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Show HN: Offset – Credit card powered by trust between people

offsetcredit.org

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Re: Show HN: Offset – Credit card powered by trust between people

#21

Post by jonahbenton »

centimeter wrote: post #16
jonahbenton wrote: post #10

Congratulations. You have reinvented tally sticks. Snark aside, I wish you lots of luck, have thought about this model a lot, think there is probably a small place for it in the world. Two suggestions from random stranger on the internet, take them for what they're worth: * don't use the word "money." This is a private credit network, not money. Private credit networks sometimes become money, but they don't start out…

> there is a tension between store of value and medium of exchange This tension only exists under Keynesian reasoning. It goes away when you use a theory that does a better job handling equilibria. The Keynesian claim is that if you have a deflationary medium of exchange, people won’t spend it. This isn’t actually true - the end result of a predictable deflationary asset (e.g. something with a fixed or essentially fi…

Thank you, agree with that, and actually was not suggesting to stick with medium of exchange for technical considerations. More about product focus. The BTC people have the asset/inflation hedge thing nailed. Leave them to it. Disentangle the things that are money.

Here, prices in the offset ecosystem are going to float because goods are exposed to/sources from the actual money ecosystem. There will be aspects of inflation, both colloquial and technical. It doesn't sound like they understand the claim anyway. Just let it go. Focus on liquidity, fraud, utilization, ergonomics. Get trains riding on those payment rails.

Re: Show HN: Offset – Credit card powered by trust between people

#22

Post by rydre »

This is an idea I always wanted to build, though never got the time.

Congrats on the work.

Now this is something I'd be willing to use. I've never used cryptocurrencies before because of POW (I believe it is a fad). But trust based crypto is something that will likely change the world like the internet, and this or something like this is gonna be it. No more banking gatekeepers. No more private credit scores.

Re: Show HN: Offset – Credit card powered by trust between people

#23

Post by technotony »

centimeter wrote: post #16
jonahbenton wrote: post #10

Congratulations. You have reinvented tally sticks. Snark aside, I wish you lots of luck, have thought about this model a lot, think there is probably a small place for it in the world. Two suggestions from random stranger on the internet, take them for what they're worth: * don't use the word "money." This is a private credit network, not money. Private credit networks sometimes become money, but they don't start out…

> there is a tension between store of value and medium of exchange This tension only exists under Keynesian reasoning. It goes away when you use a theory that does a better job handling equilibria. The Keynesian claim is that if you have a deflationary medium of exchange, people won’t spend it. This isn’t actually true - the end result of a predictable deflationary asset (e.g. something with a fixed or essentially fi…

It's less that they won't spend it, and more they won't invest it. As you point out if you can get exposure to global capital growth by keeping your money in cash you will do that. This starves the world of risk capital being invested in new projects, the net benefit of which is responsible for capital growth. So nobody invests and technological progress drives to a halt (well maybe governments invest in military technology ands whatso but net investment in risky tech drops).

Re: Show HN: Offset – Credit card powered by trust between people

#24

Post by aSplash0fDerp »

thoughtstheseus wrote: post #17

A nation-state will ban or monopolize any competitive alternative to state-backed currency or debt (obligation transfers). Just look at current macroeconomic policy around the world, vast sums of obligations ("debt") being created.

Autonomous/robotic manufacturing/production could very well bring back bartering, depending on your definition of innovation.

Gerbil wheel economics (debt until infinity) doesn't take into account low-cost, low-labor 24/7 manufacturing, so don't invest too much logic in antiquated theories that require libor-rate'esqe techniques to make it believable.

Re: Show HN: Offset – Credit card powered by trust between people

#25

Post by xwdv »

Inflation isn’t coming. Interest rate is 0. Banks were ready for inflation for years, it never came. We might even see deflation at some point.

Also, I trust very few people. People are scumbags when it comes to money. I’ll take a regular credit card thanks.

Re: Show HN: Offset – Credit card powered by trust between people

#26

Post by yellowapple »

So looking at the economic model, and the transaction where Bob pays through Charli to Dan...

