshares accounts according to RBCR. Each color would do it's own svd-consensus.

This is an interesting proposition.  This branching issue seems solvable with the Bitshares toolkit. Since the Bitshares Toolkit is moving to a relational database,  its possible to have a function that splits off in a branch. (Although I think it should have to satisfy certain parameters first; not just anybody can split off into another fork.)

Why not? The only real issue is blockchain bloat. This hypothetical is getting a little abstract now, but perhaps the Votecoin-owners would have to 'pay rent', in some sense, in the blockchain. That's actually pretty simple, isn't it. Just some kind of tiny monthly fee. However, remember that version 1 will just have "one branch", so this is just food for thought.

Maybe the delegated proof of stake

Sorry, not going to happen. PoW until Something-Else runs for at least a few years (post about this to come).

I didn't like the old branching idea. It is no good to copy everyone's coins.

I think it is best if juries have a fee for creation. Maybe 10,000 votecoins are created when you make a jury, and 1,000 truthcoins are destroyed.
Each jury has distinguishable votecoins, which are spendable like normal.

Example of somone's account in database: {'address':982378h9yf92f3, 'truthcoins:1000, 'shares':[[8093jf8304jf443fj849, 1, 100], [984320ue383294832, 0, [7823u9jd8328, 1, 1000]]], votecoins:[9824y89324r8932, 10000]]}

they have 1000 truthcoins, and they can win 100 coins in market 8093jf8304jf443fj849 on yes.
They bet 1000 into a market, and it also had a sub-market for that coin. so if you are correct on both bets, you will win 1000 coins.
You bet no in 984320ue383294832 and yes in 7823u9jd8328.

Finally, you own 1000 vote coins in jury 9824y89324r8932

The "old branching idea" was to copy what-are-now-known-as Votecoins. For a number of reasons discussed in the whitepaper, it might sometimes be a good idea to transfer those to existing owners of certain branches, to "import" the reputation of those Voters. Whatever we choose should have the option to do this "importing"-copy in a way that is (a) easy and (b) and easily-understandable by far-away Traders.

Another reason I don't like branching...
I think that a prediction market should be able to use decisions from multiple juries. (from multiple branches.)

If one jury handles who is president, and a different jury handles predicting the future tax rate, a market should be able to combine decisions from those two juries.

It can, actually. Branches handle the Decisions, not the Markets themselves, which are coordinated by time (ie block number) so it will probably be possible.

Have to add that every time I've said "relational" I really meant "transactional" - there's no relational algebra happening on the blockchain.

Yes "relational databse" has a very specific meaning (to me), which is largely irrelevant to what we're talking about.

This topic has been moved to Incentives / Game Theory.

http://forum.truthcoin.info/index.php?topic=16.0

I feel like letting people have open buy/sell orders at a specific prices solves the same problem.

It does, but there's no guarantee (a) that anyone will bother to place those orders, (b) that the orders won't be cancelled, and (c) that people won't try to 'steal insider info' about the event by watching unmatched orders be placed. Beta is for people who want to "buy" the information, without it markets are illiquid and stall out as they did on InTrade, or do today on Predictious and Fairlay.
http://www.overcomingbias.com/2012/07/prediction-markets-fail-to-mooch.html

I don't like changing beta, because I think it pushes the price towards 0.50? Maybe I am wrong about this problem?

It does, but that's more for you to buy at .56, in fact you can buy them for cheaper than .56 so you should be happy about this.

When a market is created, the creator should be able to guess at the initial price.
If his initial guess is fairly accurate, then he can reduce the cost of financing the market.

He can do this. By simply authoring the market, he only submits the hash / dimensionality, so no one else will know what it is (unless he publicizes this info). He can then make the first trade, although this will cost money, he can be the "smart investor" you describe.

This topic has been moved to Incentives / Game Theory.

http://forum.truthcoin.info/index.php?topic=17.0

(Not about coding the software).

No one has ever understood the terms, so even though it is a major risk to swap out definitions, I think this will be manageable: http://forum.truthcoin.info/index.php/topic,15.0.html

[two units of account]

One confusing thing about my project, which has confounded even extremely intelligent people, is that there are two units of account moving at once (in addition to the accounting going on within each Prediction Market). It was even difficult to explain:

Old Usage (Bitcoin-Focused Whitepaper):

1. "Coins" are exactly like Bitcoin (and, in the whitepaper, were Bitcoin), you use them to make trades in PM, to create PMs, to pay PM and Miner fees.

2. "Truthcoins" or "voting shares" or "reputation" are the ownership layer, they do the work of Voting on Outcomes, and are redistributed through RBCR. The exponentially-smoothed largest-eigenvector of the vote matrix.

[3+...] When you Buy or Sell in a prediction market, you are buying and selling tokens. These were historically known as shares (ie 43 shares of 'Barack Obama wins', "selling 17 shares at $.45/share"), and there were at least twice as many of these as there were markets (1 'yes/no' pair for this, 1 pair for that, etc.), and they all had to be kept separately from each other, as each was of course a different asset.

New Usage (Altcoin-Focused Truthcoin.info):

Now, with the heaviest of hearts, I'm going to change the wording to one that is probably more consistent with the average cryptocurrency-user's preconceptions. The primary reason for this change, is the abandonment of the use of Bitcoin as the Marketplace's currency, in this new (Altcoin) project.

Here goes: Within this forum, the names are Truthcoin (or just 'Coin', or 'Cash', or 'TRU', note that this is completely the opposite of what was originally the case)CashCoin and VoteCoins (which define the branches, do the work of Voting, and collect payment in Truthcoins). This leaves open the creation of branches ("Votecoin:Sports"). Finally, to avoid screwing this up any more, the States of the Markets which individuals buy and sell will retain their original name of Shares.

Unless there is a riot, I will be editing the whitepaper to use this language (and regrettably, remove the word "Bitcoin"). I'm open to suggestions, but we'll need to coordinate eventually and Dictator's Choice is often the most efficient way of getting that done. I'll try to rip off this band-aid as quickly as possible.

Name	Layer	Usage
TruthcoinsCashCoins	Currency/User	Transfer Value, Make trades, Create PMs, Pay Miner fees for inclusion of TX.
Votecoins	Owner/Employee	Vote on Decisions, Participate in the Consensus Mechanism (and RBCR), Earn Fees as payment.

Edit: I have updated again, changing Truthcoins to CashCoins. I think this is an even better fit, but, more encouragingly, this terminology emerged spontaneously from a conversation I was having with a large group, suggesting to me that it is much more reliable.

Oh, yes, you are correct. Where I got confused is where you said "worth 1 Truthcoin". Truthcoin were originally the 'shares' and not the 'coins'.

There's going to be severe confusion unless I do something...I'll have to think about this.

PM advocates have always thrown around the idea of having a market on something a long time in the future, say 50 years or so (the optimal Space Elevator design or something). A criticism was levied that inflation / time-value-of-money would make participants unwilling to speculate financially, and the proposed solution would be that people would "bet" shares of the DJIA or some other long-run store of value.

So I'm happy to announce that such a thing might soon be possible.