Pages:
Author

Topic: Are Most Cryptocurrencies Doomed to Collapse — because they’re “ICO-issued”? (Read 3447 times)

member
Activity: 98
Merit: 10
WARNING: those who are trading and promoting ICO issued tokens to non-accredited investors in G20 nations (even via an exchange) may be incriminating themselves. Even the European Union has a criteria for accredited investors (and even Ethereum didn’t restrict its ICO accordingly):

https://en.wikipedia.org/wiki/Accredited_investor#European_Union

These guys could possibly end up in a pickle (they’re in Hong Kong and Cayman Islands):

https://bnktothefuture.com/icos

Every major nation has securities regulation law which applies to ICOs (including even Japan and India), and eventually the authorities will crackdown and enforce the laws:



With the recent bans, and news of crypto tightening regulations, some coins (mostly those which are modeled as a security) are beginning to move more into an accredited investor/institutional investor-only ICO.

Unless they identify and verify accredited investor status and file the appropriate paperwork in every jurisdiction where those accredited investors reside, then they’re still illegally issued securities, e.g. EOS’ checkbox for “I’m an accredited investor” is not legal issuance. Anyone promoting or trading these (including the owners of the exchanges!) may be incriminating themselves.

Do you guys see it as ICOs/blockchain defeating its own purpose by being open only to individuals with the big bucks, a needed measure, or there is way for us to agree on a middle ground?

Tokens issued under an accredited investor exemption must only be traded to other verified accredited investors. If the issuers/promoters/investors reasonably expect these tokens to be listed on public exchanges then they are probably committing a crime. An attorney pointed this out.

Fundraising via tokens is a giant mess that should be entirely avoided by everyone (at least until the authorities provide some new legal framework which might be many years from now, especially since it will require globalized harmonization of law in order to allow trading across nation-state borders). ICO issued tokens are doomed and will likely become illegal to trade and thus worthless. Expect exchanges to start voluntarily delisting ICO issued tokens once they realize the deep shit they are in. You’re investing in empty bags that have never produced any real world use or than facilitating selling empty bags to greater fools.
legendary
Activity: 1946
Merit: 1055

Yes I agree. They are a powerful tool for limiting defection and promoting cooperation.

There are two ways to limit the fallout from a prisoners dilemma. The first and best way is to make the actors superrational instead of rational. This is very hard as it requires one to fundamentally elevate the nature of the participants as well as introduce verifiable mechanisms for the superrational to identify themselves to each other.

A simpler stopgap solution is to lock rational players into a metagame which alters short term decision making. In the case of the standard prisoners dilemma for example you could introduce the crime lord on the outside who punishes those who squeak.

The stopgap measures work for a time (sometimes a long time) but are vulnerable to being undermined as the fundamental problem (flawed participants) remains. In the case of the prisoners dilemma the crime lord may die or be arrested or a protection program may be offered.

Decentralized ledgers are the second stopgap type of solution. Self interest and greed are leveraged into support for an algorithm that introduces decentralized computational enforced transparency and verification. This limits the ability defect via abuse of seigniorage or debasement or forgery.

Stopgap measures can work but are vulnerable. In the case of a decentralized ledger the weakness is at the developer level where attempts can be made to seize control of the protocol via controlling future changes and updates. This is exactly where the attacks on bitcoin will and are occurring.

The world is not going to become superrational in the timeframe needed to deal with our imploding financial system. Thus stopgap measures are necessary. Fortunately it looks like decentralized ledgers are arriving just in time to provide the needed emergency relief.

The author of the linked article is on the right track this time. He seems to understand at some level the importance of moral progress. He also acknowledges some of the flaws of monarchy. With time and further consideration he may come to realize that monarchy is inferior overall to rule by republic it is moral progress that allows the progression from the former to the latter.

Rule by genuine consensus is superior still but we have not progressed enough to implement this.

Bitcoin is the first true rule by consensus system that has ever existed. It's a new and superior type of governance in addition to everything else it is.
member
Activity: 98
Merit: 10
It's been five years and I haven't yet witnessed this aggregate market become largely fragmented. What kind of message would be sent if icos could be successfully targeted, regulated and stopped?

Even with the last decline from 2014 to now the market and it's induced segmentations remained quite unified overall with regards to overall price movements.

Even those cryptocurrencies totally devoid of any unique programming have managed to be dragged along with the rest of the tide.

Because the main use case of cryptocurrency thus far is speculation. Yet another example of useless hype from Open Money without any realistic onboarding paradigm.

Ethereum's entire raison d'être is ICO speculation selling bags to greater fools. There's no adoption for any other use case.

The other use case for cryptocurrency (mostly only BTC) is to move money internationally (legally?) without a bank account, money laundering, and other currently "criminal" activities. Afaik, these are minor compared to the speculation markets.

So when ICO speculation is attacked, Bitcoin's pricing also suffers.

The entire cryptocurrency arena has become a copy of Dogecoin.

I am first and foremost all for the prevention of icos becoming hypernormalized but with the sec and other financial regulations bearing down on the market, being put up against a new bound in technology, exactly what could they do currently and what ways would they take in which to get it done?

