Topic: My Criteria for Approving Securites on LTC-GLOBAL and BTC Trading Corp - page 2. (Read 4370 times)

I have a background in economics and investing. I have a basic knowledge of finance. I don't consider myself to be an expert in any of these fields.

Yes, and my criteria and my vote are also virtual.

My advice for writing a business plan is to provide at least the information I listed, and provide investors with enough information to make rational and informed decisions about the security and its shares.
 
"you guys" is not accurate. This is my criteria. I don't represent the other moderators. Also, I don't disapprove mining bonds or perpetual bonds in general -- just the ones that don't intend to return the face value.

If I don't understand the business plan, then it is probably poorly written or conceived, or perhaps it doesn't belong on this exchange, or it is probably a scam. I don't have a specific threshold.

I don't think I'm asking for any information that shouldn't be public knowledge.

I like the current pre-qualify with votes required because a lot of the voters have been very generous with their time and have helped the asset issuers clean up their offerings and improve things before they make it to the market.  (keep in mind that once shares are sold on the open market, the contract cannot be changed anymore.)

Maybe instead of a fixed 5 YES, 3 NO it could be based on the total number of moderators available at that time?  Say there are 20 mods and we set it up so YES requires 30% of the mods and NO blocks at over 20%.  Then;

6 YES would approve it.
4 NO would block it.

I'll think on that a bit.

A lot of the rest of what you're trying to accomplish is already there in the current system.  Voting doesn't stop after approval.  Mods can vote (and change their votes) at any time.  Thus the ratings you see on the right hand column in the Market.  All we're missing is a sort by votes option I suppose.  And right now it sorts by volume, which realistically is people voting with their wallets.

I agree that a black market/delisting process needs to be established.  I'm planning on adding a separate black market page where the following assets will go;

- those that have no trades in the last month
- those that have a total moderation score of less than zero.
- those that have been proven to have violated their contract but are working toward resolution.

Some great ideas.  Love it, thank you.

Appreciate your input Ukyo, thank you.

You're absolutely right, I need to be more clear about what is an abuse of the system.  Here are my thoughts for restrictions that should be worked into the ToS.

- One vote per person.  (Ukyo suggests that some might take the current system to mean it's ok to make multiple accounts and vote multiple times, but I do not believe this would be healthy for the exchange and if this is what was intended then I'd just take your total shares, divide them by 10, and that'd make up your vote total.)
- No malicious down-voting.  (Eg, downvoting everything and leaving nasty comments.)
- No up-voting where there is a clear conflict of interest.  (Eg, up-voting your own security)

For the penalties of violating the ToS, there are few things I can do but confiscate assets.  The penalties in screwing with the financial system in real life are not much different.  Fines, etc, get levied.  Maybe we can make it a fixed amount fine instead of the entire account?  But I absolutely require that people take their moderation privileges seriously.  Since a user has agreed to the ToS to register and use the site, I do not believe it would be stealing.  Rather, it's like all the other fees on the site.  You do X, it costs Y.

I agree that bumping up the threshold to 15 shares to vote would not be cool for the people that have spent their hard-earned LTC for the first 10.  I have to think long-term though and make sure that needed adjustments do not get held up.  To that end, if we do go that direction, I will most certainly offer up a fair buyback for anyone that has between 10 and 15 shares and wants out.  I don't think we'll do that though.  It doesn't fix the problem IMHO.  It just makes it slightly more expensive to abuse the system.

Hopefully that all makes sense and sounds fair.  Definitely open to discussion.

Cheers.

Open market has the final say anyway - as that's what decides whether people buy an asset or not.  The idea behind the approval system was (I think) mainly to gie a chance for peopel to find gaps/weaknesses/holes/inconsistencies in planned securities before they got listed - i.e. whilst contract should be easily changed.  Where it falls down is that for a contract to be pretty complete it also has to, in general, be pretty long - and a plan would really need a LOT of information in it to be decent (projections, examples of accounts etc).  Most people who get the right to vote don't have the time, experience and/or ability to actually look at proposals properly - so often votes are cast on superficial things (like do they like the idea) rather than on what they (imo) SHOULD be cast on : is there sufficient information that investors know what to expect (in terms of payments, transparency and long-term plan) and can make an informed judgment about the viability or otherwise of the plan.

