Dash Business Model upgrade: Invest in start-ups

Technologov

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Dear Dash Nation.

Just recently we have donated money to two start-ups: To Charlie Shrem Dash card and to TenX VISA card.

I think we should upgrade our Dash business model. Right now, when we vote with Masternodes, we can fund start-ups, but we donate money, we don't invest money. We have zero returns on investments directly. But indirectly ecosystem grows, so we gain indirectly.

I would like to change the "donate" idea into "invest" idea, so that successful start-ups, after they grow big and successful, will pay us dividends, to the Dash network, not to Masternode owners, so we can reinvest the proceeds into more start-ups. This will increase our Dash budget quite a lot faster, rather than via standard coin emission procedure. Additionally it will increase the value of our Dash coins.

The Dash network will become a major shareholder of start-ups and blockchain companies in just a several years. The Dash network can become a large "holding company", in addition to being "money".

If Dash will not do it, some other alt-coin will. And it will gain economic efficiency that Dash missed.

Expected results: The value of our Dash tokens will grow even faster, because businesses will buy Dash tokens on the free markets in order to pay us dividends in Dash.

Technically : One way to achieve this effect : Companies will pay dividend to null-address (putting the coins out of circulation) , but Dash network should re-create those coins in the next Dash budget Superblock, and put it into "budget" section. Additionally the 5.0 DASH spent on budget proposals can also be re-created during the next budget cycle. This means a stable coin supply, 100% circulation. Unspent budget must be rolled-over to the next period.

-Technologov
 
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bhkien

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vietriches.com
Excellent! I like your idea very much. I think Evan also has that idea. Because in the Dash Open House, Evan stated that he will invest in many DAOs with most of his own coins.
 

Megahashman

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Dao gets paid back by the increased value of dash. This money is not being loaned or invested, but spent. The dao shouldn't act as an investment firm. Or expect those that get funding, to owe any sort of roi directly. The dao invests in dash, not start-ups!
 

Technologov

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It can invest in block-chain related start-ups and companies. With my idea, the value of Dash will increase even faster.
 

Megahashman

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If you want to invest in start ups and get paid, should maybe do some research on start-ups, as most of them fail in first two years. Perhaps you should invest your own dash into start-up and make a deal for the royalties. Not trying to be mean, I just don't think MNs will go for that right now. You could maybe propose to start a separate dash investment group.
 
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Technologov

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but we already donate to start-ups. To Charlie Shrem and to TenX VISA card. It would be smart to get dividend in return and company shares.
 

Megahashman

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Agreed, but I think it lowers the incentive for people to do these things if the dao starts asking for direct roi.
 

David

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Investing means receiving equity in exchange for money, which Dash isn't set up to do. First, the Dash network isn't a legal entity. The Dash Foundation is, but not the network itself. Secondly, when receiving equity for money, you get into a lot of issues with the SEC and other regulators. I definitely see what you're saying--if we are giving out money we should get some sort of profit-share in return. That would be amazing, but I don't think that's feasible at the moment. I could be wrong, though!
 
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Technologov

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1. Well, the SEC cannot sue the Dash network.
2. the SEC, AFAIK has limitations on issuing new shares (IPO), not on buying shares. DASH network will be buying shares and selling existing shares.
 
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Technologov

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donating money to start ups is a smart thing? But investing in start-up and getting return on investment (ROI) is a stupid thing? It doesn't make any sense.

Look, if companies will pay us dividends in Dash, in means that they will have to go to the open market and acquire Dash, driving the price up for all users.

And if Dash will not do it, some other alt-coin will. And it will gain efficiency that Dash missed.
 
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Megahashman

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Who would the roi go to? The dao currently doesn't exhaust their budget. And doesn't save or roll over the dash, so who would the roi really benefit? Just maybe a conversation for another day, considering the dao hasn't a clue how to spend the dash they are already allocated..
 

David

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1. Well, the SEC cannot sue the Dash network.
2. the SEC, AFAIK has limitations on issuing new shares (IPO), not on buying shares. DASH network will be buying shares and selling existing shares.
When have technicalities ever mattered to the US Government? The SEC can sue Evan, Ryan, or anybody else they want to. Whether they'll win or not is a different story, but it's not like the government hasn't ever been known to overreach. A judge not familiar with the technology would most likely call the Dash DAO a legal fiction and simply allow Evan, Ryan, etc. to be held liable.

We're still dealing with a legal system that is way behind technology. Remember Napster? Sean Parker didn't host any of the music files himself, but the courts didn't really care about that.
 

Technologov

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When have technicalities ever mattered to the US Government? The SEC can sue Evan, Ryan, or anybody else they want to. Whether they'll win or not is a different story, but it's not like the government hasn't ever been known to overreach. A judge not familiar with the technology would most likely call the Dash DAO a legal fiction and simply allow Evan, Ryan, etc. to be held liable.

We're still dealing with a legal system that is way behind technology. Remember Napster? Sean Parker didn't host any of the music files himself, but the courts didn't really care about that.
Perhaps crypto developers should move, along with their families, to Saint Kitts and Nevis (become new Kittens) or to Switzerland, which are more friendly jurisdictions towards fintech start-ups. It will make it much harder for the U. S to prosrcute them.

Roger Ver, the Bitcoin Jesus moved to Saint Kitty, and renounced his U. S citizenship. Vitalik Buterin of Ethereum established an Ethereum Foundation in Switzerland, not in the U.S for similar reasons. Namely the amount of financial regulation is too excessive in the U. S, and so start-ups must move off-shore.