I mean, specifically, where does the sec derive its power from? If its basically policing the entrances, exits and houses under which regulated trade is conducted then they will necessarily be in for a coming adaption.

This technology has the proven ability to entirely displace existing company share distribution (securities as we know them) and exchange methods currently exercised and its medium isn't necessarily secured by a lawful third party designate or human-tended balance sheets. It's secured by a ledger that isn't exactly under their thumbs as nearly as much as a physical construct in which sheets are exchanged.

While I agree that playing nice with existing financial constructs will enhance diffusion into the psychological and physical norms, there is an even gnarlier gap in existing legislation for this market. Effectively - I'm expecting that it really will be 10-20 years before some even begin to catch up wrt to legislation.

...

Personally I don't think the SEC will be able to keep up, but whatever is formed to regulate the likely coming one world currency will. So how would that play out?

The authorities can go after the issuers, promoters, exchanges, and even large traders of the unregistered tokens. The weakness of ICOs is that they're centralized, thus existing securities and financial regulation can be applied (not just securities law but also MLM laws, money laundering laws, etc).

So basically it will become illegal to trade these in G20 nations.

Trading could proceed on decentralized exchanges and issuers could flee to rogue nations or employ anonymity, but will the greater fools buy such illicit tokens?

I think I disagree with you. The truly decentralized, legally issued tokens such as Bitcoin will require a world government and new global legislation to regulate.

But the existing securities regulation in the USA, UK, Canada, China, etc.. will be sufficient to destroy those who are issuing ICOs now. Because there is no way to issue a token such that it's not acquired by citizens/residents of G5 (or G8 or G20) nations; thus, there isn't any need for global harmonization, because issuing/promoting/trading an ICO subjects those fools to multiple jurisdictional jeopardy. Once ICOs are declared illicit by the major nations, they are toast.

If I am wrong, then okay I will eat my words. But I really can't fathom how the authorities can't crack down. I believe the (elite which pull the strings behind the curtain of the) authorities have purposely allowed the ICOs so that those who comprise the "resistance movement" (or otherwise disrespect the authority of the G20) can have their "fingertips burned up to their armpits" (which was a comment from a US Treasury official about the future of goldbugs). Remember what they did to the creator of the Liberty Dollar.

The speculation on ICOs depends on the belief of the greater fools that more greater fools will be coming in to buy.

The authorities will collapse this bubble soon. Mark my words.

Please read this also:

https://bitcointalksearch.org/topic/m.21943715

Regardless of the outcome, I think getting organized asap on what I'm proposing (see the above link and other posts in this thread) would be prudent. So we can capture fundraising while this bubble is still hot (before the potential coming bubble crash) and help investors move into a paradigm that is likely to remain legal and also to genuinely succeed in onboarding and moving crypto out of speculation and into mainstream. I'm very serious. But I need help to get some momentum. One 52 year old person (trying to rehabilitate a messed up liver) can't do all of that by themselves. I will be making some phone calls to sites like SeedInvest. It would easier to issue tokens without any compliance, but I think that would be foolish. I should endeavor to offer investors another choice which is not an ICO. So that investors have options to choose from given the uncertainty about the future of ICOs.

And if y'all think China isn't becoming extremely important and powerful:

CoinCube, I want you to watch this and pay attention closely:

https://www.youtube.com/watch?v=2kwF1MXavYs

Duterte warned George Soros that there is a bounty on his head:

https://www.youtube.com/watch?v=2aoStEmNR0Y
member
Activity: 98
Merit: 10
The masses want a safe environment that allows them to steal from the system in a politically correct way which makes them feel smug about stealing. The power vacuum has always been that TPTB use the masses to attack their competitors and take control of the system, while feeding the masses the debt collectivist lie. Everyone is always trying to find a way to best game the system. Civilization is a crab bucket clusterfuck of defection.

I was asked via private message if I could refute the above quote.

@CoinCube and I were discussing the issue of cooperation and defection, with my stance being that perhaps decentralization technology supersedes religion because I argue the fundamental driver is economics, not ideology.

I will argue that religion was merely a way that societies were able to organize given the contention between labor and the capitalist as described at the above link. Civilization needed docile compliant fungible (replaceable) laborers and solid marriages to produce more such docile laborers. The superrationality emerged economically from the fact that those who didn't adopt it, were destroyed in failed civilizations. (we may have an analogous outcome coming to those who do not stop adopting ICOs)

However, the maximum division-of-labor and the Knowledge Age is ameliorating that mind programming (i.e. religion) paradigm. IOW, I claim humanity no longer needs to rely on close community, because we have the Internet to coordinate with similarly capable individuals. This highly rewards R strategy reproduction and discourages K strategy, because the offspring will find their randomized place in the soup of Knowledge Age production. Even if one tried to produce K strategy offspring highly trained for Knowledge Age skills, the technology is changing so rapidly that isn't possible to predict what training and skill set they will need. Math may not even be important any more in the future, if A.I. is able to do the math for us.

In terms of a shared set of values, I'm the dinosaur for wishing Indians shared my ancestors' values. The Knowledge Age is a multi-cultural world. Sorry to say, I think @CoinCube is trying to hang on to dying paradigms (both religion and the upper middle class American licensed-by-the-state bourgeoisie ... the future bourgeoisie will be independent of any State, religion, or culture).

