Budget Proposal - Proof of Labour

[juliomoros]

Thread in DashTalk

Wehave just created a new budget proposal called " Proof of Labour "

At: https://www.dashwhale.org/p/Proof_of_Labour

We propose here some alternative ways for money creation in a systen with interrelated solutions, based in a kind of smart contract we called "Flow Scrip".

You may find the details in this document:

https://goo.gl/TSKuE6

We appreciate your interest in our work, any question is wellcome.

Regards

 

[juliomoros]

in other words...
You want to transform Dash to Counterparty or Mastercoin...

leave it Digital Cash IMHO
this is our niche

Hello
#1 It is a proposal. Is up to the masternodes in what dash will become.
(The essence of decentralized systems is that there are no dictators).
#2 Couterparty or Mastercoin do not create flow money, as the proposed flow scrip contract will.
#3 As far as I know (May be wrong) there isn't any option to create your own money from a "credit line" in any cryptocurrency.
The only way today to really create money in cryptocurrency market is through POW minery, and now (thanks to masternode paradigm) through POService.

So, IMHO it is a needed improvement. It even can improve your niche.

This is not "a cryptocurrency more" proposal or intended to compete in the niche of anyone, but to enrich the options on any platform to create money.

 

[InTheWoods]

The 2nd tier opens the door to very interesting things like smart contracts and all sorts of different ways to decentralize stuff. I'm all for it. I think it could create a very valuable Dash ecosystem of apps and be a real boost for the project.

Let's not forget that the first smart contract platform, Mastercoin, now known as Omni, was created to offer an alternative to centralized exchanges that can't be shut down. At the time regulators were threatening certain exchanges with closure and account freezes. Decentralized exchanges and smart contracts is the way of the future.

BitShares set up an interesting model that gives all holders of a base coin a stake in the future projects that issue coin tokens on their platform. Perhaps this is a model worth following. Give Dash holders a stake in the future of Dash related projects.

For Digital Cash to succeed, it must have very good unregulated, unrestricted access to the market, the same way cash does. Using a built-in decentralized exchange, its own smart contracts platform is probably the way to go.

 

[juliomoros]

Hi Again,
#1 it was my humble opinion, if i will see a dictator, i will shoot him myself
#2 can you please elaborate what flow money is for the low level investors like me ? ( thanks in advance )
#3 as much as i can understand Counterparty , you create your own money , you name it as you wish and you can trade it in the counterparty decentralized exchange
this money can be exchange only in the counterparty exchange.

but I may miss the point here ,
so if i am wrong , i will be more than happy to get an explanation (for dummies) and i will certainly vote yes if it will make my eyes glow...

thank you juliomoros

Ok, let's see...

#2 Flow Money (https://en.wikipedia.org/wiki/Stock_and_flow)
Your wage is a form of flow money. Is an income which appears once per month. 12 times per year.
GDP is a form of flow money. Is how much a country produces each year.
Coins or deposits, are Stock Money.

Stock are how much exists now.
Flow is how quickly it is changing over time.

#3 Couterparty create Shares. If you have a business you may agree with your partners to create some shares in order to exchange them for PRE-existent money.
Even if you use those shares as means of exchange (money), it will be limited as a "cake piece" of your business, instead of enabling to use all the production potential of your business.
The money which is not created by Counterparty or Mastercoin are the dividends, which confers to shares the form of flow money.

For that shares beeng sold as flow money, you need some kind of escrow system to guarantee the public the payment of dividends.
And in order to do this in a trustless way, you need a smart contract.
I don't know if couterparty integrates already some smart contract system on that sense, but I think the smart contract is a very recent novely.

So, these colored coins may be used as shares, but are not real flow money. Real shares create money periodically, in form of dividends, as flow scrip are sopposed to do.

I'm trying to give the most clear explanation, but it is a tricky subject.
So if you have further questions, go on!

 

[InTheWoods]

I've just skimmed through the PDF documentation of your proposal. It's probably the most solid of all proposals put forth so far. Good work guys!

 

[juliomoros]

I've just skimmed through the PDF documentation of your proposal. It's probably the most solid of all proposals put forth so far. Good work guys!

