project SAFE crowd sale

[David Irvine]

Still in fast mode so forgive typo's and grammar

Well what a morning! I cannot think of any other with so much drama and excitement. We started a little late as we had to wait on a certain block appearing on the blockchain to start the whole thing off. That was bad enough. Then we got the block and pushed go on the websites.  

We were all in the office ready to get involved and as soon as the site showed up some got in, others were stunned at the immediate influx of bitcoins. It was incredible, I had to go home to transfer mine, but was distracted for ages looking at the screen and wondering how all these people knew and how much belief there was. This seemed to hit home more than all the praise and good comments we get on line. This was peoples total belief and right there in front of me, surreal and very humbling. 

We then seen the Mastercoin blockchain explode and this will initially amazing, then it was very fast. A mastercoin block explorer site showed the sale as sold out and that was then delight into shock.

This was due to the fact MSC holders just send to an issue address and MSAFE are automatically returned. BTC hodler though had to send to a BTC address where they are collected in the background and manually xferred to MSAFE. I was in shock, all those BTC inputs had not been processed, we are all shut out (all in the office to). That was not great. 

I then was straight on to the Master protocol guys (also all nighter for them) and said is this all true, have we sold out in a couple of hours? We had not, in fact it was less than 50% (Still a huge amount).

Then I was outside thinking and thinking, what is happening this is too fast, the MSC holders are at great advantage and BTC supporters are going to be disadvantaged a lot. We cannot type quickly enough for this to even out. At this rate no BTC person will get in and they will miss out. We never seen this level of support coming.

I quite quickly decided that we would use all of the MSC loan fund we had been given for the sale and buy all the remaining MSAFE. Rather than manually doing a few steps in the background we would simply transfer the MSAFE to BTC holder on confirmation of any deposit. This removed a few steps.  

We debated, is this fair, is everyone included etc. and realised, what about the bonus, the 40% sliding bonus for everyone, we cannot manually calculate that, it would be a nightmare. Then it came together, we buy all remaining MSAFE with the loan fund and everyone gets the bonus, regardless of when they get in. Then we are all in the same boat, the faster MSC people and the BTC people. It means we raise less, but more importantly for us it means the system level out and we are all on the same playing field. People know me and me search for equilibrium the whole time. 

This is what we have done, it reduces the back office steps, ensures BTC backers are looked after and not squeezed out. MSC backers got in at almost equal footing as BTC (almost 50% / 50%) and we all win. The BTC goes ahead and the MSC people got in fast and made their purchase. 

This is now amazing as BTC is pushing along nicely and people can be assured the panic is over and the sale is as fair as it can be. Many would argue MSC is not 50% of the coin base etc. but I think none of us realised how fast and furious this sale would be. It is unbelievable. 

It means SAFE can go on strongly now, we can fund core dev, create Builders (the 10% dev pool part is unlikely to be allocated, instead the network will allocate these safecoin to Builders who produce apps people use etc.). The developer pods across the world who will compete with MaidSafe on core dev can be established and the network seeded. This is a pivotal moment for us all.

I hope all of you were as taken aback as we were, but not as shocked at trying to figure out a mechanism to include everyone.  

So please bitcoin backers, take comfort, your orders are being processed and will be fine now. We did panic with the false reporting of a site etc. but it was a good warning, we need to make sure everyone is equally treated and looked after. So now we all get to become involved, we all get the ~40% bonus and many many more people and supporters are part of this project. 

Thanks everyone and sorry for the frantic start, I hope it is calmer now and continues on it's strong footing. 

We will publish the number of MSAFE remaining on safecoin.io and you will see this one the blockchain in our backers holding account (address to be published) on the blockchain. This will be simpler now and I must say again thanks to the Master Protocol team, they were just amazing and Craig Sellars in particular is a guy you want beside you when things move at this speed. 

So BTC all the way now, until we post the sale is over on safecoin.io, at that time any BTC will be refunded back to the sending address.

Thanks again everyone, it's a pleasure to be part of this community, I cannot wait to get back to work though and get the network up and testnet 1 running. 

David Irvine 

 

--

David Irvine

maidsafe.net 
twitter: @metaquestions

blog:  http://metaquestions.me

[Bob Marin]

Congrats David!

But I have to say that I definitely saw this coming, I made sure to clear my schedule 5 hours before the sale so I can calmly get in ( which of course didn't work out perfectly but who cares - I got in)

[David Yamanaka]

Can we get an update on the total MSAFE sold, every hour or even 30mins if possible?

If time permits, I may still add more BTC, but I need to know.
I realize you guys are very busy, but this would be helpful to everyone.

[David Irvine]

On Tue, Apr 22, 2014 at 3:12 PM, David Yamanaka <drey...@gmail.com> wrote:

Can we get an update on the total MSAFE sold, every hour or even 30mins if possible?

If time permits, I may still add more BTC, but I need to know.
I realize you guys are very busy, but this would be helpful to everyone.

Yes we will publish on our site. I am heading to the office to sort that out now.

[David Yamanaka]

Wonderful, thank you!

[Bob Marin]

David Y, the worst thing that could happen is that you will get your BTC back.

And also there is currently circa 12k BTC invested ( BTC + MSC) we still have more then 7k BTC to go. You have more then plenty of time but as I said the worst that could happen is you get your BTC back

[David Yamanaka]

Agreed Bob,

[surely...@gmail.com]

Frankly it's a bit unnerving how fast this crowdfunding is working, especially with Masterchain.info (still) under maintenance; ideally I'd have liked to check that my initial investment had shown up on the masterchain block ( I hope I've got the terminology right) before making another purchase - that was my plan at least.  Looking forward to seeing the current total MSAFE sold being posted and regularly updated so I can get an idea of how much time is left before the funding is closed. Thanks.

[John Kypri]

The worst thing that could happen is you get your Mastercoin back because it's not worth anything now.

[surely...@gmail.com]

apologies, I should have said - i'm using Bitcoin

[Lambert Nick]

1800 BTC worth of MaidSafeCoin still available!
- - - - - - - - - - - - - - - -
Nick Lambert
www.maidsafe.net
Twitter: @maidsafe
- - - - - - - - - - - - - - - -
maidsafe.net Limited is a limited liability company incorporated in Scotland with number SC297540. VAT Registered 889 0608 77. Registered Office: 72 Templehill, Troon, KA10 6BE.
Telephone Scotland: +44 1292 317 311

On 22 Apr 2014, at 15:58, surely...@gmail.com wrote:

>
> apologies, I should have said - i'm using Bitcoin
>

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[John Kypri]

Let me buy some of it with my mastercoin please man!

On Tuesday, April 22, 2014 9:59:01 PM UTC+7, nick.lambert wrote:

1800 BTC worth of MaidSafeCoin still available!
- - - - - - - - - - - - - - - -
Nick Lambert
www.maidsafe.net
Twitter: @maidsafe
- - - - - - - - - - - - - - - -
maidsafe.net Limited is a limited liability company incorporated in Scotland with number SC297540. VAT Registered 889 0608 77. Registered Office: 72 Templehill, Troon, KA10 6BE.
Telephone Scotland: +44 1292 317 311

On 22 Apr 2014, at 15:58, surely...@gmail.com wrote:

>
> apologies, I should have said - i'm using Bitcoin
>
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[jero...@gmail.com]

I can sell you some as soon they are available.

Op dinsdag 22 april 2014 17:15:20 UTC+2 schreef John Kypri:

> Let me buy some of it with my mastercoin please man!
>
> On Tuesday, April 22, 2014 9:59:01 PM UTC+7, nick.lambert wrote:1800 BTC worth of MaidSafeCoin still available!
>
> - - - - - - - - - - - - - - - -
>
> Nick Lambert
>
> www.maidsafe.net
>
> Twitter: @maidsafe
>
> - - - - - - - - - - - - - - - -
>
> maidsafe.net Limited is a limited liability company incorporated in Scotland with number SC297540. VAT Registered 889 0608 77. Registered Office: 72 Templehill, Troon, KA10 6BE.
>
> Telephone Scotland: +44 1292 317 311
>
>
>
> On 22 Apr 2014, at 15:58, surely...@gmail.com wrote:
>
>
>
> >
>
> > apologies, I should have said - i'm using Bitcoin
>
> >
>
> > --
>
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>

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[connorc...@gmail.com]

I think you guys should offer an official apology to the people on the wrong end of this decision you made. I understand you had your reasons, but this really screwed me and many other people over. On your site you said that the sale would run for a month, and that BTC and MSC would be accepted for that time.

Knowing that the MSC -> MaidSafeCoin conversion ratio allowed us to get a sort of discount on the sale, I and many others converted BTC to MSC in the past couple days, getting ready for the sale. Most of us paid at a ratio of around 0.15 BTC/MSC, thinking that we'd buy MaidSafeCoin at 0.2 BTC/MSC (as per your stated rules). Now, I go to check the safecoin sale THE DAY OF THE SALE, and Mastercoin transactions have been closed, and MSC is back to 0.1 BTC/MSC. I could convert back to BTC and buy MaidSafeCoin, but I've just lost a 3rd of my money in this price fluctuation, which was caused by your decision to shut down MSC sales.

I think you owe SOMETHING to people who had been excited and intending to invest in your company, and who you [inadvertently] jipped out of 1/3rd of their investment.

I would expect a company dependent on the kind of public goodwill which makes this kind of thing possible, to return the favor in some form.

On Tuesday, April 22, 2014 8:01:13 AM UTC-6, David Irvine wrote:

[John Kypri]

If you expect to get anything for your mastercoin change them fast the current price doesn't reflect liquidity. I don't give a fuck about mine, I know they've got no inherrent value so why be a cunt like these scum and sell them on. Hard lesson in greed! Samsung laptop stuck on ins.. really annoying pressed ins doesn't do anything, possible shit windows 8? any suggestions would be appreciated.

[connorc...@gmail.com]

The easiest thing your organization could do to fix this is to simply follow your originally stated plan for the crowdsale, and accept MSC for the amount of MaidSafeCoins previously stated. Or do you want to be known as an organization that so easily can go against your word (which heavily affects your investors financially)?

If you get more MSC than you bargained for, why not just sell the extra you have for BTC? That is the fairest way to run this funding project, by sticking to your previous agreement with previous investors.

If you hope to ever have another crowdfunding event like this, it's going to be hard for future investors not to hear about this first.

[Matthew Jones]

On Tuesday, April 22, 2014 5:12:23 PM UTC+1, Matthew Jones wrote:

I bought in with a some btc as well in the end.  This is too exciting a project to risk missing out on.  I still don't know if the MSC I sent will be redeemed for the Maidsafecoins as masterchest.info is still down.  I hope they will be!

[william....@gmail.com]

Shouldve been more open with what was going on. In just my case, i traded all my btc for msc and when the address was gone, tried to trade it back. Problem is that the MSCxchange has been in limbo the entire time. Unfortunately won't be able to get any Maidsafecoin. But I guess your solution works out for the best for the developers, which isnt a bad thing.

