DeFi for Real Life Companies (the Future), Part 1
What my Wife and I are about to do, is trade Soap, Oils, Incense, Candles and other Religious, Ritual, Theurgical products on Etsy, and we will also accept STEEM, BLURT, HIVE, PUTI (Steem-Engine), PUCO (TRC10), then soon Hive-Engine, and a cross Chain Steem-Engine Token pegged to the Hive-Engine Token. We will also create a TRC20, and ERC20.
Then we will clone ETH, Ethereum is the easiest coin to clone because of the Testnet framework. With Litecoin and Bitcoin it is not much harder, but understanding the Nnonce and Genesis Hash, and all that stuff to get it started can be confusing. With Ethereum you just make a Testnet, which is made easy to do because ETH is for Developers, so it is meant for someone to launch a Testnet, make coins easy to get, mine lots so they can then developers their app and test it with large amounts of Coins moving through it.
So you make a Testnet, but with a Genesis Hash, just meaning you open a node with no one else there, and Hash at Block 0 instead of synching with a chain. Then you have a genesis block that you can then connect to, an open node on a new chain. Which could just still be a testnet, but then you invite others to mine it, Develop a Wallet, a Mist Browser, a Metamask or TRON Link alternative, etc. Here on Bitcointalk it is usually easy to get an ETH Clone into a good sized mining pool, then get enough users and get added to an Exchange.
But we will be doing that, and creating other Tokens, and teaching people how all of this works at the same time, while also creating our own mining pools, and inviting other people to create Mining Pools, Tokens and Blockchains.
Then we will start creating exchanges while getting on exchanges and teach everyone how to work together to move the markets up and down to make money and move everything around.
While trading these currencies for Soap, etc.
I am going to expand on the Corporate Currency concept, I have used the examples of Pizza and Sandwhich shops before so I will start there, then I will expand to other areas of application.
The Sandwich or Pizza shop model works best because there are Perishables, so if someone comes in and trades their Crypto holdings to you, in exchange for your Perishable item, you are winning. It could be a Bakery, or a Donut/Doughnut shop, it could even be a Coffee shop or Bar or something, even though those are not something that usually "goes bad". What my Wife and I are doing with Soap, Spells, Candles, Oils, Incense, Herbs, etc, could be compared to a Botanica, or Spell shop, or maybe even Library or Herb shop, etc. This would be good for a Massage company, or Aromatherapy, even like a Chropractor or Aromatherapist could start a currency.
Basically, any company could start a Currency, and I use Perishables as an example most often as:
Everyone eats Pizza and Sandwhiches
Lots of people own these businesses and may want to do more
So, the basic idea is that your Currency becomes like a focal point of cooperation for your brand or community. So if I am a Pizza shop owner, I might have a Storefront and a Website, but when they launch a Currency they are basically creating an entire network of people. When your coin is put in a Mining Pool, then on Exchanges, etc, each of these themselves is an independent community, made up of other independent individuals. So as your Currency grows it moves through various other communities and people will join, build new apps for your currency, build entire frameworks of their own around your currency.
When you create a Currency, you are not a Dictator, you are more of a Figurehead like the Queen of England, you wave at Parades, when it all falls apart each cycle they will call it "the Queen's Government", and you will benefit somewhat, but the currency will largely exist outside of you.
You are just there to incubate it.
When you make a Currency, and you trade it in your shop, you are maybe taking a loss at first, and can think of it as paying for new customers, or a coupon campaign, you don't even have to let people pay you 100% in currency, having currency could just be a discount.
But once you have the Bitcointalk members, the Mining Pool people, the Exchange people (day traders), etc, you now have that independent thing that will operate on it's own, and as that value goes up, now all the Coins you took at a loss are something you can go put on the market and sell for a profit, and worst case scenario someone uses it to Buy your product.
2 big drivers of Bitcoin's value was Gyft.com, the ability to Buy Gift Cards with Bitcoin, and the ability to Buy Gold, Silver, Copper, etc for Bitcoin. This operates on the same concept, except that if a Currency is at $0.0001 and you have a website where the exchange is not effected by your trade, meaning you accept straight Bitcoins, no Bitpay or PayPal to Cash, just Bitcoin to Wallet now I mail you Silver or Gold, you now get lots of Coins in pretty good amounts. And just like the Perishables owner, you can trade the Currency on the Market when it goes up.