Thank you !!!

 

[TanteStefana]

Ok, let's see...

#2 Flow Money (https://en.wikipedia.org/wiki/Stock_and_flow)
Your wage is a form of flow money. Is an income which appears once per month. 12 times per year.
GDP is a form of flow money. Is how much a country produces each year.
Coins or deposits, are Stock Money.

Stock are how much exists now.
Flow is how quickly it is changing over time.

#3 Couterparty create Shares. If you have a business you may agree with your partners to create some shares in order to exchange them for PRE-existent money.
Even if you use those shares as means of exchange (money), it will be limited as a "cake piece" of your business, instead of enabling to use all the production potential of your business.
The money which is not created by Counterparty or Mastercoin are the dividends, which confers to shares the form of flow money.

For that shares beeng sold as flow money, you need some kind of escrow system to guarantee the public the payment of dividends.
And in order to do this in a trustless way, you need a smart contract.
I don't know if couterparty integrates already some smart contract system on that sense, but I think the smart contract is a very recent novely.

So, these colored coins may be used as shares, but are not real flow money. Real shares create money periodically, in form of dividends, as flow scrip are sopposed to do.

I'm trying to give the most clear explanation, but it is a tricky subject.
So if you have further questions, go on!

Thank you, this made it a little clearer to me, but need more. I mean, how would this work? An example would be so much help.

Would this be something that only businesses would create via issuing "stock" via, say DASH (actual coins) then issue a DASHf (Dash flow coin) at a set rate per DASH invested? Then, if they make a profit, it would be sent out as dividends via a DASHf which would have some kind of fluctuating DASH value? And if they lose money, Dash would ultimately be lost? (burned DASHf)

Would this DASHf be the same for everyone using it, or would it be based on which "stock" you purchased with your DASH? How would the DASHf be burned? I don't really get all this, but I'll keep re-reading but this isn't my forte, and am having a hard time with it I've asked our resident hobby economist to come here and check all this out. I hope toknormal will come by soon

 

[PantsOnFire]

It is quite tricky to understand. Could you please try and ELI5 a couple of use cases

 

[juliomoros]

Thank you, this made it a little clearer to me, but need more. I mean, how would this work?

Ok, The system we propose works, more or less this way:

1°.- let's suppose you're a baker. The product of your labor/business is bread.
2°.- You know that in your community your bread would be well received. So you announce an offer to deliver, say 10 Kg of your delicius bread weekly, for one year.
3°.- And you launch a campaign. So, in 30 days there are enough people (a community) fans for your bread. The potential clients, giving reputation to your business.
4°.- You create a smart contract wich is validated by the most of, or all of your fans. This community is now the owner of the contract for the products offered (breads).
You have a compromise to make availabe to the community 10 Kg of bread weekly, for one year.
5°.- To warrant your fulfillment, the smart contract create a negative balance in the main address of your business wallet (Te price of all the 10 Kg of bread): CHarge Account.
To make valid your contract you give the manage of this account to another decentralized pool (A master-pool <--- the guys who randomly "verify" the transaction sales, similar like masternodes).
6°.- But as reward, you will receive the same amount of coins but with positive value, deposited in your credit account.
7°.- During the week you can use the positive coins to buy whatever you like within your community to other business with other flow scrip contracts.
8°.- Everyone who buys to you a bread, pays the price to your charge account, so positive and negative coins for that price amount dissapears.
9°.- At the end of the week, all the positive coins you haven't spent or negative coins of breads you didn't sold, are destroyed by the smart contract.
10°.- Inmediately a new amount in coins for the price of the 10 Kg of bread are created in your charge account (negative coins) and in your credit account (positive).

Your commercial activity gives you credit to your personal reputed wallet (wich is unique, and identifies you on the network)
Your reputation in your community also enhance your credit line.
So if you need money, you can create it by a "credit transaction", leaving in your wallet the negative coins.

In the system you can receive negative coins to your account, only if you authorize it.
While you have a negative balance in your personal wallet, you can not participate in investments.
But here are no interests, and no hurry to pay your debt.

