I really liked this note:
"Offset’s algorithm for discovering routes for payment generally prefers routes with lower fees over routes with higher fees. This allows open competition for fees."
Show HN: Offset – Credit card powered by trust between people
41–50 of 113 posts
Re: Show HN: Offset – Credit card powered by trust between people
#42> [banker refused to cancel a personal credit card because it was the bank's]
The comment disappeared, but I wanted to illuminate ...
Banks do have reasons for delaying account closures:
- good reason - delay closing until statements arrive and are paid. This is also commonly done with checking accounts in the US, which has delayed final settlement for inter-bank transactions.
- bad reason - employees get rewards for signups and face consequences for cancellations. See Wells Fargo scandals.
Re: Show HN: Offset – Credit card powered by trust between people
#43>"Money creation in Offset
Money in Offset is created and destroyed by users. Offset is designed so that the money supply changes to match the market. As the market expands, the money supply increases. When the market shrinks, money is destroyed. Therefore, You will not become rich by joining Offset early.
The total sum of balances in Offset is always zero. Consider two Offset friends: Bob and Charli. If Bob’s balance with respect to Charli is x, then Charli’s balance with respect to Bob is -x. The sum of those two balances is always 0.
We count the amount of money in an Offset network by summing all the positive balances. For example purposes, consider again the two Offset friends: Bob and Charli. Suppose that initially the balance between Bob and Charli is 0.
Next, assume that Bob buys a chocolate bar from Charli for the price of $2. Now the balance between Bob and Charli is -$2 from Bob’s point of view, and +$2 from Charli’s point of view. In the moment of purchase, new money was created by Bob. In this case we can say that the total amount of money in the market is $2.
The money created by Bob’s purchase will be destroyed when a complete buying cycle is complete: For example, Charli will use the newly created money to buy something from Dan, which will use the money to buy something from Eve, which will eventually buy services from Bob. When Eve buys from Bob, the money is destroyed."
A lot of good and interesting ideas, but what about the Infinite Hotel Paradox, as applied to money?
https://en.wikipedia.org/wiki/Hilbert%27s_paradox_of_the_Gra...
That is, consider users as hotel rooms, and money as guests for those hotel rooms...
That value, as it approaches infinity, is sort of the theoretical upper limit of Milton Friedman's "Velocity Of Money" theory...
Also, as a side note, you'd probably find economic islands, that is, users who were corporations, where they produce much more than they consume, where, without taxation or other depletion, money would gel and pool and basically be prevented from circulating...
And, what about the people that borrowed, on credit, and never replenished from society what they took? If there's no limit, no "credit limit", then what prevents them from continuing to take, and what prevents everyone from doing this, resulting in a crashed economy?
Also, if there's no limitation on what constitutes an identity, then what prevents someone from signing up multiple times as different users, and giving themselves extra "credit" (ability to take) and taking, that way?
This being said, I think you have a lot of good ideas, and perhaps the only way to know if/when/where/how users "game the system" would be to deploy it -- and see what happens.
Does it succeed? If so why? Does it fail? If so why?
Either way, information could be gained to determine how to create more robust systems in the future.
Your system could work, and I hope it does!
Wishing you well in your endeavors!
Re: Show HN: Offset – Credit card powered by trust between people
#44It's an interesting idea, but I've got 2 questions:
- What happens with fraud? I can reverse my cc transaction, but here there's no insurance. (Just in case someone answers with trust - see how many finance SE questions go like "brother asked me to guarantee a loan and disappeared, what do I do")
- How is this usable for people working in online services? I'm never going to be paid in OUSD, or by local people, so it looks like I'd either have to continuously exchange money with a person I know, or some banker-equivalent online. That gives me no benefit over CC.
Re: Show HN: Offset – Credit card powered by trust between people
#45Being a business owed many small amounts of money from many people seems expensive to collect - any thoughts on that?
Re: Show HN: Offset – Credit card powered by trust between people
#46I'm actually kind of into this idea, even if it's purely as a Free and Open Source alternative to Venmo. But even then, you'll have to give me some good selling points to get my normie friends to use it, as they all already like Venmo.
Re: Show HN: Offset – Credit card powered by trust between people
#47this looks really interesting and an awesome idea. I downloaded the app but then realized that with nobody I know using it, and nobody I can buy things from using it, I literally can't do anything with it.
any ideas how to use it for ...anything..?
Re: Show HN: Offset – Credit card powered by trust between people
#48I am not sure how this works. Lets say we have path of 4 for a transaction.
A - B - C - D
Lets say 100usd transaction amount.
For the sake of arguement, lets consider every node has 100usd credit one way (reverse path)
So if A want to send 100usd to D.
A gets 100usd credit from B, B gets from C and C gets from D.
Until D spends money, system is locking 300usd credit for 100 usd transaction?
Re: Show HN: Offset – Credit card powered by trust between people
#49This is interesting, but I’m really skeptical about the implementation. I’d really kind to see a much more concrete specification, and details about adversarial conditions. It feels like it’s easy to create identities, establish credit lines with no intent to repay, and propagate bad money into this system. It only takes one bad actor to corrupt the chain of mutual credit. From the documentation on the website it’s n…
Hey, interesting questions. Let me try and answer. > I’d really kind to see a much more concrete specification The best I can show you at this point is here: https://docs.offsetcredit.org/en/latest/theory/mutual_credit... This document is far from a full mathematical proof of safety, but it shows how things work. I expect the protocol to change in the next months, so I didn't want to be too detailed about the current…
I think what I’m missing is how a default works in this instance. If I establish a 200 unit mutual credit line with someone, spend 200, what does a default look like? Is there some time period in which I have to pay it back? Without collateral it seems that there isn’t a way to enforce payment.
If I buy a good, from someone accepting offset do they pay me back in credit the value of the good that they deliver? Thus netting us back to zero?
Thanks for answering my questions.
Re: Show HN: Offset – Credit card powered by trust between people
#50Is there any way to do anything with this right now?
Is there anything you can buy or sell with it? Do I need real life friends to use this so I can set up "trust" as this will be a problem preventing me from even trying it out? (I have friends, just not ones that will try this)