This is Bear thinking, Buy Low, Sell High. Bulls Buy High, Sell Higher. If you are taking in large amounts of currency, you then HODL and as a market whale, you drive the price up. So trading Precious metals and other things for Currency, you can drive the entire market price. And I have seen Gold for Coins raise coin values dramatically, it happened with Bitcoin.
Now, if I make Bread, if I own a Bakery, it would benefit me to know someone who will take Bread for Flour or Sugar, or who will take whatever for Flour or Sugar, this Currency can then be that.
The first one was BBQ Coin which was like DOGE coin at first, just a joke, but became a means of buying BBQ. What I am talking about is the reverse, where you first start with an existing concept, my Concept is a Religious Cryptocurrency Network, but it could be anything, it could be a Club, or a Government, or a group of friends. A Booster Club or a School Fundraiser, or NASA, or a Political Campaign, etc.
The Currency should be Secondary.
Example, if I make a Currency called "Gold Coin", and build a community to hold it, now they wonder "who will take it".
If I have a store where I sell Nik-Naks online, now I can let people Buy Nik-Naks for Coins, and suddenly people don't wonder what it's for, and if it's called "Nik-Nak" everyone will understand.
Over the next few days I am going to get into DeFi conceptualization. I wrote the guide on Steemit that ended up defining Steemit Bots, so I promise that you are not wasting your time by reading concepts that come from my brain. This Steemit post has evidence.
SMTs and Scot Bots when they first launched changed the way everyone used STEEM. When STEEM and Steemit started it was worthless, and was actually just Steemit with no currency and a promise of payouts when it launched. The SMTs came when there were so many users they could no longer get to everyone. At first a Whale user would manually curate Steemit, looking through the Trending, Hot and New pages until they found something they wanted to vote on. You could also write about them and slip in a tag and maybe they would see it. Steemit posts about Steemit were the most popular at first, mostly because people new to it, and didn't completely understand Cryptocurrency, it was the first place you could earn for free without without mining, where fresh Crypto people were being introduced to it. The numbers grew and the Whales made bots to Vote for them, either by username or a point based algorithm based on time posted, votes, and strength of other voters by certain times.
You may wonder, "So what happened?", the Anarchocapitalists took over, removed almost all of the Bridge Toll, which started with a 104 week withdraw period with 1 payment per week. After Steemit sold to Justin Sun and TRON, they got in a War with him and lowered it to 2 months or less. And they all went to Hive.io
Hive now claims to be built for dApps, so while Steemit has SMTs and Scot Bots, Hive is built for those not just hosting them coincidentally.
A Scot Bot is a bot which distributes tokens in the same model as Steemit, with Vote weights, Whales, Payout periods/Time to collect Votes, and then they are hosted on Steem-Engine.net and now Hive-Engine.com, and you can take a whole other step and create a DTube clone Scot Bot. The DTube clone means you create a Front End, so people type your website in the browser, you make business cards for your website if you want, it has your webpage name, your logo, and in the wallet are your Tokens in whatever amount they are holding. But they log in using their Steemit username and password, and when they post it goes into a group on Steemit with a hashtag attached to your Front End.
So with a Scot Bot DTube clone people can experience Steemit completely through your website. And earn your currency, thereby raising the traffic in your Steemit group and earning themselves both your Token and STEEM at the same time.
STO is kind of misleading but also not, because STO means "Securities Token Offering", and this is True somewhat as the person who designed Steem-Engine and Hive-Engine seemed to have cooperated with a Securities Attorney to create Packages that can be purchased that comply with various Securities Laws, so these platforms have Tokens that legally comply so that people can, for example create a Token that represents Stocks, or Metals, or anything, even a House.
This is similar, and can best be comprehended by comparing it to, IBM NFTs as Diamonds and Fish. IBM uses these types of Tokens, called "Non-Fungible Tokens" (NFTs) to represent objects, and as they move to different wallets, or checkpoints in the chain of custody, it is recorded on the Blockchain. While these Tokens do not go on a market for sale, which Securities would. There are also very detailed ETH NFT Protocols.
