6 ms·

"What else ticks me off about this, is that there is absolutely nothing wrong with issuing stock in your company as tokens on a block chain instead of through b

by a_d 9y ago

"What else ticks me off about this, is that there is absolutely nothing wrong with issuing stock in your company as tokens on a block chain instead of through brokers on a standard exchange. Just do it legally, for Pete's sake! Go to the SEC, or whoever the appropriate regulatory authority in your jurisdiction is, and get authorization to issue stock! Hire somebody to implement shareholder voting as block chain transactions. If the law in your area doesn't allow anonymous stockholders, then you need identified participants (and, inevitably, a Trusted system to assign or match IDs). It can work. It has advantages even. But after the meltdown that the scammers are bringing down on this whole form, it's going to be anathema, or even illegal." Ironically, the first "ICO" to do it with full compliance, useful tech and good business model, will be huge. There is demand for it. The other big opportunity is to come up with a framework that everyone can use to be compliant (e.g. An Ethereum with "compliance" mechanisms built into it will be a big "general-purpose" blockchain). It's hard to understand why ignore compliance, when being compliant is quite simply going to be much bigger, sustainable and "good business" than all scammers put together.

wmf 9y ago
The first "ICO" to do it with full compliance, useful tech and good business model, will be huge. Yes, Filecoin raised over $200M. But their troubles are still in the future. The ICO bubble may pop before any of their investors get liquidity. It's probably illegal for Filecoin to trade on any public exchange, so they need to create a "SecondCoin" exchange for qualified investors. And blockchain-based storage has some unsolved problems like low demand. Being compliant is quite simply going to be much bigger, sustainable and "good business" than all scammers put together. Any evidence of this? My impression is that 90% of ICOs wouldn't survive any due diligence.
CJefferson 9y ago
I can't imagine blockchains ever satisfying all legal requirements. At some point I expect some court to say "X shares were illegally transferred from person A, give them back". If we don't know where they went, it's impossible on block-chain to give them back, unless we assume the existence of someone who has the rights to make arbitrary changes, at which point there is no point having a blockchain.
- lallysingh 9y ago
  Why can't you require that each wallet be signed by a party that identifies the person behind it? Then you find where the money went and you force them to give it back. But I think really the statement of interest is here: > ... at which point there is no point having a blockchain. Lots of people have different reasons for liking block chains. Their reasons may disagree with yours.
  - abakker 9y ago
    Financial transactions between real legal entities probably have no expectation that the transaction should be completely anonymous or trustless. Instead, they probably have expectations that the transaction mechanism can be trusted, and that they have legal recourse to make up the difference. Blockchains probably have very relevant uses, but using them to approximate our existing financial system doesn't seem to be that useful. All of our laws and the current system exist for a reason. I'd bet on supply chain as the corporate/real world workload that makes the most sense. the distribution of the chain actually provides a relevant service in those cases.
  - wyldfire 9y ago
    > Why can't you require that each wallet be signed by a party that identifies the person behind it? Then you find where the money went and you force them to give it back. And what if they refuse [despite consequences]? > Lots of people have different reasons for liking block chains. Their reasons may disagree with yours. I'd say the common/paramount feature is "decentralized, trustless ledger w/distributed consensus." Dillinger talks at length here about how "...the Trustless nature of Bitcoin was the main thing that convinced me Satoshi wasn't scamming." Yes, lots of private things calling themselves a "blockchain" exist. But those all submit themselves to some sort of authority/trust system. And it's likely the case that they do that in order to avoid the problem described. IMO it's anarchy [good connotation] vs rule-of-law. Crypto-coin/asset systems can be ruled by distributed consensus but this feature is mutually exclusive with state-managed systems. When they intersect or when they're forced to intersect, we end up with an imbalance/mismatch.
grandalf 9y ago
Compliance with what, the whim of officials in any nation?
- abakker 9y ago
  Yeah, pretty much. You could also think of it as the decisions of the governments of people, who were chose to act in those people's best interests.
  - ShabbosGoy 9y ago
    Like China?
  - StanislavPetrov 9y ago
    > who were chose to act in those people's best interests. Are you seriously suggesting this is how politicians are chosen?
- baq 9y ago
  That's usually called the rule of law and it's a hallmark of Western democracies.
  - grandalf 9y ago
    Following the whims of officials is quite different from the rule of law!
abrichr 9y ago
Apparently such a system has been developed by the Toronto Stock Exchange: http://business.financialpost.com/g00/news/fp-street/tmx-develops-blockchain-tech-for-shareholder-voting-to-boost-involvement-corporate-governance?i10c.encReferrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNhLw%3D%3D http://business.financialpost.com/g00/news/fp-street/tmx-dev... > TMX’s new proxy voting system prototype still needs regulatory approval before it can be tested live, the company said. Anyone have an idea of how long this might take?
- Top19 9y ago
  Don’t know, but I can tell you Blackberry used to trade there before packing up their bags for greener pastures and switching to NYSE.
paulddraper 9y ago
> Ironically, the first "ICO" to do it with full compliance, useful tech and good business model, will be huge. We're a long ways off on all counts. Just look transaction rate: BTC: 4 trans/sec Etherum: 20 trans/sec Visa: 2,000 trans/sec I'm not saying it's impossible to improve by orders of magnititude, but I don't think it will happen next year or the year after that or the year after that.
- deleted 9y ago
  [deleted]
nerpderp83 9y ago
I just announced notary chain.
throwaway8184 9y ago
[using a throwaway so I can say this] It always bugs me when I hear someone who I know knows better use a line like: "Just do it legally, for Pete's sake! Go to the SEC" -- as though this was a matter of dropping a postcard in the mail. I'm confident that these writers know better. The real situation -- as you can see in any of the stories about Blue Bottle's non-IPO, Hedosophia, etc -- is that "just do it legally" is rapidly approaching the regulatory singularity of "just get the NRC to license your new nuclear reactor design." Even for multibillion-dollar companies, "just do it legally" is becoming prohibitively costly. Compare to the 1990s, when sub-100M IPOs were not that weird. This has enabled VCs to earn enormous monopoly fees, originally as gatekeepers to the IPO process, now as gatekeepers to a gigantic secondary market in "unicorns." Lambos all around. As in taxi medallions, this bottleneck creates immense profits. Naturally, the spectacle of Uber versus the taxi mafia, or ICOs versus the VC mafia, creates a lot of passions. Especially among those with axes to grind. There is one big difference: Uber provides a consistently excellent transportation experience. Whereas most ICOs are straight-out terrible. Let's hope that the sheep get separated from the goats, as fast as possible. [/end imprudently-frank throwaway]
AlenaSatoshi 9y ago
I can't agree with "compliant = sustainable and good business". Having worked in the most regulated business - insurance, and being there when more consumer protection has been implemented, I can say that there was no drop in scams and complaints AT ALL. The fact that you have a license or a traditional VC money, doesn't ensure success or fair service. In fact, around 90% of VC funded startups fail too. Legal or compliant doesn’t mean "not scamming". It just means more expensive and hence restrictive.. It blows my mind that crypto-folks who promote inclusion and freedom call for regulation instead of finding new smart ways to deal with new problems. For example, Bitcoin resolved privacy and re-use of addresses with HD wallets. Problem with thieves - solved through hardware wallets. I'm sure we have the capacity to deal with upcoming issues without someone telling us what to do and actually preventing GOOD ideas to be done without having to sell your soul. I understand VC's interests here, but they also need to understand that their value will increasingly be in the experience, contacts and network that they have, not necessarily in their money. Having said all that, no, I'm not a fan of 99% of current ICOs. But still I don't cry on the shoulders of regulators. And those speculators who invest without any due diligence, usually with much lower $$ value than what it seems and with the vision of a 100x or 500x in a few months, well those will learn through experience. The market will clean itself from fraudsters.

