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Author Topic: Nxt 2.0 design  (Read 210705 times)

lurker10

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Re: Nxt 2.0 design
« Reply #680 on: February 20, 2016, 08:25:03 pm »

Explain where I am wrong.

Current situation:
total supply of NXT is 1 billion, market cap $10 million (I round up for convenience).
forging coins = 40%, they don't add to liquidity of the asset exchange, they are locked up in forging accounts and not used for trading.
Coins that chase assets are 600 million of the supply, valued at $6 million.

Suppose we burn NXT for fNXT.
We get:
400 million fNXT owned by dedicated forgers valued at $4 million (if you disagree, explain why more NXT will be burned).
600 million NXT valued at $6 million chasing assets.

Where is the drastic effect on asset prices when you have 600 million NXT valued at $6 million going after assets both in NXT 1.x and NXT 2.0 systems?
Now we are getting the feedback I expected. I told my analysis had a detail to be clarified and it is close to what you wrote. The effect of the delta can be adjusted by the velocity of the asset trading. I dont have any recent stats on how much NXT is tied up in bids for assets, but certainly it isnt 100% of the assetcap.

And your method would roughly balance the value according to market forces and over time, it might not be so bad. Except for the first days where there will be massive market movements, which most assets should recover from in time. However, since the NXT holders are the ones that have the option to burn for fNXT, then it becomes possible that they make decisions without any consideration to the asset holders.

So it could be possible to end up with 80% fNXT and 20% NXT, which would be a problem big enough to affect the external markets. Or maybe it is 20/80 the other way, in which case we end up with no network security.

You make huge assumptions. We have seen the forging stake stable at 40%, the rest of the stake has no desire to forge. Can you list reasons why this should change with the NXT 2.0 design implementations?

There are no first days of market movements. From my understanding the proposed design can go live no sooner than a year from today. It's a long time for gradual asset price adjustments. Where do disruptive massive market movements come from in your view? Users have a year to make plans to enter or exit assets. Most importantly there is no reason to expect the forging stake ratio to change. There is historical data it's at 40/60. You guesses of 20/80, 80/20 have no grounds whatsoever.

The rest of your post about NXT centralized is FUD. There is no obligation for forgers to fork to JL's new design. They can stay in NXT 1.x and be happy. If this is not consensus and decentralization, show me the truly decentralized system.

Quote
And still the silver deflation effect is not solved, though its negative effect is lessened a bit.

This is not related to the proposed NXT 2.0 design, but is legacy of the fixed supply decision. Maybe NXT should allow for 1% yearly inflation into the system?

Truth is asset prices will deflate regardless of NXT 1.x or going to NXT 2.0 design. Reasons are few but important. a) Investors lose patience and sell. b) Price of NXT goes up and investors sell to cash out. c) More assets are created chased by the same 600 million of traded coins, old assets are sold to buy into new assets du jour.

Going to NXT 2.0 design the system gets scalability.
Staying in NXT 1.x the system gets ossified and out-competed.
« Last Edit: February 20, 2016, 08:32:06 pm by lurker10 »
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Cassius

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Re: Nxt 2.0 design
« Reply #681 on: February 20, 2016, 08:30:59 pm »

Going to NXT 2.0 design the system gets scalability.
Staying in NXT 1.x the system gets ossified and out-competed.

I think we can all agree that 1.x has limitations. White label is a fantastic idea. Feedback from businesses time and again (one I work closely with included) is that this kind of thing would be incredibly useful.
But 2.0 as it's presently conceived is very likely to harm a lot of people. Even if it didn't, for some reason, why is ok to consider a major part of the ecosystem a fair candidate for collateral damage?

Everything so far has been shot down for one reason or another. Can we keep some constructive alternatives coming?
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lurker10

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Re: Nxt 2.0 design
« Reply #682 on: February 20, 2016, 08:40:12 pm »

I think we can all agree that 1.x has limitations. White label is a fantastic idea. Feedback from businesses time and again (one I work closely with included) is that this kind of thing would be incredibly useful.
But 2.0 as it's presently conceived is very likely to harm a lot of people. Even if it didn't, for some reason, why is ok to consider a major part of the ecosystem a fair candidate for collateral damage?

Everything so far has been shot down for one reason or another. Can we keep some constructive alternatives coming?

