Amoveo ♥🧿
7 April 2021
J
19:24
Josh
If the land is owned by amoveo, does amoveo have to decide who the tenant is?
Z
19:25
Zack
it is using harberger. So if you want to be the tenant of some land, you make a tx on the blockchain to purchase the rental contract from whoever the current tenant is. At the price that the previous tenant declared.
J
19:25
Josh
In reply to this message
that could work, the tax should be a pretty reliable way of showing what the car is worth
19:26
so the harberger tax is for both the owner and the tenant?
Z
19:27
Zack
It seems like if a car is owned by the harberger system, then it is charging a tax which is a fraction of the interest rate.
Lets say that it is 1/2 the interest rate for simplicity.

Then the harberger system owns 1/2 the value of the car, and the tenant owns the other 1/2 the value.

It seems like the tenant could buy the rental agreement for, say $5000, then they drive it to outside where the harberger system is enforced, and they could sell the car for it's full value of $10 000.
19:31
I wonder what fraction of the interest rate would be typical harberger tax?
If it is 90%, then the harberger system owns 90% of the value of the land, so it seems like the tenant could have a bad incentize to focus on short-term profit at the expense of the land's long-term value.

if it is 10%, then the harberger system owns only 10% of the value of the land, so the harberger tax is a less effective signal of the land's value, and a smaller fraction of the land's value is tokenized and available as collateral for contracts.
19:33
In reply to this message
Amoveo is the owner. Humans are tenants
J
19:35
Josh
Ok so it's only for the tenants, makes more sense now
Z
19:41
Zack
Maybe it can't work.
Like, if I was a tenant, and I was thinking of having a building built on the land.
So the building is an investment of $90k, and it increases the value of the land by $100k.

Assuming the tax is at 50% of the interest rate, this means my rental contract is worth $50k more, and that the VEO market cap is $50k higher.

If I am paying $90k to only earn $50k, that is a big loss for me.
But it is a net gain for the world, so it is something that should be done.

Maybe when people are thinking of investing in their land this way, it is the same as selling new land to Amoveo. Amoveo should create some new VEO, and pay them to build the building.
19:44
Maybe instead of burning the VEO paid as taxes, we should only burn a small fraction, and the rest is paid to whoever sold the land to Amoveo in the first place.
We could tokenize this relationship too.
So you could sell some land to Amoveo, and receive a token that means you are paid taxes from that land. Then sell that token to someone else who wants to receive the taxes from that land.
19:48
the problem with tokenizing ownership is that it isn't fungible, so it doesn't work for collateral for smart contracts.
19:50
Maybe perfection is impossible, and we just need to be better than all the alternatives.
A tax that costs 100% of the interest is non-optimal in some ways, and a tax that costs 1% is non-optimal in others. Something in the middle is best for the price of VEO, and we can use futarchy to find it.
19:52
Maybe in cities where there is more development the tax should be lower, to stimulate productive development, and in less developed agricultural land it should be higher, to help the land move to be under control of whoever can use it most efficiently.
19:53
It seems like changing the tax rate could be nearly impossible.
Increasing the tax is like stealing a fraction of land from all the current tenants. Decreasing the tax is like stealing a fraction of the land from VEO holders.
19:59
oh, we could increase the tax if it is in combination with paying the tenants an amount of veo to make up for their loss.
and we could decrease the tax if futarchy says it is beneficial for the price of veo.
Rohan Malhotra invited Rohan Malhotra
R
20:46
Ric
What are the best papers to read on the “systems dynamics” of futarchy? ie how outcomes vary depending on (for example) number of people taking part, which properties of those people affect the outcome, how to optimise a futarchy for desired characteristics (eg speed of consensus vs confidence - if that’s even a sensible question to ask).

And if that doesn’t make sense as a question, what should I read to set me straight?
RM
20:58
Rohan Malhotra
Hey everyone how’s it going?
I just stumbled upon this gem of a project
Z
21:03
Zack
In reply to this message
Robin Hanson, who invented futarchy, he wrote some papers about it. He did some experiments with his students.
21:03
In reply to this message
hi, and welcome
21:06
In reply to this message
To have more confidence and speed in a futarchy outcome, you would want more liquidity in the market. So that there is a bigger incentive for a knowledgeable person to make an accurate report.
R
21:32
Ric
In reply to this message
Great, thanks.
8 April 2021
ReduX invited ReduX
B
17:13
Ben
just another mind game with no path to real adoption i would bet 😉
J
17:53
Josh
What if Amoveo gave out prizes to the most worthy contributors to decentralization and knowlege, like the woman from sci-hub. The reputational and visibility gain could increase the value of the chain. Recipients could be chosen by the oracle mechanism.
B
18:24
Ben
first we need to enable user use it (ux)
Z
18:45
Zack
In reply to this message
Kind of like how michelin stars are awarded to restaurants by the michelin tire company.
J
19:10
Josh
Right, or the nobel prize by a dynamite company
Z
19:11
Zack
Can awards be given without a central authority? Do we use futarchy to propose who should get a reward?
J
19:31
Josh
Yes, candidates can publish their public keys and we could have a question about which public key should get the funds. The answer that would increase hashrate should win.
19:32
Eventually there might be a supporting eco-system, like committees that get paid to study the achievements of different candidates.
Z
19:32
Zack
if futarchy says that it would increase the hashrate or veo price, then we should do it
ᴅ
19:56
ᴅɪꜱᴛʙɪᴛ ⛓️💵
There will always be the fallback of just paying people who say they will allocate the payment towards mining veo
19:56
So anyone who wants to receive such a payment would need to offer better expected hashrate increase value for money than just spending the money directly on mining
20:12
This is an interesting new paper that tweaked PoW to disincentivize mining pools.
mx
21:02
mr x
In reply to this message
YES
Z
21:03
Zack
In reply to this message
This is a good point. We should set up the futarchy market to compare against using the money for a block reward instead.
mx
21:05
mr x
giving money to miners is just one way to increase hash rate
J
21:06
Josh
In reply to this message
I think we should expect that the advantage would far exceed just spending it on mining, otherwise it wouldn't be worth doing.
MF
23:28
Mr Flintstone
lets say a hash rate futarchy says that hash rate will go up if we give a miner the option to print unlimited veo provided that the hash rate is above a certain level
23:28
does this make sense? doesn't it feel like we should be pairing the hash rate futarchy with a price futarchy?
23:30
it feels like this example is converting market cap into hash rate
23:30
but it is kind of hard to think about
J
23:47
Josh
i don't think that will be a successful strategy because the value of all the veo will go down
23:50
if we increase the block reward, hash rate would probably go up temporarily but not necessarily over time
B
23:53
Ben
hashrate does not directly impact the price
23:53
hashrate follows the price
23:53
for example when ethereum spiked also the hashrate rocketed
J
23:54
Josh
that's why it's an indicator of the value of the chain
B
23:54
Ben
that is also false
23:55
miner tend to believe that a rising diff is leading to a higher price
23:55
truth is that there is not always a direct connection
23:55
espacially with low cap coins
23:55
(like amoveo)
23:56
actually around 3 -5 miner are currently providing 95% of the hashpower for amoveo
23:57
an more then 90% are comminig from a single miner.
MF
23:57
Mr Flintstone
In reply to this message
i agree it probably wouldnt be a successful strategy. so i think hash rate futarchy by itself may have issues
9 April 2021
B
00:00
Ben
yeah espacially in a so easy to manipulate state
00:00
veo is currently very vulerable to any sort of PoW attack
JT
00:32
Jehan Tremback
Jesus. we should transition to proof of stake
00:32
wouldn't be too hard to put the state machine on top of tendermint im guessing
x
00:33
x
before PoW, amoveo already had a PoS blockchain version i think
00:33
zack developed sevearl pos blockchains
JT
00:34
Jehan Tremback
flying fox
x
00:34
x
i looked at github, there's probably also a version for amoveo
x
00:54
x
In reply to this message
probably a temporary solution like pos & pow hybrid make it more secure at early stages if there's people interested in attacking.


but that's not how it was done with bitcoin,

bitcoin has always been pure PoW...
B
00:55
Ben
zack hates POS
00:55
will not happen
IS
01:10
Ilmu Somebody
I want to participate in this discussion but my premise has shifted so much in the past few days
01:10
I wrote a whitepaper for a cryptocurrency project I am working on I suppose
01:10
datalisp.is
01:10
very very very inspired by amoveo theory of economics
01:11
but I think there is an issue with wording the oracle questions precisely enough
01:11
and that lead me down a rabbit hole that connected to a lot of other stuff I've been thinking about
01:11
resulting in the paper
01:11
(which I wrote in one sitting over the weekend so it's a bit all over the place, we are working on making it clearer)
J
03:39
Josh
Ok but I was referring to the binary encoding.
ᴅ
06:13
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Yeah spending it on mining, as zack mentioned above, should always be seen as a the minimum level of efficacy, so as a kind of cutoff for what is an acceptable level of return on the money handed out. Although ofc I think we should have much higher standards than that if we are (the protocol is) going to fund something.
06:15
In reply to this message
What about a requirement that it just increase both price and market cap? That rules out inflation or deflation related solutions.
J
06:24
Josh
How does inflation game the hash rate? Hashes are still going to cost the same.
Z
06:24
Zack
There is a big difference between short term and long term hashrate
ᴅ
06:30
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
I was talking about inflation as a potential unintended consequence if all we optimised towards was marketcap, as it is possible that in some short term time period, inflation could increase the marketcap
06:30
While in the long term if inflation like that is allowed to exist it would almost certainly decrease the price and marketcap
06:31
But I think a good way of getting around such issues may be by combining multiple requirements (such as price, marketcap, hashrate) and only funding proposals that pms expect to increase all three by a considerable amount
06:32
Idk, just a thought (the general idea that requiring an improvement on multiple variables, especially the three above, probably reduces the risk of unintended/wireheading type proposals)
Z
06:41
Zack
In reply to this message
Yeah, this is a good idea.
I had been trying to figure out which to optimize for. Making it achieve all the goals makes sense.
ᴅ
06:42
ᴅɪꜱᴛʙɪᴛ ⛓️💵
👌
MF
07:00
Mr Flintstone
reducing volatility is good too. specifically downside volatility. it might be too tough to predict that though not sure
07:02
i think reducing overall volatility and increasing the price are incompatible goals
ᴅ
07:03
ᴅɪꜱᴛʙɪᴛ ⛓️💵
You could do that, e.g you can derive expected volatility in both directions from options prices
07:03
But I think with the current level of liquidity seen on amoveo, that is probably asking too much
07:03
At least for the time being
Z
07:20
Zack
In reply to this message
If the price is increasing, then some minimum amount of volatility is inevitable.
But we can at least try to prevent volatility from being worse than that.
mx
07:29
mr x
Hash rate maximizing not very popular xD. Asking about total work far enough into future could make it not so bad... The simplicity of it compared to constructing some price/market cap metric from some centralized exchange...
ᴅ
08:23
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Hmm yeah hashrate maximization could work but I think it would need to be optimising for a higher average long term hashrate
08:24
So like the average hashrate over the next year type of thing
08:32
Rather than the hashrate at any particular point in time in the future
08:33
Since then ofc that is very susceptible to manipulation by just mining a lot around that point in time
ᴅ
08:50
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
https://photos.app.goo.gl/YE2AHdgP4FN9Fudu5
08:54
From Eric voskuil's cryptoeconomics book
mx
09:03
mr x
In reply to this message
total work done in a period
ᴅ
09:13
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Yeah exactly
09:13
And preferably a long period as well
I
12:14
Instinct
I think volatility is inevitable for such a low marketcap coin & it will get repriced a lot higher. This is part of the strategy investors need to adapt to, to slowly accumulate over months or years & then it potentially goes up a lot. Once there is higher organic liquidity the volatility will come down.
12:17
People are free to sell at these prices if they want & you can see that it is really only the miner who is interested in doing so. On the other side, barely any new participants know of Amoveo so you don’t see buy pressure either
12:21
Once there is more traction for products this will change
ᴅ
16:32
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Yeah but even then volatility is inevitable during any period of price discovery, which even trillion dollar coins with tens of billions of dollars of liquidity such as Bitcoin are continuously undergoing.
10 April 2021
Deleted invited Deleted Account
ᴅ
10:05
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Lol
G Kof invited G Kof
Drew invited Drew
11 April 2021
mx
16:16
mr x
getting server rejected tx in contracts.html when claiming scalar contracts winnings
16:17
hope the oracle resolved correctly 😅
B
17:07
Ben
amoveo-docs/getting-started/dependencies.md - Linux lead to a 404
Z
18:08
Zack
In reply to this message
thanks for telling me, it should be fixed now
18:09
In reply to this message
if the final result was "true", why was the final price like 0.3?
mx
18:11
mr x
wasnt it like false is true and true is false
18:11
oracle asks: MaxPrice = 1; MaxVal = 4294967295; B = Coinbase to halt LINK trading for US customers before April 2021 from $0 to $MaxPrice; max(0, min(MaxVal, (B * MaxVal / MaxPrice)) is 0
Z
18:11
Zack
did coinbase halt trading or not?
mx
18:12
mr x
no?
Z
18:12
Zack
In reply to this message
oh right. it says "is 0" at the end
mx
18:12
mr x
yea
Z
18:12
Zack
these contracts only resolve for oracles that say "true"
18:13
and the oracle text says which is which
mx
18:24
mr x
so it is correct?
Z
18:24
Zack
yeah, it says that coinbase didn't halt trading
mx
18:26
mr x
i put cid: jz5+NialTR/Ktymo2jb7PBDdVIGcSKVXwVw0bA6dEqY= oid: bks/bGLamA2PZ2bwYhjVlLVSx5kUl70r4y10R2rdSIo= in contracts.html to claim prize
18:26
server rejected
Z
18:28
Zack
In reply to this message
I see the failed tx in the logs
18:29
oh, it looks like the oracle was closed, but the contract has still not been closed
mx
18:30
mr x
oh
Z
18:31
Zack
I guess we should improve the UI to make this process clearer
mx
18:31
mr x
my mental model of how this works is lacking lol
18:32
i did resolve now
Z
18:32
Zack
http://159.89.87.58:8080/contracts.html
the "resolve scalar contract" tool is on this page.
18:32
In reply to this message
I see the contract evidence tx and contract timeout tx in the mempool
mx
18:33
mr x
it does 3 txs?
Z
18:33
Zack
only 2. Someone else made that 3rd tx
18:33
contract evidence is the only tx type that cannot be included in a multi-tx
18:34
because it has a turing complete smart contract in it. so we need the feature where if you run out of gas, the tx is still included so you are charged a fee, but the contract isn't updated.
mx
18:34
mr x
right
18:39
now wait for noone to publish counter evidence?
Z
18:40
Zack
no need to wait, you should be able to immediately get your money out. even in the same block
mx
18:41
mr x
oh yeah
Z
18:41
Zack
the smart contract resolution can involve a delay for more people to provide evidence. but for this contract we set that delay to zero
mx
18:42
mr x
yeah waht would it mean here
Z
18:48
Zack
is that a question? I don't understand
mx
18:58
mr x
nothing
12 April 2021
S
21:04
Sy
Time to massclose old oracles...
mx
21:06
mr x
spring cleaning time. got almost 1 veo out of oracles
S
22:42
Sy
processing all those orphaned unmatched and winnings is next
22:44
closing all oracles cost the pool roughly 0.3 veo
22:44
we had over 200 open oracles that were closeable
MF
23:11
Mr Flintstone
my guess is a lot of those were the old scalar oracle method where there was 1 oracle per bit of scalar value
13 April 2021
mx
00:46
mr x
dark ages of oracle design
S
01:13
Sy
well...all done
01:13
i can cron it now thanks to zack so the pool will keep closing oracles
MF
01:14
Mr Flintstone
wdym by cron?
S
01:16
Sy
he added api:close_oracles(n) which just closes n closeable oracles
01:16
and im calling that via cron through curl
01:16
curl -d '["close_oracles", 50]'
Z
01:44
Zack
In reply to this message
"Cron" is a linux program. It allows you to schedule some other program to get run on some regular basis. In this case, he is setting it up to call an amoveo api command every day.
"Curl" is another linux program. It allows you to make http requests, the kind of requests that you make when you visit a webpage.
Amoveo's api is an http api, so you can use curl to send commands to the amoveo full node.
S
02:39
Sy
ah what do you mean by...i thought it was just some typo 😅
JS
06:23
Jon Snow
any new update in the past couple of weeks?
Z
07:26
Zack
In reply to this message
Sy had the idea to automate settling oracles and paying out winnings from oracle reports, which will simplify the ui.
mx
09:41
mr x
nice
09:43
resolving contracts also?
09:44
payout winnings?
Z
09:46
Zack
we are setting it up to payout winnings automatically.
automatic contract settling for standard contracts should be possible.
mx
09:46
mr x
yeahh
ᴅ
18:18
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Where can I find the emission schedule of veo out of interest?
S
18:19
Sy
In reply to this message
well not automaticly but the tx can be created by anyone, not just the better himself - so the pool can close them at that point once its implemented
Z
18:24
Zack
In reply to this message
http://159.89.87.58:8080/lookup.html you can look up the block reward and block time on this page.
It is like, 130 blocks per day and 0.12 veo block reward currently, including the developer reward. so like 15.6 veo per day.
you can see the market cap here: http://159.89.87.58:8080/ext/getmoneysupply
currently 77736.
so that is like 7.3% annual inflation currently.
ᴅ
18:24
ᴅɪꜱᴛʙɪᴛ ⛓️💵
👍thanks Zack
15 April 2021
03:03
when this?
Z
03:04
Zack
we have the ability to make offers to sell veo for btc.
Z
03:22
Zack
This is the announcement for hard update 50. Which activates at block 16900, in about a week, around the 21st of april. Full nodes need to update.
Here are the same updating instructions as always: https://github.com/zack-bitcoin/amoveo-docs/blob/master//getting-started/updating.md