This means that Bob can "pay" Dan through Charli, run off without paying, and now Charli somehow owes Dan? Does Charli consent to being in the middle of this transaction? This seems like it's ripe for abuse.

Re: Show HN: Offset – Credit card powered by trust between people

#27

Post by d10 »

Interesting! For folks who like this idea, I recommend looking up Ryan Fugger's Ripplepay (https://classic.ripplepay.com/). That was inspiration for Ripple Labs, who unlike Offset did go the cryptocurrency route (XRP).

I appreciate that Offset is not spawning a cryptocurrency where it doesn't need one. There are other projects influenced by Ripple and Ripplepay which are also not their own currency. For example Synchronized Network Accounting Protocol (https://michielbdejong.com/blog/20.html) and Interledger Protocol (https://interledger.org/).

One of the thought provoking ideas in interledger is that a single payment can be delivered in packets. Meaning that if Alice is making a payment to Bob, some of that payment might go through an intermediary Ivan and some of that same payment might go through Isaac. I haven't read much about Offset, but I saw that it described payments as atomic. Interledger specifically decides not to be atomic. This is not what most people expect with payments, but giving up atomicity gets other nice qualities. For example, if Alice is making a large payment to Bob, they are not limited by the liquidity of any one intermediary. Like data finding an efficient route on the internet, a payment can find an efficient route over interledger.

Glad to know about Offset. I'll add it to my list of interesting network money projects.

Re: Show HN: Offset – Credit card powered by trust between people

#28

Post by wolfgang42 »

yellowapple wrote: post #26

So looking at the economic model, and the transaction where Bob pays through Charli to Dan... This means that Bob can "pay" Dan through Charli, run off without paying, and now Charli somehow owes Dan? Does Charli consent to being in the middle of this transaction? This seems like it's ripe for abuse.

Charli consented by giving Bob a line of credit. (If she hadn’t, and hadn’t owed Bob any money, the transaction wouldn’t have gone through her.) It’s up to each individual participant to set the credit limits on their friend pairings according to their own risk tolerance and trust level. If Bob turns out to be a deadbeat, Charli probably shouldn’t have given him any credit; but that’s not a technical problem.

In practice, I’d expect that if Offset (or another p2p mutual credit system) catches on, you’d see mostly two main ways of using it: friends and maybe local businesses giving small amounts of credit to each other (think splitting the bill for lunch, or a local plumber and a bakery) based on mutual trust, and writing off the occasional bad debt the same way they do now; and larger “commercial” lenders who work like present-day credit card companies, tracking credit scores and the like and with the force of law behind them if you don’t pay your overdue bill.

Re: Show HN: Offset – Credit card powered by trust between people

#29

Post by dpatru »

technotony wrote: post #23
centimeter wrote: post #16

Earlier quoted context omitted.

> there is a tension between store of value and medium of exchange This tension only exists under Keynesian reasoning. It goes away when you use a theory that does a better job handling equilibria. The Keynesian claim is that if you have a deflationary medium of exchange, people won’t spend it. This isn’t actually true - the end result of a predictable deflationary asset (e.g. something with a fixed or essentially fi…

It's less that they won't spend it, and more they won't invest it. As you point out if you can get exposure to global capital growth by keeping your money in cash you will do that. This starves the world of risk capital being invested in new projects, the net benefit of which is responsible for capital growth. So nobody invests and technological progress drives to a halt (well maybe governments invest in military tec…

I think your assertion that inflation (money printing) is necessary for inflation is wrong and certainly not obvious. Investment necessarily comes from savings. One must not eat some of this year’s corn so as to have next year’s seed. Whether state-forced savings through inflationary bank loans is better than voluntary private savings should be answerable by studying history. Was there better investment historically in countries where the state devalued money in favor of banks, or in countries where money was not devalued?

Re: Show HN: Offset – Credit card powered by trust between people

#30

Post by alexmingoia »

The biggest advantage over bitcoin is that this is truly p2p. Bitcoin isn’t p2p in the sense that transactions require third parties (miners).

You can only transact as long as miners choose to mine. If miners stop mining for any reason bitcoin is unusable. There’s also no risk of 51% attacks and hard forks.

You could also run offset off the Internet on local networks.

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