I am not sure NXT 2.0 will necessarily harm people if they stay put and don't take hasty decisions. Given the proposed design is at least one year away, staying calm and doing what you did till now (investment in assets you have trust in, forging, speculation) is the best recommendation in my view.

In my lasts posts I explained how the coming deflationary movements in asset prices have no relation to the NXT 2.0 design and there's been no counter argument given yet why I am wrong. James made a try to guess at ratios, but it's just that, guesses. We have historical evidence of the forging stake locked up in accounts not interested in trading assets and we can use this data to project into the future NXT 2.0 design.
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jl777

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Re: Nxt 2.0 design
« Reply #683 on: February 20, 2016, 08:45:26 pm »

Explain where I am wrong.

Current situation:
total supply of NXT is 1 billion, market cap $10 million (I round up for convenience).
forging coins = 40%, they don't add to liquidity of the asset exchange, they are locked up in forging accounts and not used for trading.
Coins that chase assets are 600 million of the supply, valued at $6 million.

Suppose we burn NXT for fNXT.
We get:
400 million fNXT owned by dedicated forgers valued at $4 million (if you disagree, explain why more NXT will be burned).
600 million NXT valued at $6 million chasing assets.

Where is the drastic effect on asset prices when you have 600 million NXT valued at $6 million going after assets both in NXT 1.x and NXT 2.0 systems?
Now we are getting the feedback I expected. I told my analysis had a detail to be clarified and it is close to what you wrote. The effect of the delta can be adjusted by the velocity of the asset trading. I dont have any recent stats on how much NXT is tied up in bids for assets, but certainly it isnt 100% of the assetcap.

And your method would roughly balance the value according to market forces and over time, it might not be so bad. Except for the first days where there will be massive market movements, which most assets should recover from in time. However, since the NXT holders are the ones that have the option to burn for fNXT, then it becomes possible that they make decisions without any consideration to the asset holders.

So it could be possible to end up with 80% fNXT and 20% NXT, which would be a problem big enough to affect the external markets. Or maybe it is 20/80 the other way, in which case we end up with no network security.

You make huge assumptions. We have seen the forging stake stable at 40%, the rest of the stake has no desire to forge. Can you list reasons why this should change with the NXT 2.0 design implementations?

There are no first days of market movements. From my understanding the proposed design can go live no sooner than a year from today. It's a long time for gradual asset price adjustments. Where do disruptive massive market movements come from in your view? Users have a year to make plans to enter or exit assets. Most importantly there is no reason to expect the forging stake ratio to change. There is historical data it's at 40/60. You guesses of 20/80, 80/20 have no grounds whatsoever.

Quote
And still the silver deflation effect is not solved, though its negative effect is lessened a bit.

This is not related to the proposed NXT 2.0 design, but is legacy of the fixed supply decision. Maybe NXT should allow for 1% yearly inflation into the system?

Truth is asset prices will deflate regardless of NXT 1.x or going to NXT 2.0 design. Reasons are few but important. a) Investors lose patience and sell. b) Price of NXT goes up and investors sell to cash out. c) More assets are created chased by the same 600 million of traded coins, old assets are sold to buy into new assets du jour.

Going to NXT 2.0 design the system gets scalability.
Staying in NXT 1.x the system gets ossified and out-competed.
Did you read the link about 1873? it is really quite relevant.
The problem for the devaluation is that it happens in one moment and starting that moment the adjustment can begin. People cant reprice assets in terms of the NXT2.0 before the hardfork since if they do, they are spending NXT+fNXT when they should have only spend NXT, which they cant do.

So even smart intelligent people assisted by automated tradebots wont be able to adjust the prices until the block of the hard fork. After that, either there will be a few who capitalize on the low hanging fruit and make a one time windfall (at the expense of anybody not able to code their own tradebots) and this windfall comes from the vast majority of the people.

If you do not understand that the hardfork event is "only" a onetime event. As it is currently it is a major major event. With your improvement it is still better, but due to the unknowable value of the delta, there will be few who do the transition correctly and an important point is that if you dont do anything, you could well lose out. Maybe if you just cancelled all your AE bid/asks till the dust settles it would be reasonably safe. Not sure.

