Topic: MasterCoin: New Protocol Layer Starting From “The Exodus Address” - page 161. (Read 448489 times)

I am asking if the value of a meta-coin could float freely and not use the escrow mechanism.

So this isn't something new, Bitcoin has this concept in as yet one unimplemented BIP if I recall.

Final question before I go to sleep, I see you've changed job this month.

It seems strange that in the same month, you're willing to invest $120000 of your own money in a business venture that has a substantial amount of work to be done and that you've been passionate about for a couple of years that you wouldn't work on this full time instead?

What are your reasons for working this around a 9 to 5 when money doesn't seem to be the issue?

And how about when the Bank of England lost to a speculative attack by George Soros, in which he profited some 1.5b?  http://en.wikipedia.org/wiki/Black_Wednesday

What makes you think people are not going to irresponsibly lend GoldCoins?

I guess it doesn't really matter, since no one is going to buy the GoldCoins in the first place.  Faith in this escrow mechanism is not going to exist.

I'm very interested in giving all the coins to someone else who isn't me. I don't even care if I am a signer on the wallet. The Bitcoin Foundation, or one of a couple different bitcoin companies come to mind. There are also a couple famous bitcoiners I approached.

Until I find a partner of that caliber, I'm doing my best to guard the Exodus Address carefully.

Well, in principle. Not every Bitcoin is born equal, and I'm sure some Mastercoins will become collectibles.


Also, I haven't seen you respond yet to the suggestions (mine, and someone elses) to establish a board of trustees to hold the coins.

Yes, clearly a reversible transaction won't be spendable until the time limit passes. I should have mentioned that in the spec.

If users are the ones issueing GoldCoins and storing gold in warehouses, then what you are talking about is Colored Coins, which has its own project over at bitcoinx.org - it's a technically sound idea which works much like Ripple, but there's not any way to invest in it that I know of, other than just owning bitcoins.

The attack in Thailand wouldn't have been possible without irresponsible lending by banks in risky real-estate speculations (where have I heard that story before)?


Feel free to watch funds sent to the Exodus address. They will stay there until September 1st. Probably a lot longer than that.


I've actually raised a non-trivial amount of money since the announcement and before my own purchase. You can see the MasterCoin purchases here: http://blockchain.info/address/1EXoDusjGwvnjZUyKkxZ4UHEf77z6A5S4P

One question about the spec I find difficult. The concept of reversible transaction. Say I make a payment to John (marked as reversible for 30 days). John spends some of that paying Mark (as non-reversible). Within the window, I reverse the payment to John. What now happens to the money John sent to Mark - is that reversed, and if not, how is the debt filled?

And he said he was delaying his purchase to not make everyone mad by getting the best exchange rate, but as per his White Paper today is the best exchange rate :s

Nobody has sent any coins there yet though, and I am delaying my own purchase so I don't make everyone mad by getting the best exchange rate moments after the announcement Smiley

so whats stopping dacoinminster from sending his own coins over and over. after all he controls this address, he can take all the coins out and then put them back in giving himself monumental amounts of MasterCoins

plus he gets to keep the bitcoins

MasterCoins are free for him    

Sorry to bombard you with so many questions, just an interested potential investor with a few concerns.

Surely that would make the gold escrow company like e-gold rather than you?

Without the gold in escrow aren't people going to only buy up to the value of the asset, and sell from that point creating a loss for the escrow company as the Thai currency analogy describes above?

Well I guess I shouldn't be trying to talk you out of it, since if a bunch of idiots ever did decide to invest in an escrow fund backed GoldCoin, I would be able to profit by launching a speculative attack at their expense.

The spec defines the bonus as 10% per week. The deadline is September 1st.

Job 1 is probably going to be coding up something that will calculate the exact amounts so people can see what they purchased


I'm aware of these issues. I believe some of these currencies will be able to track their values for a very long time. Others will fail.

I'm very grateful that I don't need anybody's permission to dabble

Oh sorry. So many questions!

Chris Odom of Open Transactions was on the "Bitcoin in the Future" panel with me. I think he's doing some really interesting stuff. MasterCoin isn't designed with Open Transactions in mind, but from my understanding, Open Transactions could be made to use MasterCoin if people wanted it to.

Holding actual physical assets in a vault somewhere would make me like that company "e-gold", and I don't fancy the idea of going to jail

We already know how well this escrow fund system is going to work.  Central banks have been trying it for decades.  This makes me think you are not aware of the similarities between your idea and what already exists.  You might watch these Kahn Academy videos on how speculative attacks on currencies work to educate yourself:

Financial Crisis in Thailand Caused by Speculative Attack
http://www.youtube.com/watch?v=lA3sjWwu5-s

For more background, here is the whole Micro/Macroeconomics series.  The videos on currency reserves start at #123.
http://www.youtube.com/watch?v=_7VHfuWV-Qg&list=SPAEA5E9ACA1508F92

Even if you get a bunch of idiots to put money into GoldCoins and got it up to its target value, the idiots will be relieved of their money by speculative attackers.  The same thing that happened with the Thai Baht will happen to the GoldCoin.  Speculative attackers sold the Baht, knowing that the central bank would use its reserves to buy Baht to keep the value up, because they knew that if they kept doing it the central bank would run out of reserves and have to abandon the peg.  Speculators were borrowing Baht and selling it for dollars, knowing they were losing money in the short term, because they knew that if the central bank ran out of reserves they would show a huge profit.  In the same way, speculators will sell GoldCoins or borrow them to short them, even though they will lose money in the short term because the escrow fund will be able to buy cheaper, because they know that if they KEEP DOING IT until the escrow fund goes bankrupt, the peg will be abandoned and GoldCoins will undergo a huge devaluation.  Pulling off a speculative attack on a tiny market like GoldCoin will be trivial compared to pulling it off vs a large government.  Even a government as large as that of Britain has lost to a speculative attack by George Soros, in which he profited some 1.5b.  http://en.wikipedia.org/wiki/Black_Wednesday

You should stick to what you are good at and write code for things you know how to do, not dabble in areas in which you lack expertise.

Has it been posted how the bonus works for purchasing Mastercoins? So for every bitcoin you recieve 100 plus a bonus, how is this calculated?

For example, how many more Mastercoins would I receive if I invested now, rather than waiting a week then investing?

What were your thoughts regarding the open transactions project in my last post?

Instead of having an over complicated trading escrow fund shouldn't simply;

1 mastercoin dollar = 1 dollar with only the amount being held in escrow being traded
Same with gold... 1 mastergold = equal value of certain weight of gold held in escrow on day of purchase

Yeah - sorry, my answers to your earlier questions are all buried in a giant long post I made first thing this morning. It's probably rather hard to read.

I've talked to some of them privately. I haven't had anybody say it can't possibly work, or that it definitely will work. Obviously if one of them wanted to make a public comment, that would be very interesting to everyone.