[Benjamin Bollen]

I followed the discussions leading up to the crowdsale. That was almost a full-time job for some days. What I read is that MaidSafe made an hospitable gesture towards Mastercoin, anticipating to best efforts the effect of the crowdsale on Mastercoin. However as a secondary effect some people started advocating greed and this backfired on the greedy and equally hurt MaidSafe.

On top of that, MaidSafe repeatedly told people to prefer the XBT channel for their purchases.

To be claiming that the people supporting the MaidSafe project feel that MaidSafe made a wrong decision by closing the MSC channel is only shared by a few.

I am not saying that everyone who paid, or tried to pay in Mastercoins was deliberately being greedy, but unfortunately many were and they harmed everyone else with their greed. I feel MaidSafe will have a strong support on their decision and I feel very sorry for those honest people that got hurt by the greedy. Unfortunately this is a risk investment in a whole new territory and demanding that the SAFE project carries the full burden is closely bordering on selfishness. If you gambled with more money then you could afford to loose, this is a very important lesson for the future.

So Im very sorry Connor, but I think you’re wrong to suspect this decision will reflect badly on MaidSafe; on the contrary!

Kind regards
Ben

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[Rupert Whitlock]

I think you guys should offer an official apology to the people on the wrong end of this decision you made. I understand you had your reasons, but this really screwed me and many other people over. On your site you said that the sale would run for a month, and that BTC and MSC would be accepted for that time. 

The site said the sale would run for a month or until funds run out. The second part is pretty key.   

Knowing that the MSC -> MaidSafeCoin conversion ratio allowed us to get a sort of discount on the sale, I and many others converted BTC to MSC in the past couple days, getting ready for the sale. Most of us paid at a ratio of around 0.15 BTC/MSC, thinking that we'd buy MaidSafeCoin at 0.2 BTC/MSC (as per your stated rules). Now, I go to check the safecoin sale THE DAY OF THE SALE, and Mastercoin transactions have been closed, and MSC is back to 0.1 BTC/MSC. I could convert back to BTC and buy MaidSafeCoin, but I've just lost a 3rd of my money in this price fluctuation, which was caused by your decision to shut down MSC sales. 

It was your choice to change your BTC for MSC. No one from Maidsafe forced you to. It was your choice to not get in your order at 9 GMT. There was a limited amount of funds. 

You made bad choices, live it with and stop blaming other people.

[jmarti...@gmail.com]

On Tuesday, April 22, 2014 1:02:19 PM UTC-4, william....@gmail.com wrote:
> Shouldve been more open with what was going on. In just my case, i traded all my btc for msc and when the address was gone, tried to trade it back. Problem is that the MSCxchange has been in limbo the entire time. Unfortunately won't be able to get any Maidsafecoin. But I guess your solution works out for the best for the developers, which isnt a bad thing.

The entire thing is a farce and many people have lost money simply by following the posted instructions.

I'd advise the Maidsafe group to hold onto the funds collected as I intend to contact the Financial Conduct Authority when they open for business.

[jmarti...@gmail.com]

On Tuesday, April 22, 2014 1:15:06 PM UTC-4, Rupert Whitlock wrote:

> It was your choice to change your BTC for MSC. No one from Maidsafe forced you to. It was your choice to not get in your order at 9 GMT. There was a limited amount of funds. 
>
>
> You made bad choices, live it with and stop blaming other people.

This is ridiculous. Maidsafe set up the incentives that favored using MSC over BTC, just like they incentivized acting early to receive a bonus.

The terms of the sale were a contact and that contract was breached, to the detriment of consumers. They will now be forced to spend significant funds on defending themselves in the resulting inquiries.

[zyxx...@gmail.com]

Is there a way for me to check if my address has been credited with maidsafecoins? Masterchest seems to be under maintenance. Thanks

[Benjamin Bollen]

How about holding on to your Mastercoins for a few more days and waiting for their value to stabilise and possibly regain your full funds.

I think you will find it hard to build a case, where you took voluntary decisions all along the way.

I find it even more remarkable that people are surprised they 'lost money’. For one you still have all your Mastercoins you decided to purchase independently of the SAFE crowdsale. Secondly, the volatility of crypto currencies is a well accepted fact. How is it possible that suddenly a third party is responsible for the risks you decided to take?

I understand some people wanted to see themselves get rich over night, and the greedier the better, but can everyone please stop blaming anyone else but themselves?

Thanks
Ben

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[David Irvine]

On Tue, Apr 22, 2014 at 6:20 PM, <jmarti...@gmail.com> wrote:

The terms of the sale were a contact and that contract was breached, to the detriment of consumers. They will now be forced to spend significant funds on defending themselves in the resulting inquiries.

Are you saying you would have preferred to block out the BTC people who wanted to be part of this. We took a decision in fairness and allocated all funds at a 40% discount for all the people involved in the crowd sale. This seems fair to me, if we had not acted all the MSC would have wiped out BTC people and that seems very unfair. 

We ended up with a 50/50 split (closely) and in terms of liquidity we are probably less than 40% ourselves where we thought it would be. We took it on the chin for the sake of all the people involved, I think that is a fair thing. I said countless times BTC was the preferred route, if everyone who did this was effectively wiped out the sale then that would have been very poor. This way MSC / BTC is roughly 50 / 50 and that's maybe as fair as it can be. I would have preferred a more balanced share as MSC is a smaller market and to me (personally) I would like to see widespread participation and I am less concerned with the dollar amounts being large, it's the people who should be part of this. 

I am sorry you feel aggrieved, but we took what we thought was a very clear and definite approach to help as many as possible and I think we have done that. The whole thing could have bee over in another 2 hours probably annoying even more MSC holders as well as all BTC holders who would miss out. 

[Connor Carpenter]

The only problem I have with those at Maidsafe, is that they said you could donate in BTC and MSC for the duration of the sale. They never indicated that there were separate funds for both BTC and MSC investors. Knowing that their MSC investors stood to lose money from their choice to close MSC -> MaidSafeCoin sales, they should have instead converted all extra MSC to BTC themselves, and offered the same remuneration for MSC that they had agreed to before the sale started.

I understand the risks I took, the risks I understood because I assumed that MaidSafe would protect their investors by sticking to their original plan. Their treatment of this issue indicates a lack of care towards their investors, and I'm sure that this will have some sort of consequence in the future.

[mmasonr...@college.harvard.edu]

ben you simply do not understand the economics of the situation. i did not get involved with this crowdsale for two reasons:

first was the price fixing of msc above its market price. this would inevitably lead to a dump. however in changing the rules you disadvantage those with msc. this is not simply a matter of greed by which individuals lost money, it is a matter of gross incompetence on maidsafes part understand that if you create an incentive for ppl to purchase in msc they will. furthermore if you artificially inflate the price of msc who ever holds on to the msc is left worse off. so in an effort to not be the onese holding the bags maidsafe has changed the deal.

the second reason why i did not partake in the ipo is because all of the safecoins being sold today will eventually become diluted by the safecoins mined by farmers. you do not have to pay farmers with an issuance of new safecoins. that is an illogical business model. you simply have to pay farmers more than the cost of providing their service. the economics of your system are not sustainable in the same way that the economics behind bitcoin are not sustainable. you took a bad model and made it worse.

i encourage the maidsafe team to put more careful thought and analysis into the economic fundamentals of their project. if this were an ipo that took place on us soil, well the outcome would be several million dollars in fines. i really do like the project i just don't think you guys know what you are doing and you are moving along with things more quickly than you can think them through.

[David Irvine]

On Tue, Apr 22, 2014 at 6:34 PM, Connor Carpenter <connorc...@gmail.com> wrote:

The only problem I have with those at Maidsafe, is that they said you could donate in BTC and MSC for the duration of the sale. They never indicated that there were separate funds for both BTC and MSC investors. Knowing that their MSC investors stood to lose money from their choice to close MSC -> MaidSafeCoin sales, they should have instead converted all extra MSC to BTC themselves, and offered the same remuneration for MSC that they had agreed to before the sale started.

I understand the risks I took, the risks I understood because I assumed that MaidSafe would protect their investors by sticking to their original plan. Their treatment of this issue indicates a lack of care towards their investors, and I'm sure that this will have some sort of consequence in the future.

This is the issue though, the BTC was manual and slower, the MSC was automatic. As the sale started lots of people came in with BTC and that was great, then MSC went wild. It was like a huge dump and would have taken all the MSAFE effectively forcing us to return all the BTC investments, when in fact they had com in first. To me that was unfair. Nobody knew this sale would take off the way it did and I had been hoping for sure people would go BTC, many did. 

There seemed to be a lot of people who purchased MSC for this due to the exchange rate etc. this was speculation I think and many speculators got caught out as the sale was effectively sold out as MaidSafe bought all the remaining MSAFE and distributed these to the BTC participants. This act ended the sale for MSC as we had said we would sell to the BTC people at the agreed rate, plus include the 40% bonus for each participant. 

So a 50/50 split of MSC BTC seems fair.

[Benjamin Bollen]

Again I repeat, and I can’t seem to properly understand this:

You didn’t loose any money:  you bought Mastercoin, you have Mastercoin. Stop involving MaidSafe where the crowdsale has nothing to do with your investment decision!  You knew there were limited funds and you knew the Mastercoin has a low liquidity.  So anyone who started to buy Mastercoins in order to buy Maidsafecoins knew in advance that :

- they had no garantuee on buying Maidsafecoins as the supply was limited

- they would still just have their Mastercoins that are very hard to sell because the market still has to grow.

So seriously, can you just cool down, reflect on your own decisions and your own responsibility in this matter and keep your Mastercoins until the market grows again, or sell them at a loss.  The choice is yours and has been yours at every point along the way.

An investment is a risk and you took a risk, you could have made a less risky choice and stuck to your bitcoins.  Stop blaming others for your own decisions!

Ben

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[David Irvine]

On Tue, Apr 22, 2014 at 6:37 PM, <mmasonr...@college.harvard.edu> wrote:

i encourage the maidsafe team to put more careful thought and analysis into the economic fundamentals of their project. if this were an ipo that took place on us soil, well the outcome would be several million dollars in fines. i really do like the project i just don't think you guys know what you are doing and you are moving along with things more quickly than you can think them through.

Feel free to keep participating in discussion on these matters for sure. The more heads on the scene the better. I am happy to listen to all thoughts and I think this list seems to be aligned in that manner.

[jmarti...@gmail.com]

I would have preferred you didn't incentivize using one form of payment over another, only to shut the incentivized method down prematurely and unilaterally. You should have raised the arbitrary fundraising cap and let the market work according to the terms offered.

Instead, people who wished to support you have now lost money because you changed the terms of the sale to their detriment. It's a bit disingenuous to say you "took it on the chin," or to feign surprise, when consumers did exactly what you incentivized them to do.

[Connor Carpenter]

I would also like to add that the crowdfunding phenomena only works because crowdfunders trust that they will be compensated by their risk to throw money towards an idea or project. MaidSafe's lack of sticking to their word here depletes the trust they base all their funding on. I'm sure they'll come out and offer an apology or at least some form of compensation if enough of us make some noise about this though.