Venezuala's Petro Dollar is kind of an example, where they were going to peg a Currency to Venezualan Oil (where people burn things down and kill Officials when gas is over $0.08 or something) and trade it, then OPEC told all Countries not to buy it and it collapsed with the Country. But Venezualans are not new to volatile markets, and have actually been using Bitcoin as a store of value, or in place of their currency, pretty much since like 2012 or sooner. They could always trust it to move up more steadily than the Venezualan Peso, which went the other way.
Pegging a Token to Silver or Gemstones can be an easy way to give it real value. Silver is $0.50 per gram and then can be used to represent a currency that can go higher than silver at which point it would be stupid for someone to withdraw the Silver, giving you more valuable coins. Or people load you up such coins that you can set for sale at more than the price of silver.
Ithica Bucks and similar, as well as Store Credit, Toys R Us Bucks, and State Fair Coupons or other access Credit systems.
The Access Credit model could best be visualized in someone earning a Concert Ticket with online interaction, or as State Fair Coupons where you buy them before you show up and spend them to do things, maybe at a Festival. I will get deeper into this soon.
I will start this next section with Sweatcoin as PoC, it is a great example for various reasons. 1, a simple Scot Bot would make it all real (if they never got on a blockchain, I am not sure), but Sweatcoin had a great launch and people earned it everywhere, but Sweatcoin was not a Cryptocurrency.
Sweatcoin was created as more like a Game Token, like Points in a video game. The best way to understand what a Cryptocurrency should not be is by understanding that Points are in concept Infinite, they, similarly to Cryptocurrency, could technically be limited, I could create a Points system with limited points. I could create a game map with 500 gemstones, but that game map has no regulatory body there is no Gravity to the Points system like Cryptocurrency.
Cryptocurrency, both Tokens and Coins, are Blockchain based, meaning there are nodes, and a Ledger, an Ledger that can not be gone back through and edited, and while a True Cryptocurrency (meaning the Prime native Currency earned in the Blocks of a Blockchain as you mine it, PoW, PoS, or DPoS) should not have a function where the creator can manifest new Coins, a True Cryptocurrency will come from a Blockchain. Any large mass of Coins owned by the creator should be on a ledger and not manifestible later, CryptoNotes have no ledger but still operate on this basic principle that the Nodes are a Ledger, and the Coin is not Owned by a Central body that Issues new ones, but a Blockchain.
Crypto Tokens, are usually Smart Contracts. First conceptualized as Bitshares Assets from what I know, and Mastercoin, CounterParty somewhere and then ERC20, then all the SMTs, etc came from ERC20 Smart Contracts. But the Contract may allow the Creator to issue new Tokens. A Token is on a Blockchain, moving Transactions on top of whatever Blockchain. Mastercoin and Counterparty are on Bitcoin, there were also Colored Coins. Then Steem-Engine is on STEEM, a Graphene chain. Hive-Engine is on HIVE. ERC20 is Ethereum, TRC20 is TRON, and on and on.
[u][b]So now to Use cases[/b][/u]
A Studio Booth Token as example of Access Credit, earned by listening and sharing Music from the Studio. If you have a Recording Booth, and you want to earn more. You can host a Blockchain from the Studio, that people can mine from anywhere, or a Token they can earn on a certain Blockchain. This Token could be earned on your Website as either a custom thing (GitHub has good resources, people have tons of good stuff to fork) or on Steemit or HIVE, so they then have a World Wide community earning by interacting with their music, recorded by them, and anyone who wants to can bring it in and get recording time, so it creates a larger community. People will buy things from each other outside of your knowledge, someone might trade a pair of shoes for 6 hours of recording time. It creates a whole new way to interact with your business outside of direct service or sales of any kind.
An Access Credit Currency should be named in a way that makes it clearly recognizable by a newcomer, there could be one Currency Brand from a Studio in NY or Miami called "Hours", maybe they are associated with a big label and they sell $5,000 each on the market, and people hold them like Bitcoin, maybe there is even a 2 year wait list when you redeem. They could be NY Hours, Miami Hours, Jay Z Hours, whatever brand they are associated with. And a smaller Studio, or any big Studio, could sell Minutes. A Cryptocurreny could be called MINUTES or NYMIN and MIAMIN, etc. Then there could be the LAMIN, or LAHR come out, and it could even be Studio to Studio Label names on the Minutes. Someone could come out with Seconds, and these would all range in value based on the Studio, the rate of Pay for those earning, etc, etc.
