Topic: Colored Coins and Coinprism takes Bitcoin to a whole new level - page 4. (Read 11105 times)

Got my worthless token. There are 100 now ;-)


Yeah, that's the catch for standard investments too. Also, though I have a flat fee contract there is some fair use clause in the contract. So I'm not actually going to set up a huge farm here. Just the idea of funding a business like this is very appealing to me. It's probably also very appealing to all the scammers out there, so as always, investor beware!

I might put some miners though

You make a very good point. I think we are probably 5 - 10 years away from running a trustless web server/webapp/website.

However in the dice example, all the logic can be on the chain (See Ethereum) and you can either interact with the dice system in a direct way (send coins to the address with an encoded bit declaring the odds you intend to 'roll' at or you can interact through a front end for the trustless contract. There could be hundreds of websites providing a front end to the raw contract.

You have two options, interact with the company directly through the chain sending money and small amounts of data directly to the contract) or trust someones front end to do it for you.



This is a good point too. I am invested in both Nxt and Bitcoin (and soon Ethereum).

The way I see it is this: The contract will be in nxt for a nxt dice site, so you won't be able to use bitcoin as it's not native to the system. (I have heard that it may be possible to make a contract handle alternate currencies, I think Vitalik said one day Ethereum could become a "off the chain" transaction service for bitcoin in a trustless manner.

However, what I am hoping for is that Nxt and Ethereum prove that a turing complete language is a good thing and it then spurs the Bitcoin developers to think about upgrading Script to allow for this.

Interesting observation.  Blockchain.info doesn't pick up any transactions at my colored coin address for WTK either (33C124f3w4cJNAi3hVjNMhdegUTAcDRzmB).  

If you lookup a transaction where the color was transferred, you'll see that "something" gets sent to an "unknown" address (which is presumable the colored coin address the OP_RETURN metadata) and that the transaction gets mined.  It would be important to verify Coinprism with a method that is independent from Coinprism itself.  




EDIT: The unknown output in the colored coin transactions is the OP_RETURN command where the metadata is written:

I've been thinking about trustless companies too.  It's an exciting idea; however, I'm not convinced they are actually possible (but perhaps I am wrong).  Take the dice site for example.  The dice-game algorithm can be codified and trustless, but where does the server code run?  You can't run a website that processes hundreds of bets per second on the Nxt network, right?  Which means that the site runs on a normal server somewhere.  Which means someone has access, no?

The other thing I don't understand is how a Turing-complete contract running on Nxt could pay bitcoins to share holders in a trustless way.  Wouldn't it only be possible to issue Nxt credits in a trustless way if the contract ran on the Nxt network?

I'm not trying to be critical; it would open up lots of possibilities if it were possible.

So every colored coin transaction is posted on the blockchain also correct?

I created a test asset and did a few transactions.  When I check the "Color Address: 3AeiQacQEKTYdWTWCxBaoscDn56UW4j1AB" on blockchain.info is shows nothing...

These asset exchanges are fascinating, but remember that you still have a single point of trust, the issuer.

An interesting future using either Bitcoin Script, Nxt's Automated transactions or Ethereum's contracts is building simple business logic and then issuing shares for a trustless organization.

Obviously not every company can become a trustless organization, but there are some examples where this is perhaps possible.

Imagine a dice site implemented as a turing complete contract (Nxt AE or Ethereum contract), the shares are issued on one of these distributed exchanges (Coloured coins/Nxt AE) are used to raise funds and the issuer is the automated contract. The contract/dice site then runs the game logic over the chain and all profits are dealt out to the shareholders via the trustless company.

I think this is a bright future, we just need to think outside the box.

Great got my ultra rare WTK muwhahaha!!

One worthless token (1 WTK) sent to 1CcGUZuYwy8okr5hZeLkytwwdFsNwpGC9H!



Yes, that is one of the exciting uses for colored coins.  An entrepreneur could raise money to finance the purchase of equipment, and then use the revenue generated from that equipment to pay interest to his bond holders, or dividends to his stock holders (depending on how he sets up the colored coins).

