I am actually not really convinced by @JordanLee’s answer in the bitcointalk thread:
Theoretically it could be. However, exchange and stable currency are two completely different business models. It would complicate the protocol a great deal to accommodate both business models and increase the risk of an unexpected malfunction in the protocol.
Probably the best reason to separate them has to do with scalability. Creating two blockchains and two networks reduces blockchain size considerably and reduces the number of transactions and messages that need to be processed in each one.
There can be two separate blockchains, one BKC and one NBT, which are both secured using different staking processes but using the same NSR. Of course each NSR is eligible to stake on both chains at the same time, since they are different blockchains - NaS is our friend here.
Any NSR holder can always decide if one or both blockchains get synchronized and if staking is performed on none, one, or both chains. There is no scalability issue for pure NBT users or BKC users.
Both blockchains are different protocols, its only the same proof of stake that can be used on both chains. So any malfunction in one protocol won’t affect the other.
Where do I think wrong?
EDIT: Well not sure how to send NSR in above scenario, so its probably not working like this. I also assume that you spend a lot of thoughts on that, and probably would have preferred a single share solution if it wouldn’t suffer from those drawbacks.
I don’t think you’re wrong, @creon, that is one way to do it. I’ve never looked into multi-blockchain clients, however, so the level of complexity to adjust the existing Nu code to support both sets of protocols at the same time in the same client (or through RPC) doesn’t sound like a simple task.
Well i am still thinking about it and was about to delete my post, because the stake of the NSR blockchain can be in conflict when sending NSR, so I think what I proposed is not doable in this form. I let the post there since you answered.
But assuming this inconsistency can be solved, it is not harder than writing BKS. Its really just that you are not using BKS to sign your blocks but NSR, everything else would be the same.
An exchange requires concensus and i don’t see why the nushares blockchain can’t provides that consensus regardless of extra difficulty in implementation. In addition, blockchain bloat is seen as an issue but i also think having an exchange tied directly to nsr allows for far more features than two seperate blockchains. (trustless distribution of dividends for example)
You don’t need to tie the B&C blockchain to the Nu blockchain to do this. There’s nothing inherently different about the way that B&C would process dividends from how Nu does it that would make trusting the distributor required. They just enter the dividend distribution cutoff time, generate the list of shareholders’ addresses and balances, and then enter the value of the dividend to be sent out – just like Nu.
I still have to check with @sigmike because I am too lazy to read into the code, BUT actually I would say that if you are an NSR user right now, who doesn’t stake, then you can simply throw away the NBT part of the merkle tree, so there is no bloat.
Likewise, and if this is true, then you could run BKC and NBT on the same blockchain and would only require staking clients to sync the full merkle tree, while all other’s could only store and verify the part relevant for the coin they are using (+ NSR).
From a marketing perspective I think separate blockchains are better. Our ideal branding model should separate all products/Peershares with separate brand names in a way that consumer packaged goods (CPG) organizations like Procter & Gamble do.
Think of Nu like Procter & Gamble - a place where intellectual capital resides. Despite being a famous brand name, P&G doesn’t offer “P&G toothpaste”, “P&G paper towel” or “P&G razors”. It sells Crest, Bounty, and Gillette.
A big reason why CPGs use this approach is because it reduces the reputational damage that can occur to their entire portfolio of products if one product fails. If a vibrating Gillette Mach-18 (now with 18 blades!) razor lost control and cut off half of a user’s face, it wouldn’t affect sales of Crest toothpaste much, if at all.
B&C Exchange is a complex undertaking that will introduce all sorts of new potential ways for a user to suffer loss if not designed correctly. Placing its operations on the Nu blockchain not only reduces its ability to be marketed to the Bitcoin community, but also creates additional risk by association for the core Nu products should it fail. If a critical flaw is discovered in B&C Exchange after release, it shouldn’t affect the perceived quality of NuBits and NuShares.
If new Peershares platforms that are unrelated to core Nu activities are added in the future they should always be introduced on a new blockchain with a new brand name, with “Nu” eventually becoming synonymous for being a community that develops those new ideas, just like P&G.
