Topic: My Criteria for Approving Securites on LTC-GLOBAL and BTC Trading Corp (Read 4385 times)

I added this to my criteria for funds:

• Shares of "pass-through" funds must be exchangeable for the assets that back them.

You can take this a step further by increasing the number of shares needed to vote or giving extra weight to moderators who own more shares....

You make some very good points.

I'm not going to be doing any confiscating if I can avoid it.  I don't WANT to confiscate.  But I also don't want the platform destroyed by abuse.



If the relationship can be proven, I would think you're in the clear.  If it can't, (person want's to remain anonymous) then I think that breaks the ToS.  Otherwise everyone would just claim they're representing 10 anon clients.  Definitely some gray area here.



If you get caught voting based on a bribe and there's solid proof, you're out.  We're not going to stand for that. 

If you're a mod and you're offering a service to assist the issuer in drafting contracts and/or operating the asset, I'm pretty sure that would be ok.  Though if you have much integrity at this point you'd probably abstain from voting on the asset you helped draft.


The punishment has to fit the crime, for sure.  If what you did cost other people a lot of their crypto currency, then it's only fair that you lose yours.  On the other hand, if there was little damage done, then we might find a more lenient discipline.

I'm not going to mince words here.  If you have an inkling that what you're doing might be questionable, don't do it.  If you're caught there will be a penalty and you're not going to like it.  I feel very strongly about this.

Cheers.

Interesting ideas all around.

Chiming in, I basically vote yes on everything unless I detect some sort of funnybusiness going on.
- Is the form filled out completely and accurately?
- Are there any promises in the contract which the asset issuer has failed to keep?
- Is there enough information being published about the issue so that I can establish a value? (the most important factor)
- Is there any form of accountability (no anonymous issues please)

That's pretty much it. Of course each asset is evaluated individually but those are the basic things I look for. Also,
- I don't like startups. I like established businesses looking to list.
- I don't approve personal loans or anything directly tying US dollars or the stock market to bitcoins.
- I start to get highly suspicious of people who list more than two or three assets, because I know from first hand experience how difficult it can be to manage more than one issue (believe it).

I also want to say.. as outspoken as I am..  I don't think this voting system is going to go over very well after more moderators come on board. First, moderators are community members. That works out great right now but the fact is, community members are not necessarily financial experts. There is a notion that moderators are there to approve securities based on their personal opinion of business viability, their trust of the asset issuer, or any other subjective factor. That is not a good idea. Do the LTC-GLOBAL moderators take on any sort of liability for approving a scammy asset? They should, if it's their job to filter out scams.

I believe moderators should enforce the principle that investors must be given sufficient information to decide for themselves whether or not they want to invest in a company. As it stands, the system is starting to work opposite from how it was intended. We have extensive, extremely well-done contracts which have received several down-votes. For example the LTC-ATF contract. LTC-ATF is one of the best contracts I've ever seen and yet it has eight NO votes. What's even worse is that there are no comments and there seems to be no way for Deprived to try and fix his security. But actually there is nothing wrong with his security at all. It seems as if people are just voting him down because they don't like him personally. That is really, really bad.

Then on the other hand you see multiple assets where six or more sections have been left blank and there is no contact info other than an e-mail. And those securities have received ten upvotes and no NOs. This doesn't make sense. It shows the basic intent behind the system might have placed it's trust in the wrong area. But I do agree it's the best system among all the exchanges so far. I would not want to remove it, only improve it. But how.

Well, I'd like to see something a lot closer to what Ian proposed. Ian actually had an amazing idea. Just list everything and have a rating system from the moderators.  That would be a lot closer to how it works in the real world. Honestly, personal trust should never be an issue. Look what happened with KRAKEN. The most trusted issuer in the entire community intentionally listed an asset designed to steal investors money. So trust and personal feelings are never a good indicator of whether or not something should list.

