Topic: [Announce] Project Quixote - BitShares, BitNames and 'BitMessage' - page 11. (Read 48297 times)

Bit MoanLisa wasn't a typo  

Cheers. I am headed over to CoinJoin thread for a while.

Oh my, Obama wants to starve students at school.

Socialism always ends in scarce resources.

Yes, we have plans to use CIYAM or a model very similar to it.  We are working with Ian to get BitID logins for CIYAM.   However, we are working on the project management overhead.  In the mean time I have created some tasks in the github repo... tasks.md  and put BTC bounties on them.   I will be adding tasks there as I come up with them until I can get a full time PM to manage CIYAM.    If you know anyone who wants to work on small tasks for small bounties then they can start with that.  As it grows and is proven successful I will probably spend more time enhancing the process and integrating with CIYAM.   

So check out the tasks.md file in the github repo, contact me, and I will update the tasks.md file to indicate that it is reserved for you..  Fork the code, submit a pull request with a BTC address for payment and I will payout on merge.  Some of the tasks are 'menial' right now, but good to get your feet wet and allow me to focus on the core algorithms.

Bit MonaLisa at least as some market value to calculate against, not sure how a speculator would be on BitBeavisAndButthead...  when we launch our test network we are considering including some exotic assets just to collect the market data.   

No harm in a little embedded humor, I hope you include BitBeavisAndButthead or BitMoanLisa in the main blockchain.

P.S. I dropped underscores from local variable names. I prefer lower case first letter. The underscores make names longer.

Ah yes, this I understand.

bytemaster: when are you planning to put up bounties for specific tasks. And are you using CIYAM? I have a friend who wants to help out.

Yes, we need a model... so my mental model has been to come up with rational choices actors can make that would cause it to have any other value than one highly correlated with USD?  

The way I see it there are 3 'options':

1) Min Value  ==  0  (Ruled Out)
2) Max Value == collateral value. (Should be obvious extreme on the other side)
3) Something in the middle... based upon market forces.

I think we have proven 0 Value is not valid, and by the same logic, can assume that the value can never exceed the collateral or we would be creating value from nothing.

So this means there is some other 'equilibrium point'... the point at which a buyer and seller can agree to issue a new asset with offsetting positions.   So the only questions are:  what price would this be and why?  How does this change over time?  What does the change over time do to the expected present value of the asset.

One theory is that the price will fluctuate 'randomly'... namely the market won't know how to price it.... but I reject this theory because without some basis for consensus the very first trade creating BitUSD would never be executed.
My theory is that it will fluctuate according to market consensus of what it should follow.  You either trade with where you think the consensus will move or you will face loses by being on the wrong side of the bet.  On what basis could you rationally bet on which way the consensus would move?  

All that remains are attacks where the rules can be manipulated by a single actor independent of market consensus to manipulate the price to any arbitrary point profitably.  If these kinds of attacks are possible it would entirely undermine the system and thus I place a high value / bounty on finding and revealing them.

bytemaster, you really only need it to track for short periods of time, so that you can get the liquidity benefits for local exchangers. I think you are safe. Implement.

One difference is Bitcoin isn't tracking another asset.

So maybe your point can be taken to support that BitAssets won't go to 0. Yet that facie evidence doesn't support a cogent argument that BitUSD will track USD (at least over long periods of time). We need a model.

Is that not the same argument Bitcoin skeptics use?

In game theory, they don't have an incentive to bet the price that USD is, rather they have an incentive to calculate the probabilities of the risks of the other market participants, then bet on where that moves the price to. That is why I say asymmretric probabilities may cause either a proportional skew or a parasitic pernicious drift. I have not been able to model which it will be.

The link is in every user of the system communicating information they know through the prices they buy and sell at.

Indeed we share that rational skepticism.

But I am more open to the idea that decentralized speculation is viable. Yet I've never seen undeliverable futures or options markets.

There is no contention about that. If that is what you mean by "nash equilibrium" then the above is an insufficient model, because it doesn't explain how moves in the price of USD will translate to moves in BitUSD. Over time there could be a pernicious drift, because the relative probabilities for being short and long are not symmetric in your design. I proposed a way to attempt to make them symmetric upthread.

Okay, but why is the consensus at all related to the real world price of horseshit? Couldn't you just as easily suppose that consensus will determine that a bitHorseshit is worth 1 kg of diamonds as 1 kg of horseshit. What makes my choice of the name horseshit matter for the outcome in any way? If I backed bitHorseshit_1kg with 2x the price of 1 kg of diamonds and bitDiamonds_1kg with 2x the price of 1 kg of diamonds, wouldn't they be fungible assets? After all, they both yield the same revenue stream for asset holders. If my strongly backed horseshit sells for less then bitDiamonds_1kg, it seems like that would be an arbitrage opportunity.

[I am sounding like a broken record here. Indicating time for bed.]

Okay, sure. But the gambling is centralized. This is a decentralized currency right? So we should be able to make bitObamaBooger with no problem, as long as we define it precisely (e.g. bitObamaBooger is worth the one bitShare for every distinct booger visible in Obama's nose during the 2014 NBC HD broadcast of the State of the Union address ).

However, I don't see why the price of bitObamaBooger will be related to the real world booger count. It doesn't matter what actually happens in the real world because the real world has no link to the bitshares world at all.


 

Assuming B=BitShares, B is not only valued based on its revenue stream. Bitcoin has no revenue stream and it is $120.  


Check out some of the gambling site's shit that people bet on. People will bet on anything. Bookies in Vegas will give you odds on a booger falling from Obama's nose when he is giving his state-of-the-prison address.

Make that State-of-the-Sanitarium

Yes, you can issue BitHorseshit if you can find enough market participants to make it a viable market and establish consensus.. of course you would have to launch a new blockchain with BitShorseshit as one of the items listed and because few people are interested in speculating on the price of Horseshit no one would mine the chain.     But the economics would still work.

The key here is market consensus.  Bitcoin only has the value it does because of market consensus and the price discovery on Bitcoin started out with very wide Bid/Ask spreads that were all over the map.  Eventually you establish some market depth and everyone knows what everyone else is currently thinking based upon the order book.   So on day one this is what will happen.

I will offer to short BitUSD at price     100 BTS
Someone else will bid                      1 BTS
Someone else will bid                      5 BTS
Someone else will offer to short at    50 BTS

This back and forth placing of bids will continue until finally two people agree on what the BTS / BitUSD price should be.   By this time there is enough market depth that consensus has been reached.  No one person can change this consensus and cause it to track something else. 

This is a false analogy. We are talking about the  the price of 2*dividend stream B in terms of dividend stream B. You are talking about two different dividend streams entirely.  


This talk of long, short, etc. has no intrinsic relationship to the real world. There is an assumption that everyone will expect the price of a bitUSD in terms of bitshares to track the price of a USD in terms of bitshares. Why won't it track the price of a Euro instead? Or a piece of horseshit? Or a weighted basket of horseshit and Euros, where the weights change at random from hour to hour? Explain.

Can I issue bitHorseshit? Will it track the price of a kg of horseshit if I back it with 2 kg of horseshit in bitshares when I issue it initially? If not, why not?

Larger dividends (nominal or percentage of price) don't stop some stock prices from being lower (nominally or P/E basis). There are two different asset classes here, one is a BitShare and the other is an asset that has a short and long position that created it. Exxon-Mobile != Apple Computer != Gold futures options (Python syntax).


The nash equilibrium point needs more elaboration (at least for me to understand).

Okay, so maybe there is no incentive to create so-called bitUSD in the first place? Still not getting why the USD price of bitshares matters for any of this.