The purpose of this update is to allow anyone to make a tx to cause someone else's account to withdraw their winnings from a resolved oracle.

This allows us to make a simpler UI, where you don't have to keep track of which oracles you reported in, and you receive your winnings anyway.
A
03:53
Adrien
I'm trying to build Amoveo on NixOS and get the error reported here: https://github.com/davisp/jiffy/issues/197
Z
03:59
Zack
In reply to this message
Sounds like instead of using the rebar3 program i include, you should install a new one?
IS
04:38
Ilmu Somebody
You can use this file:
https://envs.sh/Zz.bin

In the same way as nixos-infect (just nixos-infect with a premade config). After the hetzner guy is finished building you can ssh into veo@yourip and git clone amoveo. After cloning amoveo you need a config/sys.config.tmpl like this: https://envs.sh/ZK.tmpl

and that's it. You can build and run.
04:42
so to be pedantic:

hetzner user script:

#!/bin/sh

curl https://envs.sh/Zz.bin | NIX_CHANNEL=nixos-20.09 bash 2>&1 | tee /tmp/infect.log


then ssh veo@ip-addr

then git clone https://github.com/zack-bitcoin/amoveo

then cd amoveo/config && curl https://envs.sh/ZK.tmpl > sys.config.tmpl

then cd .. && make prod-build
04:44
the user script takes a little while to run, so you need to wait for around 10minutes
Z
04:49
Zack
it seems like a security risk to link to a binary like this from the main amoveo install script.
What if this isn't a legitimate version of Amoveo?
MF
04:58
Mr Flintstone
cant you see the source
IS
05:00
Ilmu Somebody
follow the links, this is a bash script
05:01
it's just the standard nixos-infect script but it creates a user and makes some firewall adjustments
Z
05:01
Zack
oh, I get it. I should maintain my own copy of these files right?
IS
05:01
Ilmu Somebody
yep
Z
05:06
Zack
so why doesn't the default configuration file work?
IS
05:10
Ilmu Somebody
what do you mean?
Z
05:11
Zack
you get a default configuration when you use git to copy the amoveo file.
you don't need a separate sys.config.tmpl, right?
IS
05:12
Ilmu Somebody
ah the default file needs to be renamed and you need to put the username in one spot
05:12
if you diff the file I gave above against the default you'll see
Z
05:14
Zack
you are storing the database in a different spot.
because it isn't being run from inside the github repository?
05:14
the "CHANGE_TO_YOUR_USERNAME" part is commented out
IS
05:15
Ilmu Somebody
In reply to this message
oh lol didn't realize that cause I always change it when I rename the file to fix the error
05:16
In reply to this message
there's no concrete reason I just found it simple to keep the db in ~
Z
05:16
Zack
not everyone is running on a computer with a user named "veo"
IS
05:16
Ilmu Somebody
no but the config create that user
05:17
if you diff the config I give against nixos-infect you see
Z
05:17
Zack
sometimes I change the default config file too. I think we shouldn't have a second copy for some kinds of installs
IS
05:17
Ilmu Somebody
In reply to this message
what do you mean?
Z
05:18
Zack
like, sometimes a feature that was previously the same size for everyone, it becomes configurable
IS
05:19
Ilmu Somebody
the reason these files I shared are hosted in this domain: https://envs.sh/

is precisely because I did not intend for this to be a long lived solution, just a simple way to get it up and running right now
05:20
the config.. I don't know anything about it! I just rename it because if you don't the makefile will error on you
Z
05:35
Zack
@IlmuKalm
I added the nixos install instructions in a link from the page about dependencies https://github.com/zack-bitcoin/amoveo-docs/blob/master/getting-started/dependencies.md
hopefully this version works without errors.
IS
05:36
Ilmu Somebody
cool!
Deleted invited Deleted Account
Z
17:49
Zack
we probably also want to be able to withdraw winnings from settled contracts for people, right?
mx
17:54
mr x
yeah imo
16 April 2021
Deleted invited Deleted Account
Z
03:36
Zack
a little, yeah
IS
07:22
Ilmu Somebody
is the light node just the FE? (i.e. is it identical to the FE bundled with the full node?)
Z
08:28
Zack
In reply to this message
What is FE?
The full node is in erlang. The light node is in js.
IS
08:28
Ilmu Somebody
front end
Z
08:28
Zack
Oh yeah. The full node serves a light node yes.
IS
08:28
Ilmu Somebody
BE / FE is a very common abbreviation! (at this point I feel delusional, everyone asks what FE and BE stands for >.<)
08:28
alright, thanks
Mandalorian Kav invited Mandalorian Kav
MK
10:14
Mandalorian Kav
Hi guys I'm from WBF exchange would like to have a chat with manager. Who can I speak to？
D
12:28
Devender
In reply to this message
I am a developer since last 7 years. Never seen anyone using these abbreviations.
IS
12:31
Ilmu Somebody
I guess I spend too much time on HN
Z
20:32
Zack
In reply to this message
https://github.com/zack-bitcoin/amoveo/commits?author=sennui
looks like he mostly just renamed functions and variables. Which can be useful for readability, but it doesn't give me a very good idea of his capability as a programmer.
L
23:12
Lopyox
Hey @zack_amoveo
Could you tell me what is the best book on futarchy ?
17 April 2021
Z
00:36
Zack
In reply to this message
Ive never seen a book on futarchy. Maybe check out robin hansons papers.
L
00:36
Lopyox
Ty
EA
01:09
Eric Arsenault
Zack did you look into new chainlink whitepaper?
Z
01:10
Zack
In reply to this message
no
Z
07:59
Zack
Ive been thinking about how popular crypto bridges are getting.
Remember that time we tried to do markets for derivatives entirely in channels? It was crazy capital inefficient. For every person with money in the market, the market operator had to lock up the same amount. We came to the conclusion that this level of capital inefficiency cant be sustainable.

But crypto bridges are far worse. The operator needs to lock up 2x as much as can be traded. Plus the validators for pos are locking up even more.

So how come people are using these bridges?
Is it a ponzi scheme, where as long as new money is flowing into the system, the increase in price from new investment overwhelms the losses due to capital inefficiency?
EA
08:00
Eric Arsenault
was thinking about that capital inefficiency as well in the past
08:01
Synthetix and Thorchain are good examples I think
08:01
I do think it is somewhat of a ponzi tbh
08:02
token incentives sort of makes up for the inefficiency in a way. The cost is inflationary
08:03
as long as new money comes in faster than inflationary rewards, it's a great model
ᴅ
08:40
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Yeah I think a lot of the reason why people use bridges such as tbtc is in order to take advantage of yield farming (seigniorage) "interest rates"
08:41
So it is all heavily subsidised at the moment by inflation although yield farming incentivises have been declining afaik
ᴅ
09:19
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Also I think the costs associated with using tbtc do have a clear impact on the adoption of such bridges as can be seen by comparing it to the adoption of wbtc which is custodial and not over collateralized
Z
09:22
Zack
In reply to this message
Wbtc has the same amount of locked up btc as there are wbtc. So i think it doesnt suffer from the same capital inefficiency problem.
ᴅ
09:23
ᴅɪꜱᴛʙɪᴛ ⛓️💵
That's what I meant
09:24
Hence why it has a market cap orders of magnitude higher than tbtc
09:24
Which is over collateralized
IS
16:46
Ilmu Somebody
In reply to this message
It's normalized, people think it's the best that can be done.. amoveo doesn't really exist except in theory
18 April 2021
00:32
I disagree with some aspects of this article
00:33
Such as tbe regulatory threat to security tokens claims and the idea that tokens can't be productive by earning income on them (empirically refuted)
00:34
It then goes and seems to use some monetarist arguments relating to velocity and "locking up/reducing supply"
00:34
Where it just presumes that such factors are relevant to what it is discussing
00:35
Without actually giving a microeconomic explanation for why that may be the case
00:36
I have always found such arguments to be unsatisfying due to them rarely actually deriving such conclusions from first principles
00:37
This kind of relates to our discussion a few days ago @zack_amoveo on the topic of the value that would accrue to a token necessary in order to pay harberger taxes in
00:37
I am not convinced that such a source of demand would create zero value for the token
00:37
Which would be the conclusion drawn by the above "framework"
00:42
In reply to this message
I also didn't really understand the reasoning here that you used to determine the expected value of the currency used to pay harberger taxes
00:42
I will re read it and think about it a bit more ...
Z
01:32
Zack
In reply to this message
2 important concepts.
1) Deleting money is the same as distributing it to all other holders.
2) People will keep buying into your currency, or selling your currency, until the interest rate of holding your currency is the same as the interest rate of the economy.
01:33
Hold the annual value of taxes constant, and vary the market cap.
ᴅ
02:09
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Hmm yes good point
02:09
Makes sense
Sk Sagor invited Sk Sagor
Z
20:23
Zack
https://github.com/zack-bitcoin/amoveo-docs/blob/master/basics/market_cap.md
It looks like a payments or smart-contract based blockchain can't sustain a high enough market cap to be useful.
ᴅ
21:04
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Hah interesting:)
21:05
This relates to our discussion/your conclusion wrt harberger taxes
21:10
I do not think I agree with your conclusion...
21:10
I think it is missing any explanation for why monies can't have a monetary premium
21:11
While other foods can for example have a premium above the value calced by this model due to the subjective benefits that they bring their owners
21:15
https://mega.nz/file/V8AlkYxb#gAH1S2JK8sulGYnIjWrqldvrmFUgoxFjc5R6f97qZe4

I haven't yet read this but I think you may find it useful on this topic @zack_amoveo
21:15
Mises' Theory of Money and Credit
21:18
https://mega.nz/folder/h0ww2BaL#LBJz4Al9m0PgDSe7J5xYEA this is a folder of econ books I have curated and am slowly reading through in case anyone wants to download any
21:19
In reply to this message
https://mega.nz/file/wlBXwagS#Q1RdAe63Y1gqabZclb3uoYzgqum-8JwB8HgIZw9-mEI

Also this @zack_amoveo Currency Theory by Carlos Bondone
21:19
Something I have also been meaning to read recently
21:19
Will hopefully get around to doing so soon
21:20
But it may be potentially insightful on this topic
Z
22:50
Zack
Idea on how we can start experimenting with harberger.
A web page with a list of short texts. And you can control the text in a section.
A web page with regions of pixels you can control. Like the million dollar website.
A minecraft server with regions you can control.
Z
23:38
Zack
NFT with harberger might work too.
23:39
Im thinking we can make some really simple on-chain mechanism, like where you sign up to slowly burn the money in your account.
and some overlay network that scans the blockchain, it can see who is doing these slow burns and keep track of who owns which stuff based on that.
23:39
that way full nodes don't have to keep track of any database of land ownership
23:42
Landlords who use mortgages on their properties to get leverage, they want bigger mortgages to have higher leverage.
So maybe owners of land will actually prefer that the taxes are as high as possible.
23:52
What if I sell myself as like a slave to a harberger system?
So whoever my current owner is, they can assign my task for what I should be working on. But they need to pay a tax that gets burned, and I would own the majority of the currency that the tax is paid in.

