don't all the other securities exchanges already do this?
I was pretty sure this was a major factor in me getting into bitcoin securities.
Topic: ActiveMining, ASICminer, others: Please reduce Stock Exchange risk (Read 1409 times)
July 20, 2013, 06:34:03 AM
July 20, 2013, 01:36:59 AM
I agree, we need some records that prove that we hold our stock in listed assets. When trading shares (that is real shares), I use an online broker who immediately generates a PDF when I make a purchase or sale. It usually has details such as; amount of shares I purchased/sold, amount in $, company, date/time etc. All the info you could need. I believe Bitfunder, BTC-TC and any other notable exchanges should have a somewhat similar system, so that a pdf of the trade could be provided under trade history or something. Again, I don't know how expensive or efficient it would be to set up something like that.
I can make PDF's that look like broker trade receipts. What does holding a PDF prove?
You have to trust your broker. This is not unlike btct.co where you have to trust the issuer. They get complete lists mailed to them regularly. So the "who has what" problem is solved. The other problem of trusting the issuer still exists. If you don't think you can trust the issuer, do not buy the issue.
Colored coins are great, they solve the same problem our lists solve, but they do nothing for the problem of trust. So on both points it's a wash. What they DO add is distributed trading. Conversely what they take away is a backed-up easy to use safe place to trade. Now you lose your wallet.dat (or get it stolen, it's not like bitcoind can use 2FA.) and you lose all your shares. Awesome.
July 19, 2013, 08:29:48 PM
I agree, we need some records that prove that we hold our stock in listed assets. When trading shares (that is real shares), I use an online broker who immediately generates a PDF when I make a purchase or sale. It usually has details such as; amount of shares I purchased/sold, amount in $, company, date/time etc. All the info you could need. I believe Bitfunder, BTC-TC and any other notable exchanges should have a somewhat similar system, so that a pdf of the trade could be provided under trade history or something. Again, I don't know how expensive or efficient it would be to set up something like that.
Apparently mirroring bitfunder asset list can solve this issue.
July 19, 2013, 08:24:58 PM
I agree, we need some records that prove that we hold our stock in listed assets. When trading shares (that is real shares), I use an online broker who immediately generates a PDF when I make a purchase or sale. It usually has details such as; amount of shares I purchased/sold, amount in $, company, date/time etc. All the info you could need. I believe Bitfunder, BTC-TC and any other notable exchanges should have a somewhat similar system, so that a pdf of the trade could be provided under trade history or something. Again, I don't know how expensive or efficient it would be to set up something like that.
July 19, 2013, 08:06:10 PM
How did the GLBSE situation was resolved?
As far I know, shareholder's position was confirmed through their mailbox upon registration, which is also the strategy adopted by burnside or BTCT. "We are the only exchange that provides Asset Issuers complete lists of shareholders email addresses and share counts in a manner that makes it trivial to continue operations if the exchange shuts down."OP's suggestion would be great if applicable.
Yes, colored bitcoins is a great concept.
Well, I was planning starting investing in shares, stocks, that stuff, registered at bitfunder, is this a good fail safe: https://bitfunder.com/terms/
Anyway, I think I'm gonna study this subject a little more, this is still very new to me...
July 19, 2013, 07:31:58 PM
How did the GLBSE situation was resolved?
As far I know, shareholder's position was confirmed through their mailbox upon registration, which is also the strategy adopted by burnside or BTCT. "We are the only exchange that provides Asset Issuers complete lists of shareholders email addresses and share counts in a manner that makes it trivial to continue operations if the exchange shuts down."OP's suggestion would be great if applicable.
July 19, 2013, 07:25:40 PM
Not sure how.
July 19, 2013, 07:01:56 PM
How did the GLBSE situation was resolved?
July 19, 2013, 06:44:41 PM
Hi,
Today we have a funny situation, that if the (unregulated) stock exchange closes tomorrow, as happened with GLBSE, we will be holding the stock with no proof of owning it. We will lose rights for our shares.
Short term solution:
Bitfunder stock exchange has a public list of all assets held by all members / shareholders:
https://bitfunder.com/assetlist
*Perhaps other exchanges have something similar.
What I recommend, is for each serious company mirror this list from all the exchanges *daily* on their own corporate servers for public to view. (like on http://www.virtualminingcorp.com/ for ActiveMining)
Long term solution:
We must be able to store our stocks offline, off the exchange should things go wrong, in a similar way to storing our Bitcoins offline.
This is theoretically possible by using a technology called "Colored BitcoinX", which can "color" bitcoin fractions into company stocks, and store them in the block-chain.
We must convince the exchanges to adopt this standard -or- come up with a separate block-chain for storing stocks offline.
This will greatly reduce investor risk, and will let investors to invest more money.
It will also allow moving stocks between exchanges.
This is something exchanges should implement.
-Technologov
Today we have a funny situation, that if the (unregulated) stock exchange closes tomorrow, as happened with GLBSE, we will be holding the stock with no proof of owning it. We will lose rights for our shares.
Short term solution:
Bitfunder stock exchange has a public list of all assets held by all members / shareholders:
https://bitfunder.com/assetlist
*Perhaps other exchanges have something similar.
What I recommend, is for each serious company mirror this list from all the exchanges *daily* on their own corporate servers for public to view. (like on http://www.virtualminingcorp.com/ for ActiveMining)
Long term solution:
We must be able to store our stocks offline, off the exchange should things go wrong, in a similar way to storing our Bitcoins offline.
This is theoretically possible by using a technology called "Colored BitcoinX", which can "color" bitcoin fractions into company stocks, and store them in the block-chain.
We must convince the exchanges to adopt this standard -or- come up with a separate block-chain for storing stocks offline.
This will greatly reduce investor risk, and will let investors to invest more money.
It will also allow moving stocks between exchanges.
This is something exchanges should implement.
-Technologov
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