As you invest in new business projects in the community you become shareholder of new business, receiving money to more credit accounts, increasing your purchase power, and your personal credit line.

This projects will only work because a digital and cheap version of banking trust accounts can be replicated bay a smart trus (a still non existent smart contract).

But once in existence these tools make you ern a lot of money. Well, not olny to you, but for everybody.

=) regards,

P.S. please excuse my misspellings

 

[juliomoros]

It is quite tricky to understand. Could you please try and ELI5 a couple of use cases

Dude, I'll do my best...

take a look of my answer for TanteStefana I think is a good start point.

Then just ask me as if you were 5. Please, please... take your time!!!
(We've been working on this project by 2 years, and is the first time we plublic it)

 

[oaxaca]

Julio,

Is your work related to "The Community Labor Integrated Money Economy (CLIME)"?

 

[TanteStefana]

How does a person really get credit? Do other people have to invest DASH in them? Or do they create as much as they want whenever they want? If there is nothing requiring a person to pay it back, what gives these flow coins value?

 

[juliomoros]

How does a person really get credit? Do other people have to invest DASH in them? Or do they create as much as they want whenever they want? If there is nothing requiring a person to pay it back, what gives these flow coins value?

You get the credit by the reputation or by compromising on a flow scrip contract. NO INVESTMENT NEEDED... The community CREATE THAT MONEY!!!!

Money is the outcome of an agreement. So, you don't create individually an arbitrary amount, but an amount established depending on an agreement which in this case is an exchange for breads, and the reputation this activity gives to you in your community.

Your personal debt is backed on the value of your personnal reputation, and in your ability to invest. If you don't pay, your reputation is compromised and you can not invest and get more wealth.
So, there is SOMETHING requiring a person to pay back: His own personal interests.

But te value of the coins created in the flow scrip contract are backed on the goods that are produced. That is why once delivered the products, coins are destroyed as selling / buying transactions happen.

 

[TanteStefana]

What happens if you reneged on your deal? Are there any consequences?

 

[juliomoros]

What happens if you reneged on your deal? Are there any consequences?

That is why you have to be promoted your contract. You must give the comunity the ownership of the contract. If you fail, or get away there must be some collaterals. The most easy way is to execute your credits (trough an electroral pool created to that end) in favor of the community. So you get a debt, people get your money.
Other collaterals may be the community having some kind of access to your baker store.
The most of the collaterals for a contract may be accomplished with prevention.
Another kind of legal actions (a headeach) is a logistic risk, but falls beyond any cryptographyc problem.

 

[juliomoros]

Julio,

Is your work related to "The Community Labor Integrated Money Economy (CLIME)"?

First time I hear about it, sound interesting.

 

[oaxaca]

First time I hear about it, sound interesting.

http://www.amazon.com/Radically-Ben...nology-ebook/dp/B0178MQI1M/ref=dp_kinw_strp_1

 

[juliomoros]

http://www.amazon.com/Radically-Ben...nology-ebook/dp/B0178MQI1M/ref=dp_kinw_strp_1

Thank u dude, I'll check it, so we can talk about it.

 

[stan.distortion]

Still reading through it and there's a lot good so far but personally I'd be strongly against it, it's introducing debt and I feel that would be extremely harmful to Dashes reputation. Possibly something other than debt based units, contracts to pay a sum of credit maybe (essentially the same thing) but debt based money... no.

 

[InTheWoods]

stan.distortion

I haven't read the whole PDF yet but judging from a previous reply here posted by juliomoros, he's basically talking future contracts.

It would be a layer app using the Dash network. I don't think it would be up to Dash to police all the future Apps and decentralized APIs. Everyone will be able to add these to the ecosystem.

 

[stan.distortion]

This bit here at the start of section 5:

Since many of the cryptocurrencies have been designed as a fork of the Bitcoin platform, it
would be admissible to introduce some definitions in the basis of the architecture of Bitcoin
code. It is convenient to consult a good textbook about Bitcoin [4].

+UTXO: A positive unspent transaction output. Is the same regular transaction output,
holding “normal” coins [5].

