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You describe the Western Union of bitcoin. The game changer will be the Nasdaq of bitcoin. The frictionless issuance of stocks bonds and dividends will change e

by smokeyj 12y ago

You describe the Western Union of bitcoin. The game changer will be the Nasdaq of bitcoin. The frictionless issuance of stocks bonds and dividends will change everything. Operating agreements will be codified in software and organizations can operate entirely transparently with a degree of accountability never before seen. Why would this be cool? Communities can come together and finance join ventures that were previously too small to be viable (incorporating, compliance, lawyers, bribes, etc). Money can now be pooled and organized in a way that mitigates the risk of theft and corruption. While the software isn't ready for this today, I think it's a short matter of time before we get there.

zwtaylor 12y ago
I think that you could be right about this particular vision of Bitcoin as a financial platform. It's my belief that the future of Bitcoin will be analogous to something like Linux; a great deal of financial infrastructure will rely on blockchain technology, but Bitcoin itself will have little visibility or use to the average consumer outside of a small, dedicated circle of enthusiasts.
- CyberDildonics 12y ago
  If you take into account the fact that Android runs on Linux you could be right.
random28345 12y ago
> The frictionless issuance of stocks bonds and dividends will change everything. Right now, I can issue all the stock I want for a minimal filing fee. In spite of this, companies regularly pay investment banks billions of dollars to file an IPO. If you think that Bitcoin is somehow going to change that, I have a blockchain to sell you.
- smokeyj 12y ago
  My comment wasn't about billion dollar IPOs. I'm talking about small communities that would like to purchase something like a solar panel. Maybe they want to sell excess power and return the profits as dividends. My point is, small scale joint ventures require prohibitively expensive overhead (even without the threat of corrupt government officials). Bitcoin stands a real chance at tackling some of those problems.
  - dragontamer 12y ago
    > I'm talking about small communities that would like to purchase something like a solar panel. How the hell does Bitcoin help any of that? If you really want to do that, you start an LLC, issue stock to your members (possibly requiring dues or whatever). That will cost you $100 to file for an organization in your state, maybe $50 for the proper LegalZoom papers. Then you have to actually _run_ said organization. Even paying some dude minimum wage for the effort is going to grossly trump the costs of creating said organizations. The LLC exists so that when the "company" screws over one of its members and you start getting sued, the "company" can go bankrupt without its members losing everything. ------------- If you're willing to take on the risk yourself, go all sole proprietorship. Take the responsibility for the solar panel yourself, convince your neighbors to chip in. Doing that is perfectly legal (but stupid). Because as soon as one of your neighbors / shareholders gets pissed off at you, they can sue you personally. Companies exist as a protection mechanism. Instead of _you_ getting sued for damages, the company gets sued. You are protected from legal issues. But none of this has anything to do with Bitcoin. How the heck can Bitcoin make any of this easier? Companies are nothing more than a mechanism to prevent their owners from getting sued by the public at large.
walterbell 12y ago
> Operating agreements will be codified in software and organizations can operate entirely transparently with a degree of accountability never before seen. Are there any articles or papers which explain why Bitcoin is better than alternative implementations of transparent accounting? E.g. existing access control can be used to make accounts available to any subset (all the way up to public) of interested parties. Techniques are available for append-only data stores. What does Bitcoin uniquely bring to the table?
- smokeyj 12y ago
  https://github.com/bitcoin/bips/blob/master/bip-0032.mediawiki https://github.com/bitcoin/bips/blob/master/bip-0032.mediawi... I think the main advantage to a blockchain solution is the cryptographic verifiability. Not only is the accounting accurate, but the funds cannot be forged or hidden. Also the rules for managing funds can be programmatically encoded using a series of technologies such as multi-sig keys, pay-to-script-hashes, and HD Keys.
  - walterbell 12y ago
    Thanks for the explanation and wallet pointer.
    - smokeyj 12y ago
      No problem. Here's an open source implementation by bitpay https://copay.io https://copay.io using their open source framework http://bitcore.io http://bitcore.io This isn't pie in the sky tech. It's real and accessible from your mobile browser today. Pretty exciting times I think.
  - dragonwriter 12y ago
    Funds can be hidden as soon as they are converted from bitcoin to other goods and services.
exelius 12y ago
I don't see how Bitcoin enables any of this - you use the term "frictionless" but the truth is BTC is simply low friction. There is already very little friction in the transaction of stocks, bonds and dividends - HFT platforms process trillions of transactions per day with much less friction than BTC (the current iteration of the blockchain will never scale to that volume). Operating agreements are already codified in software in the form of ERP platforms. Organizations will never operate completely transparently because there is a strategic advantage in having asymmetric information.
- smokeyj 12y ago
  Yes I mean low friction. I think we're largely talking about different markets, see my comment: https://news.ycombinator.com/item?id=9313044 https://news.ycombinator.com/item?id=9313044
  - exelius 12y ago
    I just don't think digitized financial services "scale down" to that level, even with BTC. Some transactions just aren't worth enough to bother setting up the safeguards and equity splits (which, again, have to be negotiated and implemented somehow). Someone will feel screwed, and eventually legislation will arise that introduces the friction back into the transaction. I'm also not convinced that the low-friction transaction model is considered a good thing globally. The US and EU are the exception with respect to having low-friction transactions: in most of the rest of the world, buyers get angry if they can't haggle on price, even over the cheapest items. It's a cultural thing. Compared to the friction of negotiating price, cash or credit cards aren't that bad.
- CyberDildonics 12y ago
  Very low friction? Can you buy a stock in the next 10 minutes and get a dividend payout daily? You can't even buy middle man claim to a stock without signing up for an account over multiple days. To fund it? 4 days for checks to clear. To deposit your dividends... This doesn't even go in to the implications of stocks not being able to be sold in a fractional reserve style, taking out all the middle men etc. The financial services industry is 8% of the entire GDP of the US. That is close to 8% we could get back since there is very little that can't be hugely automated.

by smokeyj 12y ago

zwtaylor 12y ago

I think that you could be right about this particular vision of Bitcoin as a financial platform. It's my belief that the future of Bitcoin will be analogous to something like Linux; a great deal of financial infrastructure will rely on blockchain technology, but Bitcoin itself will have little visibility or use to the average consumer outside of a small, dedicated circle of enthusiasts.