The moral decay is a fact of thermodynamics (entropy). Decentralization paradigms are the only way to get sustainable cooperation (and avoid the tragedy-of-the-commons) in the Knowledge Age.

CoinCube, I want you to watch this and pay attention closely:

https://www.youtube.com/watch?v=2kwF1MXavYs

Duterte warned George Soros that there is a bounty on his head:

https://www.youtube.com/watch?v=2aoStEmNR0Y



There are so many black propaganda against crypto...

Is enforcement of securities regulation propaganda or reality?

You guys don't want the Koolaid greater fool punch bowl to run dry because your greed exceeds your ethics (you're stealing money from greater fools and know damn well that all of the ICOs are scams which produce nothing of merit which have any utility-of-significance other than harvesting greater fools). You're "rational actors" who defect from civilization and prefer a tragedy-of-the-commons. If you had any R&D of merit to fund, you'd care about the long-term legality of your development and thus do it with legal private placements or crowd equity that pay back legally issued tokens earned rather than creating illegal investment securities pump & dump tokens.

All the monetary claims on labor you've accumulated will be useless if civilization collapses into tragedy-of-the-commons Dark Age. I know you do not care and it isn't your concern. That is why we call it a tragedy-of-the-commons. You're "rational". Well rational only if you presume the authorities will not come after you ex post facto (i.e. later) for trading in and promoting MLM scams in defiance of MLM laws in some major countries and illegal investment securities.

The Shit Token is the epitome of daring the regulators to act. These guys think that disclaiming future profit is going to protect them from breaking the law. The economic reality is they are still selling and promoting an illegal investment security, because speculators will speculate on greater fools speculating.

On one hand, ICOs are taking precious market cap from what could be invested into Bitcoin.

They're taking focus away from those who have genuine innovation, yet are totally ignored.

On the other, they bring a whole new dimension to crypto that we have never seen before.

It is just such a shame they are almost always pump-and-dump scams. Undecided

Because those of us who want to build a long-term viable project, do not want to be involved with issuing/trading/promoting illegal MLM scams and illegal investment securities.

Regulators are going to need to send a lot of people to jail to get sanity back into crypto R&D. Yet I suspect TPTB are quite satisfied with allowing crypto to destroy itself with scams and render it's participants in jail after the global economic meltdown 2020ish.

If government doesn't get any profit from it, than it's a SCAM.

Yet regardless of whether securities regulation is dumb or beneficial, the fact is that those developers who are serious will not issue ICOs because of the legal uncertainty, thus predominantly the only ones issuing ICOs are scammers. Even if some few Ethereum, NEO, or Tezos developers might be sincere and skilled, the ones issuing the tokens for them are either well connected with the parasites you despise, else they have a criminal mindset and disregard securities regulation risk not only for themselves but also for all those who trade the tokens and for the future of the token itself.

Thus, iCOs are not helping to achieve any goal of defeating the parasites who control the governments, and instead of providing incrimination fuel for them to take control in the future.

@CoinCube continued to discuss in PMs:

Yes they are. They need to be superrational to succeed and thrive. Until you can solve the prisoners dilemma you have not solved the fundamental problem but are playing with tangential issues.

Decentralization technology does help you solve this but not in the way you argue. It helps solve the problem by introducing transparency which helps the superrational identify each other and coordinate.

Transparency is the fundamental advance of our time as I noted in my table that you dislike.

Cycles of Contention
Cycle #1  Cycle #2  Cycle #3  Cycle #4  Cycle #5  Cycle #6  
Mechanism of Control    Knowledge of Evil  Warlordism    Holy War  Usury  Universal Surveillance    Hedonism  
RulersThe Strong  Despots  God Kings/Monarchs    Capitalists    Oligarchs (NWO)  Decentralized Government    
Life of the Ruled"Nasty, Brutish, Short"    Slaves  Surfs  Debtors  Basic Income Recipients    Knowledge Workers  
Facilitated AdvanceKnowledge of Good    Commerce  Rule of Law  Growth  Transparency  Ascesis  

Ultimately the rational individuals destroy themselves just as rational nations do who abandon superrationality and descend into stealing and power vacuums. The most successful may succeed for a generation or two if they are top dog but they have locked themselves into a prisoners prisoners dilemma which can lead only to their distruction at the hands of someone more powerful or their taking the role of local top dog of a sinking ship eventually finding themselves utterly uncompetitive in an Information Age that rewards cooperation.

You have my permission to post my reply above publically if you wish.

Decentralization is more than just transparency. It's also a means of coordination. Transparency by itself doesn't solve coordination.

I mean decentralized ledger protocols are about coordination, not necessarily even transparency, as anonymity can hide information while still faciliating consensus about ordering and rules of state transitions.

Decentralized ledger protocols enable coordination by taking humans out of the picture. Trust is via algorithm and there is no need to worry about "rational actors" and what they plan to do. Except of course at the level of protocol changes here the human factor comes into play again  thus the drama over hard forks and core developers.