Thats all I'm saying - their current responses haven't been sufficient to meet the concerns of investors who have lost a significant amount of money as a result of their actions. I was very interested in following and spreading the news of MaidSafe, but at the moment I only want to let people know how their actions have affected me and many others. It will be seen how much the people at MaidSafe value this kind of word-of-mouth PR.

[Owen Gunden]

What Connor says is spot-on. There's no getting around the fact that the rules were changed in the middle of the crowdsale. Perhaps the MS team has the legal right to do that, perhaps not. Either way, there were people who made decisions based on the MS team keeping their word, and they got burned because the MS people did not keep it.

Unfortunately, the MS team was in a bind from the start with this one, because the public mastercoin funding avenue was dicey by design. Most folks I know with a solid understanding of financial markets would have advised against this approach. If you wanted to let MSC guys invest at a better rate, it would have probably worked better to do a private side deal with them.

My takeaways as an outsider/newcomer to this project are:

 - MS team may be brilliant at distributed systems and crypto, but they need to study up on markets. This gives me pause about the market-based mechanisms designed into this system. Are there similar design flaws baked in?

 - MS team's decision to change the rules mid-sale gives me great concern from an investor standpoint.

Probably the best thing MS can do at this point is to admit they were in over their heads and apologize to the community for poor handling, consider getting somebody with a solid financial background on the team, and then focus back on the core tech offering and try and put this behind them.

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[mmasonr...@college.harvard.edu]

ben, you have got to be kidding me. maidsafe and mastercoin manipulated the market with the crowdsale by artificially fixing the price of mastercoin in the sale. the price of mastercoin in the past few days is entirely reflective of the crowdsale. for you to say that it is not is ridiculous. not only did maidsafe set the rules of the game they changed them in the middle. in this way maidsafe is guilty of two forms of market manipulation.

[jmarti...@gmail.com]

On Tuesday, April 22, 2014 1:41:35 PM UTC-4, David Irvine wrote:

> There seemed to be a lot of people who purchased MSC for this due to the exchange rate etc. this was speculation I think and many speculators got caught out as the sale was effectively sold out as MaidSafe bought all the remaining MSAFE and distributed these to the BTC participants. This act ended the sale for MSC as we had said we would sell to the BTC people at the agreed rate, plus include the 40% bonus for each participant. 

Wow. People who used a calculator to understand that paying with MSC was a better deal are now "speculators." This shows a complete lack of understanding of financial markets, or markets in general, for that matter.

Bottom line: The way this sale was conducted was a disaster and you have a very small window of time to make it right. Your ideas of "fairness" are irrelevant. There was a contract and you breached it.

[nik]

+1

While I have no doubt you had good intentions ---  at the end of the day you didn't stick to the terms. That is the bottom line. And that is a big deal. A lot of goodwill was lost, and is being lost and you may be underestimating the repercussions of your actions to your project. Do no underestimate the goodwill of those who want to support you.

It doesn't matter how amazing your tech is. At the end of the day, people are people. You don't treat them right, you go nowhere.

On Tuesday, April 22, 2014 1:48:37 PM UTC-4, Owen Gunden wrote:

What Connor says is spot-on. There's no getting around the fact that the rules were changed in the middle of the crowdsale. Perhaps the MS team has the legal right to do that, perhaps not. Either way, there were people who made decisions based on the MS team keeping their word, and they got burned because the MS people did not keep it.

Unfortunately, the MS team was in a bind from the start with this one, because the public mastercoin funding avenue was dicey by design. Most folks I know with a solid understanding of financial markets would have advised against this approach. If you wanted to let MSC guys invest at a better rate, it would have probably worked better to do a private side deal with them.

My takeaways as an outsider/newcomer to this project are:

 - MS team may be brilliant at distributed systems and crypto, but they need to study up on markets. This gives me pause about the market-based mechanisms designed into this system. Are there similar design flaws baked in?

 - MS team's decision to change the rules mid-sale gives me great concern from an investor standpoint.

Probably the best thing MS can do at this point is to admit they were in over their heads and apologize to the community for poor handling, consider getting somebody with a solid financial background on the team, and then focus back on the core tech offering and try and put this behind them.

On Tue, Apr 22, 2014 at 1:34 PM, Connor Carpenter <connorc...@gmail.com> wrote:

The only problem I have with those at Maidsafe, is that they said you could donate in BTC and MSC for the duration of the sale. They never indicated that there were separate funds for both BTC and MSC investors. Knowing that their MSC investors stood to lose money from their choice to close MSC -> MaidSafeCoin sales, they should have instead converted all extra MSC to BTC themselves, and offered the same remuneration for MSC that they had agreed to before the sale started.

I understand the risks I took, the risks I understood because I assumed that MaidSafe would protect their investors by sticking to their original plan. Their treatment of this issue indicates a lack of care towards their investors, and I'm sure that this will have some sort of consequence in the future.

On Tue, Apr 22, 2014 at 11:20 AM, <jmarti...@gmail.com> wrote:

On Tuesday, April 22, 2014 1:15:06 PM UTC-4, Rupert Whitlock wrote:

> It was your choice to change your BTC for MSC. No one from Maidsafe forced you to. It was your choice to not get in your order at 9 GMT. There was a limited amount of funds. 
>
>
> You made bad choices, live it with and stop blaming other people.

This is ridiculous. Maidsafe set up the incentives that favored using MSC over BTC, just like they incentivized acting early to receive a bonus.

The terms of the sale were a contact and that contract was breached, to the detriment of consumers. They will now be forced to spend significant funds on defending themselves in the resulting inquiries.

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[Mark Hughes]

David's post (below) fails to mention that other consideration which I'm sure weighed heavily, MaidSafe the project. 

David, you may be more confident about holding MSC than some, or you might like me think holding 100% MSC was very risky, and potentially wreck your current plans. 

The risk posed by automatic issue for MSC and manual issue for BTC was obvious. While you could not have known MSC would flood the sale like it did, we were all made aware of that possibility by John K. I'm grateful to John for drawing that to my attention.

I believe you made the decisions in good faith, with the interests of the project in the forefront. It is a shame there were no measures in place to prevent what happened as a result of the different issuance mechanisms. It is a shame some feel they've been badly treated because massive demand from MSC created serious problems for the sale, and the project. 

I'm glad you acted to deal with them and came up with a way to save the project, hopefully, in what were very difficult circumstances.

MaidSafe are not responsible for the difficulties people have faced with problems caused by the Mastercoin systems (eg being unable to trade back into XBT), or wallet snafus, or market movements, or oversleeping etc. 

I'm concerned that MaidSafe had to fix the different issuance problem mid sale, and that this creates risks for the project, and of course investors. 

It looks like I'm going to be one as I sent XBT very early. I consciously took on several risks in doing so - not waiting to see how this untried system, this interested market etc - played out. Now I see those XBT investors who took less risk, were more cautious, or less keen, or less greedy will get 100% allocations and 40% bonus. I understand doing this more fairly is too much work.

However, I really sympathise with those who took more risks (IMJ) converted XBT to MSC on an attempt to maximize their holding. Some booth missed out, and are left with a book loss, though this may recover. It may even out perform SafeCoin over some period, do let's see. 

I considered converting to MSC, and think I would have done so had I more confidence in the Mastercoin wallets. There's no shame in taking they opportunity of discounted MSC any more than going in early to secure an allocation, or the 40% bonus, so I don't think MaidSafe can make much of whatwas said about sticking with XBT. No advice was given, rightly, and people were free to decide how to make their transaction. It was our risk IMO. 

To those feeling unhappy and hard done by, remember this was always a risk. If you are only here for profit, and you think you can make some out of attacking MaidSafe and potentially undermining the project, or do so because of anger, no doubt you will.

If you believe in the project, I hope when the dust settles you'll stay part of this community and help it succeed. Maybe the community can find ways to respond to that. If it succeeds, there will surely be potential for a MaidSafe spirit to show itself. We've all seen the bitcoin spirit I expect, let's see what we can learn from that. 

I hope no one is seriously hurt, but we all knew we might miss out, or might lose everything that we put in. This is extremely high risk, and could still deliver nothing. In which case those who missed this round might find themselves heaving a sigh of relief, and those who hold SafeCoin dropping our heads. 

What a day. Good luck and warm wishes to everyone involved, 

Mark

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-------- Original message --------
From: David Irvine <david....@maidsafe.net>
Date: 22/04/2014 18:27 (GMT+00:00)
To: maidsafe-d...@googlegroups.com
Subject: Re: [maidsafe-development] Re: project SAFE crowd sale

On Tue, Apr 22, 2014 at 6:20 PM, <jmarti...@gmail.com> wrote:

The terms of the sale were a contact and that contract was breached, to the detriment of consumers. They will now be forced to spend significant funds on defending themselves in the resulting inquiries.

Are you saying you would have preferred to block out the BTC people who wanted to be part of this. We took a decision in fairness and allocated all funds at a 40% discount for all the people involved in the crowd sale. This seems fair to me, if we had not acted all the MSC would have wiped out BTC people and that seems very unfair. 

We ended up with a 50/50 split (closely) and in terms of liquidity we are probably less than 40% ourselves where we thought it would be. We took it on the chin for the sake of all the people involved, I think that is a fair thing. I said countless times BTC was the preferred route, if everyone who did this was effectively wiped out the sale then that would have been very poor. This way MSC / BTC is roughly 50 / 50 and that's maybe as fair as it can be. I would have preferred a more balanced share as MSC is a smaller market and to me (personally) I would like to see widespread participation and I am less concerned with the dollar amounts being large, it's the people who should be part of this. 

I am sorry you feel aggrieved, but we took what we thought was a very clear and definite approach to help as many as possible and I think we have done that. The whole thing could have bee over in another 2 hours probably annoying even more MSC holders as well as all BTC holders who would miss out. 

--

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maidsafe.net 
twitter: @metaquestions

blog:  http://metaquestions.me

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[Sean Mc]

On Tuesday, April 22, 2014 6:42:50 PM UTC+1, Benjamin Bollen wrote:

Again I repeat, and I can’t seem to properly understand this:

You didn’t loose any money:  you bought Mastercoin, you have Mastercoin. Stop involving MaidSafe where the crowdsale has nothing to do with your investment decision!  You knew there were limited funds and you knew the Mastercoin has a low liquidity.  So anyone who started to buy Mastercoins in order to buy Maidsafecoins knew in advance that :

- they had no garantuee on buying Maidsafecoins as the supply was limited

- they would still just have their Mastercoins that are very hard to sell because the market still has to grow.

So seriously, can you just cool down, reflect on your own decisions and your own responsibility in this matter and keep your Mastercoins until the market grows again, or sell them at a loss.  The choice is yours and has been yours at every point along the way.

An investment is a risk and you took a risk, you could have made a less risky choice and stuck to your bitcoins.  Stop blaming others for your own decisions!

Ben

 

You hit the nail on the head here Ben, the people who took the bigger gamble took the bigger risk.

[connorc...@gmail.com]

I don't think that anyone involved with the MaidSafe project intended to cause these problems through the crowdsale, but there were very important stipulations that they were operating by which the public was not made aware of.