The permanent problem of demoting assets from being backed by gold to being backed by a token that is backed by gold. Ignoring any security issues this might have, it is very close to what happened to silver in 1873. It took almost 8 years for things to normalize. and it never got back to where it used to be since silver did not have any value as money anymore.

this is not about distribution, it is about what assets are denominated in. The reference for assets is being devalued and this is permanent. Worse is that as a part of this devaluation it is now at risk of being pruned, but the point of excess problems is exceeded way before the pruning issue or even the potential security issues.

Who cares about potential security issues where you would lose some money when you are sure to lose it in the first place.

I still do not see any math that proves that changing assets to be based on something that is less than the current NXT doesnt hurt it. Nor have I seen any benefit to NXT from the childchains. Nor have I seen how NXT is supposed to retain its value as non-exclusive user of the feature set and subject to the identical conditions as childchains.

Dont you understand this is like kicking someone out of your house and treating them exactly the same as any stranger? And no special treatment of any sort and this is what is being done to the NXT that assets use as a reference. Make fNXT and NXT the same and the problem goes away and we get all the benefits of childchains at the cost of ~1GB of bloat per year. If asset issuances for new assets after the hardfork is only for the childchains, that would give some scarcity value to existing assets.

Apparently it is impossible to implement pruning and childchains without making NXT a childchain too. And the price for fNXT transaction is already carved in the stone tablets at 100fNXT, so that cant be changed either. Considering that all this is just a discussion about possibilities and nothing is decided, there sure are quite a few things that have been decided.

If there is no leeway about these things then why am I wasting time debating it?

James
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lurker10

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Re: Nxt 2.0 design
« Reply #684 on: February 20, 2016, 09:04:05 pm »

James, you're constantly being passive aggressive or add drama to your story. It's manipulation of the opponent and it's annoying. here
Quote
Dont you understand this is like kicking someone out of your house and treating them exactly the same as any stranger?
or here
Quote
the price for fNXT transaction is already carved in the stone tablets at 100fNXT, so that cant be changed either.
where do you get this from?

Please try to avoid it, it doesn't help your argument. I understand the hurt ego from your interaction with JL, but seriously, it's not productive to be so manipulative.

So you haven't seen math. The only math you can calculate comes from the 40/60 ratio, and a year to adjust for asset investment miscalculations. You have given no math (you think you did but you didn't) to back your claims. In other words, it's all up in the air and nothing's decided. It'll help seeing this design in code in the test net and then discuss more. It's months away, one day is a long time in crypto.
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jl777

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Re: Nxt 2.0 design
« Reply #685 on: February 20, 2016, 09:17:29 pm »

The rest of your post about NXT centralized is FUD. There is no obligation for forgers to fork to JL's new design. They can stay in NXT 1.x and be happy. If this is not consensus and decentralization, show me the truly decentralized system.
crypto relies on gametheory math to work

NXT forgers will rationally choose to go to 2.0 fork as they get a windfall fNXT distribution. The asset issuers have not ability to choose to stay on 1.x as there wont be enough stake to keep the network secure, not to mention no dev team.

We might as well move to NAS.

The centralization in NXT is the usual dev centralization that all coins have to some extent, especially the smaller ones. But a major coin like NXT should not be at the mercy of any single person and provisions to listen to the community needs to be in place unless the community is not important.

Where is the commitment to adhere to voting results by the dev team?

Even that is not there and I guess there is no reason it has to be, but without it asset issuers will have to decide if they can trust the decisions that will be made that affect them wont harm them enough?!?!? Really? You find this an acceptable thing?

Dont you realize that if fNXT goes through there will be a mass exodus of issuers to other platforms? Most decisions would be based on an intuitive loss of trust that such a big change is just forced onto people and then fanboys cheering it on for the expected pump.

Really, is that what NXT is now?

Now even if there is a commitment by the devs to follow voting results, the past history of ignoring them and breaking the promises (BC1) does not bode well.

I was told that I was the most influential person in NXT. The scary thing is that it was probably true. And I have ZERO influence on topics that have been decided already. Even if the change is a matter of changing one number from 160 to 256 and that would save two months worth of work. Of course no way that the API behavior can be changed to prevent breaking any installation in the field, that was already working.

I had no influence. believe me I tried at great personal cost.