The value of the currency would be as much as my expected output as a worker for the expected amount of time I participate in this system.

Like a harberger version of the davie bowie bonds.
19 April 2021
MF
03:34
Mr Flintstone
your labor is not fungible
Z
03:35
Zack
right. neither is land.
CAPTAIN CRYPTO invited CAPTAIN CRYPTO
C
08:24
CAPTAIN CRYPTO
Hello
ᴅ
08:39
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Couldn't a monetary asset have its price also influenced not only via it being deflationary but also due to people valuing it and being willing to pay a certain amount for it due to the expectation that they will be able to sell it for a similar price in the future?
Z
08:43
Zack
In reply to this message
If one currency can be used for the same usecase as another, and one of them is constantly bleeding value, but the other is not, it seems like the more efficient version would win.
08:45
Like if one currency is expected to grow in value 5% vs gold, and the other is expected to stay the same value of gold, and they can both be used to power the same smart contracts or oracles.
People would tend to use the one that is stays valuable or grows in value.
ᴅ
08:51
ᴅɪꜱᴛʙɪᴛ ⛓️💵
What if the money that doesn't have an inbuilt deflationary mechanism has other properties such as strong network affects, liquidity, name recognition etc that cause it to be more attractive to the marginal next user than one that is appreciating due to deflation?
08:52
In such a case I suppose mises' regression theorem couldn't provide a basis for the value of such a coin
Z
08:52
Zack
those other things aren't mutually exclusive with deriving value from a harberger system
08:53
liquidity is very connected with the size of the market cap, which is what the harberger system is optimizing for.
EA
09:47
Eric Arsenault
In your tweet Zack “If a blockchain owns land and rents it out using harberger taxes, and we burn all the taxes collected” : how would the blockchain own the assets? Are you imagining some sort of legal entity for the blockchain that has legal ownership?
09:47
How would rent be collected?
Z
11:08
Zack
In reply to this message
With harberger taxes, you self assign you own tax rate.
Anyone can buy the property from you at any time based on the price implied by your tax rate.

So if your taxes are too low, people can buy the property from you at below its price.
11:10
In reply to this message
We would probably need to do experiments to find the best method, but i think it wont be too difficult.
People want to sell their land at a high enough price. So there is an incentive to keep the land sellable.
Bishop Jones invited Bishop Jones
ᴅ
17:12
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Yeah they aren't mutually exclusive, you could definitely have a harberger currency with all of those attributes but I think you can also have a currency that has isn't deflationary but also doesn't have any reason to revert to the discounted value of its deflation.
17:15
Like I don't think that payments based blockchains won't maintain a high enough market cap in the long term in order to be useful for trade, due to them not having a source of deflation.
17:15
I am not saying I don't think a harberger tax chain won't be able to outcompete them, I don't really know I suppose
17:16
I need to think more about the harberger tax idea, it is very interesting but I can't say I have a strong conviction for whether or not it will work
B
17:20
Ben
@zack_amoveo are you deviating from the DEX idea to be first MVP? see you now a lot writing of these harberger stuff.
Z
17:29
Zack
In reply to this message
Im trying to understand where a blockchain can get sustainable value from.
If it is really the case that useful features dont grow the market cap, then maybe that means adding features is a distraction.

Like if people can buy into your blockchain, use a tool, and then immediately sell afterwards. Maybe that doesnt help the market cap.

Eventually the blockchain industry will outgrow this speculative mania, and at that point the value will be primarily coming from something other than speculation.

Its like how we realized that bridges arent sustainable. Im tying to figure out what things are sustainable.
17:33
I think i might be missing part of the puzzle though.
Like, if a feature requires you to hold the currency for a time.
The way our financial derivatives work. You need to hold the currency for the duration of the contract.

Maybe having a demand for these kinds of contracts impacts the market cap?
17:44
I did some thought experiments about stablecoins, based on these ideas about sustainable market caps, and i came to some worrisome conclusions. It seems like stablecoins aren't completely possible.

Like imagine we made a stablecoin of gold, and we made another stablecoin that increased in value 5% per year vs gold.
What would be the difference between these assets? We can't just generate value from nothing.

It seems like the gold+5% asset, it would have a bigger premium in order to purchase it, because there is an expectation that it will be worth more at the end.

In the same way, if VEO was being inflated by 5% per year, then all the stablecoins would have an expectation of growing 5% vs VEO. So all the stablecoins would have a bigger premium to purchase them.

If we build the perpetual stablecoin, holders of the perpetual would need to keep paying this premium every time we refresh the stablecoin for the next month.

So the stablecoin contract, it only protects you against volatility. It doesn't change the long-term expected change in price of holding VEO.
If VEO is expected to increase in value 3% against gold, then holding the gold stablecoin will earn you 3% more than holding gold would.
B
17:46
Ben
as long as amoveo will not be usable for average joe. and have a usecase build in an MVP it is just a concept, last time we spoke the idea was to hard the DEX stuff and make it mvp. with what you wrote above, basically you are saying you are back to square one.
Z
17:46
Zack
So holding a stablecoin collateralized by currency X, it is necessary that the stablecoin will grow or shrink in value along with our expectation of the long-term change in the value of X. You are only protecting yourself from short term volatility.
17:48
I am still going to build the DEX. I just think it is really important to understand what kinds of mechanisms are possible for blockchains.
17:49
im not sure if we will ever build harberger stuff, it is more like an example for these thought experiments. to better understand where value comes from.
B
17:51
Ben
currently is a great time to attract user, amoveo could be easy one of the top50 dex.
I'm willing to hire a web/UI Dev to build out a nice interface as soon as you declare the MVP ready and build out some Documentation a Web/UI Dev could use to build out that Interface.
Z
17:53
Zack
In reply to this message
mises regression seems like a circular definition? maybe I am misunderstanding it.
He says the value of the currency comes from what you can purchase with it.
But that is just the definition of the value. It is as valuable as whatever you can trade for it.
17:54
In reply to this message
ok, sounds like a good plan
B
17:55
Ben
In reply to this message
perfect, ready when you are.
ᴅ
17:58
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Isn't what people do with all money to buy it, hold it for a period and then sell it? I think this idea needs more developing as the only difference between holding a coin in the long term and using it to execute a trade and then sell it afterwards is the period of time, as far as I can tell... Does that mean the period of time determines the impact on the price? If so, why would that be the case?

If we do though assume for argument sake that if people only use a coin momentarily as you describe, the coin doesn't appreciate as a result, even if they value those features then I still think it is possible that better features will increase the value of the money.

This is because if at a certain point the transaction costs and frictions of converting your money to veo, using a feature and then selling the veo outweigh the benefits of doing so (which would be the ability for you to not be exposed to the volatility of veo, or maybe the lack of acceptance of veo by others etc) then you will decide to just store your money in veo.
Z
18:00
Zack
In reply to this message
If needing to hold the currency to access features somehow provided value...

It seems like people holding for these reasons, lets imagine that they increased the market cap a little so they had capital to access the features.
Then whatever money is being burned, that value is being spread more thinly to a larger number of holders.
So the expected profit would dip below the interest rate, and people who are holding as an investment, they would start selling until it became a good investment again.

So it really seems like the people who hold to access features, they aren't causing the market cap to increase.

But maybe if we change the design, the users of smart contracts could be causing it to increase.
Like what if there were 2 currencies. One of which was used for burning, and the other was used as collateral for smart contracts. and there was some kind of exchange rate between them that changed over time.
Deleted invited Deleted Account
Z
18:08
Zack
maybe it would work like this.
We start with 1100 units of the burnable currency.
Someone converts 100 units into collateral for smart contracts.
so now there are 1000 units of burnable, and 100 units for smart contracts, and the exchange rate is 1:1.

Next 10 units of burnable currency get burned. So now there are 990 units of burnable, and 100 units for smart contracts. and the exchange rate is that 1 unit for smart contracts can only buy 0.99 units of burnable.
18:09
so the benefit of currency being burned, it only goes to people holding veo. the people actively using veo as collateral for their contracts, they don't receive the benefit.
18:13
So then, people who lock up veo into smart contracts, they are benefiting the system by letting the burned value accrue to a more concentrated group of users who only hold the burnable currency.

The total market cap could be something like (money needed to collateralize the smart contracts) + ((rate of currency being burned) / (interest rate))
ᴅ
18:17
ᴅɪꜱᴛʙɪᴛ ⛓️💵
What about requiring users of veo smart contracts to pay a fee which is burnt or distributed to other veo holders? Doesn't this already happen via tx fees?
18:18
Nvm I suppose that would incentivise parasitic oracles
Z
18:19
Zack
In reply to this message
Yeah, that or it would just cause competitors to undercut us.
ᴅ
18:19
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Makes sense
18:23
In reply to this message
If you do this, they are incurring a cost which is the opportunity cost on the capital
18:23
So it is equivalent to charging a fee
Z
18:23
Zack
Harberger is a useful example because it necessarily involves burning, so we cant be undercut.

It seems like the only way this is possible is when the blockchain owns some scarce resource it can rent out.

Maybe when people use some collateral for their smart contract, they are borrowing a scarce resource and should pay a rent.
ᴅ
18:24
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
So it can be undercut by other blockchains
Z
18:26
Zack
In reply to this message
This comes back to the gold stablecoin vs 5%better than gold stablecoin idea.
If the one currency is expected to grow 5% vs the other, then even after removing the 5% as a "fee" we only end up equivalent to that other blockchain.
ᴅ
18:26
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
How do you stop the burning from causing chains to compete to get people to burn their coins on them and so therefore making it a dollar auction for who will compensate you the most for burning, defeating the point of burning?

Or do you think burners won't want to be compensated because then it weakens the signal and reduces the value of their land?
18:28
In reply to this message
But according to your theory of value, the other blockchain token will also be growing in price at the interest rate since if it isn't it would be sold by investors until it's marketcap is inline with that interest rate
Z
18:28
Zack
In reply to this message
paying someone $1 of new inflation to burn $1 clearly doesn't do anything. it is not comparable to what the harberger system of burning is accomplishing.
18:30
In reply to this message
if one blockchain is burning more annually, then the equilibrium market cap is higher.
ᴅ
18:32
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Yeah I agree, but still if you "charge" as a fee for using your SCs people by making them lose out on interest appreciation, then other blockchains can outcompete by not charging that and allowing them to earn the interest rate on their capital
Z
18:36
Zack
if we did an airdrop, and gave free new veo to everyone who was using a smart contract, that would be inefficient.
So excluding the smart contract users from benefiting from the burned value, it seems like it would increase efficiency.

If some other blockchain did airdrops for users of their smart contracts, that wouldn't cause them to undercut us, it just dilutes the value of their currency.
ᴅ
18:46
ᴅɪꜱᴛʙɪᴛ ⛓️💵
"if we did an airdrop, and gave free new veo to everyone who was using a smart contract, that would be inefficient." What do you mean by this? Why would it be inefficient?
Z
18:46
Zack
So maybe it should work like this:
If you lock money into the smart contract system, you should lose a fraction of the money based on how many blocks it was locked up for. Like 2% per year.
But additionally we should keep track of how much veo was burned during the period of time that you had money in the smart contract system. If n% of veo were burned, then you should lose an additional n% of your collateral when you take it out of the smart contract system.
ᴅ
18:47
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Isn't that just taking a fee that could be undercut/susceptible to parasitic oracle chains?
Z
18:47
Zack
In reply to this message
if we give out free money to people for spamming the blockchain with txs, it is a negative tx fee and the blockchain gets more spam.
18:50
In reply to this message
if there is a long-term expectation that veo is increasing in value 2% vs the collateral on that other blockchain, then removing that extra 2% in our collateral makes us equivalent to the collateral in the other blockchain. they aren't undercutting.
ᴅ
18:51
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
I agree with this, but I am saying that such an expectation shouldn't exist because if it did then arbitrage would bring the two rates of increase into alignment.
Z
18:52
Zack
In reply to this message
maybe alignment happens when one of the market caps is zero.
IS
18:53
Ilmu Somebody
In reply to this message
I'm already doing a little bit of frontend work (altho so far all I did was cssify a button there are concrete plans, idea being to make a brute force cssification - i.e. some proof of work.. - and then bet against the community for further stuff like documentation and such)
ᴅ
18:53
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Well this is if the deflation model of marketcap theory that you outlined in your recent document is correct, yes.
18:54
Assuming there wasn't also deflation occurring on the other blockchain
IS
18:56
Ilmu Somebody
In reply to this message
What happened to this?

