Topic: A BTC stock exchange for high-risk, unverified securities? - page 3. (Read 6152 times)

GLBSE will release information given enough legal force. You want us to trust the GLBSE and that is reasonable depending on the clientèle you want.

Strawman again, have never said issuers need to "expose" themselves. Getting verified means GLBSE knows who you are, no one else, NOT getting verified has a proven track record of disaster for shareholders (with very few exceptions).

I don't think that the identity of an issuer need be known all around the world for them to list on B or A markets, but GLBSE needs to know who they are. Failing to do this doesn't just result in scams, it ruins the market as a whole and it's reputation (as was our experience with GLBSE 1.0).

Promoting high risk, unverified securities is probably a high risk activity (though I am not sure how verified/verifiable that assertion itself actually is).

However, situating such an exchange behind Tor and/or i2p creates sufficient barrier to casual entry that it might also permit dispensing with the security worries associated with using webservers and webbrowsers; people who are willing to get Tor or i2p running can maybe also handle using an Open Transactions client instead of a web browser.

What exactly is the job of the exchange? Are they supposed to promote/market for you or is it fine that they remain as unknown as possible to everyone other than to your shareholders and your potential shareholders: the people to whom you the issuer of a security choose to reveal the means of contacting the exchange your issue trades on?

I have been thinking it might be better to simply have experienced traders equipped with Open Transactions clients bundle managed portfolios of things as GLBSE assets to cater to the browser-addicted crowd, or maybe even set up websites of their own for interacting with their customers.

Admittedly I might be overly influenced by an old, obsolete model: floor trading / seats at the exchange; does the New York Stock Exchange run a website now so anyone can trade directly on it, or are there still remenants of the old days when only brokers / brokerages actually dealt directly on the exchange, the public dealt with brokers?

-MarkM-

Additionally, in some countries entrepreneurship is pretty much illegal through burdensome regulations.

Requiring some people to expose themselves is a recipe for disaster for their businesses. Capping funding will only put salt in the wound for them, especially if its a completely virtual business.

What if the investors and the issuer have a price of privacy and low visibility? What if no party sees any benefit in reaching B status?

I think the laissez faire caveat emptor marketplace is the best way to go. But I also take the attitude that it is better to have more issues than less just like it is better to have more speech than less.

Perhaps you can segregate securities based on type, risk, profile, etc. I do find it annoying trying to sift through all the crap to find the diamonds. But this is a GUI issue and not a fundamental philosophy and business strategy issue.

Having a laissez faire caveat emptor marketplace opens up opportunities for creative entrepreneurs to solve problems, slice risk up and develop innovative financial products. A good example is Nyancat Financial's performance in the midst of this Pirate mess.


The idea that Pirate, Ponzis, etc. issues crowds out investment from 'more legitimate' issues is a complete red herring. Individual investors determine their risk tolerance and attempting to interfere with this creates friction and inefficiency.

The problem with Ponzi scams is that they are fraudulent. A big problem with publicly traded companies is all the disclosures. This can reveal competitive advantages which results in pressure on margins and profits.

Sure, people can lie, etc. but so likewise investors can do significant due diligence, craft and execute binding contracts in addition to the GLBSE contract and maintain an aura of privacy around business operations when there is a legitimate trade secret. Often these trade secrets can be exploited for years by small private companies that keep their mouth shut and do not alert potential competitors to their money tree.

Therefore, as a shareholder and in order to maximize shareholder value I want issues I invest in to have the ability to maintain privacy, protect competitive advantage and secretly dominiate their niches. If that means we have to remove the issue from GLBSE to avoid disclosure of trade secrets and take it private then that would be the reasonable business decision.

Thus the conflict becomes whether investor's perform due diligence or whether GLBSE performs due diligence.

If GLBSE takes a regulator position attempting to ferret out the 'scams' then it costs time, resources and puts shareholders in a position to rely on GLBSE to their detriment thus opening up potential legal liability for negligence, etc. in not ferreting out the scams, etc. because some will inevitably get through or get through legitimately and then turn into scams.

Thus, a laissez faire caveat emptor position would allow for more innovative financial instruments that can creatively and more efficiently allocate risk, maintain the privacy, secrecy, trade secrets and competitive advantages of businesses which would create shareholder value and remove any reasonable reliance investors may have on GLBSE.

On the other hand, I do not see the advantages of babysitting fools who are easily separated from their money.

We'll have this done in the next couple of days.

GLBSE is definitely getting cluttered and needs some organization and I think the best solution would be to separate shares by sectors (mining, funds, high risk and so on). A new website would be slightly more obnoxious but the splitting up/reorganizing of GLBSE would be really helpful.

I think Nefario shouldn't drop those "scams/high risk" investments out. Maybe create two markets in GLBSE would be better and manually move the good ones from the high risk market to the low risk one. And make the high risk market pages stand out as high risk. Something that will always remind potential investors that this could easily be a scam.