I support Freedom. Both freedom of innovation and freedom from dumb law and freedom of speech and countries with low taxes,which leads to economic freedom. If a country is to become a bottleneck, it must be swapped into some other country, that is more Freedom-compliant.
 

lynx

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Dec 11, 2015
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Companies will pay dividend to null-address (putting the coins out of circulation) , but Dash network should re-create those coins in the next Dash budget Superblock, and put it into "budget" section.
Agreed! I was thinking about making a pre-proposal along those lines

I think roll over unspent Dash to future budgets.
I would agree, but that would inflate the supply unnecessarily, and look bad on the dao.
No, it wouldn't. Those coins had to be bought before they were burnt.
 

lynx

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Agreed, but I think it lowers the incentive for people to do these things if the dao starts asking for direct roi.
Many proposals wanted to give us ROI already, but there is no technical way to do that.
 

Megahashman

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Many proposals wanted to give us ROI already, but there is no technical way to do that.
forgive me if I'm wrong but I thought the idea of the dao was to be decentralized, not to centralize profits of all dash related project. The idea is that the dao is getting it's roi, and profiting many times over from funding projects that increase the usability, and therefore the value of the currency. Or did I miss something?
 

Technologov

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A profit isn't centralized at all. It does not go to Evan or to me. The profit goes to Fash budhet, and it will be reinvested into future blockchain-related start-ups. But because dividend is payable in Dash, it will have a good side effect : giving Dash coins more value. (rather than just donating Dash)
 

Megahashman

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I just don't see much of a point, when the current dao budget isn't being utilized. What's the point of having a larger budget when we don't use the one we currently have? Money talks and bullshit walks. Why isn't evolution out yet? Why aren't people's concerns about IX being taken seriously? Because the dao doesn't have a clue about how to allocate the budget. Giving it a larger one won't make a bit of difference, until they start making more progress. Like I said I'm not completely against the idea, it just may be premature.
 

Megahashman

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The main reason why our budget is unused is because the DASH proposals are way too expensive (and because few people know about DASH). We should reduce proposal prices to 0.1 DASH and by word of mouth gain more start-ups interested in getting funding.

I want to get a lot of proposals for every DASH coin we have available in budget.

Please vote for my proposal :
https://www.dashcentral.org/p/Reduce_proposal_fees_to_dot1_DASH
I liked 1 dash I'm not so sure about the .1
 

Megahashman

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And while we are on the subject, the dao is currently, basically an (npo) not a business.. the mission being to further the good of dash community. To become a for profit investment group, is a whole different idea altogether. So maybe propose to make a private, secondary, for profit investment group,, that could invest in dash projects for a profit. I just think it's apples and oranges my friends.
 

Technologov

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A separate entity is possible, of course. Ethereum DAO tried to do exactly that. Become a for-profit holding company of Ethereum and Blockchain-related start-ups. But it was hacked, and FAILED.
Anyway it may be much simpler to implement on top of DASH, rather than totally separate entity. Besides the DASH budget will grow huge and fairly soon.It can grow beyond $100 million a year and we must have a plan to use that kind of capital efficiently. We better prepare of what to do with the money.
Do we want to donate our money or to invest it for-profit? I vote for the latter.
 

lynx

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Dec 11, 2015
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I just don't see much of a point, when the current dao budget isn't being utilized. What's the point of having a larger budget when we don't use the one we currently have? Money talks and bullshit walks. Why isn't evolution out yet? Why aren't people's concerns about IX being taken seriously? Because the dao doesn't have a clue about how to allocate the budget. Giving it a larger one won't make a bit of difference, until they start making more progress. Like I said I'm not completely against the idea, it just may be premature.
There was a time when there were a number of good proposals and they would be approved for the budget, and one of them would "knock" other(s) down. We just didn't get enough good proposals this month (not at the eyes of the MN majority anyway). Evolution isn't out yet because 9 women can't produce a baby in one month. And I would absolutely vote for any freelance programmer (with credibility) that proposed to fix IX, there were none.

But even if it was really the case that "we don't need more budget money", I see no problem in redistributing dividends as regular block rewards for MNs (or Dash holders post Evolution).
 
T

toknormal

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I don't think this is possible because the DAO/Blockchain isn't a legal entity. There needs to be a legal entity to 'own' the shares.

What you'd have to do to make this work is something like:

• start a company and offer shares in that company to masternode owners for free (but they'd have to disclose their identities of course)
• create a proposal to capitalise that company and post it on Dashwhale
• get enough votes to activate the proposal so that an address owned by the company gets funded
• have the company then invest in startups

However the 'company' still wouldn't really be owned by the network as such. It would be owned by the individuals who happened to be masternode holders as well and they could still choose to sell their shares independently of their masternode collateral (unless there was some kind of binding condition in the terms of ownership, but they would be almost unenforceable because cryptocurrency is a bearer token with no counterparty to endorse ownership).

I'm afraid that's just the other side of the 'decentralised' equation. The DAO cannot own anything because it itself does not have a legal existence.

The Dash DAO and corporate shares are oil and water. They are unmixable and invisible to each other. Parallel universes that are unaware of each other's existences.
 

Technologov

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We can pretend as-if it's a working system and hope for dividends being paid in the end. Masternode owner would be able to sue companies that distribute profits to other shareholders, but not to Dash. Let's just try it.

There is zero downside anyway as compared to the current situation where we simply donate funds.

Perhaps some jurisdictions will call it a legal fiction, some others will treat it seriously. As long as there is zero downside and a huge upside, worth at least hundred million dollars, I'm willing to support the idea.
 
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