Decentralized ledger protocols enable coordination via  automation and coded protocol and thus serve as an active tool to limit defection. Similarly a police force enables coordination as once you have a good one you can worry less about the "rational actor" who may want to club you over the head for you watch and car as odds are higher those type of folks will get taken off of the street.

What decentralization protocols do not do is solve the "rational actor" problem. They simply minimize it and transfer this problem to the shoulders of whomever controls the ledger at the level of code updates. As these types of folks tend to be a higher quality then average this is a significant improvement..

Transparency is what facilities coordination in situations where the rational actor problem cannot be automated away. Bitcoin is not just a decentralized ledger it is a transparent decentralized ledger. This makes it much more powerful.

Decentralization + Transparency is what allows the hyperrational to identify other rational and hyperrational actors and choose an appropriate strategy based on the nature of the interaction participants.  

Transparency of subjective trust (e.g. in terms personal identity exposure in order to force trust relationships) solves nothing, because it's the political economics power vacuum of democracy clusterfuck, the same damn Dunbar limit tribalism trust relationship scaling problem of politics, and the formation of trust relationships which are inherently flawed (e.g. if I need people to trust me then I need to cowtail to people politically in defiance of my ideological principles and limits degrees-of-freedom and the fundamental universal physics trend to maximum entropy).

Objectivity transparency in terms of an objectively provable adherence to a decentralized protocol is what decentralized ledgers enable.

It's immutable decentralized protocols that offer us the potential of rational win-win coordination without a power vacuum nor "rational actor" defection problem, regardless of transparency. And yes, we need those protocols to be immutable and not "upgradeable" by centralized human control nor political power vacuums.

What the heck do you think I am working on in terms of decentralized ledger technology? You (and some others) dismiss my technological work and in your case because apparently you think so highly of Bitcoin because you don't realize you're incorrect about personal transparency being important. It seems to me you lean towards being a collectivist, leftist leaning, religion idolizing, archaic thinker despite claiming you're a Libertarian. I want to move the world forward. The Internet gave us decentralized immutable protocols for decentralized sharing of data. Now we need to perfect the same for decentralized consensus. Just because I have been so ill, doesn't mean I will necessarily not achieve my goals. I am very determined in spite of having a messed up liver (or what ever the fuck is still wrong with the inside of my gut after apparently curing the gut TB), I do not give up and keep fighting for my body to cure itself.

Note that in the case of for example the Internet upgrade from IPv4 to IPv6, this is a somewhat decentralized adoption process. Btw, IPv6 is an important technology for my decentralized ledger technology because it makes the cost of having 10,000 IP addresses per node plausible.

EDIT: decentralized ledgers are Western civilization’s only hope of avoiding a Dark Age.
full member
Activity: 121
Merit: 100
It's been five years and I haven't yet witnessed this aggregate market become largely fragmented. What kind of message would be sent if icos could be successfully targeted, regulated and stopped?

Even with the last decline from 2014 to now the market and it's induced segmentations remained quite unified overall with regards to overall price movements.

Even those cryptocurrencies totally devoid of any unique programming have managed to be dragged along with the rest of the tide.

I am first and foremost all for the prevention of icos becoming hypernormalized but with the sec and other financial regulations bearing down on the market, being put up against a new bound in technology, exactly what could they do currently and what ways would they take in which to get it done?

I mean, specifically, where does the sec derive its power from? If its basically policing the entrances, exits and houses under which regulated trade is conducted then they will necessarily be in for a coming adaption.

This technology has the proven ability to entirely displace existing company share distribution (securities as we know them) and exchange methods currently exercised and its medium isn't necessarily secured by a lawful third party designate or human-tended balance sheets. It's secured by a ledger that isn't exactly under their thumbs as nearly as much as a physical construct in which sheets are exchanged.

While I agree that playing nice with existing financial constructs will enhance diffusion into the psychological and physical norms, there is an even gnarlier gap in existing legislation for this market. Effectively - I'm expecting that it really will be 10-20 years before some even begin to catch up wrt to legislation.

What type of statutes limit them past decades? Does it go as far as social security in basically wrecking intergenerational wealth paradigms? Can they demand reparations from a likely well off progeny if there's nobody else to go after?

Also exactly how does any of this fit in with the debt crisis vs hyperinflating dollar if both crypto legislation and hyperinflation occur in 15-20 years?

Personally I don't think the SEC will be able to keep up, but whatever is formed to regulate the likely coming one world currency will. So how would that play out?
legendary
Activity: 1946
Merit: 1055
The masses want a safe environment that allows them to steal from the system in a politically correct way which makes them feel smug about stealing. The power vacuum has always been that TPTB use the masses to attack their competitors and take control of the system, while feeding the masses the debt collectivist lie. Everyone is always trying to find a way to best game the system. Civilization is a crab bucket clusterfuck of defection.

I was asked via private message if I could refute the above quote.

The power vacuum is simply a scaled up version of a prisoners dilemma. It is a situation where rational actors will make choices that improve their own short term position that result in an inferior overall outcome for society as a whole.

The only solution to a prisoners dilemma type problem is change the character of the masses over time. You must transform the masses into superrational actors as this is the only way to escape a rational defect-defect equilibrium.