I'd like to caution against ever confiscating people's assets because they break the ToS. That would be extremely bad. It could even happen accidentally. For example BTC-TRADING-PT. The issuer is assumed to control two accounts, both of which have 10 or more shares of LTC-GLOBAL. Or anyone who votes as an owner of BTC-TRADING-PT. Like me. I own some BTC-TRADING-PT. Have I broken the TOS by voting both with my own shares and as an owner of BTC-TRADING-PT? What if I own or a third fund (like LTC-ATF) and invest in LTC-GLOBAL? It seems crazy to state you will confiscate the assets of a fund because it turns out that people end up getting more than one "vote". Given that one share in BTC-TRADING-PT costs 0.15 BTC, and that you could probably swing the vote easily with a few hundred shares, well it seems you can almost buy a second vote for the same price that it costs to buy 10 shares of LTC-GLOBAL.

Secondly, I know for a fact there were some account managers who represented certain investors who prefer to remain anonymous to the GLBSE. I've seen this a couple of times. I am going to speculate that (at least) those two people are doing the same thing on LTC-GLOBAL right now, and operate not only their own account but a customer account as well. What would happen if you found out about those people and they didn't want to reveal the identity of their customers?

What if I hired someone to represent my interests? That's an external legal obligation and I can't see how you could morally prevent someone from doing that. What if I ran a full passthrough on a second exchange and operated multiple accounts in order to give investors votes? It seems that with the current ToS you are over-extending your jurisdiction into some pretty strange areas.

Also what about bribes? I'll be honest. If someone gave me 200 BTC I would find it personally difficult not to vote for their security. Unlikely, but, I can assure you that if there aren't any LTC-GLOBAL moderators selling their votes now, there WILL be once we get another 30 or 40 moderators into the system. And why not? If an asset issuer is serious about listing, why not charge a fee for an "evaluation and advice session"? Moderators could advertise that they are willing to critique someone's contract for a small fee. After all, it takes a long time to go over a detailed contract with eight or nine sections to it. There's nothing wrong with that, is there? Or is there.

For punishment, why not just ban people from voting? If it's proven conclusively that someone is trying to game the system, just penalize them from voting for say a month or two. That seems reasonable and fair. But I must voice my opinion strongly that someone's money or assets never be confiscated, that does not sit well with me at all. I don't think that should never be an option. Please try to find another way around that.

I know the current system is not perfect but I am just airing a few ideas I've had for your consideration. In the end I think you will find a good way though all of this burnside, my faith is with you now.

I think that many of the posters in this thread assume that the moderators do a thorough investigation of the securities and the issuers of the securities. Nothing could be further from the truth. Most moderators don't bother to vote. I and a few others are the exception, but even then, I don't think any of us spend that much time evaluating a security being listed. Nobody should assume that any security on any exchange has been thoroughly vetted.

Having said that, I believe that the moderator mechanism that Burnside has set up is very valuable. Overall, the securities on his exchanges are a better quality than those on other exchanges.

That's true, but taking a while might be a good thing.  If it's easier to get assets approved during the holidays when are the scammers going to apply?

We could send a reminder out to voters when assets have been waiting for approval for say, 48 hrs?  (For the lazy, "ABSTAIN" would stop the reminders.

If you go that route then you need to make it something like 50% of those who have logged in during last 48 hours or something.  Otherwise could end up with no assets getting approved if a load of people are on holiday etc.

My hope initially was that the motivation would be to vote in a manner that kept the exchange viable because shareholders have a financial interest in keeping the quality up. 

Unfortunately not everyone thinks long term like that.  Could mitigate that somewhat by setting up a waiting period between when you get your shares and when you are allowed to vote.

I'm leaning toward requiring at least 50% to vote before approving/disapproving an asset.

Same issue of personal benefit can also apply to people who aren't issuers.  There'll undoubtedly be votes cast for personal reasons (grudges or friendship) as well as ones for financial benefit.