Voting shouldn't so much be about whether the plan is 'good' as whether it's clear enough for others to make that judgment themselves - and also, of course, whether the definition of the asset is actually supported by the detail.

A bond is simply a debt security.  It can have many different forms.  There can be a specific interest rate and a face value.  There can also be perpetual bonds that will pay a specific interest rate until the issuer exists.  For perpetual bonds based on fiat currencies, inflation reduces the return of the bond over time.  For mining bonds, hashing inflation reduces the return of the mining bonds over time.

Offering "anyone" to vote could be abused much easier off the bat I think.
The sliding scale seems like it would hurt newer assets more, and "keep the little guy down" possibly?

The other ideas are definitely interesting.

Although I still think it takes away from those users who have "bought" into ltc-global with the expectancy of it being a private membership to vote type deal.
It has been thrown around a lot over and over as an strong reason for users to buy at least 10 shares.

Hey Burnside,

I would highly suggest against just 'taking' peoples accounts/shares if you are going to go the ToS route. I think it would lead to accusations of theft over
a difference in opinion. If you are selling shares of the company, and giving the share holders the right to vote on having customers or not, regardless of
the reasons why a shareholder makes their vote and if you like it or not, it is their vote. The ability to exorcise such ToS extremes of stealing (I am pretty sure it would be stealing because you are forcefully taking) shares in itself could easily be abused on purpose. (or happenstance) If you are worried what people will do, as stated before, going through what you have called a lot of trouble to setup 6+ separate accounts, linking them all, etc etc, and paying their money to have the rights to place their votes, they should be allowed to do it. After all, it IS their investment money at stake. I would also expect that at 10,000 shares and assuming all the owners are not scam artists themselves (lets hope not), they too will look out for their best interests and investment in their own judgement. Unfortunately, this could also lead them to not care about asset legitimacy as much as how much trade volume the asset could generate and earnings the asset may bring in. You could take away those peoples shares, or even just lock them from voting, but that would surely be theft in the lesat since they are just wanting to do business the way they think it should be done and may have the opinion to let the people be smart about things on their own. Stealing their shares or taking away their votes for "ToS" reasons would just be a personal disagreement of opinion even if in mass. We are all human, one person can have a different opinion out of 1,000, but they should still be entitled to that opinion, and not be punished for it. It is a problem we face every day in the the real world, and no one should have to be persecuted for it.

As for increasing the number of votes, that is now kind of tricky. You have already promised shareholders they get a vote if they have at least 10 votes, and
more than a few people have probably bought at least that much just to help out. By increasing the share requirement, or taking that away altogether, could almost be considered bait and switch. "Come buy our shares for X reason. Now that you have done it, we decided that X reason should not be there anymore."
Especially with a share increase to vote. To me that would be like dangling a carrot.. "Buy some shares... nope.. buy more shares.. NOPE!" etc...
If you were to increase the number of shares to vote, I would highly suggest considering multiplying the number of shares of the company to compensate
holders of the current amounts and ensure fairness and equality. Although at 10,000 shares, even double the votes would mean doubling to 20,000 shares.

I do like the idea of raising the number of required YES votes. That would definitely cause someone seeking bad dealings a lot more up front cost and trouble to possibly get shot down.

I hope this helps in your future considerations on the voting system.

I imagine it would be slow from eastern europe.  No real surprise there.

The rest of what you said wouldn't work.  You'd have to hold all 50 shares at once.  Add to that the complexity too of cross-linking your BTC-TC accounts to LTC-GLOBAL accounts at each stage of the process.

The system is definitely not perfect.  I can't believe some of the stuff that is getting approved.  Although on one of them I saw a YES vote attached to a negative comment, suggesting someone voted YES accidentally while meaning NO, where the NO vote would have prevented approval.  Ugh.

I am going to re-affirm my belief that having just one person overseeing the approvals is not going to be an option, that's just not the kind of site I want this to be.  Reasonable suggestions for improvement are greatly appreciated.  Maybe we need to raise the bar.  20 shares for a vote? or maybe bump up the number of required YES votes.  Maybe we should elect a couple of community members that have demonstrated a reasonable knowledge level and are willing to peruse all the submissions.