Also, what protections do AE people have of not being expropriated in the future if the NXT holders feel it is in their best interests? This whole "feedback" thread is full of "no", "not an issue", "cant be done", etc. etc

Why is it already decided before any community feedback that NXT must be split? [technically i dont care if it is implemented as a childchain, I talk of the money aspect]

Why is it already decided that it will cost 100 fNXT per transaction?

Why is basically anything that isnt a fanboy post rejected?

So after weeks of this community "feedback" it will be to announce that the community had a chance to voice its opinions and the decision is made to keep the 2.0 exactly as it was.

I call this the ten commandments approach to listening to feedback. If the feedback matches what is on the tablets, its great feedback. If it goes against it, then it is not possible. However, if it is in a part of the tablet that are still not chiseled, then ok we can put in the community number.

this level of community responsiveness is just not enough and certainly does not make me feel like my interests and my asset investor's interests will be of any concern. Maybe I have no right to expect to be listened to since I sold off all my NXT. Oh, but I didnt. SuperNET still has the vast majority of NXT so this whole fNXT thing wont hurt SuperNET directly. But I expect there will be the FUD attack that I just want special treatment, I have a giant ego, etc.

I am just trying to save NXT from the biggest mistake it can make at this point. If technically childchains cant be done in java to special case protect NXT and assets, then just make private chains and charge some sort of fee for it and distribute it as dividends to the forgers and leave NXT as the bloated 1GB/year chain it is now.

James

P.S. I could have made a windfall but not posting today, waiting for the asset dumps. this is opposite to the financial effect which should be to increase to compensate for delta to match the value, not decrease it, I would have made a lot of money. Maybe I could have gotten 2 SuperNET for 1 Rimbit.
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LocoMB

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Re: Nxt 2.0 design
« Reply #686 on: February 20, 2016, 09:23:04 pm »

the 100 fNXT TX fee for fNXT has been pulled out of thin air as a 'really high number' without any further justification other than being a 'really high number' in order to rectify a distortion introduced by this split functionality.

it is an artificial price fix that that is supposed to balance an imbalance, which is set to collapse  as soon as external parameters shift and the 'really high number' becomes unsuitable for its task either by being too high or being too low.
« Last Edit: February 20, 2016, 09:25:08 pm by LocoMB »
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lurker10

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Re: Nxt 2.0 design
« Reply #687 on: February 20, 2016, 09:28:59 pm »

The closest model to what is being proposed that I know of (I am sure there are better ones) is https://en.wikipedia.org/wiki/Panic_of_1873

It was caused by the US going to a gold standard. Which doesnt sound so bad, but prior to that it was both gold and silver that were basically the currency status. So we have two halves that are together before the 1873 and afterwards only the gold, with silver having to stand alone on its noncurrency uses.

so current NXT is modeled by pre 1873 (gold + silver) (fNXT + NXT)
after 1873 gold/fNXT and silver/NXT2.0

Silver price crashed, and anything denominated in silver suffered. Most of you probably dont remember things back in 1873, but it was pretty grim, only the great depression of the 1930's was worse.

Splitting a currency and demoting part of it to non-currency status will devalue that part. It is logical, I have math and historical support.

NXT going to NXT 2.0 is the post-1873 world modeled in NXT as gold with the money function and fNXT as silver with a special utility function.

Silver price crashed after the 1873 reform because utility functions of silver were not largely discovered until the age of electronics. The world has depleted billions of ounces of silver since the Hunt brothers cornered the silver market, at present time the above ground supply of silver is less than the above ground supply of gold. The price of silver in the last 30 years is suppressed with paper derivatives but that's another story, hope it doesn't come to trading derivatives of fNXT or the system is in real trouble. Actually it doesn't matter if derivatives for fNXT are invented, the fees paid in fNXT will take care of delivery of fNXT from exchanges to the forging accounts, so that's not a big issue.

In other words, you have historical evidence unrelated to the issue under discussion, please try again.

fNXT has a huge utility function, there is no reason to believe it's price will crash. The wise fee structure is the problem that a lot of thought needs to be given. It should be as free market as possible.

The historical ratio of 40/60 can be relied on for calculations of fNXT/NXT ratio. The same 600 million coins valued at $6 million will go after the assets, the same 400 million coins valued at $4 million will forge, give or take a few percentage points. No dramatic movements I don't see here to occur.
« Last Edit: February 20, 2016, 09:34:28 pm by lurker10 »
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TheWireMaster

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Re: Nxt 2.0 design
« Reply #688 on: February 20, 2016, 09:31:45 pm »

I don't want to interfere with the Titans here, but I'm glad to see jl777 back. :) I would be also happy to see CfB again.
I wish there could be a way to make you guys work together. NXT would be amazing!
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jl777

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Re: Nxt 2.0 design
« Reply #689 on: February 20, 2016, 09:36:32 pm »

James, you're constantly being passive aggressive or add drama to your story. It's manipulation of the opponent and it's annoying. here
Quote
Dont you understand this is like kicking someone out of your house and treating them exactly the same as any stranger?
or here
Quote
the price for fNXT transaction is already carved in the stone tablets at 100fNXT, so that cant be changed either.
where do you get this from?

Please try to avoid it, it doesn't help your argument. I understand the hurt ego from your interaction with JL, but seriously, it's not productive to be so manipulative.

So you haven't seen math. The only math you can calculate comes from the 40/60 ratio, and a year to adjust for asset investment miscalculations. You have given no math (you think you did but you didn't) to back your claims. In other words, it's all up in the air and nothing's decided. It'll help seeing this design in code in the test net and then discuss more. It's months away, one day is a long time in crypto.
the math NXT will be worth (1 - delta) of what it is now with delta being unknowable but likely in the range of 10% to 70%.

I do not see how the prices can adjust ahead of time when the split happens at a specific time. people have to bid in combined NXT, not split off NXT

There is no need to see the tech to know that fNXT has value. Do you deny that? We dont know what the value is. that is why i use "delta"

I can dig up where it was flatly stated that fNXT transactions will cost 100fNXT in the same way it has been stated that NXT must be pruned, and in the same way 160 bytes is the arbitrary number used instead of 256 which would have made things much easier. ZERO accomodation to feedback in the vast majority of areas, regardless of how important.

The fact that there is no way to determine delta ahead of time is another reason why it is bad. How exactly is the market supposed to reprice ahead of time against a delta factor that nobody will know using the combined NXT?

Let me give and example since you claim I havent, even though I did.

to avoid debating over the unknowable for this example we assume delta is 0.5
meaning 50% value for NXT and 50% value for fNXT. The good thing about this is that it cant be more than 49% wrong.

With me so far?

OK so we have a NAV backed asset to remove any value from anything that is not solid. that is a separate issue.

This asset is priced at 50, but with the above assumptions it is worth 100 NXT2.0

We are before the hardfork, with months and months to go. Please explain what bid I should put in for this asset to preadjust the price? I am not smart enough to figure it out. To my thinking I only have the combined NXT so I cant do this repricing. The idea of issuing a fNXT asset ahead of time to let the market decide the price is actually not bad as it allows to get an idea of what delta is and all you have to do is create an trading triplet where you price the asset in terms of asset/NXT -> asset/NXT2.0

ooops, we dont have a NXT2.0 asset, we have an fNXT asset
so using the fNXT + NXT2.0 = NXT asset, we derive:

NXT2.0 = (NXT - fNXT)
which means we just need to reprice the asset to be asset/(NXT - fNXT) which is asset/NXT - asset/fNXT

now we can do asset/NXT that is what is there now and since asset/asset is only available via Quack, we need to setup trades with someone else to do the asset/fNXT pricing and we need to do both halves of this at the same time to achieve a repricing.

Sounds really simple and easy for everyone to do. I am sure they are all off writing their own tradebots to do this arbitrage and we will have really exactly repricings in place way ahead of time.

or

99% of people's head explodes trying to figure out how to rebalance ahead of time with the available features and just wait for the hard fork.

Which do you feel is more likely? Or is there some other way to rebalance ahead of time? And if it cant be rebalanced ahead of time, just the hardfork event appears to be enough of a risk to not do this. and this assumes an fNXT asset will be issued

James
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lurker10

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Re: Nxt 2.0 design
« Reply #690 on: February 20, 2016, 09:36:49 pm »

Where is the commitment to adhere to voting results by the dev team?

I'd like to see it too, but is it that important or significant?
The true voting is done by forging, it's all that matters.
Show me a more decentralized system and I'll sell my NXT and buy that system coins.
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jl777

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Re: Nxt 2.0 design
« Reply #691 on: February 20, 2016, 09:50:10 pm »

The closest model to what is being proposed that I know of (I am sure there are better ones) is https://en.wikipedia.org/wiki/Panic_of_1873

It was caused by the US going to a gold standard. Which doesnt sound so bad, but prior to that it was both gold and silver that were basically the currency status. So we have two halves that are together before the 1873 and afterwards only the gold, with silver having to stand alone on its noncurrency uses.

so current NXT is modeled by pre 1873 (gold + silver) (fNXT + NXT)
after 1873 gold/fNXT and silver/NXT2.0

Silver price crashed, and anything denominated in silver suffered. Most of you probably dont remember things back in 1873, but it was pretty grim, only the great depression of the 1930's was worse.

Splitting a currency and demoting part of it to non-currency status will devalue that part. It is logical, I have math and historical support.

NXT going to NXT 2.0 is the post-1873 world modeled in NXT as gold with the money function and fNXT as silver with a special utility function.

Silver price crashed after the 1873 reform because utility functions of silver were not largely discovered until the age of electronics. The world has depleted billions of ounces of silver since the Hunt brothers cornered the silver market, at present time the above ground supply of silver is less than the above ground supply of gold. The price of silver in the last 30 years is suppressed with paper derivatives but that's another story, hope it doesn't come to trading derivatives of fNXT or the system is in real trouble. Actually it doesn't matter if derivatives for fNXT are invented, the fees paid in fNXT will take care of delivery of fNXT from exchanges to the forging accounts, so that's not a big issue.

In other words, you have historical evidence unrelated to the issue under discussion, please try again.

fNXT has a huge utility function, there is no reason to believe it's price will crash. The wise fee structure is the problem that a lot of thought needs to be given. It should be as free market as possible.

The historical ratio of 40/60 can be relied on for calculations of fNXT/NXT ratio. The same 600 million coins valued at $6 million will go after the assets, the same 400 million coins valued at $4 million will forge, give or take a few percentage points. No dramatic movements I don't see here to occur.
You are either intentionally misinterpreting my analogy or somehow not comprehending. The fNXT price is not the issue. It is the fact that it has value, which is currently part of NXT. Why is this so difficult? Are you some paid troll?

the historical ratio of forging is irrelevant for the most part. The most important thing is that fNXT has value, it is being subtracted from NXT, thus making NXT value less than it was and assets are denominated in NXT.

historically when the reference currency is devalued (recent BTC bear market hurt alts and the NXT drop hur assets) the things that use it as a reference drop in value. Maybe this is what you are debating? that it doesnt matter the price of BTC for alts? If so, there isnt much point in continuing this discussion as you are clearly smart enough to understand that and it would become clear to everyone that you are just trolling.

So given that you believe subtraction of a positive number reduces the value of something and that BTC price affects alts (value of reference currency matters) we are left with the conclusion without any math, just relative comparisons that assets trading against NXT after the fNXT split will be hurt.

To quantify this I dug up the 1873 example of a previously combined pair (gold/silver) and what happened when one of them lost its status as money. How you try to make it look like an inappropriate analogy with events from 100 years later really stretches your credibility and moves me closer to the ignore button for you as that is what i do to smart trolls with an agenda who twists facts around.

fNXT will have value proportional to the value from childchains and existing forging. we dont know how much this is but it is likely significant, possibly the majority value of the current combined NXT.

The bigger the value of fNXT the bigger the impact on assets. Based on the match and relative values described above. and before you reply that NXT has all these great features and will retain its current value, you might want to analyse the effect on market price when something goes from exclusive to nonexclusive. Like when some medicine goes from patented to public domain.

Since the value of childchains flows directly to fNXT and bypasses NXT, NXT does not benefit from childchains. fNXT does. The forging percentage does not matter for the long term effect of changing the reference currency.

I wont respond to your posts unless they are based on facts and dont misrepresent things. If you are going to respond, please address my specific points about about subtraction and reference currency. Once we can agree that subtraction subtracts and that the value of the reference currency impacts the things that refer to it, then we can move to the non-exclusivity aspect

James
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jl777

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Re: Nxt 2.0 design
« Reply #692 on: February 20, 2016, 09:52:56 pm »

Where is the commitment to adhere to voting results by the dev team?

I'd like to see it too, but is it that important or significant?
The true voting is done by forging, it's all that matters.
Show me a more decentralized system and I'll sell my NXT and buy that system coins.
it is necessary but insufficient at this stage as you say the entire AE ecosystem doesnt matter, so you will end up with Mr 4788.. not forging AE transactions

Without mechanisms in place to ensure subsets of the community are not mistreated, the self-interest factor almost assures that it will. I did not realize this as clearly until today...
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lurker10

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Re: Nxt 2.0 design
« Reply #693 on: February 20, 2016, 09:54:40 pm »

to avoid debating over the unknowable for this example we assume delta is 0.5
meaning 50% value for NXT and 50% value for fNXT. The good thing about this is that it cant be more than 49% wrong.

With me so far?

OK so we have a NAV backed asset to remove any value from anything that is not solid. that is a separate issue.

This asset is priced at 50, but with the above assumptions it is worth 100 NXT2.0

okay, stop right there, what are the assumptions that make it worth 100 NXT 2.0?

here is what i calculate.

600 million NXT 2.0 valued at $6 million with $0.01 a coin make the asset worth exactly 50 NXT 2.0 as  before it was worth 50 NXT 1.x, basically, $0.50 for 1 asset share, NXT 1.x or NXT 2.0.
I skipped the rest of your post because your 'formulas' are based on some ungrounded assumption, explain how the asset is now magically worth 100 NXT 2.0

After the fork there are now two markets: 400 million fNXT with a market cap of $4 million and 600 million NXT with a market cap of $6 million. Total dollar market cap hasn't changed and is $10 million, we have two markets instead of one, the dollar value market cap of fNXT + NXT 2.0 = dollar value market cap of NXT 1.x. The same 600 million NXT 2.0 go after assets that 600 million of NXT 1.x used to do. Assuming no new fiat money has come into the system between now and then.
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lurker10

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Re: Nxt 2.0 design
« Reply #694 on: February 20, 2016, 10:00:00 pm »

There you go, you are presented with proof of why your historical evidence of the 1873 demonetization of silver doesn't apply to demonetization of fNXT (partially stripping fNXT from the money function doesn't remove value from fNXT unlike stripping money function from silver crashing its value because utility for silver was limited back then until 20th century scientific advances happened) and you accuse me of trolling. So manipulative, it reeks. It's up to the readers to make conclusions.

The value of fNXT is locked up in forging accounts and has no relation to assets, now or after the NXT 2.0 fork. Please try to understand it, I am sure you do. This 400 million forging coins have no interest to trade assets, now or after the NXT 2.0 fork. It's like they don't exist for the asset market, doesn't matter if they are detached from the total supply or not, they don't participate in trading, they forge and are locked up.
« Last Edit: February 20, 2016, 10:05:06 pm by lurker10 »
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jl777

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Re: Nxt 2.0 design
« Reply #695 on: February 20, 2016, 10:06:43 pm »

to avoid debating over the unknowable for this example we assume delta is 0.5
meaning 50% value for NXT and 50% value for fNXT. The good thing about this is that it cant be more than 49% wrong.

With me so far?

OK so we have a NAV backed asset to remove any value from anything that is not solid. that is a separate issue.

This asset is priced at 50, but with the above assumptions it is worth 100 NXT2.0

okay, stop right there, what are the assumptions that make it worth 100 NXT 2.0?

here is what i calculate.

600 million NXT 2.0 valued at $6 million with $0.01 a coin make the asset worth exactly 50 NXT 2.0 as  before it was worth 50 NXT 1.x, basically, $0.50 for 1 asset share, NXT 1.x or NXT 2.0.
I skipped the rest of your post because your 'formulas' are based on some ungrounded assumption, explain how the asset is now magically worth 100 NXT 2.0

After the fork there are now two markets: 400 million fNXT with a market cap of $4 million and 600 million NXT with a market cap of $6 million. Total dollar market cap hasn't changed and is $10 million, we have two markets instead of one, the dollar value market cap of fNXT + NXT 2.0 = dollar value market cap of NXT 1.x. The same 600 million NXT 2.0 go after assets that 600 million of NXT 1.x used to do. Assuming no new fiat money has come into the system between now and then.
You are using the fixed 1 billion total for both NXT and fNXT model. I said this was better from the standpoint that the repricing is done with the relative amounts of NXT/fNXT and the corresponding market caps.

So it is a much cleaner way for the repricing. The problem is that it is nonviable at 100fNXT cost per trade of NXT <-> fNXT. It also allows for potentially dramatic swings in ratios and could make things much worse or really weaken network security.

But it solves the need to reprice by assuming we can rebalance the relative supply to determine the relative values and as long as the relative extremes are not happening, it might even work.

However what mechanism is there to prevent the NXT from going below the required amount to not create a liquidity crunch? or to prevent fNXT from going below the required level for adequate security?

And even if these things are dampend or capped, we now end up in a situation where everything is riding on top of a bouncing ball that is oscillating. And I have a feeling that it wont be so stable

But considering the alternative, I guess it is better, but it adds a whole new set of variables on an already complicated system, so not sure if it can be analyzed that well ahead of time.

James
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jl777

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Re: Nxt 2.0 design
« Reply #696 on: February 20, 2016, 10:08:28 pm »

There you go, you are presented with proof of why your historical evidence of the 1873 demonetization of silver doesn't apply to demonetization of fNXT (partially stripping fNXT from the money function doesn't remove value from fNXT unlike stripping money function from silver crashing its value because utility for silver was limited back then until 20th century scientific advances happened) and you accuse me of trolling. So manipulative, it reeks. It's up to the readers to make conclusions.

The value of fNXT is locked up in forging accounts and has no relation to assets, now or after the NXT 2.0 fork. Please try to understand it, I am sure you do. This 400 million forging coins have no interest to trade assets, now or after the NXT 2.0 fork. It's like they don't exist for the asset market, doesn't matter if they are detached from the total supply or not, they don't participate in trading, they forge and are locked up.
The more fNXT is worth the bigger delta is, the bigger the problem is. Can we agree with that? The assumption is the 2.0 as proposed as I have no indication that your swapping back and forth would be allowed.
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Re: Nxt 2.0 design
« Reply #697 on: February 20, 2016, 10:11:21 pm »

you say the entire AE ecosystem doesnt matter

Another silly manipulation of yours, seriously this is tiring. I never said this and I never will. Undoubtedly AE is an important part of the ecosystem. What I did say up thread is that market corrections are healthy to purge bubbly assets, and I also said a few pages ago that deflation of asset prices is inevitable for at least three reasons, regardless of the NXT 2.0 plans.
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lurker10

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Re: Nxt 2.0 design
« Reply #698 on: February 20, 2016, 10:22:13 pm »

However what mechanism is there to prevent the NXT from going below the required amount to not create a liquidity crunch? or to prevent fNXT from going below the required level for adequate security?

If your concern is assets, is it rational to assume that investors having faith in stable and performing assets should have no reason to sell to chase illusory far from guaranteed gains from fNXT? If there is no faith in assets, there is no reason to hold on to them in NXT 1.x other than delude oneself. How about this for mechanism?

What's the required level for fNXT? My assumption is any supply of fNXT created after the fork is assigned 100% forging power. Even in the extreme case of 1 million fNXT is burned, the forging power of each fNXT coin is proportionally increased to add up to 100% for the total burned supply of 1 million. After the burn there will never be more than 1 million of fNXT and it makes no difference for the network security. Goes without saying if only 1 million fNXT is created, each fNXT coin will be priced much higher than if 400 million fNXT is created which is a function of free market.

I favor the fixed 1 billion total for both NXT and fNXT burning model, it is based on responsibility of users vs. the automatic issuing of 1 billion fNXT to all accounts with NXT.
« Last Edit: February 20, 2016, 10:25:17 pm by lurker10 »
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Re: Nxt 2.0 design
« Reply #699 on: February 20, 2016, 10:22:58 pm »

What if asset-to-asset trading is implemented first, then before proceeding with the 2.0 plan we wait until assets get repriced in Btc/Fiat terms. Once assets are mainly traded in Btc/Fiat there should be no issue, isn't it? Is this idea flawed or could work?
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