Topic: The Open Business - page 2. (Read 1844 times)

Maybe a good first way to try is out would probably be a bitcoin based gambling site. Where investors can invest their money and take out their profits at will without having to trust the site operator like they currently do. Would that be possible?

This is would not be a "store" in the traditional sense, it is a business that would permit financial anonymity of the investors and founders.
Such "Open Business" can't be implemented in current, existing business, only for new one.
And not for a physical business, only knowledge, software, services, or "under radar" ones, at least until government does not embrace Bitcoin and such accounting practices.
Bitpay break any anonymity, and hide financial operation (which happens off chain) from the eyes of the investors, thus breaking the open accountability of the founder. (Thanks to the published PaymentKey)

The goal is to allow anonymity of both, founder and investors, but allowing trust despite of it by having the internal books of the business open to every investors. (And retrievable from the blockchain)
Only bitcoin payments would permit to keep the anonymity of the founder, even if the book, and accountability is irrefutable and public thanks to the public "PaymentKey".
All back and forth in currency would break anonymity but also hide operations from CC holders (investors).

This is not meant for everyday business and physical store. And not meant for black market.
But as a way to incentivize funding of an entrepreneurial project by bypassing any financial institution or institutional barrier.

Let's be clear : Such "open business" would be a big legal problem, because normal business require banking account, and books in currencies.
But I expect legislation to change to accommodate it when they would not be able to stop such business from flourishing. (thanks to backed-in anonymity of investors and founder)

Is there a service like bitpay but instead of converting bitcoin to usd, it can convert usd to bitcoin?

I think something like that might be necessary. I probably wouldn't want to invest in a store that only took bitcoin. At this point anyway...

The protocol for "open assets" is describe at https://github.com/OpenAssets/open-assets-protocol/blob/master/specification.mediawiki.
This does not make any modification to bitcoin protocol. (Just leveraging OP_RETURN TxOut)

It is already used by https://www.coinprism.com/.

So in the protocol would already support such thing without any doubt. But I think the ecosystem is not yet developped enough (market place of CC, and correct tools to manage portfolio privately -without web, hot wallet-)
My next work will maybe try to develop some tool that make tracking CC easy and off any website.
But before doing that I want to uncover any bad incentives that would make such "open business" to perform badly.

Yeah that sounds like it could work.

I would love to see this put into action at some point.

Would a protocol for this have to be written from scratch, or does something like NXT already provide some of the features necessary?

If the founder need more capital to grow, he can decide to expose the case to investors, and run a vote to issue more CC.
I think that if there is lots of growth possible, then the investors already having CC, won't mind being diluted a little bit.
Why ? Because, contrary to classic shares, CC gives right to direct and real time profit depending on sell volume of the company.
Sure, their CC will be diluted, but if the business can really grow, the whole pie will be bigger.

The investor would be able to evaluate the need for such capital growth, because they would have access to the published PayingKey to verify the financial status of the business.

This is a very interesting idea and I've often thought about applying the open source concept to business, and how that would work out.

One issue might be limiting the growth of the business by paying out too much of the profit early on. How do investors decide to take out their profits or invest in growth? If even a small percentage completely take out their profits it can really hinder the growth of the company I think.

Knowing the idea won't help financial companies at all.
They can't fight against the openness of Bitcoin and prevent such concept of totally decentralized funding, once tools and such ecosystem is in place.
I want people to be free to innovate, anonymously if they want, and finding anonymous capital is the way to provide such freedom to innovate.

I like your idea and being totally anon. is the keyword, I like it so much.

But what is next step, I see you have and you did a great illustration.

The previous reply is about, don't go for a finical company or something telling them about your idea, as they are your competitors.

Got it ?

I don't understand your point.
I don't want to open a business, I am talking about a way to make a create a business whose financial existence would exist on the bitcoin network. (Votes, Shares, and profit alike)

Do you mean that such system would create high business creation, and drive competition up, so would crush profit to the current one ?
This seems more like feature than a bug for me.

Opening a new business is more or less compete with the current one.

Competition drives down profit. So be careful who you go after.

Maybe some of you already thought about it.
My goal is to have the first proof of concept of a business entirely financed anonymously, and optionally managed anonymously.
I want to submit the idea of such "Open Business" to you. (My particular project is not relevant to this discussion)

What if everybody could create, or finance a project without any barrier ?
To my mind, it is possible with the help of colored coins, and immediate benefit transfer.

Imagine Alice wants to build a new cool project.
Alice announce the project, but need 100 BTC to start it.

What Alice can do, is to declare that each time a product is sold, then the payment is transfered to a published PublicKey that everyone can track. We call such key the PaymentKey.
Then she declares the following : For each unit sold, 20% will be kept to pay the expenses and the other 80% will be distributed proportionaly to the amount of Colored Coins one possess, in real time.

Imagine that Alice distributes 200 Colored Coins.
She keeps 100 CC for herself, so she will get 80% * 50% of every unit sold.
She sells 100 CC left for 100 BTC to investors.

Now investors have an incentives to fund her project, because they will directly receive money for every product sold.
Also, investor can check that Alice does not cheat the system because they know the "PaymentKey", and will monitor every business transaction thanks to that. (they can also buy the product by themselves just to see if the payment ends up on the PaymentKey)
Also, they can track how much CC are emitted by looking the blockchain.

Imagine Alice get funded.
She sells a unit of 10 BTC.
If you own 1 CC, then you will receive 10 * 20% * 0,5% of the sell.

Alice has an incentive to make the product works, because she owns 100 CC.

Now, imagine there exists a marketplace of Colored Coin. If the project goes well, investors will be able to trade their CC with other traders.
In the same way, if Alice wants to retire from the project, she can sell her CC.

During the project, if any decision impacts the investors, a vote system with crypto signatures of holders of CC can be put in place.
Such votes would be lazy consensus.

All the software to make such thing happening is currently not developed. (CC marketplace, and ability to track and emit your own CC)
But imagine it is, do you think such "Open Enterprise" can work ?

In a way, it is extending the open source philosophy to a business.