-UTXO: A negative unspent transaction output. Let’s suppose we have an improvement in
which transactions with negative coin value can be validated by the nodes of a
cryptocurrency network. It would require a “hard” fork in the most of the cryptocurrencies
on the market.

Maybe that's just there to aid in explanation (only re-reading as far as that bit at the mo) but I'd be very strongly against actually implementing that. The idea of someone being able to issue contracts for future work, goods, services, whatever... hell yes, I'd be all for that and would likely use it myself but not for the network its self to carry debt.

 

[InTheWoods]

This bit here at the start of section 5:


Maybe that's just there to aid in explanation (only re-reading as far as that bit at the mo) but I'd be very strongly against actually implementing that. The idea of someone being able to issue contracts for future work, goods, services, whatever... hell yes, I'd be all for that and would likely use it myself but not for the network its self to carry debt.

I believe all these 3rd layered apps that will work on the 2nd layer are not impacting the network directly, not really built-in into Dash but use the Dash network. Perhaps the proposal creator can clarify this part so that it's clear for everyone.

 

[SnowHater]

Why not just create full copy of Ethereum's smart contract engine based on top of masternode quorums?

 

[juliomoros]

Still reading through it and there's a lot good so far but personally I'd be strongly against it, it's introducing debt and I feel that would be extremely harmful to Dashes reputation. Possibly something other than debt based units, contracts to pay a sum of credit maybe (essentially the same thing) but debt based money... no.

I understand your concern (I hope), and I think is due to the risk of inflation.
(If you have a different concern, please let me know why are you against debt)
The risk of not to be able to manage the total amount of positive coins.

Nonetheless, the proposed system address this issue by several ways:

1.- Inside the flow scrip system, debt is destroyed after every trading period, and after EACH buying/selling transaction. So liquidity is never accumulated, relieving the inflationary pressure.
2.- A flow scrip, as contract is a kind of future (Derivative contract). It trends to stabilize prices. Another releiving valve for inflation.
3.- Outside the flow scrip system, the debt that any individual can create, is limited by agreements of reputation and the total amount of business shares this person holds. So you can not create an arbitrary amount of debt.
4.- There is no interest rate over any kind of debt in this system. Your motivation to pay the debt is to restore your reputation level, and to be able to keep investing in the system, to make grow your wealth (In business shares). So people will have personal reasons to destroy the debt.

In any solution for new money creation alternatives, will allways be the inflation concern. And it is independent on the debt (Creating negative coins) mechanism. To introduce new alternatives for money creation you always increase the money mass (Even if you don´t leave behind a trace of negative coins). So the main concern here is how to destroy the debt.

The paper is long enough like it is, but there are a lot of options to assure the debt destruction.

5.- To invest into a project there may be (there should be) services linked to flwo scrip contracts. So that kind of payments destroys money.
6.- Without negative coins (without debt) you are reducing the options to destroy money mass. Paying debt is a valid way here to increase your wealth and to relieve inflationary pressure.

7.- This is not mentioned in the paper (Is already too long), but you may include a little fee in all transactions destined to pay debt. If you generate the transaction from a reputed wallet, the fee-payment goes directly to your debt (If there is no debt, there is no fee). If it is generated from an anonymous address, the fee may be randomly scattered among several reputed addresses with negative balance (Not belonging to a business wallet). And to be included in this raffle, you may rise a flag announcing to the system your debt, to receive little paymens from every anonymous transactions.

But, take in mind this is an extra alternative. There may be many others. Fore example: " -coinbase " transactions can destroy coins without any output. If some amunt is held as collateral, in a compromise not fulfilled, that coins may be destroyed.

There is a lot to be discussed though. The paper is not a "last word" in anything. But I believe, debt is convenient in order to design new ways of money creation.
Negative impacts on the reputation on a cryptocurrncy, may be due to the very bad backgrounds that this concept has in the fiat money systems, and is natural for the people to be sceptial towards its useage. So, I hope a little open mindness to undertand radical new options like our proposal.

Regards

 

[juliomoros]

Why not just create full copy of Ethereum's smart contract engine based on top of masternode quorums?