I will also add that any attempts to abuse the system is a violation of the ToS and will result in forfeiture of all accounts involved, including any LTC-GLOBAL shares and coin involved.

Cheers.

... and you can feel like a low life scammer for rest of you life. I guess you are always looking for a chance to scam and sounds like you are even proud of that shit.

Wouldn't work - votes are recalced if shares in LTC Global change hands.  So to do it all yourself you'd have to buy 50 LTC-Global shares.  That would cost around 10k LTC or $780.  A pretty significant investment for most issues so terrible that they couldn't get 5 votes legitimately (some pretty horrid ones get 5 votes no problem - like the pretty obvious scam one just approved which hasn't even made a forum thread or given nicks on here/LTC talk for the issuer).  Of course getting mod approval isn't the same thing as actually selling shares.

Not sure what you mean by the site being shockingly slow - if you mean trade volume then yes, it's pretty slow: though how long it takes to sell shares depends really on how slippage you're willing to take - you can sell immediately if you don't mind accepting a low enough bid.  If you meant web-page speed (as with GLBSE's 20 second load times) then nope - there's no speed issue that I've noticed.

And yeah - I do like the site.  But as it stands the moderator approval thing is pretty much a pointless hoop to jump through, as too many retards have a vote who couldn't tell a bad contract from a good one until their funds vanished - so total junk can get approved for listing no problem.  Doesn't actually hurt me directly - as obviously I can avoid trading complete and utter junk - but indirectly it does, as scams and bad investments leech capital from the market and reduce confidence.

I thought you really liked the ltc thing? But anyway, from what I gather the fast track to listing is, make six accounts, create scam asset in one, buy 10 shares in 2nd, vote, move shares to 3rd, vote etc. Once done sell shares, you're out the slippage which should probably be < 1 BTC. Whole shebang'd take about half an hour on a normal site so probably a coupla hours on this one as it's shockingly slow and presto, approved.

EskimoBob : There's no secret or even permanent list of who can approve new securities on LTC-GLOBAL/BTC.CO.  Basically anyone who holds 10 or more shares in LTC-GLOBAL gets a vote.

Noone other than burnside (who could look in the database) knows the full list of who has that voting power - we know that there were 20+ people with votes.

For a security to get listed it only needs 5 Yes votes - and pretty much any old rubbish can get that.

I'm NOT a voter by the way - so my comments only reflect my recommendations to those who are, not how I personally vote (as I don't/can't).

I personally think that you guys need to set up a list of criteria that is accepted by all of you and publish it.
I also think that if you need to split that form you have right now to smaller segments. Your job will be much easier and consistent and questions have to be more precise.
Picking the right stuff out of a freely written "business plan" can get complicated.
The form you have right now is a good start but if I was you, I'll spilt the (just as a example) "Contract, or Shareholder Agreement" in to small segments (the a, b, c...) and do same with Executive Summary, Business Description  and so on.

Then you can have a nice "spreadsheet" like form, where you can add very specific questions, comments and your "points" when voting.
Yes, you do have written nice descriptions what you expect in any of the form right now. Use those to split the form.

Just as a example:
It is easier to evaluate if "Provide a description of how your company is organized as well as an organization chart, if available." and "Describe the legal structure of your business (proprietorship, partnership, corporation, etc.)." if those are in separate form fields and not as one blob, mixed with answers to "Identify necessary or special licenses and/or permits your business operates with" and "Provide a brief bio description of key managers within the company".
BTW, you are actually asking same thing twice here, wile not really learning anything new.

Feature request: Add "Save" and "Save and send" buttons to this form so application can be filled partially and then completed at later date for sending it for the review



What is your (or any other board members) real life background?
How do you determine the value of a security? What type of analysis do you use?



Do you realize that this market is for virtual shares and not for actual shares?


I guess the question here is the same - what is your (or anyone else on that board) qualifications?
How many business plans have you guys written in RL? Can you give advice how to write one that is accepted by this board?
  

I am clad to see that finally you guys are starting to ban "turds" Good job!



Looks reasonable.


How do you know what is scam and what is not? Maybe you do not like (or do not understand) the submitted business plan? Maybe you have no experience on that field hence you have no qualification do rule over it in any meaningful way?  
Maybe you do not like the person form the forum because they have a different understanding of some "case X"?
What is that "falls below some threshold" in EUR or USD?