Where in http://www.safecoin.io/ or any other public announcement of the crowdsale was it mentioned that BTC & MSC investors were to be seperated into different classes? Why is a 50/50 BTC/MSC split even necessary?

In the Safecoin.io Buyer's Guide there were two points which were misconstrued for investors:
"The sale event will run until ten percent of all safecoins (429,496,729) are sold or 30 days have passed, which ever happens first."
"Backers will receive 17,000 MaidSafeCoins per bitcoin sent to the SAFE Network Bitcoin exodus address or 3400 MaidSafeCoins per mastercoin sent to the SAFE Network Mastercoin exodus address."

I was an investing thinking that these two statements defined how the MaidSafe team was running their crowdsale. I was not speculating on Mastercoin, but using what information I had to get the most discounted price on MaidSafeCoins. Is your investor's desire to get the most discounted safecoin not something you counted on to incentivize early investor discounts?

In the above two stipulations, or any public announcement that I saw, there was no mention of there being separate funds for BTC and MSC. There were two distinct prices on how you could get MaidSafeCoin until the fundraiser raised %10 of all safecoins, or 30 days have passed. You have not currently sold all your safecoins, to my knowledge, so the agreement that the MaidSafe team made with it's public has been breached, if inadvertently.

I would like a member of the dev team to respond to these criticisms of their fundraiser.

[David Yamanaka]

To ALL,

Even though am not part of the MaidSafe Team, I do feel somewhat responsible.
Usually, I'm pretty good about spotting landmines and raising issues where problems may arise.

So if you want an apology... I am sorry for not spotting this one.
I was raising other issues and failed to see this one coming.

If this technology is to truly be "OURS" then we should look out for each other.
I will not judge or blame people for making the decision to use MSC for the crowd sale.
Their loss, realized or not, is already enough torment.
I really do hope they can recover their MSC investment.

For what it's worth, I will try to be more diligent in the future.

[ga...@frontiernet.net]

David, You knowledge, insight and kind attitude throughout the crowdsale is above and beyond. Thanks again. Mark

[satosh...@gmail.com]

I have no doubt MaidSafe team have very good intentions and they appear to have make an outstanding work this last 8 years, but this problem with MSC raise serious questions about your understanding of economics.

Fixing the price of MSC was a very trivial economics mistake and the fact that MSC would flow was crystal clear for anybody who understands economics and more specificly Gresham's Law.

First it hurting the project since now the foundation have 50% of MSC who already lost a third of their value, you can do the math to see how much this mistake already cost you.

But beside that its also very worrying for the future since the economic model of the network and the reasons why safecoin should have value is very shady. One observateur of today's mess can safely assume there are equivalent economics flaws in your economic model. Satoshi has a very clear and deep understandings of economics, you cannot change the world with cryptotoken without mastering economics. You should really level up on or you project will fail.

Also didn't MSC team offer you consulting? I can't believe there are the one who advice you to fixe the price, but at the same time I can't believe there did't give you any advice...

Anyway congrats for the succes of the sale and may you learn fast from your mistakes. It's a great project everyone want it to suceed.

[fer...@gmail.com]

Hey, we're all speculators here. You do the math and take your chances. Maidsafe had to make a call in a pinch, where things went much, much faster and wilder than anticipated, and I think they made a fair one. I'm still not sure if my bitcoin purchase made the cut.

Again, there's not anyone participating in this sale that is not speculating. Many of us also wish to really see the network succeed, regardless of whether we failed to get in or even took a hit.

[Benjamin Bollen]

I do want to broaden my position on what happened today, and some lessons I learned.  Importantly this is just my conclusion so far and as mmason CORRECTLY pointed out, my understanding of business is limited at best ;-)  All of this is in retrospect, which is always much easier. 

first of all, accepting two independently market valuated coins where one coin can get processed faster then the other is a bad idea for what turned out to be a run on a limited supply.  I think few people expected that so many people were standing at the door waiting to get in.

secondly, I follow David Y.’s example and apologise for not having been more pro-active and critical in the weeks running up to the crowdsale.  As a developer I stayed focussed on the amazing technology that MaidSafe has already given to us all, free of charge.  I could have and should have raised more questions concerning the crowdsale.  I know for my part I only took the effort to evaluate the essentials to join in.  Instead of being critical of what I didn’t understand, I ignored it.  MaidSafe could have benefited from more brains chipping in, more voices heard.

I leave it to the MaidSafe team to first finish handling the on-going crowdsale, and secondly to take some time and evaluate all the steps along this new process.  I am confident that in the open spirit they have so far displayed all these years, they will in due time come back to the community and state their reflections.  No doubt errors have been made, but I strongly doubt any have been made with bad intent by the MaidSafe team.

We all set out to buy safecoins.  Let’s keep in mind that MaidSafe already invested 8 years of hard work in a working technology they have shared with the world for free.  A technology we all want to see come to live, sooner rather then later.  Without their continued effort rolling out this technology will be delayed by years, at a tremendous cost to us all.

So I for one vote to get back to business and build on the promise we all believe in. When the dust has settled, I’m sure MaidSafe will come forth with an analysed position on what happened today.  In the mean time, let’s get back to coding :))

Ben 

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[Erick Lavoie]

To add a bit of perspective to the discussion, there was no guarantee whatsoever, either for XBT or MSC holders that they would obtain Safecoins during the crowdsale. There was the possibility for everyone involved that the Safecoins would sell out before they had time to buy theirs. Even if the 50/50 split that occured mid-flight never happened, the possibility is very real that some Mastercoin investors would not have gotten in. This is also true for bitcoin investors that might be on vacation in Australia right now and come back in a few days to find the window of opportunity gone.

I do understand the grief though, for Mastercoin holders that got blocked near the cut-off while Safecoins are still available for bitcoin investors. If the change had no occured mid-flight, some more Mastercoin holders would definitely have gotten in.

The speed of the crowdsale did took everyone by surprise, including me. Had I decided to wait till the end of the day, the possibility is very real that I would be holding bitcoins, that I don't want.

I don't think the MaidSafe team would have planned a one-month crowdsale if they had any clue that it would happen. From David's comments on the mailing list, I think the expectation had been that the sale would have been slower, some MSC would have been used, which would have driven the price of MSC high enough that they would not be attractive anymore compared to bitcoins, while still providing the possibility of MSC holders to invest, and the sale would have completed with the vast majority of Safecoins sold in bitcoins.

The level of interest in the project was vastly underestimated and the speed at which the crowdsale proceeded qualitatively changed its nature. If it had been let's say 10-50x slower, we would have had time to debate on the mailing list the impact of the MSC/XBT ratio and what to do about it, and announce in advance that a cap for MSC would be introduced. Some people would have chosen to go through the bitcoin route instead. The time window MaidSafe had to make a decision was tens of minutes, with the risk that all the sale would have proceeded in MSC, delaying the funding of the project until the MSC market becomes mature enough, which quite possibly could have compromised the project, and everyone would have lost whatever value they thought they would get from their Safecoins.

By accepting two different currencies with one at a significant discount compared to the other, they should have anticipated the possibility that the sale would entirely proceed in that currency. Apart from John who expressed concerns on the mailing list, I do not think anyone really considered that possibility. Otherwise a hard cap would have been put from the beginning. On the other hand, I am not sure there is precedent for crowdfunding with two digital currencies at the same time. I don't even think there is best practices for crowdfunding with digital currencies either. It is a brave new world.

I hope that we will learn as a community and with keeping with the openness and sharing spirit of the project, that the learning will inform other projects to not repeat the same mistakes. I wish MSC holders will still benefit once the MSC market matures and we will truly have a win-win situation.

Time will tell.

Erick

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[Erick Lavoie]

I am sure everyone learned their lesson and there will be ample
discussions about the economics of the system afterwards. All
contributions are welcome and the more brains the merrier.

Erick

[jr.wi...@gmail.com]

Mastercoin founder here.

Wow. I really wanted to put some of my own MSC into this fundraiser, but it looks like I missed out. The demand for MSAFE coins has been more than anybody imagined. Congratulations to Maidsafe on the money raised, and congratulations to anybody who got in on the MSC side of the crowd-sale. I expect that will be a very profitable investment for those people.

Clearly we miscalculated the demand. MSAFE coins are obviously worth far more than we thought they were, and the market has spanked those of us who didn't see it. :)

It appears that there are still a few left reserved for those of you who have bitcoins to spend.

I know everybody involved is doing their best to make sure we do right by everyone, including making allowances for people who purchased MSC for the express purpose of buying MaidsafeCoin. On that topic David Johnston said: "If you have MSC and wanted MSAFE shoot me a PM I got more than expected because of the bonus and so I can help a few people out (I'm not charging any fee, I just want to support the community members who believe in this project)" (https://www.facebook.com/groups/mastercoin/permalink/282284711939016/?comment_id=282404161927071&offset=0&total_comments=28)

While supplies last :)

I wrote more about this on reddit here: http://www.reddit.com/r/mastercoin/comments/23o60n/maidsafe_has_pulled_the_msc_payment_address/cgz6ag2

Thanks to Maidsafe for making the launch of our crowd-funding feature so memorable! :)

[Matthew Jones]

Could someone please clarify whether my MSC made it into the distribution of MSAFE?

My MSAFE are showing up here:

http://www.mymastercoins.com/default.aspx?Addr=1GdGbQWvnPLzGBT8SL5YhPhvPwz12A3vZN&CurrencyID=3

But at Masterchain.info they're not on this list:

https://www.masterchest.info/lookupsp.aspx?sp=3

Using Masterchest.info blockexplorer says my transaction was 1 minute late.  So am I in or not? 

[mmasonr...@college.harvard.edu]

my analysis wasn't in retrospect. i suggested that this would be a major issue and some of the ppl that contested me are among those left with msc, holding the bags.

this level of incompetence is not something that the community around maidsafe can be complacent with. if you have a background in economics you understand that the issues that arose are common sense issues that should have been addressed before initiating the crowdsale.

the most pressing issue at hand is not with the crowdsale but with the distribution and dilution of safecoins through farming. a company would never issue new stock to pay employees, so why then does maidsafe choose this model? a company would also never pay employees a higher wage than the market price for labor. the issuance of new safecoin to pay farmers is not determined by market forces but by a mathematical algorithm that has no regard for what the price of storage is at any given time.

until you stop trying to copy bitcoin, and understand its limitations from an economic perspective i cannot financial support your project or tell others to do so. you guys have a good product but you will be shooting yourself in the foot if you carry on as proposed without fixing the economics of your system

[Matthew Jones]

I'm also confused about my buy in with bitcoins, 2btc.  You can see the transaction here:

https://blockchain.info/tx/15bcb4e065072b103e2feeec6cfe79fd62dc10f61bdf3288456565ad7fc3a14a

But this transaction doesn't show up at all at masterchest.info:

https://www.masterchest.info/lookupadd.aspx?address=12ZQiA1uyHbj3GX6tLP4Yvr3Ffa2dZdssm

So now I don't know if I got in with MSC or BTC!

[jr.wi...@gmail.com]

It would seem there's a consensus issue between the websites that needs to get ironed out on the MSC side.