I would also like to share something I’ve been thinking about for awhile. I think the unpegged “credit” unit / equity unit model proposed in BlockShares can be extended in an incredible number of different ways if we’re creative enough. Any business in the world that provides a user service in exchange for a purchased, non-redeemable “credit” can be created in a decentralized structure with modified Nu code. Imagine starting a streaming website that requires tokens to view live entertainment (use your imagination), an online arcade that requires tokens to play games, or a video service that connects language learners and teachers; these are all lucrative businesses that are ripe for innovation. NuBits are of course suitable for payment of these services too, but these unpegged internal company credits would actually be a simpler way for companies to earn revenue from cryptocurrency. And, those companies wouldn’t be required to understand liquidity operations or be exposed to risk of loss if the peg of NuBits is lost. They would simply have sold non-refundable “credits” that allow access to their network.
If the profitability model of B&C Exchange is proven, there are so many other opportunities waiting to be capitalized on.
Sorry but this sounds a bit like you want to abandon the pegged unit model (i.e. NBT/NSR) in the long term in favor to credit based systems valued by the open market, which I strongly assume is not the case!
I also don’t see the value for companies to create such a credit. If they are selling 1 credit for $2.50 and afterwards provide their service for 1 credit, then they could also just provide their service for 2.5 NBT. Someone distributing the revenues (i.e. a custodian) would be required in both cases but can be elected through regular motions.
What I would like to see would be the first Peershares applications without any credit or currency aspect, like the Tehee design. Those systems naturally interact with the Nu economy and are not in competition.
My examples were in the context of the limited environment of a business, where a credit is paid in exchange for a business-specific service. I would certainly prefer the general usefulness of NBT, but many companies might prefer selling non-refundable tokens for USD because there is less risk in holding USD. It also offers branding opportunities for the company - there is a reason you earn AirMiles, and not just the equivalent amount of USD.
That’s right. However, they would also need to provide the (expensive) infrastructure to receive the fiat payments. We are talking about the fundamental advantages of a merchant using crypto here.
Assuming that the peg is safe, then NBT will come with all this: People can use various existing services with low fees to acquire their “credits” (NBT) and the merchant itself does not need to invest in this. I think this is a clear selling point.
This doesn’t mean that you cannot use a credit system in addition for the reasons you mentioned. An airline which would only accept AirMiles and would require people to buy AirMiles first before they can book their ticket would not be very successful. They use AirMiles as additional internal currency with assigned value.
The designers of B&C seem to have made the two projects (B&C and Nu) detachable from each other after launch of the B&C blockchain. I actually appreciate that aspect of it.
The way I see it is we have Nu as our brand. Nu contains products (NuBits) and services (b&c). Imo, all products and services should directly be controlled by Nushares. By separating the blockchains, b&c can make decisions not in the interest of Nu. In addition, i now have to split my time talking to two communities to stay current on voting and manage at least 4 blockchains (nushares, ppc, b&c, and btc).
Generally, I expect at some point to receive dividends for my NuShares when we have profit. As it stands, Nu is funding the creation of a decentralized exchange, allow ownership to leave the hands of NuShares owners, and then give dividends to those new hands. At what point will profit reach NuShare holders?
I don’t understand this argument. BlockShares ownership will exactly match NuShares ownership. Any BlockShares profit will be earned by NuShareholders as long as they don’t sell their new asset.
This is only true to some extend. The general distribution will change dramatically and the market cap will be split over BKS and NSR according to the investors believe of success in the moment when the BKS get released.
In future an increase or decrease of the NSR supply will finally also break the individual 1:1 relation.
@creon explained my point much better than i did. If Nu is funding the creation of an exchange, that exchange should be controlled by NuShareholders only since we put up the funds to create it.
i do agree the exchange should be owned by nushareholder but the 187mil shares are not own by anyone they are undistributed shares and be burnt might as well use 100 mil and buy the exchange and the rest of the 87mil be burned or distributed to shareholders in nsr form or other crypto
make a motion to use 100 million to fund the buy b&c and burn 87mil or distribute to shareholders then i would vote to the auction not just to sell 100mil nsr and leave undistributed shares its been to long the rest of the 187million must go preferably burnt
I feel similar toward this. When I said before that eventually Nu would need to make profit, I wasn’t talking about dividends coming from a completely separate blockchain. I meant that dividneds would come through holding NuShares. B&C will be owned directly by Nu shareholders in the beginning, but that doesn’t mean that will always be the case. It’s possible in the future that shareholders of B&C will change and Nu shareholders will lose majority control of the exchange. If Nu is benefiting from the profit coming from B&C (for example our contractors are paid from B&C’s profit as I mentioned above) as the share owners change over time, the future owners could possibly pass a motion which ends support of the Nu network. This can’t happen if Nu shareholders control B&C directly (because they use the same asset: NuShares).