Economics and game theory are ultimately driven by morality and ethics. To highlight this let's look at the classic and famous example of the prisoners dilemmas and its Nash equilibrium.

The prisoner's dilemma is the standard example of game theory where two rational individuals will not cooperate despite it being in their best interest to do so.

https://en.m.wikipedia.org/wiki/Prisoner%27s_dilemma
Quote from: Wikipedia
Two members of a criminal gang are arrested and imprisoned. Each prisoner is in solitary confinement with no means of communicating with the other. The prosecutors lack sufficient evidence to convict the pair on the principal charge.

They hope to get both sentenced to a year in prison on a lesser charge. Simultaneously, the prosecutors offer each prisoner a bargain. Each prisoner is given the opportunity either to: betray the other by testifying that the other committed the crime, or to cooperate with the other by remaining silent.

The offer is:
If A and B each betray the other, each of them serves 2 years in prison

If A betrays B but B remains silent, A will be set free and B will serve 3 years in prison (and vice versa)

If A and B both remain silent, both of them will only serve 1 year in prison (on the lesser charge)

It is implied that the prisoners will have no opportunity to reward or punish their partner other than the prison sentences they get

The prisoners dilemma leads rational actors to logically betray each other leading to a suboptimal low cooperation outcome. Betrayal and failure to cooperate is the Nash Equilibrium of the prisoners dilemma.

A Nash equilibrium of this sort, however, is a failure that only binds "rational" individuals. All that is needed to escape from this trap is to elevate the nature of the participants and make them superrational.

Superrationality
https://en.m.wikipedia.org/wiki/Superrationality
Quote
In economics and game theory, a participant is considered to have superrationality (or renormalized rationality) if they have perfect rationality (and thus maximize their own utility) but assume that all other players are superrational too and that a superrational individual will always come up with the same strategy as any other superrational thinker when facing the same symmetrical problem. Applying this definition, a superrational player playing against a superrational opponent in a prisoner's dilemma will cooperate while a rationally self-interested player would defect.
...
Superrationality is a form of Immanuel Kant's categorical imperative.
...
Superrationality is an alternative method of reasoning. First, it is assumed that the answer to a symmetric problem will be the same for all the superrational players. Thus the sameness is taken into account before knowing what the strategy will be.
...
(In the prisoners dilemma) two superrational players will both cooperate, since this answer maximizes their payoff.
...
Note that a superrational player playing against a game-theoretic rational player will defect, since the strategy only assumes that superrational players will agree.

If you want to see how superrationality would play out of in the real world just change the players in prisoners dilemma.

Suppose two Christian missionaries are arrested and imprisoned in North Korea for suspected spreading of blasphemy against the Great Leader. Each missionary is in solitary confinement with no means of communicating with the other.

The North Koreans lack sufficient evidence to convict the pair on the principal charge. But can get both sentenced to a year in labor camps on lesser fabricated charges. Simultaneously, the prosecutors offer each missionary a bargain. Each prisoner is given the opportunity either to betray the other by testifying that the other is a Christian missionary, or to remain silent.

Does the Nash Equilibrium still hold? Doubtful most likely the missionaries will stay quiet. They will do so because they are superrational.

The prisoners dilemma is a microcosm for a whole host of human and societal interactions.

Superrationality breaks the prisoners out of the dilemma allowing the achievement of optimal cooperative outcomes despite a Nash equilibrium of defection and betrayal. Superrationality itself is just a formalization of Immanuel Kant's categorical imperative.

Kant's categorical imperative:
Act only according to that maxim whereby you can, at the same time, will that it should become a universal law.

The categorical imperative in turn is a valiant but incomplete attempt to codify much older wisdom into a logical framework.

Brett Stevens wrote up a nice article on this deeper religious wisdom and its relationship to the good but imperfect categorical imperative.

Kant’s categorical imperative, Biblical law and the “golden rule”
http://www.amerika.org/science/kants-categorical-imperative-biblical-law-and-the-popular-notion-of-the-golden-rule/

Ultimately superrationality is at its heart the logical result of applying ancient religious wisdom to modern problems. It is Ethical Monotheism that teaches us to treat others as ourselves even when dealing with strangers.

Christianity: Matthew 7:12
"So  everything, do to others what you would have them do to you, for this sums up the Law and the Prophets."

Judaism: Hillel the Elder
"What is hateful to you, do not do to your fellow: this is the whole Torah; the rest is the explanation; go and learn."

Islam: Abdullah ibn Amr Al-Ass
"Whoever wishes to be delivered from the fire and enter the garden should die with faith in Allah and the Last Day and should treat the people as he wishes to be treated by them"

Ethical Monotheism is thus directly responsible for a tremendous portion of the progress humanity had made to date as it facilitates cooperative outcomes over competitive defection.


Religion is a the only functional superrationality protocol. It maximizes superrationality and thus positive societal outcomes. It is the only force that enables suspension of defect-defect equilibrium like the power vacuum. When a superrationality protocol is abandoned (widespread rejection of religion) the gradual vice of ever increasing defection sets in and the countdown towards destruction of the society commences.