On the BTC side, you have to realize that there are human beings involved who take your BTC, and send you MaidsafeCoins in return. Those human beings are probably sleeping right now after staying up all night :)

[Erick Lavoie]

On 2014-04-22 5:37 PM, mmasonr...@college.harvard.edu wrote:
> the most pressing issue at hand is not with the crowdsale but with the distribution and dilution of safecoins through farming. a company would never issue new stock to pay employees, so why then does maidsafe choose this model? a company would also never pay employees a higher wage than the market price for labor. the issuance of new safecoin to pay farmers is not determined by market forces but by a mathematical algorithm that has no regard for what the price of storage is at any given time.

As another member of the community with no background whatsoever in
economics, I am certainly interested in your analysis on the matter and
will gladly read any insights you have on the different proposals that
were thrown around on the mailing list, as well as the upcoming ones.

As far as I understand, nothing has been set in stone regarding
safecoins and everything is up for discussion. I do think however, that
a simpler technical decision has been made to facilitate initial
deployments for the purposes of testing. I believe I read also that
during testing, the preliminary safecoins might be destroyed from time
to time to try different things until we finally agree on a working
solution. So there is room for experimentation and your input is welcome.

Cheers,

Erick

[Mark Hughes]

A Harvard email address does not an expert make.

I am no expert, but he makes statements that are:
- in one case false (companies do indeed pay above market rates - I've
worked for more than one of them)
- in the other case - assuming that the status quo is ideal. In fact its
trashing the planet.

In the second instance I agree as far as it goes, he does make a valid
point which we could discuss, but the man's just puffing himself up.

We have enough good people without pandering - he can join in
constructively if he wants.

Mark

[James Lowry]

This was the right thing to do, but it should have been 80% bitcoin 20% mastercoin, as was discussed in the run up to the crowd sale.  That was the expectation for participation levels.  Unfortunately, the total amount of loaned mastercoin was apparently only enough to cover 50% of the total, not 80%.  But at least a partial technical solution was found without requiring a rollback.  So now the decision that has to be made is whether a rollback would be better with an explicit 20% cap on mastercoin valuation or not.  

For future crowdsales of this nature, I would suggest there being a built-in ethical protection against potential conflicts of interest between the consultants arranging the tokenization, the company being advised, and the purchasing community.  That a proposal be made then discussed for a period of time with legitimate concerns addressed prior to final details being announced.  That way when final plans are set forth, all contingencies have been accounted for by crowdsourcing bugfixes in the crowdsale process prior to statements being made upon which the end purchasers rely to their detriment.

But much of this is only obvious in hindsight, and I have a great deal of respect for David Irvine's team's fast acting solution to protect both Maidsafe and the purchasers from a bug in the plan that was not accounted for with a contingency plan by essentially drafting and implementing an effective contingency plan rapidly under great stress.

On Tuesday, April 22, 2014 8:01:13 AM UTC-6, David Irvine wrote:

Still in fast mode so forgive typo's and grammar

Well what a morning! I cannot think of any other with so much drama and excitement. We started a little late as we had to wait on a certain block appearing on the blockchain to start the whole thing off. That was bad enough. Then we got the block and pushed go on the websites.  

We were all in the office ready to get involved and as soon as the site showed up some got in, others were stunned at the immediate influx of bitcoins. It was incredible, I had to go home to transfer mine, but was distracted for ages looking at the screen and wondering how all these people knew and how much belief there was. This seemed to hit home more than all the praise and good comments we get on line. This was peoples total belief and right there in front of me, surreal and very humbling. 

We then seen the Mastercoin blockchain explode and this will initially amazing, then it was very fast. A mastercoin block explorer site showed the sale as sold out and that was then delight into shock.

This was due to the fact MSC holders just send to an issue address and MSAFE are automatically returned. BTC hodler though had to send to a BTC address where they are collected in the background and manually xferred to MSAFE. I was in shock, all those BTC inputs had not been processed, we are all shut out (all in the office to). That was not great. 

I then was straight on to the Master protocol guys (also all nighter for them) and said is this all true, have we sold out in a couple of hours? We had not, in fact it was less than 50% (Still a huge amount).

Then I was outside thinking and thinking, what is happening this is too fast, the MSC holders are at great advantage and BTC supporters are going to be disadvantaged a lot. We cannot type quickly enough for this to even out. At this rate no BTC person will get in and they will miss out. We never seen this level of support coming.

I quite quickly decided that we would use all of the MSC loan fund we had been given for the sale and buy all the remaining MSAFE. Rather than manually doing a few steps in the background we would simply transfer the MSAFE to BTC holder on confirmation of any deposit. This removed a few steps.  

We debated, is this fair, is everyone included etc. and realised, what about the bonus, the 40% sliding bonus for everyone, we cannot manually calculate that, it would be a nightmare. Then it came together, we buy all remaining MSAFE with the loan fund and everyone gets the bonus, regardless of when they get in. Then we are all in the same boat, the faster MSC people and the BTC people. It means we raise less, but more importantly for us it means the system level out and we are all on the same playing field. People know me and me search for equilibrium the whole time. 

This is what we have done, it reduces the back office steps, ensures BTC backers are looked after and not squeezed out. MSC backers got in at almost equal footing as BTC (almost 50% / 50%) and we all win. The BTC goes ahead and the MSC people got in fast and made their purchase. 

This is now amazing as BTC is pushing along nicely and people can be assured the panic is over and the sale is as fair as it can be. Many would argue MSC is not 50% of the coin base etc. but I think none of us realised how fast and furious this sale would be. It is unbelievable. 

It means SAFE can go on strongly now, we can fund core dev, create Builders (the 10% dev pool part is unlikely to be allocated, instead the network will allocate these safecoin to Builders who produce apps people use etc.). The developer pods across the world who will compete with MaidSafe on core dev can be established and the network seeded. This is a pivotal moment for us all.

I hope all of you were as taken aback as we were, but not as shocked at trying to figure out a mechanism to include everyone.  

So please bitcoin backers, take comfort, your orders are being processed and will be fine now. We did panic with the false reporting of a site etc. but it was a good warning, we need to make sure everyone is equally treated and looked after. So now we all get to become involved, we all get the ~40% bonus and many many more people and supporters are part of this project. 

Thanks everyone and sorry for the frantic start, I hope it is calmer now and continues on it's strong footing. 

We will publish the number of MSAFE remaining on safecoin.io and you will see this one the blockchain in our backers holding account (address to be published) on the blockchain. This will be simpler now and I must say again thanks to the Master Protocol team, they were just amazing and Craig Sellars in particular is a guy you want beside you when things move at this speed. 

So BTC all the way now, until we post the sale is over on safecoin.io, at that time any BTC will be refunded back to the sending address.

Thanks again everyone, it's a pleasure to be part of this community, I cannot wait to get back to work though and get the network up and testnet 1 running. 

David Irvine 

[Mark Hughes]

+1

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[mmasonr...@college.harvard.edu]

they pay people above the market rate because they are paying for human resources not computational resources. there are many reasons for why you might pay above the market price for labor but those do not factor into this scenario. secondly, its not about upholding the status quo, its about acting according to economic truths. the status quo has its faults, but most of those faults depend on human irrationality, incompetence, and greed. this system is devoid of human related failures, but is still beholden to the failures of the structure as it is conceived. you do not create more value by creating more safecoins you simply transfer value by diluting the value previously held by backers.

[Benjamin Bollen]

I’m making an honest effort to follow you’re reasoning.

So to better understand, let me object: the farmers are the ones who keep the SAFE network running and only by their efforts the safecoin has any value. If the network goes down, so do all safecoins. How would you propose to tie the reward for farmers to the ‘market value’ of safecoins?

On 23 Apr 2014, at 00:36, mmasonr...@college.harvard.edu wrote:

> they pay people above the market rate because they are paying for human resources not computational resources. there are many reasons for why you might pay above the market price for labor but those do not factor into this scenario. secondly, its not about upholding the status quo, its about acting according to economic truths. the status quo has its faults, but most of those faults depend on human irrationality, incompetence, and greed. this system is devoid of human related failures, but is still beholden to the failures of the structure as it is conceived. you do not create more value by creating more safecoins you simply transfer value by diluting the value previously held by backers.
>

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[Mark Hughes]

As I said, the constructive input is ... ?

And your points were still, 1) incorrect and 2) based on assumptions
about economics "as is" which is fucking the planet, because of factors
such as the ones you mention. Its doesn't validate economics, or your
argument, to say "oh, economics is fine, its human failings that mess it
up".

Now as to what we should do instead, and why. Let's hear it. I am no
expert. You want us to listen to your expertise. I'm listening for ideas
that would be better and why.

Welcome :-)

Mark

[Erick Lavoie]

The aims of the approach is to reward early backers fairly given the
risk they took while making sure that on the long run, what gets
rewarded is any contributions by farmers (who provide computational
resources), and builders (who provide end-user applications and improve
the core system) without giving any privilege position to the initial
backers or even the founders.

If you have another technical proposition that satisfies those
requirements within an economically sound framework, I am all ears (and
eyes!).

Erick

[Christopher Andre']

Sorry if this is a silly question. Are we all getting 17000 per bitcoin, or 17000 + 40%?

Also curious to know how many coins are left.  I have some friends still scrambling to get bitcoins

[mmasonr...@college.harvard.edu]

the service is paid in por or safecoin. safecoin is not issued to pay for farmers. there is a decentralized market exchange for these two assets which will create the free market price ratio between safecoin and por. farmers charge there own fee that would be a little higher than the price of their resources in safecoin. those that contribute less resources to the network than they consume will have to buy safecoin and thereby bid up the price of safecoin. users pay the market price for the storage service, the farmers make a profit from the fee they charge, and equity holders do not lose equity.

markus, my point wasn't incorrect, it was an oversimplification of a metaphor that does not entirely work for this system because there is no labor. im not debating anything with you since you don't want to listen. im not making astounding assumptions about economics. a rational actor will never pay more for a good or service than he has to. that is to say if the market price for an orange is $1, you are not going to go out and buy an orange for $100. this is what you are doing by diluting the safecoin supply without regard for the market price of safecoin just to pay farmers.

just understand that if you do not go through with mining, there will be a greater appreciation in the safecoin price. im not arguing with you to be a dick, im simply stating what i believe to be in everyones best interest.

[Benjamin Bollen]

I would even want to turn your question around: if the given rate of safecoin farming is on average predetermined by the scale of the network, then it is up for the market to valuate the safecoin at that point. For example, a farmer who earned some safecoin will unlikely sell it below a price he feels does not honour the effort (s)he put into earning that coin.

If at some point the trade-currency-related value of a safecoin is pushed higher then its farmed-value then the farmer is at that point indeed paid more then the market-valuation which will incentivise more farmers to invest. This at its turn pushes the capabilities of the network and pushes down the rate of farming a (part of a) safecoin. This produces a balancing force.

I might not have studied economics, but I can reason and I kindly ask you to comment from your knowledge as a business student.

