[Discuss]Motion to make BKC the first Hayek coin in the world!

B&C Exchange
#1

After B&C finished,

  1. Reputed signers provide liquidity to BKC with official 10% spread on B&C platform.
    We encourage self-funded LP provide 9-3% spread liquidity on BKC/BTC pair.

  2. Shareholders can Park some BKS to be granted some BKC on a ratio continuous voted by shareholders. This is short term lending business, and shareholder can expand/shrink the BKC supply by voting new ratio. And borrowers can set up 1% spread liquidity on BKC/USD pair on traditional exchanges.

3)Peg BKC to stable buy power, because neither BTC/Gold nor FEDcoin(Tether, NBT) are stable, they are bad money. Shareholders update CPI per year or half year with passed motion.

POLL for NuShareholders: What is Your Current Sentiment on Nu's Future? (Updated Version - July 2016)
[Passed] X-NBT Change
#2

The idea is not mine, it’s from FA Hayek, and B&C is a company, shareholder are doing business, and we need good accounting, cut the expenditure and try to increase revenue, nothing newer than real world, but blockchain tech gives us the chance to issue a private currency which is never possible in real world. Wonderful Cryptoworld!

#3

I don’t think you understand what BKC are. The problem is that BKC is not a currency, we dont PEG it to anything. BKC are nothing more then the trading fees people have to buy up front and consume when they execute trades.

#4

I think @Sabreiib understands what BKC are.
He seems to make more than just a means to pay fees with BKC and thinks about making BKC a Hayek compliant money.
B&C Exchange wouldn’t even need to buy BKC back to support this approach.
All that would be required were a prospect of B&C Exchange not to undercut a certain buy power of BKC when selling them.

Free market would make sure that BKC will be bought and sold in the open market below that price with a spread, because there’s money to be made from it.
That’s what you already see at NBT rates since the peg was lost albeit supposedly manipulated by phoenix.

#5

We’re selling BKC at a fixed price say 2 dollars a piece and we’re not buying them back. People buy BKC only to use those BKC for trades at which point they’re “consumed” and destroyed. Explain to me how anyone could profit from this or how this in any way is related to a stable Hayek currency? BKC are just trade fees paid in advance instead of paid when you execute a trade (like you’d do on a centralized exchange).

#6

Untill we peg it to something, @Dhume, be openminded, B&C is a clone of Nu, or share most source code with Nu.

Don’t be restrained by Jordan’s original mindset, in fact, B&C is the first model which complies to Hayek’s theory. The authors of B&C may not perceive its potential or interested in being a Hayek coin, however, it has the potential.

Do you know where are Unix/C language come from? They were NOT intentional invented as OS and language AT FIRST, because in 1960s “Ken Thompson” in AT&T Bell Laboratory wanted to play game----Space Travel, and he got a machine PDP-7, but PDP-7 had no OS, so he had to write a OS for this machine so that he can play the game, and during the OS(Unix) dev, he developed B language and then develope C language with D. M. Ritchie.

In 1973, “Ken Thompson” and “D. M. Ritchie” rewrote Unix with C language, till then, they almost forgot the original intention: play the game of “Space travel”! :grinning:

Another famous example is US Mustang P51 fighter in WWII, initially(1940), North American designed a plane for UK RAF, and P-51 equipped with one stage superchager which means good low altitude performance and bad performance at high altitude. At that time, in US army’s eyes, p51 was just 2nd class fighter selling to foreign countries. US army’s key products were P47(thunderbolt) and F6F both of which equipped with R2800 air cooling radial engines.

Conclusion: there are many inventions that are not the things that were original expected.

I hope in 2020 someone will say “BKC was not designed as Hayek money at first, it was just expected as trade fee on B&C platform, but after B&C launched, people found it can be a very good stable currency, and get even more popular than NBT which was intentionally designed as stable crypto.”:blush:

2 Likes
#7

Why would we overcomplicate B&C by making BKC a trade fee mechanism AND a stable currency it doesn’t make sense. B&C doesn’t have anything to do with a stable currency platform. Don’t get me wrong I’m not necessarily against the idea of a new stable currency or a Hayek version of a stable currency but let’s not try to do 2 things at once. We need a way to for people to pay fee for trading on B&C that what BKC is designed to do, not be a stable currency.