The way I see it this harberger tax is a tangent that firmly falls in the camp of premature optimisation. Amoveo is well positioned to step into the limelight if we have a DEX that can uniswap perpetual stablecoins.. once the platform sees use and hires people to extend itself then the bikeshedding can continue
Z
18:58
Zack
the global market cap for derivatives is big because they have a lot of collateral to work with.
Mortgages seem to be a major source of collateral for the fiat money system.
IS
18:58
Ilmu Somebody
But no one will trust this platform as land registry until it can do other things so the whole point is moot
Z
18:58
Zack
The DEX is a cool tool, and great for on-boarding, but it isn't a derivative.
IS
18:59
Ilmu Somebody
Once the DEX is trading some large amounts it will be possible to extend amoveo to cover more oracle usecases'
Z
18:59
Zack
In reply to this message
harberger is an example to help us understand where the market cap value comes from. Hopefully there are other ways to get this value besides a land registry. Maybe by renting out scarce capital.
IS
18:59
Ilmu Somebody
It's a question of building trust
ᴅ
19:02
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Btw zack i think I have found a flaw in the stablecoin impossibility argument
Z
19:02
Zack
In reply to this message
economically speaking, bundling is bad.
So it is a bad idea to bundle smart contracts along with investing in the cryptocurrency.
19:03
In reply to this message
ok. what is it?
ᴅ
19:03
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Well if someone is holding veo it means they do not believe that ti will depreciate, as if they did they would allocate their capital elsewhere.
19:04
It will already be priced into the price of veo
B
19:04
Ben
In reply to this message
interesting keep it going 😉
ᴅ
19:04
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
So therefore such expectations shouldn't impact the long willingness of people to lend out their veo at market interest rates
19:05
So generally it should be expected that the costs of holding a stablecoin on veo should just be the interest rate on the collateral
19:05
not compensation for changes in the price of the collateral
Z
19:08
Zack
If I made a stablecoin that constantly lost 5% of it's worth vs USD per year, and another that stayed the same as USD.
Then the premium when you purchase the stablecoin instead of the other, it would need to differ by that 5%.
19:19
so if you invest in a stablecoin contract, you are only selling the volatility. You cannot sell the long-term expected change in value of veo. you can't get rid of all your veo exposure.
Z
20:04
Zack
In reply to this message
Now i get what you are saying. If the blockchains are in equilibrium, then the expected return of holding each would be the same.
So if we charge rent to make smart contracts, they could undercut us.
ᴅ
20:04
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
yes :)
20:04
Sorry I could have probably been more clear
Z
20:05
Zack
So maybe this means the utility of features really cant increase the market cap.
20:18
In reply to this message
So maybe just holding the cryptocurrency isnt necessarily the same in equilibrium.
Rather, if you use that cryptocurrency to optimally earn profit from that blockchain, then you achieve returns that end up in equilibrium.
20:20
In that case, adding more utility features to the blockchain would cause the currency itself to decrease in value. Because if you arent taking advantage of all the ways to profit, you are losing.
20:21
So we could compensate for this by charging rent that gets burned to people who use utility features.
ᴅ
20:29
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Ah ok I have an argument for why stablecoins are possible
20:29
But it only applies to stablecoins representing financial assets
20:30
Anything else will potentially require payments from the stablecoin holder to the collateraliser or vice versa depending on expected direction in change of the non-financial asset
20:31
i.e a non financial asset could be if you wanted to create a stablecoin on a volatility index or daily active users of an app
20:32
(or the price of gold + 5%)
20:32
Basically it comes down to the fact that arbitrage is possible if there are any extra fees being paid by the stablecoin holder above the rate of interest to the collaterliser
20:32
Because the collaterliser can hedge their exposure to veo
20:32
by borrowing veo and selling it (shorting veo)
20:33
To offset their exposure to veo in the form of their collateral that they haave put down to create the stablecoin
20:34
And the cost of borrowing the veo in order to sell it should only be the rate of interest, not any compensation for price changes in veo
20:34
because if price changes were expected they would be reflected in the price of veo (emh)
20:35
This is why futures contracts generally trade around the current price of the underlying asset (spot price)
20:35
because arbitrage is possible
20:35
Arbitrage isn't possible though for non financial assets
20:36
So therefore the stablecoin holder will need to compensate the collaterliser for expected "price" (not actually price, since it isn't a financial asset) changes
20:36
Since they can't be hedged
20:37
Thoughts? @zack_amoveo
20:37
I was actually thinking about this exact question yesterday btw while I was on a roadtrip, coincidentally
Z
20:39
Zack
Lets say we had stable usd.
The usd supply is being inflated. So it seems like veo would be expected to increase in price relative to usd.
So there would be a non-zero premium.
So i guess usd is a non-financial asset with your definition.
ᴅ
20:40
ᴅɪꜱᴛʙɪᴛ ⛓️💵
I don't think so tbh
20:40
I think if we expected the price of amoveo to appreciate in USD terms, it would already be priced in
20:43
In an efficient market, assets aren't expected to increase relative to other assets
20:44
Well at least their time discounted and risk adjusted future price based on available information is priced in
20:44
... I am too tired to think of how the time discounted part of that influences this atm
20:45
Actually I think that even if it was expected to decline for some reason, you could still borrow it at the natural rate of interest
20:46
Because the person lending it to you was holding veo anyway and they can always sell the loan to someone else
20:47
(I am referring to the loan for veo used by the collaterliser of the stablecoin to short veo in order to hedge their position)
Z
20:48
Zack
But maybe the price of usd vs veo isnt what is in equilibrium.
You need to also account for the utility features of each as well.
ᴅ
20:48
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
So therefore they aren't tasking on any extra risk by lending veo to you
20:48
Than by just holding it
20:49
Assuming a liquid market for selling loan obligations of veo
Z
20:51
Zack
Usd can be used to buy real estate, and mortgage that real estate and get a leveraged position in real estate.
So even if usd is expected to fall in value, people could still be buying it up for this utility feature.
ᴅ
20:52
ᴅɪꜱᴛʙɪᴛ ⛓️💵
What are you saying the consequence of that is?
Z
20:53
Zack
The expected future price of usd could be falling relative to veo. So there could be a nonzero premium on usd stablecoin contracts.
20:54
Usd used to maximum utility and veo used to maximum utility could be in an equilibrium
ᴅ
20:55
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Why wouldn't this be already priced in?
20:55
https://medium.com/@nic__carter/an-introduction-to-the-efficient-market-hypothesis-for-bitcoiners-ed7e90be7c0d

I must admit all of this is quite new to me, but this is something I found interesting on the emh
Z
20:55
Zack
In reply to this message
If one person just sits on a pile of usd, and another is using the usd to get maximum returns, the second person ends up with more
20:58
The value of the usd at the start is the sum of the expected future value of that usd plus how much returns you can get for fully utilizing it until that future date
20:59
If there is more utility, then the value of usd is falling faster
MF
21:23
Mr Flintstone
using the dex is using derivatives. it is a short dated future
MF
21:41
Mr Flintstone
In reply to this message
if there was a stablecoin offering +5% fixed return its initial price would be 5% lower than a stablecoin that didnt include a fixed return. the price wouldnt be higher i dont think
Z
21:42
Zack
In reply to this message
right, that is what I meant by the premium to buy it
MF
21:45
Mr Flintstone
probably the easiest thing to do is just make a futarchy market showing that adding features to a blockchain increases its market cap
21:45
happy to bet that the price goes down if a new feature is never implemented
Z
21:46
Zack
In reply to this message
I think what we want to do is keep adding features, and ask futarchy what should be the rental cost of using veo to participate in these features. and the rent gets burned.
21:47
I am writing an essay about this now. It really seems like if we don't burn money for utility features, that each additional utility feature will only have a negative influence on the price of veo.
ᴅ
21:51
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Look forward to reading the essay and discussing tomorrow
MF
21:52
Mr Flintstone
if holding veo collateral lets you participate in trust free contracts and no other platform has trust free contracts i am not sure how it is possible that adding uses for veo collateral would have a negative influence on the price. but yes i guess will read your essay
ᴅ
21:52
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
I may only be able to discuss it more in 2 days though as I may have something on tomorrow that consumes my available time...
Z
21:55
Zack
In reply to this message
if the expected returns of holding veo + profit from contracts is bigger than the interest rate, people will keep buying into veo until the profit goes down to the interest rate.

just holding veo is worse than veo + utility features.
so if the utility features are more valuable, then the price of veo would need to be falling faster, so that the combination stays the same as the interest rate
21:59
maybe ive got some circular logic messing this up
ᴅ
22:00
ᴅɪꜱᴛʙɪᴛ ⛓️💵
I admit the conversation this afternoon has been one of the most brain-hurting conversations about this stuff I have had in a while
22:01
But I did enjoy it and I think that the eventual clarity we achieve once we resolve these questions will probably be quite valuable as it will require us to probably gain a more precise understanding of the relevant concepts
22:05
In reply to this message
What if adding features doesn't increase the profitability of using veo, but just the range of uses cases and individuals who will find it valuable.
22:07
I think part of the confusion may be due to misuse of equilibrium analysis
22:07
Maybe
22:07
Like maybe it isn't actually useful here for some reason... The market is always in disequilibrium
22:07
Idk, I need to read more econ
Z
22:09
Zack
We want to have a good stablecoin.
It is impossible to have a stablecoin that is expected to increase in value against VEO.
So we want VEO to not be bleeding value vs the interest rate.

The market cap of VEO will settle at a value so that the expected returns of holding VEO + using the utility features as much as possible is the same as the interest rate.
So the expected returns of holding VEO is (interest rate) - (returns of using utility features).

So, if we add more utility features to Amoveo, then the stablecoin mechanism keeps getting worse.
And we can fix this problem by charging a rent to use the utility features, and burning the rent.
22:13
Having a good stablecoin will make all the utility features even more useful, compounding the benefits of this strategy
ᴅ
22:14
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Why will the rent not result in undercutting?
Z
22:15
Zack
In reply to this message
Holding crypto + maximally benefiting from utility features is equal to the interest rate in both cases.
MF
22:16
Mr Flintstone
im not sure these are comparable quantities
22:19
like the benefit from utility is more on the risk management & hedging side specifically you are most likely hedging things external to amoveo
22:23
also there is a weird output of this formula that doesnt fully make sense to me because the price growth rate of coins is >> their interest rate at least right now so this implies that utility benefit is negative right now which is not really possible
Z
22:27
Zack
In reply to this message
that is from speculators
22:28
In reply to this message
that means they are profiting from holding VEO. I don't see how it matters whether this profit is from risk management, or from anything else
Z
22:48
Zack
If people need to pay rent to buy their stablecoins, is that rent lower than the premium they would have needed to pay if we didnt charge rent?
MF
23:04
Mr Flintstone
im pretty sure it would cancel out
Z
23:12
Zack
the rent would be about the same as the utility provided by the smart contract system.
the premium would be the difference between the expected future price of veo, and the expected future price of the stable asset.
23:13
the rent is a flat cost for any kind of smart contract, but the premium would be different for different contracts.
23:16
only considering a stablecoin that captures the current interest rate of the economy.
then the expected future price of veo is less than the interest rate based on the utility provided.
So in that case it does seem to cancel out.
23:17
maybe utility features really don't impact the market cap then.
23:22
it is weird that they would be the same. since the burned rent is going to all veo holders, but the premium is only going to the long-veo holder.
23:22
maybe something in the middle is more efficient, like if the rent is half of the interest rate.
Z
23:45
Zack
A limitation with the premium strategy is that most people are better off not holding veo. The only people who would hold veo is if they personally have a way to use the smart contract system to earn enough profit to overcome how veo isn't giving as much returns as the interest rate. So almost all available veo would be actively used for smart contracts.

A limitation with the rental strategy is that the smart contract system gets used less. The only time it is worth it to use a smart contract is if you can get enough profit to overcome the rental cost. otherwise you are better off just holding veo. So most veo would just sit around as veo.