If an issuer runs an asset that isn't an investment/trading fund then treating investment as a zerosum game (where funds invested elsewhere aren't buying their shares) then for financial benefit they should vote NO on all issues except ones which are either:

1. Direct competitors to their own but very clearly inferior.
2. Investment funds likely to buy their asset.

Similarly there's a strong case that if a smart Investor/Investment fund wants to vote purely for their own financial benefit then they should vote YES on some horrible investments as well as voting NO on marginal ones which objectively probably deserve a Yes vote.

Don't know if anyone's doing anything like that - but it wouldn't surprise me.

For any voting, it's better to have no vote preselected at all. Let people make up their own mind. Changing default "No"  to "no vote" can also be a slippery slope and cause confusion down the road.

How do you keep moderators interested in voting? What is the incentive? I bet, first few times must be interesting , but then what?
If moderators is also a issuer, every new listing can be a competition to his own issue. Can this become a problem?
What if there was some type of a "reward" for those who vote in first X days or even hours?
If the new listing request just sits there, it will not get any better. Only active moderators can improve the application (if there is something missing etc)

They're supposed to.  EskimoBob found a bug last night that I had introduced when I plugged in that notification a couple of weeks ago.  The Create page was breaking on the submission and no one had even mentioned it!  heh.  Just lucky it was breaking after the DB insert of the actual asset info. 

It's fixed now, and all mods should now get a notification whenever a new asset is created.

If we do change it to default to NO, we'll probably have to also reduce the "NO" threshold a bit, and then when approved automatically wipe the votes that had defaulted to NO and were not actually updated during the approval process.  Laying out the details this sounds like it could get kind of ugly.

Another alternative... simply require 50% of the mods to vote before an asset can be approved.  (in addition to the ratio requiring a positive outcome.)

I like this idea, although it might be frustrating if too many of the potential voters take too long to respond. Do they get some sort of notification that there is a new asset awaiting approval?

Ahhh, I gotcha.  Yes, if people buy in before the manipulator sells the shares they used to manipulate the system, then those people would be stuck holding a turd.  It's already happened a couple of times on LTC-GLOBAL.  This is why we're trying to improve on the system.  While the system has greatly reduced the damage, it has not completely prevented it.  (It seems like people will buy almost anything without reading a prospectus.)

I'm open to good ideas for improvement.

One possibility that occurred to me would be to default everyone's vote to "NO".  Then a sneaky manipulator could not go in and get a quick approval.  They'd have to convince nearly everyone else to change their votes.

But the security was approved already. Does it somehow become disapproved, for instance after people bought in?

Sent you a PM

I think people should take an exam in finance before they can become voting moderators.

And then all your votes disappear.


I'm definitely not happy with the panama setup.  There was a complete outage earlier this evening for a few minutes.

I've been discussing setting up a box with Neotrix of Koddos/Esecurity in the Netherlands.  Anyone else have suggestions for a good colo provider for a Belize company?  I want to colo 3U of gear with lots of bandwidth for under 100 USD/mo.  

Perpetual bonds do not have a face value because they do not have a maturity date.  You are confusing face value for the amount a bondholder paid for the bond.

Perpetual bitcoin mining bonds and fiat perpetual bonds are a little different because traditional fiat bonds guarantee a coupon payment of a certain amount for perpetuity.  This means that bonds sold during the Napoleonic Wars are still being paid, but that inflation has decayed the coupon payments over time.  For a perpetual bitcoin mining bonds it is the inflation of difficulty that is decaying the coupon payment as the perpetual bitcoin mining bond's coupon is dependent on the difficulty.  The problem with perpetual bitcoin mining bonds on GLBSE was not that they decreased in value from the initial bond price (not face value), it is that they were overpriced to begin with.

You sell them after tho, so depending how liquid the market is your costs wouldn't likely be above the 8 BTC GLBSE used to charge.


I mean it took > 20 seconds to load. Pingdom shows it at 4 seconds currently, so maybe it was just a bad connection or something. Still pretty slow.


What are you, the forum idiot?

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.

> I will disapprove any bond that does not promise to pay back the principal (face value).