Banning them outright has more less cons (pun intended) than pros. 1. Less profit for Nefario. 2. To much intervention in the market which goes against the "bitcoin spirit". Letting the people decide and giving them the proper tools to do so would be better.

Of course in any case it's up to market own to decide what will be trades in the market. After all someone else will cover the demand for a high risk market if GLBSE backs out.

+1 for this.  NASDAQ is a 3 tiered market.
http://www.nasdaq.net/PublicPages/ListingStandards.aspx

Then there's OTC BB, and Pink Sheets for companies not meeting certain listing standards.

That's an acceptable explanation to me; lived and learnt. It's what makes us human.


I completely agree there is a balance, and I think all that matters is who's in charge, and what the scale is.

Perhaps I don't really understand what "free market" means; I read your definition but I have trouble with the paradox - you are allowed to decide the rules of your football game with your football (GLBSE) which I must submit to if I want to play in it, but the government is not allowed to define the rules of the football game (society) for it's football (the country) which we must submit to if we want to play in it. The only way I can imagine resolving this paradox is to consider the modern government as the sum of people's cumulative actions and experience. That is, the modern government was created by the cumulative effect of individual anarchy. This allows for the resolution of the paradox - they are fractal representations of each other. You are free to create rules which people may not follow in your game, just as the government is free to create rules you may not follow when playing their game.

You would say you have an incentive to manage GLBSE, perhaps in the pursuit of profit by recognizing the need for certain constraints. Is this any different to a government managing the rules of trade on the NYSE, so that they may too metaphorically profit via a positive happy to sad ratio of citizens? Their scale is much bigger than yours, sure, but they still believe they are creating a more interesting market where more people can have fun rather than less. I do believe that, albeit in larger scale, the government is fractally mirroring you by applying their own experience when creating regulation. It may be too much or badly done (as yours might be), but I would say that's a problem with the people in charge, not the concept of rules being created to benefit particular people.

I suppose I was being facetious in my original comment anyway...so sorry about that. I certainly back your ability to apply your intellect to run your business successfully.

I think it would take glbse to a whole new level.

Not for long.

Also there are several on GLBSE at the moment that would only need a little help in reaching that status.

Why now and not before? Experience. When GLBSE first started we had no rules or even any form of verification, after about 6 months of this total absolute freedom GLBSE was a ghetto of scams and failed assets. Then we started to tidy things up, we moved to GLBSE 2.0 and added verification. The quality of assets skyrocketed and trade flourished.

I think looking back we can see where GLBSE has gone wrong and where it needs improvement, a little more market segregation and a few reasonable rules will help a lot.

Regarding your libertarian comment, I don't think you understand what the term free market means. It doesn't mean no rules at all, that's a free for all.

It means the owner of the football gets to decide the rules of play instead of the government, that a free market is free of government regulation. We don't run GLBSE for the purpose of collecting tax, we run it with the intention of helping investors, projects, business and people. So it's in our interest to try to ensure the market runs as smoothly as possible to the benefit of everyone.

I don't want to see any more rules on GLBSE than are absolutely needed, and the ones that are in place are there for a good reason and are clearly not enough. I, we at GLBSE hate rules because every one means more work and expense for us, it's against our own profit interest to have any, but at the same time it's against our profit interest to have an exchange that is full of scams and nothing else, that is not a market with a future.  

We need to strike a balance.

I think you are confusing libertarians with anarchists  

The point is GLBSE is private property and can set any rules and regulations it wants to.

That sounds reasonably sensible. There is nothing that says the GLBSE has to follow practices set by stock exchanges and their regulators.

Why are you doing this, though? Have people been complaining to you about the pirate fiasco? How come it's a problem now and not 3 months ago? Although I suppose I can understand it being a "wait and see" situation.

This is one thing that I don't understand about the libertarian cause (not saying you're one)...they claim they want a free market (which is essentially what you had provided), but if they're the ones that are going to get screwed, they suddenly don't. Why aren't they all here berating this idea as blasphemy?

Why would the C market have a cap on funding?

I'll be adding tags in the next couple of days for things like bonds, mining etc. to shorten the assets page.

But what I actually had in mind was having 3 different markets (or 3 different market pages) with differing requirements to get into each of them.

The (C) market could be unverified, no accounting records etc. and considered very risky, it would also have the lowest starting fees and maybe a limit on the amount that can be raised.

(B) market would be where most of the good assets currently stand, verified to the current level, but I think providing monthly accounting statements, they'd need to have a running business as well (compared to funds to get a project started). So it would only be a little more effort (I think mostly for the accounting side) for some existing assets to get into this category.

(A) market would have even higher levels of verification than now(background and credit checks), would also require a treasurer to approve the use of funds, provide GAAP accounts and be audited by an external source.

This way an asset could start off in the C market and as they grow (if they're successful) they will be moved to B market and then eventually A market, each step up raising the levels of capital they have access to.

We still wouldn't allow assets that would make GLBSE a target for government regulators/police (i.e. drugs, prostitution).

Just host it in Russia and make a positive homage to Putin. Then you're good.