About a token that generates revenue for the issuing corporation

[Sabreiib]

The most important barrier I see will be ensuring funds remain under the control of shareholders

Let each shareholder control his/her own fund, the only money you cannot steal is your own money!

[mhps]

i.e. we decrease the pledge ratio, if we vote for zero ratio, no one can borrow coins from protocol and coin supple will become zero within short period.

You may want supply to be negative sometimes. How are you going to do that?

If you hoard Hayek, you actually get nothing and loss nothing because you always buy same amount of commodites(roughly).

Wrong. If you hoard you gain preserved value in real asset terms. Example: Singapore decides to put 100 billion USD worth of asset in your coin. Singapore doesn’t spend the fund after buying it in a year, and wants to redeem all to USD after a year. The inflation rate is say 3% pa in USD terms. Where do you come up with the 3 b USD extra value in your money system? By tx fee of rest of the coin holders? What if all coin they have is $3 m USD and fee burned is 3000?

[Sabreiib]

You may want supply to be negative sometimes. How are you going to do that?

Assume NSR market cap is 2 millions USD, and 1 million USD value NSR are parked by the owners to retrieve 0.5million NBT (2:1 pledge ratio), the lending period is 14 days, after 14 days, borrowers must return their NBT, otherwise they lose their more valueable NSR. This is automatically executed by network protocol.

If nushareholders vote for 2:0 ratio today, which means Nu stops lending business right now, One simple question, how long will NBT supply become zero? Zero NBT in circulation.

The answer is within 14 days.

That’s the beauty of Hayek’s solution.

[mhps]

Now that is Interesting.

[Sabreiib]

Example: Singapore decides to put 100 billion USD worth of asset in your coin. Singapore doesn’t spend the fund after buying it in a year, and wants to redeem all to USD after a year. The inflation rate is say 3% pa in USD terms. Where do you come up with the 3 b USD extra value in your money system? By tx fee of rest of the coin holders? What if all coin they have is $3 m USD and fee burned is 3000?

In Hayek design, both revenue and backing asset will support anti-inflation.

1. Do you believe a successful private business profit ratio is just 3% per year?

If singapore deposites 100Billion USD, it is because our profit/revenue per year is more than 3 billions. Economics is mutual activity, our customers are not fool. Meaningless assumption is meaningless, just like you cannot assume all human beings suicide in one day.

2. Even if our official revenue is less than 3 Billions, the liquidity providers(NBT borrowers)will pay the 3Billion bill, otherwise they will lose 200Billion NSR to protocol. And decentralized LP make their living by spread trade, don’t tell me their profit ratio is less than 3% per year, even ticket scalpers can earn more. And if some of them are really less than 3% annually, they washed out by free market. In the end, the LP free market gets stabilized at something like 10% profit ratio. The “singapore dumping event” did lower LP’s profit level, but they are far from bankrupt.

[Sabreiib]

@mhps, have you calculated this model:

I invest 1000 USD buying 1000 NBT and set up buy/sell wall at OKpay NBT/USD pair, my trade volume(sell and buy) is 20,000 USD per year, i.e. turnover rate is 10. If I set 1% spread: 0.99buy 1.00sell, what’s my gross profit? 100USD, it means 10% profit ratio per year!

Can I pay my Okpay fee with revenue?

The more turnover rate, the higher revenue.

E-gold

E-gold was a digital gold currency operated by Gold & Silver Reserve Inc. (G&SR) under e-gold Ltd. that allowed users to open an account on their web site denominated in grams of gold (or other precious metals) and the ability to make instant transfers of value (“spends”) to other e-gold accounts. The e-gold system was launched online in 1996 and had grown to five million accounts by 2009, when transfers were suspended due to legal issues. At its peak in 2006 e-gold was processing more than US$2 billion worth of spends per year,[1] on a monetary base of only USD $71 million worth of gold (~3.5 metric tonnes),[2] indicating a high monetary turnover (velocity) of about 28 times per year (for comparison, annual velocity of USD is about 6 for M1 [3] and less than 1.6 for M2 [4]) . e-gold Ltd. was incorporated in Nevis, Saint Kitts and Nevis with operations conducted out of Florida, USA.

[mhps]

OK. Fixed lending term is like forced expiring dates of future trade contracts that forces all lenders of nsr for nbt pay for the inflation. However realizing this fact lenders will pull the fund early if the economy of the coin system is not looking good. When Singapore is going to sell, all lenders will try to front run so the coin will become cheaper in real terms.