The catch is just that people might not trust an issuer of colored coins enough to actually buy them!  The issuer has to earn investors trust somehow.  Perhaps he could start a thread that describes his ideas with high-quality posts, and then just try to raise a small amount of funds at first.  If he deliver on his promises and his bond holders or stock holders make a good ROI, they might invest more on his next larger project.  Next thing you know, he may be able to attract large amounts of funding.  By this time, it would be unlikely he'd ever want to screw over his investors even if he could get away with it because he'd ruin all his hard work building up his reputation and lose his ability to raise funds in the future (in addition to opening himself up to potential litigation). 

I have a flat fee contract for my facility so for mining my only (added) cost would be buying mining hardware. So I could generate a color coin to collect capital allowing me to buy a miner, then mine coins and use the revenue from mining to back up the colored coins I gave out?

That sounds like a very interesting way to get me started up as a miner. It sounds far too easy actually. What is the catch?


By the way, if there are still worthless tokens left I created an address as well: 1CcGUZuYwy8okr5hZeLkytwwdFsNwpGC9H I have a feeling these coins will be in high demand in the future 

Thanks! I have one of ten in existence. I vow to exploit this coin to the fullest extent. 

One worthless token has been sent to 1LK9UZ6ktgxFXZbpwdNVnS3VsF4yzetF4C 

1LK9UZ6ktgxFXZbpwdNVnS3VsF4yzetF4C

My colored coins address for WTK if you have any left. Thanks!
 

I am not an expert myself, so perhaps this is the case.  The protocol is described here: https://github.com/OpenAssets/open-assets-protocol/blob/master/specification.mediawiki

Whether this would be a positive or a negative I guess it depends on your view of the role of the protocol.  I understand your concern, but could you not argue that the issuer could just sign the hash of some legal document (with the key he used to create the colored coins) and then time stamp this in the blockchain (or something along these lines)?  It seems to me this could be done only when and as required (rather than forcing it on top of the protocol).

If you are going to make a statement like "the technology is buckling on the current capacity," you should back it up with some evidence.  

The entire blockchain fits on the tip of a finger with enough space (46 GB free, 18 GB used) to grow for another 1-3 years.  




Blocks aren't close to being full (and the limit can be raised), bandwidth requirements are acceptable, there are a sufficient number of nodes, etc.  The most unhealthy thing about the network in my opinion is simply the concentration of mining pools.

Worked, thx!


I think storing a hash of the description in the coin type creation block is very important.  Its how you would take the issuer to court if s/he breaks the contract.


Great!

many things could happen.  I know for certain the transactions won't be cheap, the miners need an incentive to carry them.  If we continue to have more mining monopolization, then they could hold these networks hostage and charge exorbitant fees.  My primary concern though is if Bitcoin can even handle this sort of thing.  The technology is buckling on the current capacity, now were about to multiply it by 1000?  

the COIN_DUST limit was created to keep trivial transactions off the network, and the response was to hover just about the COIN_DUST limit?  so the devs will just raise it again, pumping more money into the miners.  Why not?  it's going to be a big balagan isn't it?

-bm

Exactly.  If colored coins can hurt bitcoin due to blockchain size issues, then bitcoin would be hurt by an attacker anyways.  I hope we do see an increase in the number of transactions thanks to colored coins.  It will motivate discussion about raising the block limit, reducing the orphan cost by implementing block propagation by hash, and floating the miners fee.

Since colored coins uses OP_RETURN to store the metadata, there is also no issue with the UXTO becoming polluted.

No, I'm not in any way related to Coinprism. I certainly don't want to harm bitcoin, but the whole thing is an experiment and it should be tested in this way too. We can rely on people not doing projects like Coinprism in order to keep Bitcoin running smooth. It has to defend itself if it's a potential problem.

I don't have a prediction. I don't have enough knowledge. I guess it will work fine.

what?

I guess time will tell... we KNOW the number of txs are going to multiply- what's your prediction?  smooth sailing?  are you an active backer of this technology project?

-bm

I don't believe the description is stored in the blockchain for privacy reasons--there is no need to make information about the colored coins public (other than the fact that they exist).  I think the idea is that open-assets is simply an accounting protocol.  It makes no attempt to enforce or make transparent the promises made by the issuer.

(BTW--I think Coinprism is pulling the information you see about WTK from a URL.)


I believe colored coins and normal bitcoins can coincide at the same address and I think this was done for the reason you said (so that interest or dividends could be issued directly to the address where the colored-coins are held).