Topic: IOTA - page 747. (Read 1473405 times)

If the maximum amount that can be purchased by name & fiat account is small, then you'd need to have many, many people involved in your Sybil attack, which would put you at much greater risk of being caught. Thus I think it radically lowers the risk of cheating.

Versus a promise (not to buy your own coins) which unverifiable.

But I am not telling you what to do. I am just stating the options that are available. You are choosing one of the options I stated, which is to admit you could buy as many of your own coins as you want to, but promising not to do so. It is not my role to judge that option. Your investors must judge that. At least you've been honest about which option you are planning to choose.

There is no about that in the whitepaper. There is no a formal proof that coin generation is impossible, intensive search for a coin generation technique was done to have 2% annual inflation (because it's a near-optimal number) and none of the ideas let to keep the security of the system at an acceptable level. This is a well-known problem of proof asymmetry, it's hard to prove that unicorns don't exist while it's trivial to prove the opposite if you have such a unicorn. If you have an idea how to add 2% inflation, share it, please.

It is not at all clear there are "end users" for something like this for years to come. It will take a significant period of time to build a market with supporting devices, services, and a large enough population of users, all interacting with each other using the token as a tool to accomplish something else. So I doubt that anyone buying it now could be viewed as anything but a speculator (including long term investor).

That might be different for some other kind of token such as one backing assets in a game or even maybe decentralized storage. Something with actual ready-to-go uses. But that seems a bit off topic on this thread.

PoS can be used for that as well.

I can draw more pictures. But I don't think it's necessary. Imagine that the attacker started preparing for the attack a month ago. He spent the whole month to accumulate PoW on top of the second doublespend. He published no transactions during the month. Then he publishes the first doublespending transaction, provides the first confirmation, thus attaching it to recent part of the tangle, waits for the merchant to send him his puchase. Then publishes his secret subtangle and attaches in to the legit subtangle. The first doublespending transaction now is rejected by the network, the second doublespend has more weight.

I understand you can fool to some extent the verification process, but requiring a limit buy-in per user complicated the fooling process a lot.

Can someone link me to that and/or the relevant page of the white paper? Seems to be mining could be used to generate check points. That was one of tweaks I had in mind.


But then I am responsible for how those shares were promoted as investment securities and I don't want to run afoul of the law against selling or offering for sale to the general public unregistered investment securities.


The only way I can see to do this is either make no promises as to the number of coins you as the seller will end up holding, or do unique buyer verification.

As for complying with laws, my current thinking is to sell the software with some tokens for use at set prices to end users (not investors) with a cap on the size of the sale and user verification (by name and payment account is sufficient), so that it is not a significant amount to be worthwhile for investment and profusely disclaim any expection of future gains. Selling software internationally has not been illegal. Selling shares to investors is very illegal if they are not registered with the SEC in the USA.

Any investors who want large size would have to buy in on the open market later. Typically prices sag after an ICO, but maybe with this strategy where no one can buy in large quantity at the ICO, would have a more positive effect, but again no one knows and expectations of gain can be profusely disclaimed.

Why not give the little guy (the actual users) a chance to get in and maximally spread the distribution? That creates a wider base of support. Mining is dominated by professionals and a small cross-section of the actual users of crypto.

On your picture it has 1 confirmation only?..

Sorry, you wrote so much that I'm not sure what exactly you are talking about.

NP, the merchant waits of course for normal amount of confirmations.

Anyhow, we are discussing now with CfB ways to define better referral algorithms, which would permit to fence off such attacks in a more efficient way.

In short: yes we could take up loans by people to buy up IOTA token. There are plenty of these opportunities if one wants to and this would not change if we had premine either, it would just give us even more IOTA.

As for verification process: there is no way to beat sybil, there would be numerous ways to fool this third party too. We could just pay some random people to buy coins via their IDs and then send them to us.

We wont cheat the system, it would be a detriment to IOTA and thus a larger detriment to ourselves than the profit we could get out of manipulating the ICO. This boils down to how inclined you are to believe in conspiracy theories. Fortunately participating in ICO is 100% voluntary.

But the cumulative weight of that tx is not so big, so why the merchant should accept it?

It is released and confirmed. If necessary the attacker himself provides the first confirmation, which connects it to a recent tip. The transaction looks legit.

We assume that the node knows that most nodes will behave well, and so it's obliged to behave well too.

Then why the merchant would accept it?

Sorry I don't follow this logic. Can you unpack that and make it more clear? I don't see any way around what I wrote.

That's why the transaction which references both the legit subtangle and the second doublespend is red on my picture.

The second doublespending won't be referenced because the longest tip already contains the legit transaction.

The idea is to raise money for hardware supporting Iota.