The premium strategy seems like it would suffer a lot if the demand for smart contracts were to fluctuate.
The rental strategy has a buffer of veo that aren't actively being used, and that buffer could grow or shrink to respond more smoothly to changes in demand for smart contracts.
23:53
Another limitation with premium is that if all the veo is already locked in smart contracts, and something happened that greatly increased the short term demand for smart contracts, we wouldn't have any extra veo on hand to quickly grow the amount of smart contracts.
20 April 2021
MF
01:07
Mr Flintstone
i dont think you would ever have all the veo locked up
01:07
or even close really
Z
01:48
Zack
In reply to this message
how about negative rents then.
Giving out free veo to anyone who has money in a smart contract.
MF
03:02
Mr Flintstone
no sybil resistance
03:03
you would have to do it on chain and reward unmatched bets
Z
03:04
Zack
Maybe part of the value of contracts is from having money on hand to make them.
Z
03:53
Zack
In reply to this message
with the rental strategy, the rental fee for the contract ends up benefiting everyone.
with the premium strategy, does anyone benefit from the premium getting paid?
With the premium strategy, don't we need to lock up more veo in each smart contract to get the same range of volatility protection? Because the premium changes sides linearly.
21 April 2021
BTFDNOMZ invited BTFDNOMZ
22 April 2021
Akash Hossain invited Akash Hossain
Deleted invited Deleted Account
23 April 2021
Deleted invited Deleted Account
24 April 2021
JT
02:58
Jehan Tremback
we prefer that Amoveo stay secret
02:59
that's why the wallet ui is the way it is
B
03:22
Ben
In reply to this message
Good one 😂
Z
05:18
Zack
im thinking we should reduce the cost of some txs to zero.
like, taking your money out of an oracle that is finalized, or closing an oracle that is finalized, or taking your money out of a contract that is finalized.
That way we can have a server that posts all these txs automatically, to make the user interface simpler, and that server doesn't cost anything to run.
mx
05:28
mr x
zero cost transactions are just consensus rules? :P
ᴅ
05:29
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Is it possible for the beneficiary of such tx automations to include a an amt in the contract that can be used to fund the tx fee?
mx
05:29
mr x
event driven chain
Z
05:29
Zack
It costs something to make the oracle. So we arent generating spam by letting it be closed for free.
ᴅ
05:31
ᴅɪꜱᴛʙɪᴛ ⛓️💵
How will you incentivise miners to include such free txs if they also have the choice of including paying txs? I guess this would work if the blocks aren't full but if they are, would this become an issue?
Z
05:32
Zack
In reply to this message
We would only set the governance fee to zero. The mining fee could be nonzero.
05:32
Currently the gov fee is like 99.99%
05:33
Sys pool accepts txs without any mining fee.
IS
05:36
Ilmu Somebody
if the fee can be set by gov param then it makes sense to set it to zero for the time being to make the oracle more accessible
rocket fuel invited rocket fuel
MF
06:27
Mr Flintstone
seems to me like specialized users would only use those functions at scale since they would do something like a 99% swap for the unsettled tokens
Z
07:13
Zack
If 2 people are betting together, and they make an oracle for the 2 way bet. All these tools could help smooth out their experience.
If the oracle closed automatically, and they withdraw winning automatically.
09:25
higher market cap than VEO.....what a world
IS
09:40
Ilmu Somebody
Web is wide and shallow
Hello Packet invited Hello Packet
gordongekko #BHB #TCL invited gordongekko #BHB #TCL
TG
11:39
Toby Ganger
I think the rise of dogecoin should teach folks that growing the social community around a coin is more valuable than the quality of the tech. Community with no tech can be very valuable(and potentially even useful) while tech with no community has no utility or value
EA
12:51
Eric Arsenault
Whatever happened to cross chain dex
B
13:20
Ben
cDex should be the short term goal and MVP
Z
19:04
Zack
In reply to this message
offers to sell veo are still live. offers to buy veo are coming.
25 April 2021
m0ntag invited m0ntag
Z
17:26
Zack
In reply to this message
Thanks for sharing
26 April 2021
Z
22:42
Zack
I wrote the code into the light node for accepting offers to buy veo. This involves giving your pubkey to the contract.
J
23:09
Josh
Yay!
EA
23:16
Eric Arsenault
🔥
27 April 2021
B
00:35
Ben
interesting, will check it out as soon as you delclare it as rdy
Z
01:18
Zack
it still needs some more parts. like canceling an offer.
but the rest should be easier.
IKMcrypto invited IKMcrypto
AHMED MOHAMED invited AHMED MOHAMED
AM
09:43
AHMED MOHAMED
Hello guys
09:43
WHO should I PM for AMA proposal ?
Gamal | IoTeX Ambassador invited Gamal | IoTeX Ambassador
28 April 2021
Z
07:07
Zack
I added an interface to the light node so that you can cancel offers to buy veo.
I still need an interface that says where to send your btc, for after someone accepts your offer to sell that veo for btc. and I need to make an interface to release the veo, for after you receive your bitcoin.
and we need an interface for how to challenge the swap, if they do not deliver the bitcoin in time.
EA
08:19
Eric Arsenault
Zack on the coding train again 🚀
B
18:01
Ben
yeah
x
22:18
xyzzy
I can't remember why I joined this channel, because I really don't know what Amoveo is besides another blockchain, but of all the channels people are no nice and chill here. I enjoy it.
29 April 2021
Satoshi Nakamoto invited Satoshi Nakamoto
Z
17:35
Zack
Amoveo's difficulty is dropping. Mining is getting more profitable. looks like it will still get 3x more profitable than it is right now.
IS
18:43
Ilmu Somebody
what hardware would you recommend to use?
Z
18:44
Zack
historically only fpga have been profitable, but maybe gpu will become profitable now. Hopefully someone more knowledgeable than me can tell us.
C
18:51
CAPTAIN CRYPTO
hello
18:51
On which exchanges amoveo is listed
Z
18:51
Zack
qtrade.io
C
18:51
CAPTAIN CRYPTO
Where is that
Z
18:52
Zack
it is a website
EW
18:53
Eli W
@zack_amoveo are where still in the process of figuring out what is/are best use-cases , you are so knowledgeable, I’m puzzled by market don’t recognised the effort so far , not related to those defi boom like project go 10-100bn , but vs a so so project , our mkt recognition in term of mkt cap is tiny
C
18:55
CAPTAIN CRYPTO
In reply to this message
this exchange does not give me confidence
19:00
is there someone else
Z
19:06
Zack
In reply to this message
You can use the amoveo dex
C
19:07
CAPTAIN CRYPTO
In reply to this message
where is she
Z
19:07
Zack
http://159.89.87.58:8080/wallet.html
Here is the light node. It can access the dex.
19:08
In reply to this message
Lots of room to grow
C
19:10
CAPTAIN CRYPTO
On which exchanges is amoveo could you please give a proper answer
Z
19:11
Zack
you just asked that
EW
19:12
Eli W
Amoveo is relative illiquid in those exchanges , wish some more liquid way to trade indeed. I’m small holder and buy cos of the developer will hold long long time
Z
19:12
Zack
you tried using the dex, and it was illiquid?
19:13
did you post your trade in the dex telegram group?
EW
19:13
Eli W
In reply to this message
I didn’t try
Z
19:13
Zack
people don't put much money onto centralized exchanges, because that is risky.
C
19:14
CAPTAIN CRYPTO
In reply to this message
I asked you a question like a Why do you still insist on not giving true answers
EW
19:14
Eli W
@zack_amoveo in 3-5 years I mean long term relatively , what amoveo will become in term utilities to non tech people , do you mind share some thoughts to us 🙏🏻
Z
19:15
Zack
the goal of amoveo is to become the biggest platform for financial derivatives. tools for exchanging risk.
EW
19:16
Eli W
In reply to this message
Derivatives function indeed is leverage and risk mgmt , amoveo seem is good in pricing risk , so also advantage in leverage ?
19:17
In reply to this message
And probably privacy also key by consider the old economy otc desk
C
19:17
CAPTAIN CRYPTO
Why do you still insist on not giving true answers
EW
19:18
Eli W
In reply to this message
Not offence , just people thinking process is difference , Zack has good intentions
Z
19:18
Zack
In reply to this message
you can make leveraged contracts yes.
C
19:20
CAPTAIN CRYPTO
Which exchanges is this token available on?
Z
19:20
Zack
In reply to this message
http://159.89.87.58:8080/wallet.html in the create scalar tab, by choosing the margins of the contract you control the leverage.
EW
19:21
Eli W
So what we now lack of is frontend/uiux ? And indeed good tech don’t need marketing, so I’m puzzled by our mkt cap . I think mkt is okie efficient in 2-3 years time. Any thought on this , not to argue , just wanna know what you think and see anyway community members might be collective think of something
19:21
In reply to this message
Appreciated 👍🏻
C
19:22
CAPTAIN CRYPTO
I advise everyone to stay away from leveraged transactions because they are all fraudulent.
Z
19:23
Zack
In reply to this message
we have a plan to make the dex private.
lets say you are trading amoveo for btc.
The way the dex works currently, you don't need to reveal any connection between the btc tx and the amoveo tx.
So this would allow you to own amoveo more privately.
EW
19:24
Eli W
In reply to this message
Nice , written in code already ?
Z
19:24
Zack
In reply to this message
hard to be sure.
Currently im working on a tool so you can make offers to sell veo in the DEX.
We have a plan to combine this tool with the existing tool to make offers to buy veo, so that we can have a DEX to trade between pairs of currencies from other blockchains. like BTC <> monero.
EW
19:24
Eli W
So on design level , it is great ,everything I can think of you consider long time ago seem
C
19:25
CAPTAIN CRYPTO
I advise everyone to stay away from leveraged transactions because they are all fraudulent.
19:26
In reply to this message
?
Z
19:27
Zack
In reply to this message
https://github.com/zack-bitcoin/light-node-amoveo/blob/master/src/js/buy_veo_contract.js#L5 here is the smart contract for making offers to buy veo.
The idea is that we would put some of this code into a hidden branch of the merklized abstract syntax tree, to make it private.

This part2 of the contract already works by being in a private branch of the merklized abstract syntax tree https://github.com/zack-bitcoin/light-node-amoveo/blob/master/src/js/buy_veo_contract.js#L133
So the smart contract tech already exists.

To add this feature we need to modify the smart contract, and then make a UI.
19:30
In reply to this message
a "leveraged contract" isn't so different from a normal scalar contract.
Imagine you had a contract for USD. So if the USD price increased 10% relative to VEO, then your contract would be worth 10% more in VEO terms. And your counterparty's side of the contract would worth less, based on how much you gained.

If you made this same contract with 2x leverage, then a 10% increase in USD price would make your side worth 20% more, and your counterparty's side would be worth less based on how much you gained.

So instead of betting on the price of USD, you are betting on the price of USD times 2.
EW
19:31
Eli W
Do our way need veo become a very big in market cap , to let players act properly ? Or is it irrelevant
Z
19:31
Zack
In reply to this message
I already answered this. qtrade.io
or you can use the amoveo DEX.
If you repeat the same messages like you are doing, this is spam, and I might have to ban you.
C
19:33
CAPTAIN CRYPTO
hitbtc and gozo
Z
19:33
Zack
In reply to this message
If the price was more stable, then contracts that last for longer periods of time would be more efficient.
Having a bigger market cap could help make the price stable, depending on what kind of investors cause the market cap to be big.

But there are also usecases that don't depend so much on price stability or the market cap size, like the DEX.
Maybe the best path forward is to focus on those kinds of applications first.
C
19:34
CAPTAIN CRYPTO
These stock exchanges do not give success
Z
19:34
Zack
Other DEX are getting a lot of attention lately, and Amoveo's DEX design is much more capital efficient than the alternatives, so it could be a good way of bootstrapping the system.
EW
19:36
Eli W
In reply to this message
I think most dex related to ethereum community, my view is eth go from like sub 100m to a trillion , a lot of purchasing power , those liquidity inflow to related projects in the ecosystem , so have defi boom
19:37
Your idea is great but without those liquidity it need other type of people to recognise
19:38
I’m very positive on the your ability and the tech you describe to us ... wishing mkt can discover amoveo sooner or later 😁
19:41
In reply to this message
So it is self fulfilling, it let owners of coins make money , supporters more powerful in term of purchasing powers , cycle back , more talents attract to do related things and keep innovating... so the mkt cap then can be more justified, it just frontrun but chase back later by the ecosystem
19:43
@zack_amoveo should we consider the same ? Or indeed follow btc , I do think good tech don’t need marketing, but need group of people think so and act on different aspects , tech , mining , holding , trading etc , need create an ecosystem , any view?
Z
19:47
Zack
I see startups kind of like a slot machine or panning for gold.
Each time you play, there is only a small chance of success.
But you keep trying different things, and if one of them does work, it can explode in popularity.

The most important signal of success at this point is if we can get some regular group of users to keep using some Amoveo tool. If we have regular users, that will drive everything else.
EW
19:48
Eli W
In reply to this message
Agree exactly on this mentality, keep attempt , and finally will find the right things
19:51
@zack_amoveo on pos technically under what scenarios it will break or prove to have great problems🙏🏻
Z
19:52
Zack
ive got to leave for a bit, ill be back in like 45 minutes to answer
EW
19:52
Eli W
Economically I heard in 17 I not so believe so
19:52
In reply to this message
Sure and thanks in advance 🤝🙏🏻
IS
19:53
Ilmu Somebody
In reply to this message
wait wouldn't you still need to reveal the tx if the other party doesn't hold up their end? or do you mean if you uniswap synthetics inside of amoveo?
EW
20:01
Eli W
In reply to this message
For those , seem great short after the bull run, thinking when problems will become obvious
20:02
In reply to this message
Any exchange that design option/ leveraged futures to play it downward will attract lot users in due course
Z
20:53
Zack
In reply to this message
As the number of stakers grows, attacks get cheaper. The bribes get cheaper.

As we get better smart contract systems, the attacks get cheaper. The stakers need to have a very high degree of confidence in the attackers smart contract to be willing to accept the bribe and participate in the attack.

But pos might not die from attacks. It might end up dying by simply being less efficient.
Currently, the cryptocurrency world is expanding so fast, that projects can under-charge their customers and get all their profits from price inflation. This situation is not sustainable.
Eventually everyone will have bought in, and at that point efficiency will start to matter.
If two projects offer the same service, but one is more expensive, the more expensive one will lose.

Pos just cant be as affordable as pow.
With pos, users are paying tx fees to stakers as a kind of bribe, so the staker will prefer to take tx fees over time instead of profiting from a single big attack.
So the fees need to be big enough to discourage an attack.
This makes pos expensive.
20:54
In reply to this message
Right. Anonymity is lost if they dont cooperate. But you also get free money when they dont cooperate.
So in that case, you just try again, until eventually someone does cooperate with your exchange.
IS
21:04
Ilmu Somebody
In reply to this message
ok yep makes sense
EW
21:27
Eli W
In reply to this message
Appreciated for the insights
30 April 2021
M
02:32
Marko
Zeitgeist is an evolving blockchain for prediction markets and futarchy. Was this reviewed already ?
EA
03:08
Eric Arsenault
In reply to this message
Haven’t heard of it
03:08
Sounds like Amoveo lol
OK
04:44
O K
In reply to this message
qtrade is currently the best centralized exchange for trading amoveo, regardless of your personal confidence
M
04:57
Marko
In reply to this message
Sure does. https://zeitgeist.pm/
MF
05:12
Mr Flintstone
pretty cool that another project is trying to use futarchy. the oracle is broken though
05:13
or should i say “will break with enough money at risk”
TG
05:14
Toby Ganger
In reply to this message
Amoveo with minimal marketing….ah..imagine the possibilities
EA
05:20
Eric Arsenault
"Zeitgeist is governed by the holders of the ZTG using a mix of normal token voting and a new futarchy model."
Z
06:14
Zack
looks like the rate of block production is down to 12 minutes again
06:14
mining rewards are like 10x higher, right?
06:15
oh 5 -> 1.2
so only 4x higher
06:16
hashpower is a lot more spread out now
06:17
Wet season is starting in China right?
I wonder if that is related
06:17
do you think our big miner is doing his seasonal migration?
JT
06:56
Jehan Tremback
hey @zack_amoveo I wanted to get your opinion about a financial instrument i came up with. The purpose is twofold- to accurately determine the likely sale price of an NFT, and to shift some risk from artists creating NFTs to speculators.

Here's how it works: An artist puts the NFT up for auction. The exact auction mechanism could vary, as long as the rules cannot be changed after it starts.

Speculators can now try to get exposure to some % of the eventual sale price (let's say 10% for this example). Here's how they get the exposure: the range of possible sale prices is divided into some number of buckets. Speculators can buy one of these buckets for an up front fee. This fee immediately goes to the artist. When the piece sells, the speculator who holds the bucket containing the price it sold at gets 10% of the sale price.

The hope is that the price of each of the buckets can be used to predict what it will eventually sell at.
ᴅ
07:02
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Ha that's very interesting, I was thinking about applying PMs to NFTs last night! Ha
07:03
Your idea is more interesting though I think than what I was considering
JT
07:04
Jehan Tremback
well the key thing here is that it's not a betting system like a PM. In a PM, you are just betting against other speculators and the bet is financially disconnected from the outcome. With this, the bet taps into the outcome. It's an attempt bring some ideas from stock options into a non fungible asset
Z
07:04
Zack
In reply to this message
The person selling their NFT in the market, they are also selling risk in the price that the NFT get sold for.

The simple option is to use other money to bet on what price the NFT will get sold for.

The capital efficient method is different. You would want to tokenize the side of the contract that is selling the NFT, that way the person selling their NFT doesn't need to lock up any other money to sell their expected winnings from the auction.
JT
07:05
Jehan Tremback
yea, that's what i'm trying to accomplish here
07:05
the artist doesn't lock up any money, since the speculators are getting paid out from the eventual sale
07:08
also, they get money up front, before it even sells
Z
07:08
Zack
If you own 50% of the shares, and you pay $1000 to win the auction. you get $500 back, since you are paying yourself. so it really cost $500 + the 50% of shares you own.
JT
07:11
Jehan Tremback
I think i didn't explain it clearly. You only get paid out if the price is what you thought it would be. You get paid out with a fixed % of the sale price. So the more shares you buy, the more likely it is that you will get paid out, but you'll only ever get a fixed payout
07:12
so, i could pay you a dollar to receive 10% of the sale price, IF it sells for between $90-$100. I'm hoping to get a 10x return on my dollar
07:13
and sure, i can try to manipulate it by bidding a very high price so that i can name it exactly, but that doesn't do me much good if i'll only be getting, for example, 10% of my money back
07:14
i could also manipulate it by trying to bid the price up with fake bids, but it's always possible that someone's doing that in an auction
07:15
i guess the speculators are vulnerable to the artist bidding the price up themselves
07:15
that's probably the biggest problem here
07:16
because then the artist gets their own money back + the up front wagers from the speculators
ᴅ
07:20
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Hmm yeah my immediate thought was what if the artist realised that they could cause it to sell for a higher price by buying shares in a highly priced bucket
07:21
Especially since there isn't a way for someone else to come and bet against them if they do that
07:21
As the incentive for betting is capped at the % of the sale price
07:21
So it doesn't have the same kind of manipulation resistance that normal PMs have
07:22
Because in a normal pm if you try to manipulate it, you are basically giving away money for free to others
07:22
And the amount you need to give away in order to continue to manipulate the price is potentially unlimited, depending on the liquidity
07:23
While here the amount you need to give away is always going to be less than 10% of the sale price, and you aren't giving it away (assuming that the artist is trying to manipulate the market)
07:23
Since you are paying it to yourself
Z
07:36
Zack
you could offer to buy 0.00000000001% for $1, but offering to buy 50% for a high price is going to mean you need to lock up a lot of money in the contract. So you need to be rich to manipulate very much.
07:38
I get how tokenizing an nft could be useful. but for only the duration of an auction seems limited.

