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A decentralized anonymous marketplace

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Re: A decentralized anonymous marketplace

#51
post #36
post #32

Earlier quoted context omitted.

> It's not important for me to know that an anonymous person tipped an anonymous vendor. That doesn't add much value. Allow me to disagree (with the last sentence). If you can see that a certain vendor has spent a total of, say, 100 BTC on fees, to build up a reputation, then it doesn't make financial sense for that person to try to scam you in a 1 BTC transaction.

Maybe. But, doesn't it make sense for a vendor to spend 100 BTC in fees to build a reputation so that they may scam 1,000 people in 1 BTC transactions?

Yes, it does. Which is why you have to have the trust factor incorporate the transaction volume for each vendor (calculated based on how much they've paid in fees).

Scamming 1,000 people for 1 BTC would require having 1,000 open orders for 1 BTC each at the same time. If a vendor who has paid 100 BTC in fees has over one hundred 1 BTC pending orders, you'd probably be wise to stay away. And the software can guide you in making this decision.

Re: A decentralized anonymous marketplace

#52
post #41
post #16

Earlier quoted context omitted.

Without having thought about it further, this might work. All we would need to do would be to "burn" a certain percentage of the transaction, eg. by sending it to an provably unspendable address (a hash160 of all zeros, for example). So the transaction from the customer to the vendor, paying for the goods, would be a 2-of-3 multi-signature transaction (of which the customer, the vendor and the escrow agent each hold…

Might also help if the burn amount could be denoted as positive or negative. If zero is the worst, it might just mean "didn't care." If someone spends a significant sum on a negative rating, you know he was pissed. There have been some behavioral economics experiments showing that people are quite willing to make sacrifices to punish offenders.

The burn amount shouldn't be proportional to the rating.

I realize now the system described above is faulty, as the vendor must not be able to hide transactions with a low rating. Also, of course the review value shouldn't be specified by the buyer before he has received the goods. But I'm pretty confident this can be worked around with the right protocol.

Re: A decentralized anonymous marketplace

#53
post #14

As far as I can see, the essential problem with decentralized anonymous marketplaces is that reviews need to cost money. Plain and simple. Good reviews have great value, so they need to have a non-zero price. A vendor's review history is the indicator by which you assess whether a vendor is trustworthy or not, and a vendor should have to pay to achieve a trustworthy reputation - if good reviews are free, and you can…

When has this ever worked in the real world? I mean, in theory parts of it are nice, but conflating it with the spam problem is probably not accurate; merchants will just pay for positive reviews for themselves and negative ones for competitors. I ask honestly: are there examples where this has worked? I feel like the much better system is to increase the available information about transaction and/or review volumes…

"When has this ever worked in the real world?"

Much of everything related to decentralized systems are just new and can not therefore be backed by previous working examples.

"merchants will just pay for positive reviews for themselves and negative ones for competitors"

Of course they will! Boys will fight, that's part of their nature, but we can set rules nevertheless. If rating will cost money and merchants will be willing to pay for it, let them! In the end, the artificial rating will have to be paid with real money coming from real customers. This real deal will have to be larger than the artificial one (in order to sustain it) and thus it will be costly to be fought against, like in an uphill battle.

___

As an improvement to this system (in order to make it harder to be gamed), I add the automatic distribution of the review paid costs to a pool of recent reviewers.

Re: A decentralized anonymous marketplace

#54
post #42
post #14

As far as I can see, the essential problem with decentralized anonymous marketplaces is that reviews need to cost money. Plain and simple. Good reviews have great value, so they need to have a non-zero price. A vendor's review history is the indicator by which you assess whether a vendor is trustworthy or not, and a vendor should have to pay to achieve a trustworthy reputation - if good reviews are free, and you can…

What about creating some sort of token which allows a user to review a seller? The token itself can only be generated by a successful and verified transaction. One transaction would equal one token which would allow only one review to only that specific seller.

Yeah that makes sense. But I'm not sure the token should only be generated upon a successful transaction. This would make vendors not want to issue the token if something goes wrong.

When the buyer creates the unsigned multisig transaction, he could request the token from the vendor, so the buyer gets a token in exchange for the unsigned transaction. The token could simply be a unique, random number signed with the vendor's public key.