Ben

On 23 Apr 2014, at 00:36, mmasonr...@college.harvard.edu wrote:

> they pay people above the market rate because they are paying for human resources not computational resources. there are many reasons for why you might pay above the market price for labor but those do not factor into this scenario. secondly, its not about upholding the status quo, its about acting according to economic truths. the status quo has its faults, but most of those faults depend on human irrationality, incompetence, and greed. this system is devoid of human related failures, but is still beholden to the failures of the structure as it is conceived. you do not create more value by creating more safecoins you simply transfer value by diluting the value previously held by backers.
>

[Mark Hughes]

Thanks for taking the time to explain what you are trying to say.

Firstly I apologise for my unwelcoming welcome. Its been a long day, and
I was offended by your words, and you have responded very well so let's
go ahead and debate.

I think that you still idealise economics, and that is not itself a
fault. You bring understanding and constructive criticism. Yet people
*do* pay above the market rate, people and markets are in fact
irrational when it comes to purchasing and all sorts of other economic
decisions. We are also incredibly poor judges of risk. We are
inconsistent. And so on. So while your suggestions may point to
improvements, its not because of sound logic in these respects. In other
words, those arguments are unconvincing to me.

David (who will I'm sure be willing to debate you himself) is behind the
choices you disagree with, very recently introduced, because he has a
different vision for SAFE than your pure market. You may be right, in
which case we can revert to a purer market model, but being a better
bitcoin is the current strategy as I understand it.

I understand the criticism, if this is your point, that bitcoin is
flawed because it is not tied to something with value. But that is an
ongoing debate, the jury is out on whether this is a problem. If that is
not your argument here, please explain, because I think (and David can
chime in to correct me) that we are essentially trying to provide a
bitcoin like currency, and use its adoption, to pay the farmers, and to
offset a substantial amount of the costs with donated resources
(expecting many people with most resources - e.g. first world - being
willing to give up small amounts of resources to be a part of something
good for all. Although, the efficiency gains of pooling resources may
also be a way of funding the network, because in the short/medium term
the gains here could be very large. The ever reducing cost of resources
is another factor in our favour.

I think we need to understand your objection to these points, but maybe
better for David to explain the reasoning behind the current model than
me, because I am still new to this, and I don't claim what I've outlined
to be correct. It is my understanding.

As Erick suggested, it is fluid, and your input is welcome. Really :-)

Mark

[mmasonr...@college.harvard.edu]

On Tuesday, April 22, 2014 7:02:55 PM UTC-4, Benjamin Bollen wrote:
> I would even want to turn your question around: if the given rate of safecoin farming is on average predetermined by the scale of the network, then it is up for the market to valuate the safecoin at that point. For example, a farmer who earned some safecoin will unlikely sell it below a price he feels does not honour the effort (s)he put into earning that coin.

this is not true. the farmer has to sell it to pay for initial fixed cost. if that farmer finds that the price is so egregiously low then he will abandon the network and sell his storage space to a forked network that pays more.

> If at some point the trade-currency-related value of a safecoin is pushed higher then its farmed-value then the farmer is at that point indeed paid more then the market-valuation which will incentivise more farmers to invest. This at its turn pushes the capabilities of the network and pushes down the rate of farming a (part of a) safecoin. This produces a balancing force.

so the problem i have with this is that mining and farming lend themselves to centralization through specialization and economies of scale. when you dilute the value of backers you're effectively putting that value in the pockets of a small group of farmers, probably the companies that already make data storage hardware and you are paying them more than they are currently paid by the market, because now they can accumulate equity in what should be a profitable business.

all i know is that if during the initial launch of the network there are mostly just farmers and no paying users, the price of safecoin has to go to zero. and if that happens the network will probably be forked and a system that maintains an economic structure conducive to steady gains in the safecoin price will succeed the original safecoin network

[mmasonr...@college.harvard.edu]

mark, i think that it makes sense to want to enter the cryptocurrency space but it is important to understand that these are not primarily currencies but rather equity which can be used as currency by virtue of its digital nature. the value of this equity is determined by the value of the network, which is determined by the value of the services the network provides. just like a business the network whether maidsafe or bitcoin has expenses (pay for farmers or miners) and it has revenue (storage fees or transaction fees). the most rational business model is to reduce expenses and increase revenue. i know you said that we should not support the status quo and as much as i support that in a general sense there are reason why business operate the way they do. you have to be economically accountable for the allocation of resources and the proposed structure is not in accordance with that logic.

[Mark Hughes]

I guess David is asleep, but I speculate that his vision is different to
what you believe will happen - centralisation and specialisation. The
network may go as you suggest, but we are I think attempting to do
something different, and to enable everyone to participate, and since
the cost of their "donated" resources is so marginal, the network
self-funds and everyone is a farmer on some scale.

I agree with you this is highly speculative, against market dynamics
etc. We are doing a big experiment. Looking for better models, because
we need something better than current thinking.

I think we should continue this debate with better minds than mine, so
please stick around.

Mark

[joel...@gmail.com]

> all i know is that if during the initial launch of the network there are mostly just farmers and no paying users, the price of safecoin has to go to zero. and if that happens the network will probably be forked and a system that maintains an economic structure conducive to steady gains in the safecoin price will succeed the original safecoin network

There's value in the real world infrastructure, community and brand that Maidsafe is building. It's been 5 years and no one has been able to create a larger or more valuable cryptocurrency network from a fork of the bitcoin source code. People are still people after all and copy is a copy. The risk of a Maidsafe fork is pretty low even if the internal currency of that fork is based on a more traditional economic model.

Also, owning a scarce token that's utilized in an online distributed network is not the same as equity in a business. There are no assets, no debt, only network utilization.

You can't compare safecoin to a stock, it's apples to oranges.

[jr.wi...@gmail.com]

Did you guys see the press release?: http://launch.it/launch/maidsafe-sells-6-million-of-bitcoin-20-software-in-five-hours

My favorite part: ” . . . the sale of $6 million of its software token, safecoin, in five hours, a record for any kind of crowd-sale”

Making history here, folks :)

[Erick Lavoie]

On 2014-04-22 7:37 PM, mmasonr...@college.harvard.edu wrote:
> On Tuesday, April 22, 2014 7:02:55 PM UTC-4, Benjamin Bollen wrote:
>> I would even want to turn your question around: if the given rate of safecoin farming is on average predetermined by the scale of the network, then it is up for the market to valuate the safecoin at that point. For example, a farmer who earned some safecoin will unlikely sell it below a price he feels does not honour the effort (s)he put into earning that coin.
> this is not true. the farmer has to sell it to pay for initial fixed cost. if that farmer finds that the price is so egregiously low then he will abandon the network and sell his storage space to a forked network that pays more.

If we are using commodity computers already used for other purposes
there is no initial fixed cost. I think that might be one of the
greatest strength of the vision. If you aggregate the combined computing
power and storage capabilities of all the latops, desktops, smartphones
and tablets cumulatively sold up to now and that are still usable, I
believe it dwarfs any centralized services, even at Google scale (I did
back of the envelope calculations a few months ago with the combined
computing power of devices sold by Apple in 2013 only and it was
comparable to the 4th top supercomputer in Gflops on wikipedia). The
fact that all those computing resources are mostly unused since these
machines are used as rich clients is one of the most flagrant
misallocation of computing resources of the current business models of
the computing industry.

The current mining algorithm is not dependent on superfast computers but
mostly on availability of storage, which should incentivize people to
connect any old machine that could still contribute resources to the
network. If there is flaws in the mining algorithm that prevents it,
then I think we should fix them to enable it.

So I don't think farmers will initially calculate in terms of
return-on-investment of important capital investments on machines, the
resources that will make up the system are already widely abundant and
distributed. Hopefully the majority of the resources won't be
contributed in centralized data centers by rational business men
optimizing for profits by buying new computers, they will come from
everyday Joes that will get let's say a discount on their broadband
access for connecting their old computers and hard drives to a special
NAS, or resurrecting old recycled computers that were donated once their
school or company upgraded, etc.

The key difference here is that we are not optimizing the usage of
scarce resources with the aim of maximizing a profit for an important
initial investment, we are (finally!) using widely abundant resources
that are otherwise completely wasted. Any value derived from it is pure
profit (minus the electricity cost ;-)).

Therefore I think Ben points holds, a farmer might want to wait
indefinitely until selling the coins is profitable.

>
>> If at some point the trade-currency-related value of a safecoin is pushed higher then its farmed-value then the farmer is at that point indeed paid more then the market-valuation which will incentivise more farmers to invest. This at its turn pushes the capabilities of the network and pushes down the rate of farming a (part of a) safecoin. This produces a balancing force.
>
> so the problem i have with this is that mining and farming lend themselves to centralization through specialization and economies of scale. when you dilute the value of backers you're effectively putting that value in the pockets of a small group of farmers, probably the companies that already make data storage hardware and you are paying them more than they are currently paid by the market, because now they can accumulate equity in what should be a profitable business.
>
> all i know is that if during the initial launch of the network there are mostly just farmers and no paying users, the price of safecoin has to go to zero. and if that happens the network will probably be forked and a system that maintains an economic structure conducive to steady gains in the safecoin price will succeed the original safecoin network
>

If the computing resources already available that were cumulatively
produced up until now are much greater than whatever a company is
currently producing, then their own production should be small in
comparison and might make it harder to corner the resources of the system.

I believe the centralization and uniformity of hardware in a data center
is done to minimize the labor costs of operating the data center.
However, centralization incurs costs of cooling that are mostly there
*because* there is centralization and therefore a high-density of
computers. And if remember well, those costs are significant and might
dominate other costs.

Automatically coordinating the computing resources in a fully
decentralized manner removes much of the need for cooling (and the labor
costs) and I believe will turn out in the end to be much more efficient.
I believe that it was not done before because of a lack of a working
business model. Automatically assigning a value to resources that are
contributed to the network, in a way that users can then exchange for
apps services using the resources of the network or even trade for other
real-life services is truly revolutionary and game-changing and might be
the missing ingredient.

The combination of already widely abundant resources and automatic
valuation of resources contributed to the network might not be so
common. I would be curious to know if current economics has a model that
holds for other industries or even other examples of companies that
operate in a similar situation.

Erick

[Malcolm Mason Rodriguez]

Thats the very point of using the p2p distributed structure, we're trying to make companies that do not have assets and debts because the cost of infrastructure is distributed amongst its employees, stake holders and clients. This company is infinitely scalable and can provide any of the services that the internet and banks provide. The main difference lies in the fact that these companies are open source, which means they are fully transparent and incorruptible (unless poorly designed).

Its not apples to oranges, these are companies whether you want to brand it that or not.