Quote from:  Henning Webb Prentis, Jr
Paradoxically enough, the release of initiative and enterprise made possible by popular self-government ultimately generates disintegrating forces from within. Again and again after freedom has brought opportunity and some degree of plenty, the competent become selfish, luxury-loving and complacent, the incompetent and the unfortunate grow envious and covetous, and all three groups turn aside from the hard road of freedom to worship the Golden Calf of economic security.

The historical cycle seems to be: From bondage to spiritual faith; from spiritual faith to courage; from courage to liberty; from liberty to abundance; from abundance to selfishness; from selfishness to apathy; from apathy to dependency; and from dependency back to bondage once more."

It is moral degradation that leads to bondage for it is moral strengthening that allows free and strong societies to be built in the first place.

This is why Ethical Monotheism is so important and the reason why so much that is good in the world came from the west.

Without it we are reduced to merely rational actors. We become the prisoners who cannot escape the Nash equilibrium of defection and betrayal.

See: Health and Religion for more.
member
Activity: 98
Merit: 10
Although some have expressed defiance and disregard the potential legal issues of encumbering a token with potential future securities regulation, I think it's best to structure fundraising so that it will not encumber the token of the decentralized ledger. Why add potential legal problems for the token if it's not necessary? Why risk future delisting from exchanges and legal hassles for users/traders/promoters of the token?

We need to improve the culture of cryptocurrencies RIGHT NOW. As crypto gets big, we are spreading out this culture to the wider world

Agreed we should create something for the world which is not encumbered with legal issues that we can avoid.

Specifically my idea is that fundraising should be for a corporation which creates apps for the decentralized ledger. The tokens are not issued to investors, and instead either with proof-of-work or alternative onboarding idea I have, such that the tokens are not securities and are not encumbered with securities regulation. The investors instead receive shares in a corporation which earns tokens by making apps which provide services to users (holders) of the tokens. The corporation can then pay dividends in tokens. The tokens are thus not securities and any securities regulations apply to the shares of the corporation, not to the tokens.

The downside of this idea is that the tokens are taxed as dividends when distributed to the shareholders, and not as capital gains. But this may not be a significant disadvantage because the tokens are distributed as they are earned, potentially when they have a very low value early on (when that probably single corporation formed at inception has a near exclusive on apps since others did not jump into the app ecosystem yet). Also it compares favorable from a tax standpoint compared to ICOs which try (I think unsuccessfully) to escape securities regulation by selling utility tokens as goods and paying sales and income taxes:

However, adding more people to software projects usually fails when its components can’t be divided up, and there are a sufficient number of different scaling paths at this point where each can be pursued relatively independently...

...So, perhaps the highest leverage thing protocol designers can do is think about how to engineer the evolutionary characteristics of their blockchains — specifically, the economic incentives for anyone to come along and improve them...

...By harnessing their decentralized nature they can evolve faster than a centralized organization ever could.

My idea is that many corporations are eventually formed to work on apps for the decentralized ledger.

And since they all have an incentive for the decentralized ledger to be improved, they each voluntarily contribute some (perhaps small) fraction of their development resources to the decentralized ledger development, not just only to their own apps. They do this for the same reason that corporations fund open source projects, because it's the way to cooperate on the shared portion of their businesses. Corporations tend to act rationally with a longer-term perspective, unlike most individuals. Also it would help if the core protocol of the decentralized ledger is stable and doesn't need further changes going forward after initial development, which can be facilitated if improvements can be added on top of the core protocol (think of the analogy of the layering of network protocols).

In that way, we would in theory attain an open competition, decentralized, permissionless, independent, open sourced solution, which avoids the securities regulation issue on the tokens of the decentralized ledger and attain greater myriad of decentralized participation instead of just one centralized set of developers.

I think this is much superior to Ethereum's model. I'm trying to get this organized.
full member
Activity: 196
Merit: 101
We need to improve the culture of cryptocurrencies RIGHT NOW. As crypto gets big, we are spreading out this culture to the wider world
legendary
Activity: 1540
Merit: 1011
FUD Philanthropist™

Crypto could be illegalized everywhere and we would still be able to use it, they could have stopped it in 2009 but now it's too late. No matter what we will be able to use and trade crypto.

I would not worry about this.

Agreed. The cat is out of the bag, nothing can stop cryptos now.

I agree..
There will be 10,000 more shit coins and another 1 million accounts here.
And ?
Clap for your success now ?
member
Activity: 98
Merit: 10
Sure some cryptocurrencies are doomed but that's not because they are ICO-issued. Ethereum itself was ICO-issued - the reason some of these cryptocurrencies are doomed is because the teams isn't driven or the solution isn't workable. A good project is going to be good regardless how it's issued.

I agree with all you wrote except the last sentence seems dubious. Are you not familiar with what happened to the proprietors of the Liberty Dollar in the USA, egold in Panama, and the Tencent QQ game currency in China? Afaik the former two are still in jail, defunct, and afaik QQ currency (and other game currencies) can not be converted to fiat any more.