I would favor trying to reboot Nu by creating a new pegged currency potentially based on Hayek theory but we need BKC to be what is was indented to be and that is trade fees.

#8

Well, if you like simplification, just do as white paper describes, at least BKC is selling at stable USD price, i.e. the official BKC selling wall exists, is it correct?

All the remaining things belong to free market, I’ll provide liquidity to BKC with my own money. I plan to set up 10K USD buy wall at 0.9$.

1 Like
#9

Most likely we’ll use Nubots to sell them at a rough stable value perhaps 1 dollar perhaps something else. You could potentially profit by buying up at 90 cents and selling below our sell wall at 99 cents. However I don’t think many people will be selling BKC there is no reason to buy more BKC then you’d need for you current trade fees and we should always have sell side liquidity up.

Why buy up 10 dollar sell fees in advance if you just need 1 dollar sell fees right now? So if everyone just buys the amount they need (which should be easy since you can buy on the exchange whenever you need the fees 24/7) very few would ever be selling into your buy wall.

#10

1)Isn’t it boring to buy exact BKC before every trade? I guess most customers will buy some and prepare for future use. B&C customers don’t know exact how many BKC they need in coming months. Can you predict your trade behavior on exchange in 2017? No. At least I don’t know my mine.

  1. I guess hedging customers(same as Nu’s customers) will prefer BKC to NBT because they have more confidence on BKC, B&C has revenue!
#11

  1. They can buy BKC the moment they need it?

  2. Only BKC is not pegged and we don’t buy them back ourselves, so if you’d use it as a hedge you’d be completely depended on private entities like yourself who are willing to buy up “cheap” BKC. That’s quite risky for something that supposed to be a hedge.

#12
  1. if some people find they overbuy BKC, they need to sell BKC to me. I am the tickets scalper.

2)Again, tickets scalpers are the most stable service providers. You can google what’s “spontanous order”.

No one ever designed English or French language, but they are there and popular, some one ever designed Esperanto, but it is rare to use.

#13

Don’t get me wrong there is some money to be made scalping cheap BKC and undercutting our sell walls. I just don’t see it being a lot but the more it will be the more you’ll earn so more power to you!

#14

If being a BKC scalper is a profit business, many people will rush here and free competition begins, this means less and less spread untill to an equilibrium reached, perhaps 3% spread is the destination on BKC/BTC.

In the end, we have free LP! Isn’t this result better than Nu’s design?

#15

Let’s do a thought experiment as I would like to run a scenario past you and see if it makes sense:

Say I owned a laundromat and users need to give me $1 fiat to get a token. I put the $1 fiat in the cash drawer.
Each token enables either 1 wash transaction or 1 dry transaction.

The client can return any unused tokens for conversion back to $1 fiat each at any time

Tokens that are used are simply put back in the token holder by me and recycled for the next client

Our profit is the $ fiat received for the tokens less the value of any outstanding tokens that are in circulation (and hence could be returned for a refund)

If for some reason, we increase the cost of tokens to say $1.50 we run the risk of those in circulation being returned for a profit but these can then be recycled and resold for a $1.50 and we are back to square (unless we can’t sell any at that price).

If for some reason, we reduced the cost of tokens to say $0.50 the client runs the risk of making a loss on returning his/her tokens.

The moral of the story is that:

Transaction fees received in BTC less those unspent in BKC (converted back to BTC at the current BTC rate) can be assumed to be B&C’s revenue.

Transaction fees received in NBT less those unspent in BKC (converted back to NBT at the current NBT rate) can be assumed to be B&C revenue.

B&C revenue stream is in BTC and or NBT not BKC. BKC are just tokens.

If an accounting entry were to be made, then any transaction fees spent/used up by the client in BKC would be converted (in an accounting entry only) to BTC at the time they were used at the prevailing BTC/BKC or NBT rate.

The BTC equivalent spent would then move from being a BTC liability to BTC income while the NBT equivalent spent would then move from being a NBT liability to NBT income.

Any difference in the BKC or NBT rate at the time of the transaction vs when the client deposited the fees would be an exchange gain or loss to B&C (just like our gain or loss from the price change in laundry tokens).

So there is no need for custodians to convert BKC to BTC or NBT. The BKC can just be parked until required by another customer.