What if it was tokenized a year before the auction?
07:39
you plan to let them re-sell their partial ownership in the NFT right?
07:41
it is kind of a weird tokenization process. because depending on the auction price, different partial ownership contracts can end up settling one direction or the other.
So the NFT tokens are only fungible with others of the same art and the same limit price.
07:44
the harberger system is a kind of continuous auction that would always give us a price for each NFT.
07:47
In reply to this message
do you think there is there much demand for this kind of tool?
JT
07:51
Jehan Tremback
not sure
07:52
i think there's demand for something that can tell you the price of an nft more quickly and consistently than an auction. And i think there's demand for something that moves risk from artists to speculators
Z
07:53
Zack
Has harberger been tried?
JT
07:53
Jehan Tremback
i believe so
Z
07:54
Zack
It seems like there are different of versions of it too
JT
07:54
Jehan Tremback
it tends to operate over the life of the nft, instead of just temporarily
07:54
i want something that is really just related to the exchange. after that it can go back to being a normal nft
07:55
i think people did stuff like where harberger taxes give a revenue stream back to the artist. but i think collectors don't like the cost and the uncertainty inherent in harberger taxes
07:55
just like landowners don't like them in the real world lol
Z
07:56
Zack
People pay to have their car displayed in a place where it can get sold
07:58
Does the harberger system not work if it is time limited?
Like what if i only paid tax on my nft for 1 week?
08:00
Having the tax go back to the artist doesnt seem right.
I would think you would want to have a new altcoin, and require taxes for all nft being auctioned to be paid in that, and the taxes are burned. So that owning this altcoin is like having a stake in the new system.
EA
08:06
Eric Arsenault
In reply to this message
Yeah it has https://thisartworkisalwaysonsale.com/ for example
Z
08:07
Zack
Oh, we wouldnt want the auction priced on the new altcoin.
So we would need a way to know the relative price, to convert taxes to an auction price.
Probably some constant swap markets could work for that.
EA
08:07
Eric Arsenault
@Jtremback we’ve been thinking of something similar for NFT curation. Stake on NFTs, get a reward (% of sale price) when it sells
08:08
But applying it for price discovery is interesting
Z
08:08
Zack
I think it would be pretty easy to add nft to amoveo.
The explorer could look at our current tx types, and interpret some of them as controlling the nft.
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1 May 2021
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2 May 2021
Z
09:15
Zack
In reply to this message
haha
09:18
im working on the tool for being able to make offers to sell veo.
This involved pushing an update to the p2p derivative server.
But after updating, it wont turn on. Looks like an issue with dependencies.

So I made a version of the code that works on my machine. I can pull a clone into an empty directory, and it works.
But when I try to use it on the server, it does not work.

rebar3 crashes in a really weird way:
Error: undef
[{xref,stop,[amoveo_p2p_derivatives_explorer],[]},
 {rlx_assemble,maybe_check_for_undefined_functions_,2,
               [{file,"/home/runner/work/rebar3/rebar3/_build/default/lib/relx/src/rlx_assemble.erl"},
                {line,746}]},
 {rlx_assemble,make_bo
09:19
maybe it needs to use ubuntu 20.04?
I hope this dependency issue hasn't impacted other software.
09:26
looks like amoveo is still working ok
09:40
I found a solution. I backed up to an older version of rebar3. the same one we are using for the full node.
3 May 2021
ᴅ
10:15
ᴅɪꜱᴛʙɪᴛ ⛓️💵
"This is the same tragedy of the commons math as mechanism designers have known about since at least 1833." from https://github.com/zack-bitcoin/amoveo-docs/blob/master/other_blockchains/UMA.md

What specifically is this referring to out of interest? Is there something I can read wrt similar ideas from a separate context back then?
Z
11:03
Zack
In reply to this message
A classic example of tragedy of commons is if land for grazing cattle is available for anyone to use, vs cutting up the land and letting private owners decide when to permit cows to graze.
ᴅ
11:03
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Ah I see I didn't realise you were referring more generally to the idea of tragedy of the commons
11:04
👍
AG
19:53
A G
Hello. Sorry for a probably redundant question: why is amoveo independent from bitcoin, contrary to Paul Sztorc's vision? Is there a link where I can find this answer so you don't waste your time? Thanks to you.
ᴅ
19:54
ᴅɪꜱᴛʙɪᴛ ⛓️💵
It is because if it were dependant on bitcoin then it couldn't fork when reporters dispute the result of an oracle
19:54
which is necessary
19:55
because the forking mechanism that is activated in the event of a significant dispute on the outcome of an oracle ensures that people can chose which side of the fork is the true one
19:55
so it acts as a last resort form of accountability
19:56
but that is only possible if the base currency that is bet on the markets is native to the pm platform
19:56
since if it isn't native then it can only exist on one fork at a time
19:57
and so therefore there would need to be some centralised process for determining which fork gets to keep the coins
19:57
which goes against the design philosophy of amoveo, as then whatever mechanism decides which fork is valid can steal by lying
AG
20:02
A G
Thank you very much.
ᴅ
20:02
ᴅɪꜱᴛʙɪᴛ ⛓️💵
👌hope it made some sense
20:02
it took me a while to fully understand these ideas
20:03
very interesting stuff
Z
20:24
Zack
In reply to this message
Yeah, this is all exactly correct. It's great seeing someone else explaining it.
ᴅ
20:25
ᴅɪꜱᴛʙɪᴛ ⛓️💵
:) Glad I understand it. Thanks for taking the time to go through it in detail with me
[SupaHotFire] invited [SupaHotFire]
4 May 2021
AG
00:27
A G
Can Amoveo predict its own success?

Ways to reach the critical tipping point of global adoption?
00:31
Or, is there a paradox where the future of the oracle cannot be predicted at the risk of being sucked into the mirror?
Z
00:32
Zack
you can make leveraged bets on the future price of VEO
AG
00:56
A G
Perhaps Amoveo is the first time machine in the sense that it aligns the truth of both times, present and future in the most honest way.
Z
01:17
Zack
I think we need a hard update to enable offers to buy veo in the DEX.
We want to have all 3 things in a single block:

* creating the parent contract
* choosing the bitcoin address you want to get paid to
* settling the parent contract into a child contract that has your bitcoin address embedded in it.

The way things are set up now, we would need 2 blocks for this.
01:18
either we need to keep track of the results of previous txs when processing the next txs in the same block. or, we need to change the format of the contract_timeout_tx, so the child contract's ID is written on that tx.
01:21
We need to do all 3 things in the same block because every way of splitting them up would add bad UX.
We don't want to need 2 blocks, just to provide your bitcoin deposit address.

We need to create the parent contract at the same time, so that it can be free to make offers to buy veo, in the case when no one accepts you offer.

we need settling the contract to be in the same block, because otherwise the explorer can't be sure if the contract_evidence tx was valid, so it can't be sure if that is the correct place to send your bitcoin, without creating a contract_timeout tx first. so you would need to publish a tx and see it get included in a block before you could send the bitcoin. You would need to wait for a block as part of the process of delivering the bitcoin.
01:22
im still not sure whether it is better to change the format of that tx, or to keep track of more data while processing txs in the block.
01:23
changing the format of the tx is nice for the explorer, so the explorer has access to more info when it scans txs.
but providing more data when processing txs could be nice, because we could reduce how much you need to touch the hard drive if you are running a mining pool and accepting txs from users to include in the next block.
01:27
The memoryless full node feature makes it tougher to develop everything, because we are always managing these merkle proofs.
But I think it will pay off, since this allows us to process blocks in parallel, and eventually it should let us process txs in parallel. So it should eventually be important for scalability.

Maintaining memoryless full node capability while adding features is a lot more doable than trying to add memoryless-ness after the fact when we are trying to scale.
Kevin .N invited Kevin .N
K.
06:44
Kevin .N
Hi,
I'm a hands-on experienced full-stack web & mobile developer with blockchain technology and looking for a full-time position.
If you need any help regarding the above skillset or others, please feel free to reach out to me.

Best.
EA
06:49
Eric Arsenault
Best.
06:49
you should contribute to Amoveo
Z
21:24
Zack
in the tool for making offers to buy veo. After they provide the bitcoin address where they want to get paid, how does the other account find out about that bitcoin address?

We don't want the light node to be downloading blocks and scanning txs, that would be slow, and be spam on the full nodes.

We don't want the full node to need to know the bytes that make up smart contract code. Because that breaks our model of smart contracts.

It might make sense for the explorer to keep track of this data. Since it is the job of the explorer to scan all the txs and create useful databases to give access to historical information.

but, up till this point, the explorer hasn't had to know anything about kinds of smart contracts. We have been using the p2p derivatives server for that.

Maybe the explorer should realize that a contract settled as another contract, and tell the p2p derivatives tool about that?
But then, the explorer and p2p derivatives tool would become dependencies of each other, becoming more monolithic.

Maybe the light node should download all the txs that touched a contract, and process those to know if a child contract was created?

Whatever solution we go with, we want it to make sense for more contracts we will make in the future.
A contract could resolve into another contract many times, so a light node needs to have a way to process these links.
21:26
It looks like the explorer currently is only storing "contract_new_tx" in the list of txs associated to a contract.
We could also store contract_evidence and contract_timeout. and that would give the light node enough information to find out what the bitcoin address to send to is.
21:28
It is a little tricky, because we want to maintain trustlessness.
So the light node can't trust the explorer to deliver txs honestly.
The light node needs to derive the smart contract code for the child contract, and re-calculate it's contract ID. that way it can verify a merkle proof from consensus state, to have trust-free evidence that it is the correct bitcoin address to send to.
Z
21:46
Zack
In reply to this message
a third alternative is that if a contract evidence tx results in a delay of 0, we could immediately close that contract without needing a contract_timeout tx.
This strategy is nice because it saves space in the block.
21:52
so, to reiterate the 3 alternative ways we could do this hard update:
1) contract_timeout_tx could say the id of the child contract, if it creates a child contract.
2) when mining pools process txs, the partially updated consensus state should be available.
3) contract_evidence that results in a delay of 0 should immediately end that contract.
21:55
(2) seems like a dangerous idea. Eventually we want to process txs in parallel, and this seems contradictory to that goal.
5 May 2021
Z
00:56
Zack
maybe (2) isn't so bad. we already have access to that data while processing the txs. In particular, we use that data while adding new txs to the tx pool.
the difference is that we would have access to that data while producing the merkle proofs.
01:02
plan (3) makes me nervous because the explorer doesn't have access to the result of running the smart contract. So the explorer can't know whether a contract_evidence tx failed or not.
Is it ok for the explorer to do an extra http request to the full node every time it scans a contract_evidence tx?

Currently we do one http request for every page of blocks to get in sync, and one http request for every new block while staying in sync.
A single block could potentially have lots of contract_evidence tx, so this could potentially generate a lot of spam on the full node, especially when you first sync the explorer. It could make the explorer a lot slower to set up.
01:03
plan 2 seems like less programming than plan 1.
I guess ill start by trying to implement plan 2, and if we run into issues we can switch to plan 1.
01:16
this hard update, it is to fix an issue in contract_timeout tx, where when the merkle proof is being created it assumes that the contract already exists in consensus state before processing this blocks.
im noticing that contract_winnings tx has the same issue. It is assuming that the contract already exists, and was already finalized, before this block.

so I guess ill fix that one at the same time.
01:16
also contract_simplify
01:21
plan 1 would be a lot of programming. I would have to make 3 new pages for the 3 new tx types.
we would need to do another hard update later to get rid of the old versions of these 3 tx types.
the light node would need to be updated to produce the new versions.
and the 3 new versions of the txs would be longer which would waste consensus space, and it seems like we aren't getting benefits from the longer versions, since the light node can get that consensus state from the full node, and needs to get it anyway, because we don't want to trust the explorer to be honest.
Z
02:20
Zack
It looks like plan (2) does not work.
The way we create blocks is that first we look up all the merkle proofs we will need for that block, then we process the block.

but if we go with plan (2), we can't know what merkle proofs we need until we have already processed the txs.
02:22
plan (1) is a lot of programming, but all that programming is straightforward and easy to be sure it is correct. I guess that is the correct strategy.
Z
04:10
Zack
I think I found a simpler solution.
If the merkle proof we are looking for is not yet available in consensus space, then there are 2 possibilities.
Either 1) the tx is invalid, in which case it doesn't matter what merkle proofs we do or do not include, because it is invalid anyway.
or 2) the merkle proof was already included by an earlier tx in the same block.

So I think we can just not include the merkle proof, and it will work.

It is still a hard update, because currently the nodes just refuse to include the tx at all, but it is super simple. practically a one liner fix, and we don't need to change the light node at all.
ᴅ
04:43
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
@zack_amoveo just in case you missed this btw :)
Z
05:36
Zack
In reply to this message
You think i should try to hire someone?
JT
07:21
Jehan Tremback
shouldn't a DAC spring forth which incentivizes improvement of the public good of the Amoveo wallet?
Z
07:22
Zack
Yeah, that would be cool
07:23
I think someone needs to make a proposal of work they want to accomplish, and lock money on their side of the contract so they have skin in the game.
EA
07:23
Eric Arsenault
I don't believe DAC works for amoveo development (just based on what I've tried and seen), would probably rather see a tax to fund a dao or something
Z
08:07
Zack
In reply to this message
This doesn't work.
the contract_evidence_tx produces the child contract id as an output of a smart contract, so it is not included as a merkle proof.
So the contract_timeout_tx, that is the first time that the merkle proof of the child contract comes up. So we can't ignore it.
08:17
so I think we can do this trick for contract_simplify_tx and contract_winnings_tx. we don't have to re-write those tx types.
but since contract_timeout_tx is the first time this merkle proof comes up, we really do need the child contracts id to be written in that tx.
We don't want to have to wait for turing complete tx to finish before we can process another turing complete tx.

