[Passed] Motion to provide seed funding for B&C Exchange - a decentralized exchange built on the Peershares platform

I asked this set of questions on the corresponding thread in bitcointalk, with no answer.

  • Is BCExchange part of the Nu team or is he or she a new contributor?
  • What is more important? The number of confirmations required by blockchain ID or the number of total reputed signers of deposit addresses of blockchain ID required by B&C, protocol wise?
  • Let us say that the system requires 8 signers for each transaction to be valid. What happens if the pool of available signers contains at the time of the tx only 3?
  • Why “+2” in “…Verification must be received from enough signers to accomplish the appropriate transfers from deposit addresses plus two signers to be valid.”? Why not “+0”?
  • Do you have a concrete, feasible idea about how B&C would be able to help regarding solving the biggest issue of NuBits (at least from my perspective): the loss of funds incurred by LPCS on NBT/BTC because of BTC volatility? Since FIAT cannot be handled per se in the system, NBT would be exposed to BTC volatility for sure.
    See the following link (On the profitability of liquidity provision) if you would like to get some more context.
  • If the trade fees in credits a percentage of the exchanged quantity or is it a fixed fee regardless of the quantity?

That would be great if I could be answered (assuming the questions make sense) to at least some them. Tks.


So nobody here has created projections of their own, no matter how off they might be in the end? I’m really curious to see what people think about this.

You should try posting it in the bitcointalk thread too, there might be more people there willing to share their projections.

Do you think it would be fair to say B&C won’t be very attractive to day traders due to the slower speed of trades?

That’s difficult to say. Day traders on centralized exchanges have consistently lost money over the past 18 months due to theft and operator error. I think it’s reasonable to assume that a portion of those traders would be willing to use a safer service, even if it is a bit slower. The design document outlines a few different ways that speed can be improved too, so I don’t see it as a permanently limiting factor to B&C’s future success.

I think B&C Exchange will initially be most attractive to users who are trading large sums of value, and less attractive to high-frequency traders who are trying to continually capitalize on small changes in price, with a variety of opinions from traders between those two extremes.

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I’ll try to answer a few of your questions, but I’m commenting in a completely unofficial capacity so if someone who is working on B&C notices an error, please let me know and I’ll correct it.

Based on their responses to questions so far, I’m pretty confident that the person or persons posting as “BCExchange” on BitcoinTalk have been involved in the Nu project in some capacity. I do not know if this will be the situation in the future or if new contributor will be given the task of posting on the B&C “official” BitcoinTalk account.

They are both important, so I’m not sure I understand what root concern your question is trying to answer. Do these statements help?

  • A blockchain’s number of confirmations (such as six, for Bitcoin) is a widely-accepted suggestion, rather than something that is protocol-enforced. It follows that the deeper a specific transaction is buried in the blockchain the less likely it is to be included in a chain that ends up being orphaned because a competing chain reached a higher confirmed height.
  • For n-of-m multi-signature addresses there’s a relationship between the level of security provided versus the ease of use and cost, if you’re confident that the reputed signers are sufficiently decentralized and are not in collusion. The more required signers, the less likely the funds are to be stolen. On the other side, the higher the number of required signers the more “expensive” each transaction is to transmit (in terms of payout size in bytes and the associated fees incurred) and the more trouble it is to bring together the minimum required amount of signers when a transaction needs to be created.

(Personal Observation): I haven’t seen a use case yet that suggests that it will, natively. That is, until futures markets could develop, or until different forms of derivatives could be offered. The payment gateway projects that @mhps has proposed seem to be the best path to limiting exposure for LPCs.

If B&C is a major success, I imagine that there will be lots of smart people working on solving the problems associated with facilitating the exchange of fiat for cryptoassets.

Neither*. B&C will not charge commission fees on trades, only the transaction fees on the messages sent through the blockchain (charged by the byte, instead of per kilobyte like in Nu or Peercoin). The size of the fee per “trade” will have more to do with the number of signers used and the type of message being sent (“trade”, “confirmation”, etc.) than the amount of tokens being traded between the separate blockchains.

* Initially. It’s entirely within the B&C shareholders’ right to vote on a motion that requires a percentage-based or flat commission fee at some point in the future.


The speed of trading on B&C will be slower relative to other (centralized) exchanges, sure. I’d wager that there are a lot of different types of day traders – some may be following strategies that require sub-second APIs while others may not need that level of reaction.

B&C’s architecture will exclude the traders that are attempting to build high frequency trading agents, but then again, so do the rate limits and reaction times of a lot of centralized exchanges that exist today (including many of the “big” players).

It will definitely have some impact, but I believe it’s too early to tell how large it will be until test trades can be made using the production code and settlement timeframes can be benchmarked.

Ok, I did that and bumped the thread.

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I posted a notice about the auction in the Bitcoin’s block chain using http://cryptograffiti.info
Perhaps this gives a little more exposure to the auction.

Here’s the TX:


That’s great, thanks! If anyone advertises though, I think it’s a key selling point that we mention shareholders will receive Bitcoin dividends.


Tks. It helps a lot.

Alternatively you have this idea, in the same vein as this but simpler.

The announcement at bitcointalk.org is currently on page 4 of the project development threads if sorted by views in descending order.
Taking into account that the thread is very young it has received an impressive amount of attention!

Most threads that have that much or even more views are much older.
Only the mercury exchange thread can almost compete with the ratio of views per days of existence.

If we might derive one thing from my randomly picked and not in any way representative selection it is:
people are interested in decentralized exchanges and we know why :wink:

The time has come for decentralized exchanges!


@JordanLee, there is some criticism posted here…


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I would call it good feedback instead of criticism. I share that the proposed reputation system is one of the weaker elements in the design. Not necessarily bad, but also not as robust as you would like to see. Definitely room for improvement, but not sure whether that can be achieved in the first release. Maybe an iterative approach is better.

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Why is that new, almost on every page someone is bringing this up: It is impossible to make a decentralized random selection using a reputation system and it also cannot work in long term if user accounts are not redistributed to new signers if the old signers go offline. It was really pointed out since day one, by many different users, and the only answer is that it is expected not to happen.

I think B&C bets on the fact that the shareholders as a whole would make sure to act swiftly in a state of emergency where the system is getting dangerously closer to situation where there are not enough trustable signers as Nu has been betting on the fact that the shareholders would act swiftly in a state of emergency in which shareholders need to raise drastically the parking rates to keep the peg…

It is basically a bet on human inventiveness and rapid response by a decentralized organization.

This is only my view.

BKS shareholders have no influence on that, i.e. they cannot force to move the credentials of a user account from one signer to another. Even if they increase the number of signers, it doesn’t solve the problem that your particular user account still was associated to the old signers and will never go to one of the new signers if not done on a voluntary basis by the old one. So you can not deposit something on B&C and more or less forget about it, you should frequently check about the current state of signers to be sure about your coins, and make a new account every time you don’t see a sufficient number of signers online.

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I would lilke to see this discussion on bitcointalk so it gets more view and review.

Important questions addressed by @JordanLee here, on the trust built on the multisig signers and comparison with other centralised/prxyasset exchange.

The answers are satisfying to me.

I still have a hard time believing that the reputation system will be that easy to manage in practice.

There’s a huge amount of overhead required to maintain trusted signers that will fall (rightfully) on the shareholders. A large amount of automation will be required to make it something that is more than just a bunch of “rubber stamp” votes.

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