by a_d 9y ago

wmf 9y ago

The first "ICO" to do it with full compliance, useful tech and good business model, will be huge. Yes, Filecoin raised over $200M. But their troubles are still in the future. The ICO bubble may pop before any of their investors get liquidity. It's probably illegal for Filecoin to trade on any public exchange, so they need to create a "SecondCoin" exchange for qualified investors. And blockchain-based storage has some unsolved problems like low demand. Being compliant is quite simply going to be much bigger, sustainable and "good business" than all scammers put together. Any evidence of this? My impression is that 90% of ICOs wouldn't survive any due diligence.

CJefferson 9y ago

I can't imagine blockchains ever satisfying all legal requirements. At some point I expect some court to say "X shares were illegally transferred from person A, give them back". If we don't know where they went, it's impossible on block-chain to give them back, unless we assume the existence of someone who has the rights to make arbitrary changes, at which point there is no point having a blockchain.

lallysingh 9y ago
Why can't you require that each wallet be signed by a party that identifies the person behind it? Then you find where the money went and you force them to give it back. But I think really the statement of interest is here: > ... at which point there is no point having a blockchain. Lots of people have different reasons for liking block chains. Their reasons may disagree with yours.
- abakker 9y ago
  Financial transactions between real legal entities probably have no expectation that the transaction should be completely anonymous or trustless. Instead, they probably have expectations that the transaction mechanism can be trusted, and that they have legal recourse to make up the difference. Blockchains probably have very relevant uses, but using them to approximate our existing financial system doesn't seem to be that useful. All of our laws and the current system exist for a reason. I'd bet on supply chain as the corporate/real world workload that makes the most sense. the distribution of the chain actually provides a relevant service in those cases.
- wyldfire 9y ago
  > Why can't you require that each wallet be signed by a party that identifies the person behind it? Then you find where the money went and you force them to give it back. And what if they refuse [despite consequences]? > Lots of people have different reasons for liking block chains. Their reasons may disagree with yours. I'd say the common/paramount feature is "decentralized, trustless ledger w/distributed consensus." Dillinger talks at length here about how "...the Trustless nature of Bitcoin was the main thing that convinced me Satoshi wasn't scamming." Yes, lots of private things calling themselves a "blockchain" exist. But those all submit themselves to some sort of authority/trust system. And it's likely the case that they do that in order to avoid the problem described. IMO it's anarchy [good connotation] vs rule-of-law. Crypto-coin/asset systems can be ruled by distributed consensus but this feature is mutually exclusive with state-managed systems. When they intersect or when they're forced to intersect, we end up with an imbalance/mismatch.