The benefits of getting deep into planning is DAOs as an example, a DAO is a Decentralized Autonomous Organization (DAO) which can best be compared to a massive board of Directors made up of each and every person holding a Currency. A DAO gives users the ability to Vote and shape the future of a Currency or Blockchain by weighting their input to the organization to their Cryptocurrency holdings. So if people are earning Studio Currencies like NYMIN, LAMIN, MIAMIN, etc, the people who don't spend them can help shape the future of the currency, because it will grow and people will use it outside of your Studio, outside of your DAO, they will create ways for people to spend it.
DeFi is an entire concept where coins other people invented or cloned, are pumped through Smart Contracts in a way that technically multiplies them as they are locked in Bank type investment Contracts, with Loans taken out on the Contract to pay for more Investment on Bank type contracts, to take out more and more loans. The creators of the Currencies never planned it.
There is an App for Temporary workers called JobStack that does with the company PeopleReady, and you go on and look for Jobs. Someone like Veryable or other companies could compete (or they could use it) to get more jobs and workers by having a Currency that pays workers, to be available or working and diminishes if you refuse specific jobs after claiming availability. Or if you are just doing it to earn. These could also then be used to pay for projects, turning workers into Employers, and helping existing Employers have a way to maybe buy Low and cash out High on Labor speculation. The Minutes could end up being used in many places.
Tokens for Museums, Zoos, Wildlife and Security Cameras could be used the same way. The Government and others could pay people to watch cameras and report things. It would be like a game to help with Security. People love watching certain Pandas, or Dolphins, and they could have earnings to show for it. Someone might say "Participation Trophies", and sure, but you can buy everyone's up and drive up the price if you want. It is a Currency, a Current. The Tax Law in the U.S. Amendments can best help you understand Currency, it says that The Governent may Tax "Income from any source derived",
US Constitution 16th Amendment:
[i]"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."[/i]
Eisner V Macomber:
[i]"The fundamental relation of "capital" to "income" has been much discussed by economists, the former being likened to the tree or the land, the latter to the fruit or the crop; the former depicted as a reservoir supplied from springs, the latter as the outlet stream, to be measured by its flow during a period of time. For the present purpose, we require only a clear definition of the term "income," as used in common speech, in order to determine its meaning in the amendment, and, having formed also a correct judgment as to the nature of a stock dividend, we shall find it easy to decide the matter at issue. After examining dictionaries in common use (Bouv. L.D.; Standard Dict.; Webster's Internat. Dict.; Century Dict.), we find little to add to the succinct definition adopted in two cases arising under the Corporation Tax Act of 1909 (Stratton's Independence v. Howbert, 231 U. S. 399, 231 U. S. 415; Doyle v. Mitchell Bros. Co., 247 U. S. 179, 247 U. S. 185), "Income may be defined as the gain derived from capital, from labor, or from both combined," provided it be understood to include profit gained through a sale or conversion of capital assets, to which it was applied in the Doyle case, pp. 247 U. S. 183-185. Brief as it is, it indicates the characteristic and distinguishing attribute of income essential for a correct solution of the present controversy. The government, although basing its argument upon the definition as quoted, placed chief emphasis upon the word "gain," which was extended to include a variety of meanings; while the significance of the next three words was either overlooked or misconceived. "Derived from capital;" "the gain derived from capital," etc. Here, we have the essential matter: not a gain accruing to capital; not a growth or increment of value in the investment; but a gain, a profit, something of exchangeable value, proceeding from the property, severed from the capital, however invested or employed, and coming in, being "derived" -- that is, received or drawn by the recipient (the taxpayer) for his separate use, benefit and disposal -- that is income derived from property. Nothing else answers the description. The same fundamental conception is clearly set forth in the Sixteenth Amendment -- "incomes, from whatever source derived"-- the essential thought being expressed with a conciseness and lucidity entirely in harmony with the form and style of the Constitution. "
"It is manifest that the stock dividend in question cannot be reached by the Income Tax Act and could not, even though Congress expressly declared it to be taxable as income, unless it is in fact income."
"Gibbons v. Mahon, 136 U. S. 549, 136 U. S. 559-560. In short, the corporation is no poorer and the stockholder is no richer than they were before."