---

From: joel...@gmail.com
Sent: ‎4/‎22/‎2014 8:17 PM
To: maidsafe-d...@googlegroups.com
Cc: benjami...@gmail.com; mmasonr...@college.harvard.edu
Subject: Re: [maidsafe-development] Re: project SAFE crowd sale

> all i know is that if during the initial launch of the network there are mostly just farmers and no paying users, the price of safecoin has to go to zero. and if that happens the network will probably be forked and a system that maintains an economic structure conducive to steady gains in the safecoin price will succeed the original safecoin network

[AMIR GOREN]

Are the MSAFE coins supposed to already be seen on masterchest.info? (I don't see anything when searching my blockchain.info address)

[David Irvine]

On Wed, Apr 23, 2014 at 4:12 AM, AMIR GOREN <goren...@gmail.com> wrote:

Are the MSAFE coins supposed to already be seen on masterchest.info? (I don't see anything when searching my blockchain.info address)

Hi Amir we are processing the BTC manually, but looks like the Master Protocol guys may automate this for us. We are updating the site now to explain this process and the intention. It seems there may be 24-48 delay on seeing the MSAFE coins, but the blockchain confirms receipt of the BTC and we have created a spreadsheet detailing all the tx that we were using for the manual process. 

[Amir Goren]

OK thanks David. Just wanted to make sure that I didn't make a mistake...

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[David Irvine]

On Wed, Apr 23, 2014 at 4:24 AM, Amir Goren <goren...@gmail.com> wrote:

OK thanks David. Just wanted to make sure that I didn't make a mistake...

Any time Amir.

[Mark Hughes]

With respect if you think in the old paradigm, you will come to the
conclusion that the old paradigm is the best way of doing things. I
don't believe I'm the person to debate with you on the details of old or
new, but I do have an intuitive sense. It is possible that this is all
we have, until the new emerges. We may not be able to rationalise and
visualise it with models until it stares us in the face.

We can though consider how natures "economics" operate, and how this is
different (or not) from the current paradigm. Nature is our guide in
this enterprise, and we see from her that evolution does indeed have
elements of the competitive, but not only this. Its structures are
incredibly complex, and yet in many respects this arises from very
simple rules (which gives our simple minds a chance!).

So, for example the holarchies of nature. Can you bring your economic
understanding to holarchies, and see how this can be reflected in our
brace new world? Or Illya Prigogine's work on emergent systems. A
problem with past thinking is its reductionism, lack of holism. Lack of
heart even.

Getting to a personal hobby horse, but one reason I'm so attracted to
David's thinking, I think we need to stop thinking of systems in terms
of "efficiency", "profit" and "growth" (because this thinking creates
machines that are better and better at consuming resources and
socialising the costs (financial, environmental, and human) of these
machines - those corporations and other structures we craft with these
goals. Instead we need to build into the economic system (or the new
paradigm) thinking that manifests human values, through those
mechanisms, but in the service of what we actually want such machines to
deliver: wellbeing and sustainability for example - but values that all
mankind can agree are paramount.

Do you get my drift? If we keep the "rules" of economics as they are, of
course the structures that it fosters are efficient (and destructive) in
the ways that they are. If we can create new rules, we can create new
kinds of structure.

I'm not saying that SAFE could change the world to the new economic
paradigm, I wish, but I'm saying that new thinking is necessary in terms
of creating something. We get to set the rules within, and if we create
something that works better, it will win out even in the current
paradigm. Perhaps we won't be reliant on those entities that do thrive
in an environment where to centralise and specialise works best. Perhaps
we'll create an envrionment where different attributes are successful.

If you're not clear what I'm saying, I suggest you watch Dr Deborah
Gordon's TED talk on her ant research. Natural "economic" systems like
this are one of the sources of inspiration for SAFE. Here's the link:
http://blog.ted.com/2008/01/08/deborah_gordon/

I wish I were more able to understand your specialty and to debate you
more concretely rather than with my broad and rather vague intuitions.
Hopefully others will bring more substance.

Mark

[shatoshi...@gmail.com]

> --
>
>
> David Irvine
> maidsafe.net 
>
>
> twitter: @metaquestions
> blog:  http://metaquestions.me

@Mark yo dude why u write long stuff like dat? @David chin up man i never knew much til like a few months in da game

[Mark Hughes]

Very well articulated Erick. I particularly like:

> The key difference here is that we are not optimizing the usage of
> scarce resources with the aim of maximizing a profit for an important
> initial investment, we are (finally!) using widely abundant resources
> that are otherwise completely wasted. Any value derived from it is
> pure profit (minus the electricity cost ;-)).

[Mark Hughes]

Its fine to call them companies, but doing so brings a risk that we think of them as the same, and make the same assumptions, and de facto preserve the old paradigm. What we call them doesn't matter. They *are* different, and we don't yet know the ways in which that difference will change them or the ecosystem as they grow and the model evolves. We need to put down our learning and open our minds for something new to emerge.

You can't compare safecoin to a stock, it's apples to oranges. --
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[mmasonr...@college.harvard.edu]

it's not that im stuck in the old paradigm. it is simply that i understand natural economic truths, one of which you just rejected in your post. efficiency is the one and only thing we are striving for. it is not necessarily about profits although the most profitable organization are also the ones that are the most efficient. economics is about dealing with scarcity. the only way to alleviate scarcity and thereby increase the quality of life for all is through greater efficiency. in the long run what system do you think will win out, the one that is more efficient or the one that is less? if you do not optimize the efficiency of the network ppl will opt to use the network that does so. the reasons for using these distributed networks whether to provide a currency or a data storage service are simply a matter of increased efficiency.

im essentially asking, why would you optimize the data storage aspect of the network and not do the same with the currency? im giving you a better model for the currency and you're saying no we don't want the currency to be backed by anything or have intrinsic value. so then why would anyone pay for it? if i don't have to pay for the service of the network there is no demand for the currency (more appropriately equity) of the network. if maidsafe is going to make its services free then they should just scrap the currency altogether. otherwise ppl are going to lose money in the same way they (including maidsafe) lost money with the ipo.

[Mark Hughes]

I think the IPO issue is different altogether and doesn't assist your
argument.

You may be right about efficiency being the highest good, or you may
not. I think you are not, but I'm not about to tell you what the
ultimate goal of evolution is, and not just because I don't now. But
because it "is". That's it. Our ideas are never "it". So back to our
poultry musings on the "ultimate" in the form of economic ideas...

I don't accept your point that economic truths are established and
that's that. This is the state of the art perhaps, I hope you can speak
of that and bring it here, but everything evolves, everything changes,
and your absolutism to me emphasises the value and importance of what
you know, but shrouds it in a distasteful arrogance that makes it harder
for me to listen, as you noted earlier.

Not least because I have a tendency to the same kind of arrogance, as
you may notice.

I hope we can find a way of debating this, pooling our ideas, and
allowing what is new to emerge, as opposed to batting back and forward
from our different positions. But this is perhaps the beginning of that.

We are not the creators. That is anthropomorhic nonesense. We are actors
and observers, we create and are created by what we create.

I'd like to see you take on board some of the thinking here, but you
seem only to want to work through the lense of the economics you know.
Did you check out the ant video? Is there room for new ideas in your
economic model? Or in your way of perceiving systems?

Its fun :-)

Mark

[黃俊淵]

I think all this economic debate is crucial. The biggest assumption of the nowadays economic theory is that the 'resource' is scarcity. This Safe project is challenging this assumption. People deserve better system to feel like abundant rather than scarcity. Yes I definitely agree it is all about the efficiency. But what is efficiency. When people feel freedom people have the efficiency. We need moving forward.... I know it was too idealist :)

[Erick Lavoie]

I think an interesting line of inquiry would be to identify stated and unstated assumptions of major "natural economic" theories and see which still hold and which do not in our particular situation. I would personally focus on the assumptions that are made on the behaviour of an economic agent. From the very limited understanding I have, I think many of these theories assume a rational agent that seeks to maximize value, and I believe that assumption is mostly an artifact of modeling an economy through analytical mathematics and seeking to derive emergent properties from mathematical reasoning. However, I don't think the rationality assumed for agents fully capture the wide range of actual economic behaviour. That line of inquiry would probably help bridge the communication gap in-between different paradigms.

There is also a tremendous opportunity with the SAFE network to *experiment* with different models of allocation of resources in the context of a real economy and see which ones lead to the emerging properties we are looking for. Maybe, we could try many schemes in a sequential time-limited manner until we find one we all agree on, and restart the initial distribution of coins according to the MaidSafeCoin distribution every time. Maybe we could even have multiple schemes running concurrently (Safecoin-1, Safecoin-2, etc.) with different floating exchange rates that would mutually be exclusive and see which one ends up being valued the most. (Getting off the beaten tracks here...)

There is another more technical thread started by David Y, that reflect on the technicality of the Safecoin, to which you guys might want to contribute:

https://groups.google.com/forum/#!msg/maidsafe-development/IO7Zb4pq3XQ/

Erick

[luckyb...@gmail.com]

I agree a lot with what you are saying. They need to fix their economic incentive structure or get forked.

Maidsafe is a technological marvel but they don't have a clue when it comes to economics and it's proven by the result of this crowd sale experience.

I actually tried to give suggestions before the crowd sale and wasn't taken too seriously. Others tried as well.

In my opinion the Bitcoin economic model isn't perfect because it leads to centralization, but Maidsafe will be centralized from the start if I understand it correctly.

On Tuesday, April 22, 2014 5:37:34 PM UTC-4, mmasonr...@college.harvard.edu wrote:
> my analysis wasn't in retrospect. i suggested that this would be a major issue and some of the ppl that contested me are among those left with msc, holding the bags.
>
> this level of incompetence is not something that the community around maidsafe can be complacent with. if you have a background in economics you understand that the issues that arose are common sense issues that should have been addressed before initiating the crowdsale.
>
> the most pressing issue at hand is not with the crowdsale but with the distribution and dilution of safecoins through farming. a company would never issue new stock to pay employees, so why then does maidsafe choose this model? a company would also never pay employees a higher wage than the market price for labor. the issuance of new safecoin to pay farmers is not determined by market forces but by a mathematical algorithm that has no regard for what the price of storage is at any given time.
>
> until you stop trying to copy bitcoin, and understand its limitations from an economic perspective i cannot financial support your project or tell others to do so. you guys have a good product but you will be shooting yourself in the foot if you carry on as proposed without fixing the economics of your system

[luckyb...@gmail.com]

I agree with these statements. Maidsafe must fix it's economics or risk being forked.

The incentives should in my opinion go to the little guy in order to promote decentralization of power over the long term. A lot of little guys farming, starting new data centers and businesses, at least in the first few years, is better than setting it up so that from the start large established companies can come in and provide everything. And if you want large companies to come in and provide the farming resources then set the system up so that builders and other individuals can benefit from the growth of Maidsafe.

I'm no economist, but I could see from the start that the economics were at best unfinished and at worst going in the wrong direction. Since I purchased Safecoin tokens in the crowd sale I don't want the risk of a fork if my tokens could be made worthless.

But if I'm expected to someday be a farmer, I have to know that it's a profitable business for me to do so. It's perfectly fine if the profits don't last forever, but if the idea is to grow an economy around it you need ways for people to earn Safe tokens and ways for people to spend them.

This is something which should be thought out very carefully because the entire success of this idea depends on getting the economic incentives right.

[shatoshi...@gmail.com]

nah it aint tho bruv u dont know understand it either pmsl @ every1

[Mark Hughes]

+1

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[LB]

Okay explain to me why Google and Amazon wouldn't just take complete
control? They have the resources right now. What about the builders and
funders?