Of course any surplus NBT (deposited less spent) would still need to be converted to BTC for dividend distribution but this would be achieved as per existing liquidity operations.

So rationalizing it the only reason that BKC are created is to effectively hedge any exchange risk on the revenue stream. With an active park and recycle mechanism in place to use BKC as a Hayek currency would require a very large pool of fees to be paid in advance and investors that believe them to be worth close to $1.

Does this make sense or am I being totally crazy here?

#16

It makes sense, but:

If B&C Exchange were to adjust the price per BKC, the “traders” would need some advance.
With adjustments regularly occurring (scheduled once or twice a year to adjust the price to buying power), traders could get rid of the BKC (sell them) before those adjustments.

The BKC in circulation can be gathered from the client (‘getinfo’).
Could work this way, no?

It would even be possible that the BKC price close to an adjustment would try to anticipate the adjustment.

Of course the BKC are only tokens and the revenue will be distributed as BTC (and likely accounted in USD).
But creating a Hayek currency could be achieved as side effect with little or no drawbacks I could identify.
Are there any I’m not aware of?

Again, I don’t speak about B&C Exchange operating dual side operations.
All B&C Exchange would have to do is

  • peg to buy power when selling BKC
  • schedule the adjustments to allow the market makers sell their stock before

This of course assumes that the exchange causes some more or less stable BKC consumption and the market makers can ‘predict’ when they need to start selling their BKC.
Of course they might calculate wrong or B&C Exchange users are aware of that market making and withhold orders to save BKC and buy them cheaper later.
In the end free market will find its way, if there’s some ground to build this on.

Is more than the two points mentioned above required for it?

#17

Every BKC destroyed by B&C for the exchange or other service is B&C’s net revenue, i.e.profit. Profit is the key, it makes our business going on, and make it possible to slowly raise BKC buying back price for anti-inflation.

E.g, In 2017 after 6 months operation, B&C has sold 180K BKC at 1$ and100K of them are destroyed. Assume the BTC FIAT price is stable, there are 180K USD value BTC in B&C’s hand and 80K BKC outstanding in circulation. If B&C won’t pay dividend, B&C can lift BKC price to 18/8= 2.25$. While the common USD CPI is around 3% yearly, which means we only need to lift BKC to 1.015$. We can naturally pay some dividend or withstand BTC’s 50% price drop during the 6 months.

If people like to use BKC to hedge, this means their purpose of buying BKC is not only pay the fee on B&C platform, but also as a stable value storage, the ratio of circulation BKS will be higher, ie. there are 120K BKC in customers’ hand and B&C can only lift BKC price to 1.5$ if BTC price stable. But that’s also enough to compensate the mild 3% USD inflation rate and paying extra dividend to shareholders.

It doesn’t matter our B&C business is large or small, the key is our revenue/liability ratio. Even if we only sell 100 BKC this year, we can stilll declare BKS is anti-inflation money. The currency issue quantity should be align with our revenue level, it’s bad for us to sell many BKC with few revenue(destroy ratio), because our BTC/ FIAT will face potential big risk!

BTW, BKC can be used as a accounting unit of B&C company, the only difference is that the BKC in B&C’s hands are not our asset because we can print it from thin air.

#18

If B&C slowly lift BKC buy back price, why customers will sell BKC before the price lift? I guess they want to sell BKC AFTER the buy back price lifted, but if there are 3% spread in pegging and we only lift 1.5% per half year, they have no speculation chance.

BTW, holding an anti-inflation money is not profitable because buy power is same, it’s a late fairness for the public since government abuse the public for a long time.

#19

You are right.
What I wrote makes more sense with deflation at fiat, but we won’t see that happen anytime soon.

If the alternative is losing 3% annually, it might be profitable compared to holding fiat :wink:

#20

Yes, holding FIAT is losing money activity, so Hayek said people will love anti-inflation money.

What I wrote makes more sense with deflation at fiat, but we won’t see that happen anytime soon.

Yes, if deflation occurs, customers will sell BKC before B&C lowers the pirce. My suggestion is to make the price lift/lowering more smooth, we can vote an annual in(de)flation rate of 3%, and we adjust price per month, so every time we change 0.25% price, is it wrothy of speculation? If so, we change price every week, that’s 0.06% every time.