That is not a bad idea, indeed, there is a lot of work advanced already towards smart contracts in ethereum.
The problem is to know how to integrate one thing to the other. The putting togheter all the needed pieces (Buecuse there is not only ethereum giving a lot of solutions, there are many others) in a syncronized way, is the work we want to do, and put in test.

 

[juliomoros]

I believe all these 3rd layered apps that will work on the 2nd layer are not impacting the network directly, not really built-in into Dash but use the Dash network. Perhaps the proposal creator can clarify this part so that it's clear for everyone.

That is right. The solutions do not need to impact any pre-existent network. It may run as colored coins (Again there may be many options). The purpose of the worrk we want to do is to analize in detail pros and cons, and find by consensus the best way to implement these ideas.

 

[stan.distortion]

Thanks for the reply. I'm still only about half way through the paper and to be honest, this appears to be an complete alternative currency that's had Dash elements added afterwards and while I've nothing against that it doesn't mix too well.

I'm only speaking from my own point of view here but I'm confident I'm in the majority, negative Dash transactions will not be implemented. There's a lot of good points in the paper and I'd imagine many of the proposed features would be widely supported but not that one, debt is evil in the world of cryptocurrencies. I don't honestly see that as a problem though, a platform to issue smart contracts and from there the ability to issue contracts for all the points I've read through so far would be a huge benefit and from there the ability for someone to issue contractual debt is only a small step but the important point there is its the individual issuing debt, not the network.

I don't see this proposal as favourable in its current form but hopefully it can be shaped into something that is and a clear plan for implementation built from it as I feel some of the points covered in the paper would be a huge benefit to the Dash system but I'd humbly suggest separating it into more easily digestible stages of development with a proposal for each rather than a single large scale project.

 

[juliomoros]

Thanks for the reply. I'm still only about half way through the paper and to be honest, this appears to be an complete alternative currency that's had Dash elements added afterwards and while I've nothing against that it doesn't mix too well.

I'm only speaking from my own point of view here but I'm confident I'm in the majority, negative Dash transactions will not be implemented. There's a lot of good points in the paper and I'd imagine many of the proposed features would be widely supported but not that one, debt is evil in the world of cryptocurrencies. I don't honestly see that as a problem though, a platform to issue smart contracts and from there the ability to issue contracts for all the points I've read through so far would be a huge benefit and from there the ability for someone to issue contractual debt is only a small step but the important point there is its the individual issuing debt, not the network.

I don't see this proposal as favourable in its current form but hopefully it can be shaped into something that is and a clear plan for implementation built from it as I feel some of the points covered in the paper would be a huge benefit to the Dash system but I'd humbly suggest separating it into more easily digestible stages of development with a proposal for each rather than a single large scale project.

Your point of view is very wellcome dude!!

I personally don't expect to change the pre-existent structure of any cryptocurrency sys.
But there are several ways how to address this fact of the life, like in example, coloured coins.

And now I see your concern!!!...

"the important point there is its the individual issuing debt, not the network."

And I indeed agree. Money, can not be created by a single individual. In order to have an agreement you need another person giving you the "YES".
And that is not different in the money creation agreement.

The individual can not issue by himself his own credit line.
He/she don't give him/her-self his/her own reputation. Is the community.
That is why the proposal require a backing pool as "godparents" for every reputed wallet.

But once agreed the credit line, (calculated from the reputation level) you should be free to use it when you please.

Thank you very much for your interest in this project. And do not hesitate to ask or replay, and take yur time. Is a very knotty subject.

 

[tungfa]

just as a general thought
the community voted back in the day reg Currency vs Dash Tor network, ... other external features based on the masternode network
and the vote went for currency 1st

 

[InTheWoods]

just as a general thought
the community voted back in the day reg Currency vs Dash Tor network, ... other external features based on the masternode network
and the vote went for currency 1st

Not sure this is the right way to put it.

A decentralized exchange would be all about currency and could facilitate Dash access to fiat and fiat to Dash without going through KYC/AML which is somewhat defeats the purposes of having a privacy oriented currency.