Apparently in the case of QQ coin, China was able to stop it because it was centralized. And that is the problem with ICO issued tokens, they are centralized. So to kill those systems, the authorities can go after the developers and issuers, as well as delisting on centralized exchanges within their jurisdictions. However, I agree with you in that if those systems have any merit as decentralized systems, perhaps they can be continued as decentralized systems, yet I'm thinking they would have to be reissued as non-ICO, else trading them would be illegal. So then you do think that the masses are going to be willing to use an illegal token system?

Do you really think an illegally issued blockchain token will be above the reach of the law?

(again I presume Bitcoin, Litecoin, and other decentralized issued tokens employing proof-of-work are exempt from securities regulation)

(Again I am thinking not only China will attack the ICO issued tokens, and I presume all the major nations will uphold their responsibility to regulate securities, but if I am mistaken, then the analysis will change significantly)

Decentralization changes the equation if the masses are wiling to do "illegal" activity. With online music downloads, many of the affluent masses preferred hassle free low priced alternatives (e.g. iTunes) than pirating.

Stupid laws should be broken and destroyed. Are securities regulations stupid?

The masses gain (selfishly?) from pirating music, games, and videos. But do the masses benefit from being greater fools in ICO pump & dumps? I think the masses will remain in support of securities regulation to minimize the scams (but I might be wrong and the world has reached some insanity, bubble mania, and ultimately collapse).

The masses want a safe environment that allows them to steal from the system in a politically correct way which makes them feel smug about stealing. The power vacuum has always been that TPTB use the masses to attack their competitors and take control of the system, while feeding the masses the debt collectivist lie. Everyone is always trying to find a way to best game the system. Civilization is a crab bucket clusterfuck of defection.

Decentralization is long-term viable when it benefits the masses, not when it suckers them into scams and financial abuse. Primarily because the harm to the masses empowers TPTB to regulate and steal it all.

We might be headed into a tragedy-of-the-commons bubble mania if the authorities are unable to get control of this.

Taking all of this into account, I realize it is very important for me to leverage this bubble/mania for the additional resources it can provide, without incriminating myself nor encumbering the token I want to create. I have an idea of how to do this (will explain in my next post).
hero member
Activity: 2128
Merit: 530
PredX - AI-Powered Prediction Market
With the  CHinese exchanges ban confirmed I expect a new air to be breathe into the space, the uncertainties from CHina has presented a very good buy opportunities for good traders to make money
full member
Activity: 221
Merit: 100

Many people do not see the big picture, because we have lived our whole lives under the current economic system, where the US dollar is the reserve currency. That system is coming to an end, I could point to many events which prove my case. People NEED to get into the burgeoning crypto and ICO space because it is literally going to save humanity, and WILL NOT BE STOPPED, no matter what China does. This movement is THAT big of a deal, it will fundamentally change the world.
newbie
Activity: 44
Merit: 0
Sure some cryptocurrencies are doomed but that's not because they are ICO-issued. Ethereum itself was ICO-issued - the reason some of these cryptocurrencies are doomed is because the teams isn't driven or the solution isn't workable. A good project is going to be good regardless how it's issued.
newbie
Activity: 17
Merit: 0
most cryptocurrencies are doomed because there is no use for them.  ico or not.
member
Activity: 98
Merit: 10
Hyperme, thanks for your posts. It's good to get a reality check on what could be coming. I wonder what kind of timescale it would be before the SEC & others come after crypto?

Thinking about it, all it would take is an official announcement that ICO issued cryptos are illegal and SEC are investigating exchanges for the prices to crash through the floor. They wouldn't even have to issue shutdown orders or go after anyone.

Is there a list of ico cryptos anywhere? I think it might soon be time to move my investments.

Finally someone gets it.

Yeah we do not know the timing (especially harmonization with nations which have underdeveloped securities law), but I had the same thought that if the SEC announces a crackdown, it will crater ICO market prices we'll see a stampede for the exits.

If crackdowns continue to accrue from major nations ongoing, the ICOs will get repeatedly slapped down.

I just can't fathom how ICOs would not be doomed unless securities regulation is abandoned by major nations.

And I can't fathom how illegal trading in minor nations could sustain them. They may end up more unappreciated than Pink Sheets stocks in the USA. However, if the mania in ICOs is too strong we may get the opposite where the masses are fighting to get in and commit illegal trading to not miss out on the gains. We could be headed for some Tulip or South Seas Bubble situation, wherein the destruction and punishments come much later after a much larger bubble that is beyond the control of authorities.

Also if another vehicle for speculation which replaces ICOs comes along, that could be another significant factor in the outcome. I outlined one such idea w.r.t. to gaming.



Sheesh man, chill. I was just asking a question. Regulators can and do grandfather stuff all the time. I'm not an expert so I posted a theory. Thanks for explaining why it was wrong but you don't have to get all condescending about it. Maybe you should put the computer away and get some sleep

I thought I made it very clear that I was not being disrespectful or unappreciative, and that my frustration is only that I do not have time to run around every place on the forum where incorrect information is promulgated. And I asked for others to take on that responsibility of correcting misinformation based on what they read.