"And if, for the reasons thus expressed, such a dividend is not to be regarded as "income" or "dividends" within the meaning of the Act of 1913, we are unable to see how it can be brought within the meaning of "incomes" in the Sixteenth Amendment, it being very clear that Congress intended in that act to exert its power to the extent permitted by the amendment."
"Just as we deem the legislative intent manifest to tax the stockholder with respect to such accumulations only if and when, and to the extent that, his interest in them comes to fruition as income, that is, in dividends declared, so we can perceive no constitutional obstacle that stands in the way of carrying out this intent"
"[The 16th Amendment] did not extend the taxing power to new subjects, but merely removed the necessity which otherwise might exist for an apportionment among the states of taxes laid on income. Brushaber v. Union Pacific R. Co., 240 U. S. 1, 240 U. S. 17-19; Stanton v. Baltic Mining Co., 240 U. S. 103, 240 U. S. 112 et seq.; Peck & Co. v. Lowe, 247 U. S. 165, 247 U. S. 172-173. "
"In order, therefore, that the clauses cited from Article I of the Constitution may have proper force and effect, save only as modified by the amendment, and that the latter also may have proper effect, it becomes essential to distinguish between what is and what is not "income," as the term is there used, and to apply the distinction, as cases arise, according to truth and substance, without regard to form. Congress cannot by any definition it may adopt conclude the matter, since it cannot by legislation alter the Constitution, from which alone it derives its power to legislate, and within whose limitations alone that power can be lawfully exercised."
"We are clear that not only does a stock dividend really take nothing from the property of the corporation and add nothing to that of the shareholder, but that the antecedent accumulation of profits evidenced thereby, while indicating that the shareholder is the richer because of an increase of his capital, at the same time shows he has not realized or received any income in the transaction."
"It is equally true that, if he does sell, and in doing so realizes a profit, such profit, like any other, is income, and, so far as it may have arisen since the Sixteenth Amendment, is taxable by Congress without apportionment."
"Thus, the government contends that the tax "is levied on income derived from corporate earnings," when in truth the stockholder has "derived" nothing except paper certificates, which, so far as they have any effect, deny him present participation in such earnings. It contends that the tax may be laid when earnings "are received by the stockholder," whereas he has received none; that the profits are "distributed by means of a stock dividend," although a stock dividend distributes no profits; that, under the Act of 1916, "the tax is on the stockholder's share in corporate earnings," when in truth a stockholder has no such share, and receives none in a stock dividend; that "the profits are segregated from his former capital, and he has a separate certificate representing his invested profits or gains," "
"We cannot disregard the essential truth disclosed, ignore the substantial difference between corporation and stockholder, treat the entire organization as unreal, look upon stockholders as partners when they are not such, treat them as having in equity a right to a partition of the corporate assets when they have none, and indulge the fiction that they have received and realized a share of the profits of the company which in truth they have neither received nor realized."
"Thus, from every point of view, we are brought irresistibly to the conclusion that neither under the Sixteenth Amendment nor otherwise has Congress power to tax without apportionment a true stock dividend made lawfully and in good faith, or the accumulated profits behind it, as income of the stockholder. The Revenue Act of 1916, insofar as it imposes a tax upon the stockholder because of such dividend, contravenes the provisions of Article I, § 2, cl. 3, and Article I, § 9, cl. 4, of the Constitution, and to this extent is invalid notwithstanding the Sixteenth Amendment."[/i]
Rewards Points, Game Tokens like in individual games or as in an arcade, as well as Augmented Reality Access Credits (Decentraland, ex), and Tokens that are a game like Gradients (CryptoKitties), or dynamic like a hot potato with PoS qualities. Tokens may also work as Keys in the Access Credits model, but could be used to Unlock things as in Kerberos. Decentraland is a Virtual Reality space that sold property and has a Currency, and from my understanding of the original concept they intend it to be freely selected by the people, but for each area to be different. Like where you can go to different styles of places, or like time period themes, or maybe games v. social, etc. So this same concept can be used at Festivals, or like someone could do it at a Theme Park in place of the E-Z pass, or on top of. The E-Z pass people could probably make a very very successful currency. The Bitshares Asset concept was originally meant to be like Concert tickets, Coupons, etc. But they are like Brownie Points now, but they are the same type of thing IBM uses for their NFTs. :)