That would make the block slow to process in a non-parallelizable way.

So we need the contract ID, which defines the code of the child contract, to be included in the text at some point of the cycle, so we can unwrap it all and calculate the chunks in parallel.
ᴅ
10:50
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
I wasn't suggesting so, just wrote the above message incase you had missed it before 👌

But if you had already seen it then nvm
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6 May 2021
R
05:23
Ric
In reply to this message
If you wanted to, I don’t think you’d have to try very hard
05:24
In reply to this message
But yes, this would be ideal
JT
05:25
Jehan Tremback
I mean just to ask the hard questions here...@zack_amoveo has a vision for amoveo that revolves around advanced financial instruments making society better. DACs are a part of this that he has written about. Seems like the first test for Amoveo would be simply to make amoveo better
05:28
otherwise, why should i believe that DACs will pay for bridges in an Amoveo powered libertarian utopia?
ᴅ
05:41
ᴅɪꜱᴛʙɪᴛ ⛓️💵
When I get time soon I think I have some questions around the idea of dacs funding public goods
05:42
As much as I would very much like that to work, and hope that I have an error in my thinking, I am not currently convinced that it is incentive compatible...
05:43
At least based on what I have read about them from Alex Tabarrok and Zack's github page on them
05:43
Although I haven't yet read sztorc's paper on applying PMs to funding public goods, so I may be missing some key point I suppose
Z
05:44
Zack
If you think the dac will fail, then you would surely invest in one, because you get your money back plus interest.
ᴅ
05:45
ᴅɪꜱᴛʙɪᴛ ⛓️💵
But you can earn interest elsewhere, without risking possibly paying for the public good without having been pivotal
Z
05:46
Zack
The dac can pay higher than the market interest rate.
And we are assuming here that the amount you would invest is worth less to you than how much you would benefit from the public good.
ᴅ
05:49
ᴅɪꜱᴛʙɪᴛ ⛓️💵
I can talk more abt this arvo (in 7 hours for me) 👌
Z
05:51
Zack
Haha
If you use localized slang to refer to a local time of day, then it becomes a time reference that works globally.
JT
05:52
Jehan Tremback
hahaha
05:52
@zack_amoveo hey link me to you DAC stuff again
05:53
i'm ready to invest in a failing DAC
EA
06:29
Eric Arsenault
In reply to this message
what are you thinking?
JT
07:06
Jehan Tremback
free money bro
07:06
"Bob contributes $9000 and the bridge is not built. Bob gets his money back plus interest, he is $1000 richer."
07:06
how can i do this?
07:06
where does the interest come from?
07:07
ohhh... somebody needs to be the entrepreneur
07:09
I think the amoveo wallet UI is actually pretty good test case for a DAC. the big weakness of DACs is the open ended nature of most tasks, and how to define their value
07:09
the wallet UI is built out but ugly so a designer can easily spec the cost to improve it
07:10
we need to pay a lot to make this experiment clean. at least $50k for design and frontend dev of the wallet
07:10
maybe $100k. that way we can get a good team to take it seriously and be compensated well
07:10
how much would I have to put up as an entrepreneur to make this happen?
Z
07:12
Zack
In reply to this message
http://159.89.87.58:8080/contracts.html

You want a contract betting on whether the public good will get created.
You can teach a contract to the server, and it tells you the ID for that contract.

The offer can be created by either the person raising money to build, or the person contributing money. ill give from the perspective of the person raising money.

Using that ID you can make a swap offer, where you offer to give 2 VEO, in exchange for someone giving you 2.2 share that are valuable if the public good is not created.

You give the swap offer to the server, so we can see it in our light nodes too.

At this point everything is still off-chain, you haven't made any txs.

When they accept this swap offer on the same page of the light node, the DAC is active.
JT
07:12
Jehan Tremback
i only have like 83 amoveo so that makes things tough
Z
07:12
Zack
In reply to this message
it might make sense to break up the job into smaller tasks, so we can keep trying out the DAC and do more improvements.
JT
07:12
Jehan Tremback
good point. the problem is that if a small task is completed it is kind of useless without further work
Z
07:13
Zack
In reply to this message
it is free to make the offer if no one accepts it. because it is all off-chain until someone accepts.
07:13
In reply to this message
a lot of parts are fairly self contained.
Like what if we just did the crosschain DEX?
JT
07:14
Jehan Tremback
yea that could work
07:14
how much money can i make on this without doing the actual work?
Z
07:15
Zack
how much do you expect the price of VEO to increase from your planned improvement?
JT
07:15
Jehan Tremback
with my small amoveo holdings i'm not properly incentivized to do it just from what i hold
07:15
you should do an ICO zack
EA
07:16
Eric Arsenault
Can we just direct a portion of mining rewards towards a DAC to build the front-end?
Z
07:16
Zack
What if we do an ICO to make new VEO, and the money raised is evenly distributed to all current holders, based on how much VEO they are holding now?
JT
07:18
Jehan Tremback
lol
Z
07:20
Zack
In reply to this message
that is pretty controversial. I think you would need to ask the futarchy about it.
TG
08:21
Toby Ganger
In reply to this message
That would help out us old bag holders
ᴅ
09:02
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
That can be solved via an escrow/arbitrator which could be in the form of an amoveo oracle
OK
09:19
O K
In reply to this message
😂 love this idea
EA
09:30
Eric Arsenault
we would just need way better marketing page... and that's about it lol
09:30
people throwing money at everything these days
09:30
maybe we could give them some NFTs in the process
JT
09:31
Jehan Tremback
In reply to this message
Just to be sure… this is literally the same as doing nothing, right?
Z
09:32
Zack
In reply to this message
Its like a forced sale i think
JT
09:33
Jehan Tremback
In reply to this message
Those of us who bought in at a price of 1 eth lol
09:33
Per veo
09:34
Jk I think I was between .5 and .8 eth per veo
SS
11:48
Steve Steve
@zack_amoveo Does VEO plan to re-develop?
rare leroux invited rare leroux
x
14:16
x
In reply to this message
https://ipwe.com/nft/ this seems to be a good use case for nft
ᴅ
16:00
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Hey Zack ok now I can talk about this
16:03
So the way I see it is that in a dac, assuming the market rate of interest is paid on your capital if it fails, the only outcome where you actually benefit by funding it is if you were the pivotal donor
16:03
and the extent to which you benefit in that case is the benefit you derive from the public good minus the amount you donated
16:04
because if you aren't the pivotal donor, there was no need for you to donate in order for the good to be created
16:05
so if you donate and it turns out you were not pivotal (i.e it would have been very likely that it would have succeeded without your donation), but it succeeds anyway, then your profit/loss from donating is the entire donation
16:05
you haven't benefited at all from it
16:06
and if you aren't pivotal and it doesn't succeed, then your p/l is 0 (since you are merely being compensated for the opportunity cost of locking up your capital)
16:08
so if:
the amount you donate = d
benefit you derive from public good = b
probability that you are the pivotal donor = p

then your expected profit is (assuming the campaign succeeds):
p*(b-d)-d(1-p)
16:11
if the probability that you are pivotal is equal to your donation as a % of the funding goal, then:

the amount you donate = d
benefit you derive from public good = b
funding goal = f

then your expected profit is (assuming the campaign succeeds):
(d/f)*(b-d)-d(1-(d/f))

so (d/f)*(b-d)>d(1-(d/f)) for it to be profitable
16:16
(d/f)*(b-d)>d(1-(d/f))
ᴅ
17:17
ᴅɪꜱᴛʙɪᴛ ⛓️💵
do you agree with that reasoning zack?
Z
17:22
Zack
In reply to this message
Its the same development as always
17:24
In reply to this message
Patents need a central enforcement authority. I dont see why they would be on a blockchain.
17:26
In reply to this message
You dont know if you will be pivotal. The investment contracts stay private.

You also want to contribute in the case where the project fails. Because the returns are higher than the interest rate you can get elsewhere.
ᴅ
17:27
ᴅɪꜱᴛʙɪᴛ ⛓️💵
you don't know whether you are pivotal, agreed
17:27
but you can make a decision based off heuristics
17:27
for how likely you are to be pivotal
17:27
hence the use of a probability variable into the equation above 👍
17:30
heuristics could be things like how large your donation is as a % of the funding goal, how much interest there is in the dac etc
17:30
as well as things such as how close it is to being complete, how quickly it has reached that goal etc
Z
17:32
Zack
You dont know the funding goal either.
ᴅ
17:32
ᴅɪꜱᴛʙɪᴛ ⛓️💵
having uncertainty about the probability doesn't solve the problem
Z
17:32
Zack
You dont know how much money was raised so far
ᴅ
17:32
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
It just adds uncertainty
17:32
which isn't generally a good thing
17:33
when trying to incentivise investment 👍
Z
17:33
Zack
If the project fails, then donating was a profitable investment
17:33
I think we can ignore the probability of being pivotal
17:34
And just focus on the fact that people will donate as long as they expect the project to fail.
ᴅ
17:34
ᴅɪꜱᴛʙɪᴛ ⛓️💵
But no one knows with absolute certainty that it will fail
17:34
especially if datapoints such as those you mention above are unknown
17:34
so therefore they will need to consider the implications of it succeeding
17:35
and how that will affect their expected return
Z
17:36
Zack
Lets say i can get $2000 of personal benefit from the public good.
So at most it would only make sense to donate $2000, otherwise i am taking a risk that i lose money.

And i think there is a 20% chance that the project will fail.

So in this situation i want to hedge my risks.

It seems like an ideal hedge donates less than $2000, but more than nothing.
ᴅ
17:37
ᴅɪꜱᴛʙɪᴛ ⛓️💵
>otherwise i am taking a risk that i lose money.
You are doing that by donating.
17:37
if you donate but it turns out that someone else would have donated in your place and it would have still succeeded
17:37
then you have lost $2k by donating
17:37
ofc you can't know for sure, but it is a risk
Z
17:40
Zack
If the project doesnt get built, you will be $2000 poorer.
Wouldnt you want insurance for that risk?
17:40
There is a law of diminishing returns for money
17:40
A 100% chance of $100 is worth more than a 50% chance of $200.
ᴅ
17:41
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
only $2000 poorer than the hypothetical cases where it was built without you donating
17:42
not $2000 poorer than the case of you donating and it being built
17:42
but that isn't a good response, it is kind of tangential I think
Z
17:46
Zack
If you have a 50% chance to lose your house in a fire over a time period.
And the price of insurance is that you can pay $1 now to get $1.10 if your house burns down.

How much fire insurance would a person buy? In relation to the value of their house.
ᴅ
17:47
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
btw in this I wasn't referring to your response to me, but my response to you)
Z
17:49
Zack
Being a little poorer with a house isnt so bad. But losing the house and everything would be terrible. Having a little extra money after it burns could make a big difference.
ᴅ
17:49
ᴅɪꜱᴛʙɪᴛ ⛓️💵
yeah I see that
17:49
makes sense
17:49
in that "expected value" is actually subjective
17:49
i.e it depends on how an individual actually values the outcomes
17:50
which isn't necessarily a linear function of their quantitative amount
17:51
But I think it is important to consider that the dac doesn't have a monopoly on insuring the possibility of the pub good not being created
17:51
that can be done with any other insurance provider/pm
17:52
and so therefore that shouldn't influence the attractiveness of donating to the dac
17:52
since there are much less risky/uncertain ways of insuring against the construction of the pub good
Z
17:52
Zack
In reply to this message
Paul talks about this in his truthcoin documentation.
The lighthouse is built and has a number written on it.
We also bet on that number. The person who builds it controls that number.
17:53
Oh, if they make another contract that ignores the number on the lighthouse
ᴅ
17:53
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Yeah I read that paper, although I did not actually finish it as I got sidetracked thinking about this exact question and didn't end up resolving it or finishing reading the document
17:54
but I am def interested in discussing it with you if you are willing to argue what the paper says (np if you aren't, I will get around to reading it again soon)
17:54
In reply to this message
yes exactly!
17:54
that is what I was thinking
17:54
how is that prevented?
Z
17:57
Zack
The builder does know how much money was raised, and how much money they need to complete the project. So they have an advantage over other insurance providers.
They can buy insurance from another provider, and then not do the project, as a way to get free money.
ᴅ
17:59
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Hmm ok I suppose though the price that they are offering is publicly known by other insurers who could just use it as an input into their risk models?
18:00
I.e they copy the information that the entrepreneur is leaking via his price
18:00
Esp considering that the insurance specialists may have other information that the entrepreneur doesn't have about potential factors that could cause him to fail, resulting in them being able to offer a better price (i.e because they specialize in insurance)
Z
18:01
Zack
You might want to read vitaliks blog post on dac. His conclusion was that they do not work.
ᴅ
18:01
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Interesting yeah I recall reading a discussion between him and sztorc on some forum
18:01
on this topic
18:02
but I found it quite unproductive largely due to the extent Vitalik seems to like to turn everything into extremely complex maths
18:02
which I was not able to fully appreciate as I was verbal arguments
Z
18:02
Zack
In reply to this message
you can publicly offer a price, and then not sign transactions if people try to buy more than you can handle. to fake-out the other insurance providers.
18:03
I think that the builder has a lot more information about what they are building than an insurance provider does.
18:08
I think Vitalik's analysis is working off the assumption that everyone knows as much as everyone else.
I think there needs to be a steep information asymmetry for it to work. the builder+entrepenuer team need to know a lot more than the contributors.
ᴅ
18:10
ᴅɪꜱᴛʙɪᴛ ⛓️💵
What if the insurer lowers their prices until they begin to receive customers, which means they are probably close to the price offered by the entrepreneur?
18:11
But wouldn't it be a public condition of the dac anyway?
Z
18:11
Zack
In reply to this message
the builder could switch to buying insurance from them at any time. If they can buy enough to cover the costs of losing on their own contracts, then abandoning the project is profitable.
ᴅ
18:12
ᴅɪꜱᴛʙɪᴛ ⛓️💵
True
18:12
Especially if there are multiple insurance companies
18:12
Since then none know how much the builder has bought from them in coverage
18:13
So they can't limit it
Z
18:14
Zack
sometimes it is worth it for the builder to build the building, even if they didn't reach their funding goal and they are taking a loss.
If they are paying 50% interest, then the loss of not building could be worse than the loss of building.

