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Semantics. When I say "money", I mean Libra. If this currency is to be trusted, proof of stake should apply to all parties - having some party able to mint libr

Semantics. When I say "money", I mean Libra. If this currency is to be trusted, proof of stake should apply to all parties - having some party able to mint libra is no different to what banks do now. That libra can be converted into cash from their reserves using users funds. How can you guarantee that this wont happen? How is this regulated?

riffraff 7y ago
as I understand it, the only parties authorized to buy/sell libra are resellers operating through a smart contract, while founding members act as multiple oracles for such contracts, and the minting is in the public ledger. I agree this is wildly unregulated and problems exist, but it's not just a party clicking "mint coin" and cashing out. Edit: unless you consider all parties as cooperating in the scam, which seems possible but unlikely.
- supermatt 7y ago
  founding members acting as oracles is the whole problem. this is centralised trust and it’s ripe for abuse. that the minting is recorded is irrelevant - there’s no guarantee the backing funds exist, much in the same way a traditional bank lends money that doesn’t exist. what if this were to become the universal credit? it’s not impossible given the clout of facebook. placing trust in a few “founding corporations” is not the banking model that we should be pursuing for the future.
  - riffraff 7y ago
    The oracle acts as a verification that the statement "Jane put 1M USD in fund X" is true, but anyone else can verify the data too. The fund can be regulated normally, and will be subject to existing transparency rules on reporting its net assets. Since any observer can verify when an oracle is lying, there is a disincentive in doing that (also, the oracles are sitting on a perpetuous revenue stream if they don't fuck up, and have no interest in scaring people). Sure, the founders can change the rules as they go forward, but at the moment there is no reason to think they would create money ex aere just to cash a quick buck killing the system.

riffraff 7y ago

as I understand it, the only parties authorized to buy/sell libra are resellers operating through a smart contract, while founding members act as multiple oracles for such contracts, and the minting is in the public ledger. I agree this is wildly unregulated and problems exist, but it's not just a party clicking "mint coin" and cashing out. Edit: unless you consider all parties as cooperating in the scam, which seems possible but unlikely.

supermatt 7y ago
founding members acting as oracles is the whole problem. this is centralised trust and it’s ripe for abuse. that the minting is recorded is irrelevant - there’s no guarantee the backing funds exist, much in the same way a traditional bank lends money that doesn’t exist. what if this were to become the universal credit? it’s not impossible given the clout of facebook. placing trust in a few “founding corporations” is not the banking model that we should be pursuing for the future.
- riffraff 7y ago
  The oracle acts as a verification that the statement "Jane put 1M USD in fund X" is true, but anyone else can verify the data too. The fund can be regulated normally, and will be subject to existing transparency rules on reporting its net assets. Since any observer can verify when an oracle is lying, there is a disincentive in doing that (also, the oracles are sitting on a perpetuous revenue stream if they don't fuck up, and have no interest in scaring people). Sure, the founders can change the rules as they go forward, but at the moment there is no reason to think they would create money ex aere just to cash a quick buck killing the system.