Since very few people will be farmers and most people will probably be
either builders or funders, what do you expect?

Explain why this is the wrong assumption?

[Mark Hughes]

On 23/04/2014 18:47, luckyb...@gmail.com wrote:
> In my opinion the Bitcoin economic model isn't perfect because it leads to centralization, but Maidsafe will be centralized from the start if I understand it correctly.

Please can you explain what you mean be "Maidsafe will be centralized".
Thanks.

[mmasonr...@college.harvard.edu]

On Wednesday, April 23, 2014 1:13:03 PM UTC-4, Érick Lavoie wrote:
> I think an interesting line of inquiry would be to identify stated
> and unstated assumptions of major "natural economic" theories and
> see which still hold and which do not in our particular situation. I
> would personally focus on the assumptions that are made on the
> behaviour of an economic agent. From the very limited understanding
> I have, I think many of these theories assume a rational agent that
> seeks to maximize value, and I believe that assumption is mostly an
> artifact of modeling an economy through analytical mathematics and
> seeking to derive emergent properties from mathematical reasoning.
> However, I don't think the rationality assumed for agents fully
> capture the wide range of actual economic behaviour. That line of
> inquiry would probably help bridge the communication gap in-between
> different paradigms.

if you aggregate the behaviors of individuals they act in a rational fashion unless there is incentive to act irrationally, for example government intervention in the free markets.

> There is also a tremendous opportunity with the SAFE network to
> *experiment* with different models of allocation of resources in the
> context of a real economy and see which ones lead to the emerging
> properties we are looking for. Maybe, we could try many schemes in a
> sequential time-limited manner until we find one we all agree on,
> and restart the initial distribution of coins according to the
> MaidSafeCoin distribution every time. Maybe we could even have
> multiple schemes running concurrently (Safecoin-1, Safecoin-2, etc.)
> with different floating exchange rates that would mutually be
> exclusive and see which one ends up being valued the most. (Getting
> off the beaten tracks here...)

what you are talking about here are forks. the fork that creates the greatest gain in value for safecoin holders is the one that will win out. you are right to say that we need to change the paradigm, we need to stop using the inflationary model of fiat governments, which serves as an additional tax on citizens. bitcoin uses an inflationary model and therefore only continues to repeat the mistakes of these antiquated organizations.

[Benjamin Bollen]

when it comes to ‘natural truths’, there is a subtle difference: nature minimises the action it takes to achieve a goal, which is different from efficiency. Efficiency is defined against an arbitrarily chosen measure and is not a driving force per se. Considering dynamical complex systems the description comes from game theory, you should know this.

On your second point, the fallback strategy is exactly what you are arguing for. It’s not something that has not been discussed before. In fact the initial model tied the currency directly to the value of the storage.

The current model is really even better: transaction fees on safecoin are reabsorbed into the farming pool. Essentially the revenue stream from the network are the transaction fees, the cost is the payment to the farmers, paid from this revenue. The exact governing formulas can be debated (anything can be debated!) but it would be interesting to analyse it further.

On 23 Apr 2014, at 10:53, mmasonr...@college.harvard.edu wrote:

> it's not that im stuck in the old paradigm. it is simply that i understand natural economic truths, one of which you just rejected in your post. efficiency is the one and only thing we are striving for. it is not necessarily about profits although the most profitable organization are also the ones that are the most efficient. economics is about dealing with scarcity. the only way to alleviate scarcity and thereby increase the quality of life for all is through greater efficiency. in the long run what system do you think will win out, the one that is more efficient or the one that is less? if you do not optimize the efficiency of the network ppl will opt to use the network that does so. the reasons for using these distributed networks whether to provide a currency or a data storage service are simply a matter of increased efficiency.
>
> im essentially asking, why would you optimize the data storage aspect of the network and not do the same with the currency? im giving you a better model for the currency and you're saying no we don't want the currency to be backed by anything or have intrinsic value. so then why would anyone pay for it? if i don't have to pay for the service of the network there is no demand for the currency (more appropriately equity) of the network. if maidsafe is going to make its services free then they should just scrap the currency altogether. otherwise ppl are going to lose money in the same way they (including maidsafe) lost money with the ipo.
>

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[Amir Goren]

Human Action should be the focus. I believe that with minimal intervention the market forces will adapt repeatedly. Minimal intervention means flexibility of the model that allows human action to change supply and demand. The goal of the Safecoin model should be to create flexible enough incentives and disincentives that would withstand all kinds of scenarios and conditions.

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[Benjamin Bollen]

On 23 Apr 2014, at 20:10, LB <luckyb...@gmail.com> wrote:

Okay explain to me why Google and Amazon wouldn't just take complete
control? They have the resources right now. What about the builders and
funders?

Since very few people will be farmers and most people will probably be
either builders or funders, what do you expect?

Everyone (excepting handheld devices and other resource strained devices) who uses the network will automatically also be a farmer.  It is very weird to start reading these posts that ‘MaidSafe is from the start a centralised system and we should focus on decentralising’…

I really don’t even know where I have to start correcting these statements, sorry. 

At least I can answer your question: no company, no matter how big, or how many resources it has, can monetise the information stored in any other way but through farming for safecoins.  The information stored is in every way unreadable to the machines storing it.  So yes it is possible companies start to form that farm, but it is disincentives as there is only one option for growth: more raw power. they can’t do anything but serve and are almost certainly outperformed by the collective of end-users farming.  There is no market domination strategy, no advertisement model or big data mining.

Explain why this is the wrong assumption?

On 04/23/2014 01:59 PM, shatoshi...@gmail.com wrote:

nah it aint tho bruv u dont know understand it either pmsl @ every1

On Thursday, April 24, 2014 12:47:34 AM UTC+7, luckyb...@gmail.com wrote:

I agree a lot with what you are saying. They need to fix their economic incentive structure or get forked.

Maidsafe is a technological marvel but they don't have a clue when it comes to economics and it's proven by the result of this crowd sale experience.

I actually tried to give suggestions before the crowd sale and wasn't taken too seriously. Others tried as well.

In my opinion the Bitcoin economic model isn't perfect because it leads to centralization, but Maidsafe will be centralized from the start if I understand it correctly.  

On Tuesday, April 22, 2014 5:37:34 PM UTC-4, mmasonr...@college.harvard.edu wrote:

my analysis wasn't in retrospect. i suggested that this would be a major issue and some of the ppl that contested me are among those left with msc, holding the bags. 

this level of incompetence is not something that the community around maidsafe can be complacent with. if you have a background in economics you understand that the issues that arose are common sense issues that should have been addressed before initiating the crowdsale.

the most pressing issue at hand is not with the crowdsale but with the distribution and dilution of safecoins through farming. a company would never issue new stock to pay employees, so why then does maidsafe choose this model? a company would also never pay employees a higher wage than the market price for labor. the issuance of new safecoin to pay farmers is not determined by market forces but by a mathematical algorithm that has no regard for what the price of storage is at any given time. 

until you stop trying to copy bitcoin, and understand its limitations from an economic perspective i cannot financial support your project or tell others to do so. you guys have a good product but you will be shooting yourself in the foot if you carry on as proposed without fixing the economics of your system

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[Joe Looney]

This was the point I was trying to make.

While apples and oranges are both fruit (equity), you can't compare them directly because they are very different types of fruit.

On Wednesday, April 23, 2014 4:23:05 AM UTC-4, Mark Hughes wrote:

Its fine to call them companies, but doing so brings a risk that we think of them as the same, and make the same assumptions, and de facto preserve the old paradigm. What we call them doesn't matter. They *are* different, and we don't yet know the ways in which that difference will change them or the ecosystem as they grow and the model evolves. We need to put down our learning and open our minds for something new to emerge.

On 23/04/2014 02:25, Malcolm Mason Rodriguez wrote:

Thats the very point of using the p2p distributed structure, we're trying to make companies that do not have assets and debts because the cost of infrastructure is distributed amongst its employees, stake holders and clients. This company is infinitely scalable and can provide any of the services that the internet and banks provide. The main difference lies in the fact that these companies are open source, which means they are fully transparent and incorruptible (unless poorly designed).

Its not apples to oranges, these are companies whether you want to brand it that or not.

---

From: joel...@gmail.com

[mmasonr...@college.harvard.edu]

no they are not different. every organization is subject to the same fundamental constraint - it must produce more than it consumes, or die. thats not hyperbole, thats not an archaic paradigm, that is a fact.

[David Irvine]

On Fri, Apr 25, 2014 at 1:35 AM, <mmasonr...@college.harvard.edu> wrote:

no they are not different. every organization is subject to the same fundamental constraint - it must produce more than it consumes, or die. thats not hyperbole, thats not an archaic paradigm, that is a fact.

Some consume what others provide though, the balance of assets is like this, one thing this does not suffer this seems to be knowledge. The if I have an apple and give it to you I have no apples, if I have a thought and share it then we both have that thought. In the latter case the producer produces something the other consumed and then together the group became stronger. The producer though also got stronger by giving, that giving cost some effort and that effort was paid by that person who gave (through use of energy). In this case the producer apparently gave something away, so in a market it loses, in nature it wins.

And every organisation does in fact die AFAIK. I do not know of any that lasts for infinity. The rate matters, but over production is quashed by nature and markets, under production speeds up decline. Evading this requires evolution, usually this means the old dies and the new takes over. 

Sorry for barging in, I think there are ways to look at things sideways sometimes. 

[mmasonr...@college.harvard.edu]

the problem with that perspective is that you are comparing two different types of resources. an apple is a scarce resource in the same way that storage is a scarce resource. as you demonstrated with your analogy if one person has a scarce resource then another person can't have that same scarce resource. so if one person is using the networks storage, another person can't use that same exact storage space, it can only be used by one person at a time. a phenomenon known as tragedy of the commons occurs when resources are not used economically. information is a non-scarce resource. it becomes more valuable the more people use it. that same exploitation of resources that leads to a tragedy of the commons when scarce resources are involved lends itself to a comedy of commons where value is created out of the mere exchange of information, a non-scarce resource.

your system still deals with many scarce resources, one being storage, and one being human participation. if you are not attempting to tie the value of safecoin to the value of maidsafe itself. you are simply asking for safecoin not to succeed when it very well can. you're model does not lend itself to profitability, when it could otherwise be made profitable, which is why i keep saying that it is going to be forked.

[Mark Hughes]

This isn't true - I suggest you go read about natural systems,
holarchies etc. rather than repeating things that people here believe
are not true, and ignoring those responses because you don't yet know
this yourself. I don't think you are widely read, or have an intuitive
sense of very much yet. You are clearly very familiar with the
orthodoxies of certain areas. Do you understand the nature of truth? How
nothing we think of as true, is in fact true? Truth is relative, which
is, in fact, then only a limited truth. Enough...

You're applying absolutes from textbooks to the real world, when they
are models, derived from the real world and can only ever approximate to it.

If you really believe what you say, go away and prove it. You'll probaly
get a Nobel one day. Though if you live long enough, it will later turn
out not to be true!

Mark