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Thoughts on Tokens

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Re: Thoughts on Tokens

#71
post #49
post #5

Earlier quoted context omitted.

Ideally the organization itself should: a) be fully built on distributed technologies, if that's not the case, this is a clear red flag as it gives too much control to the founders to screw it. Ether+Web3.js+IPFS is a good combo. Proper voting/execution system for members is also a must IMO but very few actually have it. b) have a clear incentives model in place (built in smart contracts which code you should be able…

It's very easy to make a "whitepaper" about solving some important problem using Ethereum/Web3/IPFS with whatever interesting kinds of voting schemes and incentives. Whitepapers of all kinds are basically designed to seem impressive and downplay problems, just like any other promotional material. Deciding whether the organization behind that whitepaper is legit, competent, and serious enough to actually make it happe…

It's also "very easy" not fall into FOMO token buying.

Re: Thoughts on Tokens

#72
post #65

However, when considered as an alternative to classic equity financing, token sales yield a >100X increase in the available base of buyers and a >1000X improvement in the time to liquidity over traditional methods for startup finance. The three reasons why: a 30X increase in US buyers, a 20–25X increase in international buyers, and a 1000X improvement in time-to-liquidity. these token sales are successful because peo…

Bitcoin has grown "not that much" from 2013 you say

In actual usage, no not really. In bubble based investment, yes. I know people who run bitcoin ATMs, and who trade bitcoin for cash, they have seen only a marginal increase in activity over the last few years.

Bitcoin is a useful store of value, it provides ways to transmit value, the electronic equivalent of cash. But the use cases have not much improved, and so it's usage (outside of financial sectors) has not really grown (except the marginal increase of late-adapters in sectors where it is useful).

Financial sectors of economies are supposed to help manage the allocation of resources. What financial sectors make are the tools for economies. The bitcoin financial sector forgets this way too much. They don't actually make anything of real value. Which is why these bubbles happen, people are speculating bitcoin will be a great economic tool someday.

Except that bitcoin is loosing to other coins in features. As well as the trust of the people using it to produce actual value.

Re: Thoughts on Tokens

#73
post #66

Earlier quoted context omitted.

> Attitudes like yours are not consistent with the principles of liberal democracy, which rest on the idea that we should be free to do with our body and property whatever we wish, as long as it violates no one's right to the same. If so, then I'd say it's clear those principles (as presented by you) are wrong. They don't take into account the fact that human beings are not independent, perfectly rational actors. Dec…

>They don't take into account the fact that human beings are not independent, perfectly rational actors. and >That's the practical reality of fallible humans with finite computational capacity. and >Fortunately, laws do recognize that fact. A lot of them exist to shield people from being predictably exploited. And who votes in these people who enact these laws? Other people. They are not always rational, especially w…

> In conclusion, regulations destroy innovation and the development of industries

Let's go back to using leaded gasoline then, shall we?

And we should remove all nutritional labels from food packaging.

Safety ratings for automobiles are clearly a waste of time and are holding back innovation.

Restaurant health inspections, also useless.

And I'm sure building codes have nothing to do with the fact the we don't really have earthquake deaths in the U.S. anymore.

And so on...

Of course, not all regulation is effective, and some probably ends up doing more harm than good. But we shouldn't throw out the baby with the bathwater.

Re: Thoughts on Tokens

#74
post #66

Earlier quoted context omitted.

>They don't take into account the fact that human beings are not independent, perfectly rational actors. and >That's the practical reality of fallible humans with finite computational capacity. and >Fortunately, laws do recognize that fact. A lot of them exist to shield people from being predictably exploited. And who votes in these people who enact these laws? Other people. They are not always rational, especially w…

> In conclusion, regulations destroy innovation and the development of industries Let's go back to using leaded gasoline then, shall we? And we should remove all nutritional labels from food packaging. Safety ratings for automobiles are clearly a waste of time and are holding back innovation. Restaurant health inspections, also useless. And I'm sure building codes have nothing to do with the fact the we don't really…

Leaded gasoline damages the health of others without their consent. Restricting pollution is obviously not the kind of "regulation" I'm talking about.

We should abolish mandates requiring nutritional labeling, safety ratings for cars (carmakers far exceed government safety requirements anyway, because it's good for business), restaurant health inspections, and building codes.

That is not to say we shouldn't have nutritional labeling, safety standards, and restaurant inspections. But it should be voluntary, in response to consumer demand for certified safety and quality.

Apple didn't become the largest company in the world by producing shoddy products. The market rewards a reputation for quality. In other words, society evolves toward safer and better quality products over time, whether it's through government mandates or simply changing consumer preferences and increasing consumer awareness.