grandalf 9y ago

Compliance with what, the whim of officials in any nation?

abakker 9y ago
Yeah, pretty much. You could also think of it as the decisions of the governments of people, who were chose to act in those people's best interests.
- ShabbosGoy 9y ago
  Like China?
- StanislavPetrov 9y ago
  > who were chose to act in those people's best interests. Are you seriously suggesting this is how politicians are chosen?
baq 9y ago
That's usually called the rule of law and it's a hallmark of Western democracies.
- grandalf 9y ago
  Following the whims of officials is quite different from the rule of law!

abrichr 9y ago

Apparently such a system has been developed by the Toronto Stock Exchange: http://business.financialpost.com/g00/news/fp-street/tmx-develops-blockchain-tech-for-shareholder-voting-to-boost-involvement-corporate-governance?i10c.encReferrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNhLw%3D%3D http://business.financialpost.com/g00/news/fp-street/tmx-dev... > TMX’s new proxy voting system prototype still needs regulatory approval before it can be tested live, the company said. Anyone have an idea of how long this might take?

Top19 9y ago
Don’t know, but I can tell you Blackberry used to trade there before packing up their bags for greener pastures and switching to NYSE.

paulddraper 9y ago

> Ironically, the first "ICO" to do it with full compliance, useful tech and good business model, will be huge. We're a long ways off on all counts. Just look transaction rate: BTC: 4 trans/sec Etherum: 20 trans/sec Visa: 2,000 trans/sec I'm not saying it's impossible to improve by orders of magnititude, but I don't think it will happen next year or the year after that or the year after that.

deleted 9y ago
[deleted]

nerpderp83 9y ago

I just announced notary chain.

throwaway8184 9y ago

[using a throwaway so I can say this] It always bugs me when I hear someone who I know knows better use a line like: "Just do it legally, for Pete's sake! Go to the SEC" -- as though this was a matter of dropping a postcard in the mail. I'm confident that these writers know better. The real situation -- as you can see in any of the stories about Blue Bottle's non-IPO, Hedosophia, etc -- is that "just do it legally" is rapidly approaching the regulatory singularity of "just get the NRC to license your new nuclear reactor design." Even for multibillion-dollar companies, "just do it legally" is becoming prohibitively costly. Compare to the 1990s, when sub-100M IPOs were not that weird. This has enabled VCs to earn enormous monopoly fees, originally as gatekeepers to the IPO process, now as gatekeepers to a gigantic secondary market in "unicorns." Lambos all around. As in taxi medallions, this bottleneck creates immense profits. Naturally, the spectacle of Uber versus the taxi mafia, or ICOs versus the VC mafia, creates a lot of passions. Especially among those with axes to grind. There is one big difference: Uber provides a consistently excellent transportation experience. Whereas most ICOs are straight-out terrible. Let's hope that the sheep get separated from the goats, as fast as possible. [/end imprudently-frank throwaway]

AlenaSatoshi 9y ago

I can't agree with "compliant = sustainable and good business". Having worked in the most regulated business - insurance, and being there when more consumer protection has been implemented, I can say that there was no drop in scams and complaints AT ALL. The fact that you have a license or a traditional VC money, doesn't ensure success or fair service. In fact, around 90% of VC funded startups fail too. Legal or compliant doesn’t mean "not scamming". It just means more expensive and hence restrictive.. It blows my mind that crypto-folks who promote inclusion and freedom call for regulation instead of finding new smart ways to deal with new problems. For example, Bitcoin resolved privacy and re-use of addresses with HD wallets. Problem with thieves - solved through hardware wallets. I'm sure we have the capacity to deal with upcoming issues without someone telling us what to do and actually preventing GOOD ideas to be done without having to sell your soul. I understand VC's interests here, but they also need to understand that their value will increasingly be in the experience, contacts and network that they have, not necessarily in their money. Having said all that, no, I'm not a fan of 99% of current ICOs. But still I don't cry on the shoulders of regulators. And those speculators who invest without any due diligence, usually with much lower $$ value than what it seems and with the vision of a 100x or 500x in a few months, well those will learn through experience. The market will clean itself from fraudsters.