Concerns:
1) Some of the information asked is really personal and can be misused easily. Especially as a package with corporate information.  
So, who are you guys? Can you please publish all the same information about yourself, unless you accept forum and IRC names in the application and we can keep it virtual.

3 yes votes with no forum link or any reputation references is rather depressing.

Think there's a couple of very general requirements that should be on any list:

1.  That whoever posts the asset for approval makes a thread on either this forum or the LTC one where anyone can ask questions about the asset/contract.  If they don't have confidence enough in their offering to discuss it in public then no way it should get approval.
2.  That the asset issuer disclose the nicks they use on this forum and/or the LTC one.  If they have (or claim to have) zero history on both sites then they need to make that explicit.

Right now there's an asset up for voting on LTC Global that has absolutely glaring problems with it (e.g. no definition of what payments investors will receive, an alleged 'board' with no details of who's on it, no exit plan, no information on what level of disclosure will be provided etc).  Asset issuer is totally unidentifiable other than an email address - not even a brand new nick.

Not sure what's more shocking - that he thinks it'll get 5 votes or that 3 retards have actually voted yes (the latter could be him + 2 alts of course).

This is a good thread to have.  Definitely need to help people understand the process behind BTC-TC approval, and how BTC-TC is more of a community approval process, in contrast to what you might see elsewhere.

This is a cross-post from the LTC thread as well, but factors I personally take into account are:

- Is business plan or contract well thought out and documented?
- Are there factual errors?
- Are there any glaring omissions?
- Does it smell fishy?
- Doing research into the issuer using the facts and data they are willing to present, do I feel deep-down that they are moral, capable, and driven enough to follow through?
- Do I feel like they have a decent grasp of their market?
- Do they have a clear plan for how to handle failure?
- Do I feel like this is a good asset for the exchange and for the LTC community?

It's tough to weigh all that, but that's my thought processes.  When I vote NO or ABSTAIN I always put in a comment as to why and I would encourage all voters to do the same.

One of the things I like is that even after approval the voting doesn't stop.  You can get a feel for how much trust an asset has from the community by looking at the votes.  The breakdown is very simple:

When a mod votes YES: +1
When a mod votes NO:  -2

Voters/Moderators also have the option of publicly making their vote and/or comment visible on the asset information page.

Cheers.

This is a very reasonable list.

On the topic of bonds: if you are not going to pay back the principle, then it should be a stock instead.

Impossible? If a miner can't make enough income to pay off the equipment, then he is mining at a loss and shouldn't be mining at all.

What you call "legit" bonds are not really legit. How legit is loan when the person doesn't promise to pay you back? Here are the terms for a typical mining bond:

In exchange for the initial price of a share, I promise to pay the shareholder some percentage of my mining income each week forever*. I am not obligated in any other way.
*The term "forever" means forever, or whenever I stop mining or cancel this contract, whichever is sooner.

What rational person would loan money with those terms?

I realize that I am going against the status quo here (kind of like telling people that the Fed can't keep printing money), but mining bonds in their current form are a problem and I would like to fix the problem.

If the face value of it is going to steadily drop then it's not a bond and shouldn't market itself as one.  IF mining actually is profitable (and that's arguable - depending on costs/equipment used) then it's entirely possible to run a bond with a fixed face value, redemption allowed at will and that pays a dividend.  Just the dividend would be rather low as most mined coins would have to be reinvested.  Fixed-rate bonds were just (in the main) a way to generate a loss for investors whilst lining the pockets of asset issuers.  Similarly most mining shares are also terrible investments - due to wnting to take a fee on turnover rather than on profit: giving operator near guaranteed profit and no risk whilst investors take the majority of risk for a pretty tiny share of profits (if any).

Asset issuers need to focus on making a profit for investors - not just on paying dividends (whilst underlieing asset value drops at a faster rate) and taking fees for themselves.  Prove that investors will make a profit from whatever you offer and I'm sure you'll get moderator approval.  Try the old "Give me money so I can buy mining gear then I'll take X% of what's mined and you get whatever's left and hopefully it won't be too big a loss for you" and you may not find it so easy to get approval.

There are no legit mining bonds because bonds are not what they should be called.

Calling them "bonds" is a lie from the start.