I would argue that the agricultural and food safety regulations have contributed to the modern industrial agro-business model, because they are naturally geared toward more centralized operations. Small farms that slaughter and butcher animals on the premises for example face significant hurdles due to agriculture regulations. Cookie cutter solutions mandated by the government kill diversity and encourage consolidation and centralisation.

The government can play an active and positive role, by creating voluntary opt-in certification programs, that act as market signals for quality. For example, it can create a voluntary food safety certification that participating companies that meet its requirements can advertise with a seal on their products.

The government can fund public information resources to better inform consumers of the options available on the market and how they compare in quality and risks.

I am not arguing against a government role in the economy. I'm only arguing against mandating a cookie cutter solution that abridges the right of an individual to decide for themselves what risks to incur.

Re: Thoughts on Tokens

#75
post #64
post #46

If the only reason to buy a token is because you expect to sell it later at a greater price, then this is known as a pyramid scheme, not investment. This will end the same way as all other schemes that rely on continual capital gains: collapse when people want to withdraw their profits, turning capital gains into capital losses, and thus revealing that there was never any future profit to be had (unless you were luck…

> If the only reason to buy a token is because you expect to sell it later at a greater price, then this is known as a pyramid scheme, not investment. I don't agree with this. Would you classify Google stock a pyramid scheme? You get zero dividend, zero voting rights, etc. etc. The only utility of owning a Google share is to sell it later when it's worth more. An important difference is that Google generates value to…

Google and other large companies return money to shareholders by doing share buy backs at market prices.

Re: Thoughts on Tokens

#76
post #40

Earlier quoted context omitted.

This. I'm still shocked that reputable VC firms like a16z are completely throwing their weight behind cryptocurrencies without even a slight bit of skepticism. I recently listened to an a16z podcast where they had on a founder of a blockchain hedgefund. It was enlightening to listen to them talk about all the various coins and all the use cases. Chris, in the interview, uses an analogy of this being similar to the be…

So let's try this. Basically you are not "wrong" it's just about Belief and fiction. Have you read the "sapiens" book? There is a good narrative in that book in that: religion, money and legal institutions are just fictions. So I guess the question with tokens is : can we make up new fictions? I think we can. If you insist on "there is a reason why Regulator exist" , well I think it's not that reason you think it is.…

Sorry I was traveling and missed this. I haven't read Sapiens yet though I have a rough idea of the concepts you're talking about.

I definitely agree with you in that there is some good that will come from all this but right now it's being painted as only flowers and roses by most when it isn't.

Re: Thoughts on Tokens

#77
post #65

However, when considered as an alternative to classic equity financing, token sales yield a >100X increase in the available base of buyers and a >1000X improvement in the time to liquidity over traditional methods for startup finance. The three reasons why: a 30X increase in US buyers, a 20–25X increase in international buyers, and a 1000X improvement in time-to-liquidity. these token sales are successful because peo…

Bitcoin has grown "not that much" from 2013 you say

my exact language was "grown from that" meaning grown from the black market.

Re: Thoughts on Tokens

#78
post #2

Beyond buying some Bitcoin and Ethereum, is there anything else a prospective investor should do?

Have knowledge asynchronous from the market. If you're asking here you don't, so don't trade.

Do you invest in the stock market? Do you have "asynchronous" knowledge that the market doesn't know about?

Re: Thoughts on Tokens

#79
post #62

Earlier quoted context omitted.

Something like Golem might fall into this category. It's a project that allows you to use tokens to trade computation time on other people's machines. The software is open source and you could probably set up your own network that uses your own tokens, but likely most users will buy and sell computation at the network the founders set up.

That's different though. That's paying for a service (compute time). Not somehow getting money for an open source software library.

The team got $8.6 million in the initial token sale though. I'm pretty sure they also retained a fair number of tokens. Since there is s fixed amount of tokens the value per token should go up if Golem gets many people to use it and thus the value of the retained tokens rewards the team for their success. A scheme like that of course only would work for a very small portion of open source projects. I could see this work though for pretty much anything that needs hosting. In order to join the network you pay tokens to someone else who is providing that hosting. You could clone pretty much any social network that way. Want to have an account or make changes to your account you gotta pay for the computation.

Re: Thoughts on Tokens

#80
post #62

Earlier quoted context omitted.

That's different though. That's paying for a service (compute time). Not somehow getting money for an open source software library.

The team got $8.6 million in the initial token sale though. I'm pretty sure they also retained a fair number of tokens. Since there is s fixed amount of tokens the value per token should go up if Golem gets many people to use it and thus the value of the retained tokens rewards the team for their success. A scheme like that of course only would work for a very small portion of open source projects. I could see this w…

Why would people want to use a social network they have to pay for when all of the existing ones are free?
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