So you answered what the mechanism to destroy coins.

Do you believe a successful private business profit ratio is just 3% per year?

If this business has the size of a developed country, as shown by most developed countries, making the economy to grow all the time is very difficult. For a normal sized business, making a financial product that performs better than inflation rates is not highly difficult. But you’d ask what is the point in issuing a currency when you could just sell fund.

[Sabreiib]

If our decentralized LP capital turnover is like e-gold, say 28 per year, when they set 1% spread on NBT/USD pair, their profit ratio is 28% per year. They can afford inflation rate, they can == Nu can.

@mhps,@phoenix Have you calculated the total trade volumn of NBT from 2014 to before the crisis? What’s the turnover rate?

[mhps]

e-gold was welcome because it had demonstratable reserve in gold. What can the coin you talk about show to potential customers?

[irritant]

they can show some digital gold in their accounts BTC, PPC you know, backbone currency

[Gilbert]

If nu has shares in private companies economize, it can generate revenue.
ownership of land, Sustainable Forestry
ownership of storage facilities, storage of foreign and own things. eg wood
ownership of farmland, self-cultivation or lease

[ConfusedObserver]

If nu has shares in private companies

If that would work easily, a “Hayek” coin would be easy as well.
You need a way to store those shares in a way that’s out of reach of governments - I have no solution for that.

[Sabreiib]

shares in a way that’s out of reach of governments - I have

digital gold - BTC - is the only way.

[ConfusedObserver]

No, it isn’t

Instead of ETFs that stand for commodities, goods, food you make a kind of crypto index. You issue tokens that represent onwership of (just as an example) a% BTC, b% LTC, c% ETH, d% XMR, etc. - you create a crypto coin index.
The tokens in the index need to support multisignature transactions and most have a high trading volume at a tight spread.

[irritant]

You’re saying the same thing (or I don’t understand the difference), BTC also know as digital gold (not in exchange of BTC), is how I read Sabreiib comment

You issue tokens that represent onwership of (just as an example) a% BTC

[ConfusedObserver]

You’re saying the same thing

I’m not saying the same thing.
I’m saying something similar, which is different in an important aspect.

digital gold - BTC - is the only way.

as opposed to

you create a crypto coin index

in which BTC is only a part. The tokens represent index ownership just like with index ETF at stock exchanges.
That difference is important.

I hoped that the initial post presented my idea more clearly.
Which part needs rework?

[irritant]

ok maybe I’m wrong, still I think he means the same, except naming only one example of digital gold, it could (of course), also be a number of those (PPC, XPM, XMR), which would result in what you are saying, an index
@Sabreiib maybe you better speak for yourself

[Sabreiib]

BTC is digital gold, XPM is trying to become digital gold(copper?), PPC theoretically not possible become digital gold.

[ConfusedObserver]

I’d happily include PPC and XPM for technological reasons in that index.

PPC can be regarded as a kind of ‘insurance’ against BTC failure. PPC as old PoS coin with a track record might be seen as safe harbour in case BTC fails. I don’t know about its potential independent from BTC failure. PPC trade volume is quite low. It should have only a minor role in the index.

XPM is quite ASIC resistant. Are there even FPGAs? I’m only aware of GPU miners. The inflation model is smoother than Bitcoin’s and the number of tx per time can exceed Bitcoin’s.
But I fear there’s not really enough trade volume in XPM pairs to consider it for the index.

To float an idea possible members of such an index could be (part 1):
BTC
ETH
XMR
LTC
FCT
XCP
DASH
NXT
MAID
BTS

Optional members with low percentage (due to design or trade volume (part 2); or candidates for a second, ‘increased risk’ index):
WAVES
EMC
SJCX
SYS
NSR
XPM

The choice is somewhat randomly taken from listings on coinmarketcap, although I tried to include coins with a reasonable trade volume and features (vastly/slightly) different from other index members.
Part 2 obviously deals with a set of coins that should have only little percentage (due to little trade volume), but could play a role (due to features) in an index - maybe a separate index.

[Sabreiib]

These cryptos are all very volatile, because if BTC price halves over night, most of them also follow, are all “bad money”, if we peg to these, the meaning of peg is gone.

Then why not use BTC directly? @ConfusedObserver, do you know the meaning of “stable currency” at all?