CyberDildonics 12y ago
If you take into account the fact that Android runs on Linux you could be right.

random28345 12y ago

> The frictionless issuance of stocks bonds and dividends will change everything. Right now, I can issue all the stock I want for a minimal filing fee. In spite of this, companies regularly pay investment banks billions of dollars to file an IPO. If you think that Bitcoin is somehow going to change that, I have a blockchain to sell you.

smokeyj 12y ago
My comment wasn't about billion dollar IPOs. I'm talking about small communities that would like to purchase something like a solar panel. Maybe they want to sell excess power and return the profits as dividends. My point is, small scale joint ventures require prohibitively expensive overhead (even without the threat of corrupt government officials). Bitcoin stands a real chance at tackling some of those problems.
- dragontamer 12y ago
  > I'm talking about small communities that would like to purchase something like a solar panel. How the hell does Bitcoin help any of that? If you really want to do that, you start an LLC, issue stock to your members (possibly requiring dues or whatever). That will cost you $100 to file for an organization in your state, maybe $50 for the proper LegalZoom papers. Then you have to actually _run_ said organization. Even paying some dude minimum wage for the effort is going to grossly trump the costs of creating said organizations. The LLC exists so that when the "company" screws over one of its members and you start getting sued, the "company" can go bankrupt without its members losing everything. ------------- If you're willing to take on the risk yourself, go all sole proprietorship. Take the responsibility for the solar panel yourself, convince your neighbors to chip in. Doing that is perfectly legal (but stupid). Because as soon as one of your neighbors / shareholders gets pissed off at you, they can sue you personally. Companies exist as a protection mechanism. Instead of _you_ getting sued for damages, the company gets sued. You are protected from legal issues. But none of this has anything to do with Bitcoin. How the heck can Bitcoin make any of this easier? Companies are nothing more than a mechanism to prevent their owners from getting sued by the public at large.

walterbell 12y ago

> Operating agreements will be codified in software and organizations can operate entirely transparently with a degree of accountability never before seen. Are there any articles or papers which explain why Bitcoin is better than alternative implementations of transparent accounting? E.g. existing access control can be used to make accounts available to any subset (all the way up to public) of interested parties. Techniques are available for append-only data stores. What does Bitcoin uniquely bring to the table?

smokeyj 12y ago
https://github.com/bitcoin/bips/blob/master/bip-0032.mediawiki https://github.com/bitcoin/bips/blob/master/bip-0032.mediawi... I think the main advantage to a blockchain solution is the cryptographic verifiability. Not only is the accounting accurate, but the funds cannot be forged or hidden. Also the rules for managing funds can be programmatically encoded using a series of technologies such as multi-sig keys, pay-to-script-hashes, and HD Keys.
- walterbell 12y ago
  Thanks for the explanation and wallet pointer.
  - smokeyj 12y ago
    No problem. Here's an open source implementation by bitpay https://copay.io https://copay.io using their open source framework http://bitcore.io http://bitcore.io This isn't pie in the sky tech. It's real and accessible from your mobile browser today. Pretty exciting times I think.
- dragonwriter 12y ago
  Funds can be hidden as soon as they are converted from bitcoin to other goods and services.

exelius 12y ago

I don't see how Bitcoin enables any of this - you use the term "frictionless" but the truth is BTC is simply low friction. There is already very little friction in the transaction of stocks, bonds and dividends - HFT platforms process trillions of transactions per day with much less friction than BTC (the current iteration of the blockchain will never scale to that volume). Operating agreements are already codified in software in the form of ERP platforms. Organizations will never operate completely transparently because there is a strategic advantage in having asymmetric information.

smokeyj 12y ago
Yes I mean low friction. I think we're largely talking about different markets, see my comment: https://news.ycombinator.com/item?id=9313044 https://news.ycombinator.com/item?id=9313044
- exelius 12y ago
  I just don't think digitized financial services "scale down" to that level, even with BTC. Some transactions just aren't worth enough to bother setting up the safeguards and equity splits (which, again, have to be negotiated and implemented somehow). Someone will feel screwed, and eventually legislation will arise that introduces the friction back into the transaction. I'm also not convinced that the low-friction transaction model is considered a good thing globally. The US and EU are the exception with respect to having low-friction transactions: in most of the rest of the world, buyers get angry if they can't haggle on price, even over the cheapest items. It's a cultural thing. Compared to the friction of negotiating price, cash or credit cards aren't that bad.
CyberDildonics 12y ago
Very low friction? Can you buy a stock in the next 10 minutes and get a dividend payout daily? You can't even buy middle man claim to a stock without signing up for an account over multiple days. To fund it? 4 days for checks to clear. To deposit your dividends... This doesn't even go in to the implications of stocks not being able to be sold in a fractional reserve style, taking out all the middle men etc. The financial services industry is 8% of the entire GDP of the US. That is close to 8% we could get back since there is very little that can't be hugely automated.