So the "funding goal" doesn't really exist as a number.
But if the project is more profitable, they are more likely to do more similar projects in the future.
ᴅ
18:15
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Agreed
18:15
That's true
18:16
Whether the project was funded can only be determined by asking whether it was built by the deadline
Z
18:16
Zack
So then, a person might contribute to one project, because they want that builder to do more projects in the future?
18:17
or maybe this effect is negligible
ᴅ
18:17
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Yeah
18:18
It is very difficult to know the future intentions of the entrepreneur
18:18
I don't think it is an important consideration, and definitely adds a lot of complexity
18:18
So isn't worth it imo to consider
18:19
Let's assume that there is a valuable insurance function that exists in dacs
18:19
For the sake of argument
18:20
It would still only result in someone donating to the dac if they valued the insurance payout potential more than the costs they incur if it succeeds
18:21
Hence why whether they are pivotal still matters
18:21
Because they aren't just buying insurance
18:21
They are buying insurance + a risk that they lose their initial capital
18:22
Which would occur if they weren't pivotal and donated
Z
18:23
Zack
There exist projects that are funded completely by donation, without any refund if the project ends up failing.
A DAC is strictly better than that kind of project, and should work in more cases than pure donations.
18:24
during fundraising the contracts are private, but after the fact they can become public, so people can brag about how much they contributed.
ᴅ
18:24
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
Yes a dac is better than donations, but whether it causes public goods to be funded if they create more benefits than they cost is a different question 👍
18:25
I am very interested in the latter, even some weak forms of the latter I suppose
18:25
Gofundme is better than donations because you get your name recognized in a list of donors
18:25
It doesn't mean GoFundMe can be used to build generalized public goods though
Z
18:26
Zack
the hypothetical perfect mechanism would be if any project that produced more benefit than the cost of construction, it should get built.
ᴅ
18:26
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Yeah agreed
18:26
Ofc benefits and costs are subjective but yes
Z
18:27
Zack
do we have anything like that though? it seems like whatever is the best approximation would win.
ᴅ
18:27
ᴅɪꜱᴛʙɪᴛ ⛓️💵
It is possible that dac is the best approximation
18:27
But I am still interested in understand whether dac comes close
18:27
Which is a separate question
18:28
It could be the best but still be very bad
Z
18:29
Zack
there are a lot of subjective values involved.
can we apply the revalation principle here? https://en.wikipedia.org/wiki/Revelation_principle
18:29
the DAC is at least attempting to get people to reveal their subjective values
ᴅ
18:31
ᴅɪꜱᴛʙɪᴛ ⛓️💵
So the revelation principle is that if a game exists with outcome x that involves lying, a game can always exists with the same outcome without lying?
Z
18:32
Zack
uhhh... idk if "lying" is the right way to think about it.
More like, a game will exist where the participants reveal their subjective values.

So if the public good will make you $2000 richer, then there is a game that is at least as good as the most efficient possible game, and it involves you revealing the number $2000.
ᴅ
18:33
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Ah ok
18:33
Interesting
18:33
Well the question is what the most efficient possible game is
18:33
Maybe it is dac
18:34
But that doesn't mean that dac achieves the goal very well...
18:34
Or am I missing something?
Z
18:34
Zack
One kind of game is where someone very rich, they buy up all the property that stands to increase in value if the public good should get created. Then they pay for the public good entirely. Then they re-sell all this property at a higher price, because the public good made it worth more.
18:35
Like, buying up all the land in a neighborhood, building roads or some infrastructure, and then selling that land after.
18:37
but this might not work for cryptocurrency. If one person tries buying up all the cryptocurrency, the price will get too high. and even if they did have all the cryptocurrency, then it destroys network effects, and could cause the destruction of that cryptocurrency.
ᴅ
18:42
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Hmm interesting
18:42
Yeah I suppose
18:43
In reply to this message
If this strategy did result in something being built if it was valued more than it costed, then dac would be unnecessary no?
18:44
Isn't the issue that such a game is quite unideal due to the frictions involved in the purchase of the land etc
18:44
Like that is a lot harder than it seems, which adds costs
18:44
And so as a result it isn't often done
Z
18:47
Zack
I think the best mechanism we can create would look something like a dac. Because in a dac people are revealing their subjective value in the public good.
ᴅ
18:48
ᴅɪꜱᴛʙɪᴛ ⛓️💵
idk tbh I do not yet have any intuition for why the revelation principle is true and do not currently see its applicability to answering our question... But would def be interested in if you think it could help
18:48
I have not yet read the proof section yet of the above wikipedia page
18:48
In reply to this message
why is that the case though?
18:49
Aren't they revealing their subjective valuation of the cost:benfit of investing in the dac?
Z
18:49
Zack
The revelation principle is one of the most important ideas in mechanism design.
ᴅ
18:50
ᴅɪꜱᴛʙɪᴛ ⛓️💵
Do we have any reason to believe that there is an incentive compatible way to fund public goods that works without the revelation of preferences?
18:51
I suppose if we did then we could apply the revelation principle
18:51
to conclude that a mechanism exists that incorporates revelation of preferences
18:51
or am i missing something?
Z
18:53
Zack
The way to use the revelation principle is to shrink the space of possible mechanisms that we are considering.

We want to consider those mechanisms where players are incentivized to reveal their subjective preferences.
ᴅ
18:53
ᴅɪꜱᴛʙɪᴛ ⛓️💵
👍yeah that makes sense
Z
18:53
Zack
In dac people are at least partially revealing their subjective value of the public good when they decide how much insurance to buy.
ᴅ
18:54
ᴅɪꜱᴛʙɪᴛ ⛓️💵
They don't decide such a thing in a vacuum though
18:54
it is always in a package
18:54
with the other half of the dac outcome space
18:54
which is where the dac succeeds
18:55
in which case they potentially suffer a significant loss
18:55
so when they decide how much to invest in the dac, they aren't just simply expressing their subjective valuation of the pub good
18:56
they are also expressing their valuation of the other part of the dac
Z
18:56
Zack
One kind of dac is where there are multiple builders in a race. And the first one to finish gets paid for delivering the final product.
It is wasteful because of duplicated effort.
ᴅ
18:57
ᴅɪꜱᴛʙɪᴛ ⛓️💵
It would likely make the effective funding requirement much higher
18:58
as each risks potentially not being compensated
18:58
so therefore will require more compensation if they win the race in order to make it worthwhile
Z
18:58
Zack
I guess by the revelation principle, the builder needs to end up revealing how much it costs them to build it.
ᴅ
18:59
ᴅɪꜱᴛʙɪᴛ ⛓️💵
could you elaborate on that pls?
Z
19:00
Zack
well, before we were thinking the funding goal needs to stay private until the end. Maybe that isn't true.
ᴅ
19:01
ᴅɪꜱᴛʙɪᴛ ⛓️💵
As in because doing so gives an extra form of information advantage to the builder?
Z
19:02
Zack
one kind of mechanism is where everyone commits to their subjective preferences. They write down how much the public good would be worth to them, and lock some money in the contract. the builder writes how much it would cost to build, and locks that in the contract.

Then everything is revealed, and the smart contract uses all this information to calculate the optimal outcome, and gives partial refunds or pays for the construction, based on what would be optimal.
19:04
a kind of sealed-bid auction
19:06
In reply to this message
we were thinking that keeping this info private is what prevents the contributors from knowing if they are pivotal, and so allows more money to be raised. but by the revelation principle, it seems like this information shouldn't stay private.
ᴅ
19:07
ᴅɪꜱᴛʙɪᴛ ⛓️💵
I don't think it results in more money being raised
19:08
for the same reason I don't think shops randomly forcing customers to pay a certain amount when they leave the store rather than charging them deterministically for each item they buy will result in them buying more things
19:08
it will most likely result in them buying less
19:08
as they do not know what the cost will be
19:08
it could be very high or low
Z
19:09
Zack
the ideal price for fungible goods in a store is the market-clearing price.
ᴅ
19:09
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
it is the same as an insurance company that charges you premiums based on the output of an rng
Z
19:09
Zack
a public good is singular. it is more like an auction
ᴅ
19:10
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
^ maybe this is a better analogy
19:10
in an auction you still know what you are paying and what you are getting
19:11
you write your own bid and that determines the most you will pay
Z
19:11
Zack
in a second-price auction, you end up paying less than your bid.
19:11
that way there is an incentive to write down your true subjective value
19:12
we want a DAC that works similarly. Where people are incentivized to reveal their true subjective value
ᴅ
19:15
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In an auction your bid is always pivotal in whether you receive the good if the good is given to you
19:15
which isn't the case in a dac
19:15
in that the public good can be given to you without you bidding for it
19:15
so therefore you have to consider the risk that that is the case
19:17
A dac is like an auction where you have a chance of receiving the good without bidding and are also simultaneously buying insurance in case you do not receive the good @zack_amoveo
Z
19:21
Zack
so, lets say that everyone secretly tells you how much they subjectively value the public good, and the builder secretly tells you how much it would cost them to deliver, and they all lock up money in the contract.

Is there some way to use that information and create a contract betting on whether the public good is created, and move money and shares in the contract between the participants, such that they were incentivized to reveal the information honestly in the first place?

If you can't cause them to reveal honestly, maybe that is a proof that the DAC doesn't work.
ᴅ
19:23
ᴅɪꜱᴛʙɪᴛ ⛓️💵
I don't think there is
Z
19:24
Zack
it is like a system of algebraic equations at this point right? we should be able to calculate this formally
ᴅ
19:24
ᴅɪꜱᴛʙɪᴛ ⛓️💵
unless there can be a guarantee to every donor that if they hadn't donated, then it would have failed
19:24
since if there isn't, then they may have wasted their money by donating
19:25
so I think it depends on what they think the probability of them being pivotal is
19:26
In reply to this message
thoughts on this?
19:29
the equation there doesn't factor in the benefit derived from the insurance, but it basically can be easily done by adding the insurance as another term in the revenue side of the inequality
19:30
actually no you would add the marginal improvement of the insurance provided by the dac over an alternative insurance provider (where this improvement is primarily a consequence of the builder's information asymmetry as discussed earlier). The improvement would just be the dac insurance premium minus the alternative insurance premium
19:33
but that is probably not the most important consideration
Z
19:34
Zack
In reply to this message
your equation simplifies to d*(b/f - 1)

So it is only worth it to donate if your personal benefit from the public good is bigger than the entire cost of constructing the public good.
ᴅ
19:35
ᴅɪꜱᴛʙɪᴛ ⛓️💵
what you wrote there isn't an inequality
19:35
How does an inequality simplify to an expression?
Z
19:35
Zack 
profit = p*(b-d) - d(1-p)
= pb - pd - d + dp
= (d/f)b - d
= d(b/f - 1)
ᴅ
19:36
ᴅɪꜱᴛʙɪᴛ ⛓️💵
ah I see
19:37
In reply to this message
ha
19:37
yeah you are right
Z
19:37
Zack
im not sure it is the correct model though
ᴅ
19:37
ᴅɪꜱᴛʙɪᴛ ⛓️💵
yeah I could have def made an error
19:38
if you find an error in the derivation I am interested
19:38
I am quite new to deriving these equations for incentive compatibility
19:38
I have felt inspired after reading a lot of your wiki pages ;)
Z
19:40
Zack
I think the law of diminishing returns matters here. And also, the fact that you get a profit if the project fails matters.

If you are expecting that no one else will contribute, then you definitely want to contribute because it is free money. they pay above the market interest rate.
ᴅ
19:42
ᴅɪꜱᴛʙɪᴛ ⛓️💵
yeah my equation only considers the cases where it succeeds
Z
19:42
Zack
In reply to this message
I think there wont be any alternative insurance, because it is insecure for anyone else to offer insurance. They don't know how much money was raised, or how much money needs to be raised to complete the project.
ᴅ
19:42
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
So I think it is accurate for the case where the dac succeeds
19:42
but still
19:42
In reply to this message
^
Z
19:42
Zack
In reply to this message
they wont all succeed.
ᴅ
19:43
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
you can also read this replacing the word insurance with above market interest rate
19:43
In reply to this message
agreed
Z
19:43
Zack
your model is causing a contradiction.
If it is never in anyone's incentive to donate, then that means it is free money for me to donate, so I would definitely donate.
ᴅ
19:44
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
yeah that's a good point which we actually arrived at earlier but I forgot, likely due to being tired
19:49
In reply to this message
this is weird
19:49
because if you actually plug values into the equation
19:49
p does affect the output
19:49
(the original equation, not the simplified one)
Z
19:50
Zack
Maybe trying to solve a simple example will make it clearer.

Imagine builder Zoe needs $1000 to build the public good.
There are people who would benefit, Alice, Bob, and Charlie. They would receive $250, $500, and $750 respectively.

Everyone does the commit reveal scheme, so the smart contract has access to all these numbers.

Is there any way the smart contract can set up the contracts, so everyone was incentivized to reveal these numbers in the first place?
19:51
In reply to this message
oh yeah, there is an algebra mistake
ᴅ
19:51
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
I don't think it is, because it isn't saying it isn't in anyone's interest to donate.
19:51
i think there was an algebra mistake
19:51
In reply to this message
where was it?
Z
19:51
Zack
oh no. it is because I replaced p with d/f
19:51
algebra is ok
19:52
the probability of being pivotal is your donation over the funding limit, right?
ᴅ
19:52
ᴅɪꜱᴛʙɪᴛ ⛓️💵
ah right
19:52
i see
19:54
hmm
19:54
In reply to this message
I mean... I suppose
19:54
it seemed like a reasonable heuristic
Z
19:55
Zack
In reply to this message
so one way to do it in this situation is that Alice pays 1/6th of the total, Bob 1/3rd, and Charlie 1/2. they each get refunded the extra, and Zoe is payed their $1000.

Another way is if Zoe earns $1500, and Alice Bob and Charlie don't get refunded.

Another way is if Alice Bob and Charlie get refunded more than they had put in, and Zoe doesn't get paid and loses a deposit.
ᴅ
19:57
ᴅɪꜱᴛʙɪᴛ ⛓️💵
In reply to this message
the first two don't work
19:57
I think
19:57
because alice and bob would both have an incentive not to participate
Z
19:58
Zack
maybe it only gets built if the benefit is several times larger than the cost of building?
ᴅ
19:58
ᴅɪꜱᴛʙɪᴛ ⛓️💵
as they could not participate yet it still be funded