And that's why I don't give a shred of trust to your "criteria". Take mining for example - it is simply impossible to return the principal if you already brought deprecated mining equipment. What your criteria means is that those legit mining bonds will not be approved, but scam bonds who can be magical unicorns and scam everyone will be able to meet your criteria.

A security must be approved by a certain number of LTC-GLOBAL shareholders (known as "moderators") before the security can be listed on the LTC-GLOBAL or BTC Trading Corp. exchanges. However, without published criteria, it is difficult, tedious, and time-consuming for an issuer to gain approval of the security. For this reason, I think moderators should publish their criteria, and here are mine.

Note: This is a copy of a post I previously made here: http://forum.litecoin.net/index.php/topic,906.0.html

Please keep in mind that these criteria are mine, and other moderators will have different criteria. Some consider my criteria to be too strict or too cumbersome. I don't think so. Bitcoin is no longer somebody's lunch money.

Also, note that some of these criteria also apply to securities after they have been listed. I will change my vote if necessary, although that doesn't change the status of a security that has already been listed.

I can't list all of my criteria because each security must be assessed individually, but the goals are:

• Full disclosure.
• Ability to determine the value of the security.
• Legitimacy.
• Information quality.

These are not my goals:

• Risk reduction (other than by disclosure).
• Conformity.
• Political or social goals

Stocks

A share of stock represents ownership of a company and all the assets owned by the company.

• Stocks must have a business plan -- a detailed description of how the business operates and how it plans to succeed. Without this information, it is not possible to determine the value of the company.
• Balance sheet and profit/loss statements must be published periodically. A start-up must provide these as projections in its business plan. Without this information, it is not possible to determine the value of the company.
• The rights granted by owning shares should be specified. There is no good reason to leave this out, or to leave it open to interpretation. It could be something like, "a share represents partial ownership of this company and all the assets held by this company". This particular statement guarantees that if the company shuts down, the investor will receive his/her share of the assets of the company.
• Detailed information about dividends should not be specified in the prospectus/contract. Dividends must be allowed to be adjusted by the management.

Bonds

A bond is a loan. It normally pays interest, and the principal is returned after a period of time. However, there is a kind of bond called a perpetual bond in which interest is paid forever, but the principal is normally never returned.

• I will disapprove any bond that does not promise to pay back the principal (face value).
• The interest rate must be specified. If it varies, then a precise description of how the interest is determined must be specified.
• The face value of a bond (per share) must be specified.
• The terms of the bond cannot be changed, except by unanimous bondholder consent.
• Collateral must be provided, or information must be provided proving that the face value plus interest can be paid.
• Detailed information about the financial state of the issuer must be published periodically.

Funds

A fund is a company that holds investments and pays shareholders any income derived from investment operations. A share in a fund represents partial ownership of the fund assets, but not ownership of the fund or fund manager. The fund uses money obtained from selling shares to purchase investments.

• A detailed description of how funds are invested must be provided. Investors must be able to determine if the investment strategy and goals match their own.
• Information about expenses and fees must be provided.
• Investment holdings and fund performance information must be published periodically.
• Funds must offer to buy back shares at NAV if there is any change to the contract.
• The rights granted by owning shares should be specified. There is no good reason to leave this out, or to leave it open to interpretation. It could be something like, "a share represents partial ownership of the assets of this fund, but does not represent ownership of the fund or fund manager". This particular statement guarantees that if the fund shuts down, the investor will receive his/her share of the assets.
• Shares of "pass-through" funds must be exchangeable for the assets that back them.
• Proof of possession of the holdings should be provided, if possible.
• Funds should not sell new shares for less than NAV.

General

• I will disapprove a security that appears to be a scam.
• I will disapprove a security that is no longer actively managed or traded.
• I will disapprove a security whose market capitalization falls below some threshold.
• My vote is not anonymous unless I forget to check the box. My name on Litecoin Global and BTCTC is oZoNo

I welcome comments and suggestions.