I do not think regulators will grandfather illegal issuance of securities, because it would embolden future non-compliance with new twists such as the obfuscation of an ICO with instamining. I also think that in order to punish non-compliance with illegal trading, they will be forced to punish some traders as well. Otherwise, they will appear to be impotent and non-compliance will proliferate.

Btw, I did edit the sentences about "tl;dr" to replace 'you' with 'they' which was my intention when I wrote it.

(I'm not lacking sleep nor overworking recently)
full member
Activity: 144
Merit: 100
full member
Activity: 196
Merit: 100
One thing that has not been mentioned is that regulators like the sec can grandfather existing instruments when a new regulation comes out.

This situation reminds me a lot of crowdfunding. People did crowdfunding even though it was not permitted by securities law. In the us, the sec got involved and issued regulation. The existing crowdfunding arrangements were grandfathered, afaik. Even thoug they were securities.

I do not admonish you with an intent to be disrespectful or unappreciative. I guess I am glad you raised this point although it has been raised numerous times all over the forums and refuting and correcting it every time will become tiring and impossible for an expert. Thus the community will become highly misinformed and idiotic as a result. It behooves all of you to be more astute and stop spreading incorrect information. And to try to help spread correct information.

Unfortunately readers here such as yourself make comments while being inadequately informed about the details, thus your statements are most often highly incorrect because "the devil is always in the details". This is why statements by people who have not studied an issue carefully, are worse than worthless. Statements from uninformed people, can be misleading and contain the opposite of the truth.

In this case, you are not emphasizing a very important detail which can mislead readers of your comment, which is that equity crowdfunding (as opposed to preselling production or other forms of non-securities crowdfunding a la Kickstarter) afaik has not been grandfathered in any way that allows them to be not classified as securities.

Thus all equity crowdfunding has remained subject to securities regulations, and thus all the pitfalls I detailed about not being able to trade the securities (i.e. shares or tokens) applies to all equity crowdfunding that occurred prior to the Regulation CF and Regulation A+ legislation. Essentially the main change in those new equity crowdfunding rules is that it is easier to sell equity to up to 1000 non-accredited investors subject to certain stipulations and regulatory compliance requirements (but only for a USA corporation!).

But they are all still securities. And as I explained already, a token being a security is a kiss of death, because it can not be legally traded P2P nor on unregulated exchanges (and afaik no crypto exchanges are registered with the SEC yet and no tokens are registered with the SEC).

Even if ICO issued tokens are properly registered and compliant in the future (in every fucking jurisdiction! which is an implausible clusterfucked mess of unresolved legal crap!), still they will be delisted from unregistered exchanges and illegal for use as a currency or utility token, because P2P trading of even registered securities is illegal.

Bottom line is that raising equity is entirely incompatible with creating an unencumbered token.

And there is no way currently to legally raise equity with a global sale to non-accredited investors all over the globe. For legal reaons, equity must be raised separately in each jurisdiction, e.g. USA, Canada, UK, Singapore, etc..

Also I do not think any equity crowdfunding was grandfathered. Rather the equity crowdfunding sites were working with the SEC on the new Regulation A+ and CF rules. And any equity crowdfunding that was sneakily done on non-equity crowdfunding sites (such as Rimbit's scam on Indiegogo which was linked in the linked blog of the OP of this thread) is still culpable (and will eventually haunt the participants unless it is just too small for the regulators to bother going after).

Readers are apparently very slow minded and/or just uninformed (and not well read) and thus having much difficulty in grasping these facts.

Ponder the many days and dozens of hours or more I have expended to become somewhat knowledgeable on this issue. And every issue I am involved in, ranging from deeply technological issues to these organizational and political economic issues requires deep study. That is why I am often on the computer 16 hours a day, which is a very unhealthy level of exposure to blue light and lack of exposure to the sunshine and exercise.

The soundbite Twitter tl;dr generation expects everything to be easy. But then you do not give chops and respect to those who do the hard work for you. How do you expect that to end up then?

I wish someone even more expert than myself on this issue would enter this thread and help analyze. Unfortunately that does not seem to happen on BCT.

Sheesh man, chill. I was just asking a question. Regulators can and do grandfather stuff all the time. I'm not an expert so I posted a theory. Thanks for explaining why it was wrong but you don't have to get all condescending about it. Maybe you should put the computer away and get some sleep
jr. member
Activity: 62
Merit: 1
Hyperme, thanks for your posts. It's good to get a reality check on what could be coming. I wonder what kind of timescale it would be before the SEC & others come after crypto?

Thinking about it, all it would take is an official announcement that ICO issued cryptos are illegal and SEC are investigating exchanges for the prices to crash through the floor. They wouldn't even have to issue shutdown orders or go after anyone.

Is there a list of ico cryptos anywhere? I think it might soon be time to move my investments.
full member
Activity: 392
Merit: 100
Just do your research before investing in any ico's.  Even the ones you believe in can still crash.  The team might just be professional scammers
newbie
Activity: 26
Merit: 0

Crypto could be illegalized everywhere and we would still be able to use it, they could have stopped it in 2009 but now it's too late. No matter what we will be able to use and trade crypto.

I would not worry about this.

Agreed. The cat is out of the bag, nothing can stop cryptos now.
Pages:
Jump to: