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Are you worried about NXT being controlled by few?
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Author Topic: Are you worried about NXT being controlled by few?  (Read 6288 times)

Canaanite

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Are you worried about NXT being controlled by few?
« on: May 28, 2014, 09:02:47 am »

I know it really worries me,

What if one of the NXT whales decide to become a Fiat Millionare?
Right now i'm gathering my stack of NXT's (I spread the buying over time) and I'm very worried about entering into a coin that is so concentrated by few owners.

Do you guys know if the NXT whales coordinate their moves? do they have some kind of agreement to slowly distribute the coin and avoid massive drop of coins? these few guys have full control of the price of NXT (and its future)
Does anyone know how much coins they stream towards the developments of NXT? (I see the community still expects small NXTers to donate coins towards projects)


A lot of people compare it to bitcoin distribution but unlike Bitcoin, Nxt does not have an Inflation mechanism built in, even worse, due to forging rich NXT accounts are becoming even richer

I really like the the technology and enjoy seeing such an amazing community but the distribution worries me
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Eadeqa

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Re: Are you worried about NXT being controlled by few?
« Reply #1 on: May 28, 2014, 09:16:40 am »

I know it really worries me,

What if one of the NXT whales decide to become a Fiat Millionare?
Right now i'm gathering my stack of NXT's (I spread the buying over time) and I'm very worried about entering into a coin that is so concentrated by few owners.

This is not unique to Nxt.

What if Satoshi dumps his BTC? He controls 10% That will tank the prices

50% LTC are owned by less than 100 people
60%  Peercoin are owned by less than 70 addresses.

I am sure you heard about instantmine for blackcoin. Probably less than 2 dozen own 70 - 90%

and on and on.


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Canaanite

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Re: Are you worried about NXT being controlled by few?
« Reply #2 on: May 28, 2014, 09:26:57 am »

I know it really worries me,

What if one of the NXT whales decide to become a Fiat Millionare?
Right now i'm gathering my stack of NXT's (I spread the buying over time) and I'm very worried about entering into a coin that is so concentrated by few owners.

This is not unique to Nxt.

What if Satoshi dumps his BTC? He controls 10% That will tank the prices

50% LTC are owned by less than 100 people
60%  Peercoin are owned by less than 70 addresses.

I am sure you heard about instantmine for blackcoin. Probably less than 2 dozen own 70 - 90%

and on and on.

Everything you wrote is problematic, thats exactly the reason I sold all my litecoins as I dont see any future to a coin that is so concentrated.
But dont forget that all of this other coins have much higher volume that can take a hit. Nxt doesn't have this kind of volume (and I hope it will have soon)


Is there any plan to distribute the coins in the future? to motivate the whales to sell/use/invest their coins?
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bizz

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Re: Are you worried about NXT being controlled by few?
« Reply #3 on: May 28, 2014, 09:27:50 am »

You're doing a good job if  you buy in slowly through time. Whales will always be here & there. Everywhere. 99% will always be owned by 1%. Except in communism. We all know how that ended. Hmmm maybe initial distribution is actually the reason for Nxt success? Imagine if Nxt was distributed to everyone in Iceland! Oh wait ... what was that coin name?  ;D

Bitcoin inflation and forging is the same thing actually. Big BTC owners have more money + they buy more ASICs = they mine more Bitcoins. Average Joe gets breadcrumbs.
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Berzerk

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Re: Are you worried about NXT being controlled by few?
« Reply #4 on: May 28, 2014, 09:29:35 am »

I also think it's a good thing in general. These guys are securing our future. If 1000ths of guys own just a few NXT, nobody would donate some to help at conferences or with projects.

But here are guys having hundreds thousands or a few millions in NXT. They really WANT that NXT succeeds. ;)
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Canaanite

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Re: Are you worried about NXT being controlled by few?
« Reply #5 on: May 28, 2014, 09:33:36 am »

You're doing a good job if  you buy in slowly through time. Whales will always be here & there. Everywhere. 99% will always be owned by 1%. Except in communism. We all know how that ended. Hmmm maybe initial distribution is actually the reason for Nxt success? Imagine if Nxt was distributed to everyone in Iceland! Oh wait ... what was that coin name?  ;D

Bitcoin inflation and forging is the same thing actually. Big BTC owners have more money + they buy more ASICs = they mine more Bitcoins. Average Joe gets breadcrumbs.

The distribution is exactly the reason NXT is so successful, But in looking for the future it might be a huge problem

I personally believe that mined coins are being sold to the market and not kept, in order to justify the price of electricity and the ASICS... that's why over time you will see the ownership of most coins decreasing, bitcoin has additional 50% inflation in total.
we dont have this mechanism in NXT

http://bitcoinrichlist.com/charts/percent-bitcoins-owned-by-richest
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Eadeqa

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Re: Are you worried about NXT being controlled by few?
« Reply #6 on: May 28, 2014, 09:37:27 am »

99% will always be owned by 1%. Except in communism.

35% of US $ are owned by top 1%. 60% by top 5%
 
Bottom 40% only account for 0.2% of US $
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bizz

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Re: Are you worried about NXT being controlled by few?
« Reply #7 on: May 28, 2014, 09:50:14 am »


I personally believe that mined coins are being sold to the market and not kept, in order to justify the price of electricity and the ASICS... that's why over time you will see the ownership of most coins decreasing, bitcoin has additional 50% inflation in total.
we dont have this mechanism in NXT

http://bitcoinrichlist.com/charts/percent-bitcoins-owned-by-richest

I don't really believe  that chart. As bitcoin grew in value it was spread through several addresses owned by same person. I think because people became rich overnight, some sold but some just moved coins to different locations. But, we can never know that for sure. Trend in NXT is the same. I think I saw chart confirming that somewhere...
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websioux

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Re: Are you worried about NXT being controlled by few?
« Reply #8 on: May 28, 2014, 09:57:19 am »

First, to become a fiat millionaire, at a point of time, you need to convert you nxt to fiat = sell your nxt and not being a nxt whale anymore. And you have to do it regularly not to push the nxt price down hence reducing the success of you objective.

Then, someone with 10 millions Nxts earns 10% of all the fees, but the rest of the community still get's 90% (suppose everyone is forging)
So he's not getting richer than the rest of the community, if he uses his Nxt as the rest of the community does.

Now, if he really never spend any nxt, he can increase his global share, but how long does it take for him to earn 1 million Nxt in fees ?
Based on my experience, so far, with 10 millions Nxts, he would earn around 12000 nxt/year which means 83 years to own 11% of Nxt
and 830 years to double his share in nxt...

Of course if the global fees reward skyrockets (more transactions) and brings everyone 100 times more than today, it would only take him (or her) about 8 years to own 20% of shares..
But if there were 100 times more fees rolling than today, the value of each nxt would probably not be the same and all and might have skyrocketed too by a factor 100.
Meaning a forging reward (in fiat) about 10 000 times higher than today

Why seating on such a valuable cash flow (4 200 000 $/year instead of 420 today) and treasure (350 000 000$) and never spend any part of it ?
To destroy it ?
Ok may be, going on this way he can wait 40 more year and approach something like 90% share...

But during that time you will have benefit from the skyrocket too and will have sell (if needed) every thing before he manages to monopolyse everything.

All of this is a very unlikely scenario.

And this would be done by one of the lucky early 21 who took the nxt risk first ?
Initial distribution was only 6 or 7 month ago.. at a point of time they will sell, some have already started.


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Ezravdb

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Re: Are you worried about NXT being controlled by few?
« Reply #9 on: May 28, 2014, 09:58:23 am »

I am not really worried ;)

Nxt exists 6 months now, has survived lots of dumps, Nxt changed lots of hands.

Stakeholders that hold long term want it to succeed just like us

With the momentum Nxt has now, every bit of dump will be swallowed by sharks now
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Berzerk

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Re: Are you worried about NXT being controlled by few?
« Reply #10 on: May 28, 2014, 09:58:31 am »

Then, someone with 10 millions Nxts earns 10% of all the fees, but the rest of the community still get's 90% (suppose everyone is forging)
So he's not getting richer than the rest of the community, if he uses his Nxt as the rest of the community does.
With leased forging I hope that soon someone with 10M NXT wil earn 1% of all the fees. :)
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websioux

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Re: Are you worried about NXT being controlled by few?
« Reply #11 on: May 28, 2014, 10:28:15 am »

With leased forging I hope that soon someone with 10M NXT wil earn 1% of all the fees. :)

Arrg, you're right, I have a factor 10 problem, we should read my 10% whale has 100 millions and not 10.. thanks  :P
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Neomadra

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Re: Are you worried about NXT being controlled by few?
« Reply #12 on: May 28, 2014, 10:47:20 am »

I'm not worried at all. There are advantages and disadvantages having so few stakeholder which has already outlined here. But you can't say that the few people control NXT because even if the stakeholders dumped all their coins it would not really hurt NXT. Of course the price would drop unbelievable hard but it wouldn't hurt NXT itself. It would hurt the image of course but the price wouldn't be low for a long time anyways because there are enough people that would love to buy tons of NXT at 1 cent or so. Also it has been exposed that the stakeholders are clever, they are selling bit by bit such that the price won't reach 1$ soon but it will rise low and steady.
The situation in Bitcoin and its clones it's a little more difficult. The rich people can afford a lot of mining hardware and LTC has proven that 51% attack is a real danger.
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Ezravdb

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Re: Are you worried about NXT being controlled by few?
« Reply #13 on: May 28, 2014, 10:52:15 am »

I'm not worried at all. There are advantages and disadvantages having so few stakeholder which has already outlined here. But you can't say that the few people control NXT because even if the stakeholders dumped all their coins it would not really hurt NXT. Of course the price would drop unbelievable hard but it wouldn't hurt NXT itself. It would hurt the image of course but the price wouldn't be low for a long time anyways because there are enough people that would love to buy tons of NXT at 1 cent or so. Also it has been exposed that the stakeholders are clever, they are selling bit by bit such that the price won't reach 1$ soon but it will rise low and steady.
The situation in Bitcoin and its clones it's a little more difficult. The rich people can afford a lot of mining hardware and LTC has proven that 51% attack is a real danger.

I am ready
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ThomasVeil

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Re: Are you worried about NXT being controlled by few?
« Reply #14 on: May 28, 2014, 11:02:04 am »

I know it really worries me,

I am worried (like I wrote in the distribution thread).

But: Unless someone comes up with a true solution to the distribution problem, I think it's pointless to complain. Mining is worse in my eyes.

Quote
What if one of the NXT whales decide to become a Fiat Millionare?

For that the majority of whales have to do two things: Support NXT so that the price is rising. And then sell, so they get the fiat.
If the short history of NXT is any indicator, then that's what they are doing. No massive dumps, and solid support of the developments (i.e. with grants). Plus they are selling in uptrends.


Quote
Do you guys know if the NXT whales coordinate their moves? do they have some kind of agreement to slowly distribute the coin and avoid massive drop of coins? these few guys have full control of the price of NXT (and its future)
Does anyone know how much coins they stream towards the developments of NXT? (I see the community still expects small NXTers to donate coins towards projects)

All we NXT holders coordinate over this forum - some whales take part. I'm not aware of anything other communication (though it might exist).

Quote
A lot of people compare it to bitcoin distribution but unlike Bitcoin, Nxt does not have an Inflation mechanism built in, even worse, due to forging rich NXT accounts are becoming even richer

NXT forging has about 0.5% return last I read. That is no good investment for getting rich. Investing in any business will make you richer more quickly.
Forging is simply some chump change you get for supporting the network.
« Last Edit: May 28, 2014, 11:05:07 am by ThomasVeil »
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Canaanite

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Re: Are you worried about NXT being controlled by few?
« Reply #15 on: May 28, 2014, 11:08:31 am »

Thanks for the answers
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mczarnek

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Re: Are you worried about NXT being controlled by few?
« Reply #16 on: May 28, 2014, 11:55:29 pm »

Yeah, Nxt forging fees aren't going to get you rich, and as the network grows, the fees are planned to decrease with time.  So in the long run we'll probably end up with < $0.01 fees.

Which is a shame from the point of view of if Nxt were better distributed, we could charge a little bit more and everyone would be encouraged to buy more Nxt so they could make more interest on their Nxt, but it's still decent and especially with leased forging, worth it for anyone who owns a decent number of Nxt.

And I wasn't initially convinced but I think Nxt really is fairly resistant to a larger than 50% attack.. except for the start dumping Nxt like crazy to crash the price attack.  But I don't see anyone having motivation and opportunity to load up on enough Nxt while also being crazy enough to significantly hurt his otherwise amazing financial situation.
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nCtrl

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Re: Are you worried about NXT being controlled by few?
« Reply #17 on: May 29, 2014, 12:26:43 am »

http://charts.nxt.org/cDistribution.aspx
You can click (and exclude) the different balance ranges the see it better.

Some food for thought and to give perspective:
http://www.businessinsider.com/927-people-own-half-of-the-bitcoins-2013-12
« Last Edit: May 29, 2014, 02:01:57 am by nCtrl »
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bluemeanie1

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Re: Are you worried about NXT being controlled by few?
« Reply #18 on: May 29, 2014, 01:24:51 am »

In Bitcoin, mining is controlled by a few parties who can afford to invest in the hardware.

I don't see a big difference from a sociological standpoint.

-bm
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msin

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Re: Are you worried about NXT being controlled by few?
« Reply #19 on: May 29, 2014, 03:04:57 am »

Within this year there will be multiple ways for anyone to exchange Nxt that won't have any effect on market cap. 
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