Upon completion of the transaction (multisig transaction is signed by two parties and published to the network), the buyer could publish a special transaction (the "review transaction"), referencing the vendor's ID (his public key), the token, and the review score/value, along with an optional comment.

Re: A decentralized anonymous marketplace

#55
post #38
post #33

Earlier quoted context omitted.

> An anonymous market means that there's no legal recourse if someone cheats you or steals from you. Which is why the protocol needs to financially discourage cheating. Take the Bitcoin protocol, for example. It's not impossible to build a Bitcoin mining ASIC for $10M, get 30% of the network hashrate, and have a reasonable chance of reversing a 6-confirmation transaction. But unless you can find someone who is willin…

In practice it is better to build p2p systems under the stronger assumption that actors need not be economically rational. Otherwise the market could be attacked (say by a nation state that wants to kill it) by repeatedly building up rep, then scamming on a large transaction (even if the accumulated rep is worth more) to destroy faith in the market itself.

Of course. But if this is not possible, we're much better off with a system where at least actors cannot profit from being dishonest.

I think Bitcoin is a great example of a system that is not cryptographically secure per se, but still holds up because actors need to spend money to - temporarily - prevent it from functioning properly.

Re: A decentralized anonymous marketplace

#56
post #33

Earlier quoted context omitted.

> An anonymous market means that there's no legal recourse if someone cheats you or steals from you. Which is why the protocol needs to financially discourage cheating. Take the Bitcoin protocol, for example. It's not impossible to build a Bitcoin mining ASIC for $10M, get 30% of the network hashrate, and have a reasonable chance of reversing a 6-confirmation transaction. But unless you can find someone who is willin…

Interesting. Would this prevent something like some of the Silk Road clones happening, wherein somebody spends months to years acquiring trust, and then makes off with the money for all incoming transactions, which is by then worth more than what they've spent on building the reputation?

Yes, I believe so. I mean, no one can prevent other people from engaging in a large transaction with a vendor that exceeds what the vendor has spent on building up his reputation, but I think we can make sure all the information is available for nodes to make an informed decision, and not make it profitable for the vendor to attempt to cheat.

Eg. in the user interface of the application talking this hypothetical decentralized anonymous marketplace protocol, a warning could pop up if you're trying to place an order with a vendor that has open orders for a value of, say, 50% of what he has burned in total.

If nodes who begin a transaction with a vendor simply publish their unsigned multisig transactions -- signed by the vendor in a way that doesn't make the transaction valid, but enables other nodes to cryptographically prove that the vendor has accepted this transaction and that it is open -- to the network (and I see no reason why they wouldn't want to), we can know the total number of outstanding orders for a vendor, and the their total value. Along with information on how much a vendor has burned in connection with other trades, we can figure out whether we would put the vendor in a position where he could profit financially from running off with the money, were we to place out order.

But remember, an escrow service is involved. The vendor would have to convince the escrow service to sign the unsigned multisig transaction (open order) so the vendor gets the money. Although the vendor can just promise a cutback to the escrow service. But if we make sure that the total value of all open orders doesn't exceed a tempting amount for the vendor, we can at least make the dishonest behavior of a vendor unprofitable.

Re: A decentralized anonymous marketplace

#59
Hi. I've been working on a system very similar to OPs description for months now -- http://portobello-road.org . Must be an idea who's time has come, eh? Now I know how Newton and Liebniz felt when they discovered they'd simultaneously invented calculus. Aside from a few architectural decisions (hubs and marketplaces instead of DHT for seller data dissemination and indexing) things are much the same. Would love to join forces and do something cool. I've already gotten a whitepaper put together (though very incomplete I've done a lot of the work in getting a build system for LaTeX up and going and a structure in place) and an initial implementation of a downloadable nodewebkit client and some server code. Just starting on documentation of the communications protocol and getting things going, so it's not very far along. Open to all discussions and debate regarding architecture and specifics.

Re: A decentralized anonymous marketplace

#60

Hi. I've been working on a system very similar to OPs description for months now -- http://portobello-road.org . Must be an idea who's time has come, eh? Now I know how Newton and Liebniz felt when they discovered they'd simultaneously invented calculus. Aside from a few architectural decisions (hubs and marketplaces instead of DHT for seller data dissemination and indexing) things are much the same. Would love to jo…

Oh, forgot to directly link the codebase. It's at https://github.com/portobello-road
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