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admittedly new to this. have a question about "crypto businesses."
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Date: January 14th, 2018 10:15 PM Author: Trip Plaza Hominid it's my understanding that one of the more typical business models for tokens is that they are to be used as a payments mechanism for a technology or service. e.g. request network, where users pay REQ tokens as a fee to make transactions with others.
what exactly is the benefit of maintaining a proprietary currency for something like this? why not just charge ETH (or whatever becomes the dominant cryptocurrency) as a fee rather than force people to hold a low-volume and inevitably volatile asset to use their service? or even if the customer can purchase a token at the time of the transaction, why expose both him and the business to exchange rate risk by introducing another currency in the middle? seems like an identical service which doesn’t require the use of a proprietary currency is immediately superior to any service that does (so long as the latter isn’t already an established business, which none of these businesses are).
why is this business model anything other than a quick cash grab in the middle of a crypto bubble, or at best an entirely superfluous use of a novel technology for its own sake? what business outside of chuck e cheese uses this business model? |
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Date: January 14th, 2018 10:18 PM Author: snowy elastic band shhhhhhhhhhh, hush baby we surf waves looking for value here, we don't talk about biz (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157498) |
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Date: January 14th, 2018 10:29 PM Author: Trip Plaza Hominid (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157563) |
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Date: January 14th, 2018 10:25 PM Author: laughsome aquamarine step-uncle's house Good post..I have these same thoughts. The main argument that can be made for the token system is it allows "decentralized" tech companies to generate revenue in a way that doesn't involve hoarding users' personal information.
The question I think is do people detest tech companies having all of their info enough to perpetuate tulip bulbs 2.0 |
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Date: January 14th, 2018 10:29 PM Author: Trip Plaza Hominid as far as i can tell private tokens are not needed to achieve this (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157562) |
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Date: January 14th, 2018 10:32 PM Author: laughsome aquamarine step-uncle's house If a company like STORM uses ETH, doesn't seem like the funding/profit margins would be there for the project (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157583) |
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Date: January 14th, 2018 10:35 PM Author: Trip Plaza Hominid why (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157596) |
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Date: January 14th, 2018 10:45 PM Author: laughsome aquamarine step-uncle's house Take a business like upwork.com, the "centralized" equivalent of storm...In addition to transaction fees and subscription charges for enhanced services, they're also collecting all the user information they can for possible future monetization opportunities.
The tokens give these startups much more leeway in terms of funding and business model. The startups are then not beholden to the ever-increasing expectations of venture capitalists who fund their projects. The hope is that more and more people will adopt the token until it's a self-fulfilling prophecy, and everybody wins. Idealistic thoughts indeed, but who knows what will happen. |
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Date: January 14th, 2018 10:32 PM Author: Puce Geriatric Pit Sandwich They sell the proprietary token as start-up capital to fund the project. People buy in the belief it will be worth more. How else would they get the money up-front? (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157579) |
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Date: January 14th, 2018 10:34 PM Author: Trip Plaza Hominid vc, like every other tech company for the past 25 years (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157591) |
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Date: January 14th, 2018 10:36 PM Author: Puce Geriatric Pit Sandwich Ok, but they didn't do that, either because they couldn't get VC or philosophically believed in the ICO. In either event, the coins you see are people that raised funds like that. You don't see coins for people that used VC. (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35157604) |
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Date: January 14th, 2018 10:45 PM Author: Trip Plaza Hominid that of course takes away the element of a vc fund vetting the quality of a business and instead leaving it to millions of hikikomori koreans who are more interested in drawing squiggles on the price chart than they are in the business. but that’s not my point. my point is that this business model is pathetically inefficient. imagine if chili’s quoted its prices in chilicoin and forced you pay in chilicoin but that chilicoin is known to see price swings of ~10% by the hour, or even more in some cases. or if it changed its prices dynamically given the exchange rate between USD and chilicoin but still forced you to exchange USD for chilicoin to make the transaction, leaving you exposed to potentially massive exchange rate risk for an extremely volatile asset for the few minutes while the waitress rings you up. if there was an identical restaurant down the street that did business in USD i'd just go there. |
Date: January 17th, 2018 7:11 PM Author: Trip Plaza Hominid speak of the devil https://www.snopes.com/chuck-e-cheese-bitcoin/ (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35179018) |
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Date: January 17th, 2018 7:15 PM Author: bateful son of senegal They're selling securities, called "tokens," in order to raise funds without being subject (for now) to SEC regulation (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35179055) |
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Date: January 17th, 2018 7:18 PM Author: anal odious philosopher-king mental disorder Except the company could just form a corporation with actual equity and say we don't need these faggot coins anymore thanks (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35179068) |
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Date: January 17th, 2018 7:24 PM Author: bateful son of senegal If your observation is that plenty of shitcoins have no actual utility once funds are raised, then yeah.
Imagine raising tens of millions without giving up any equity in your company. You just need to articulate some convoluted scheme about how the token will be used to access/use your product and plan implementation of that somewhere in your "roadmap" -- no doubt in the distant future. |
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Date: January 17th, 2018 7:30 PM Author: Trip Plaza Hominid part of my point is that the existence of a native token for a business is itself a flaw in its business model and inherently puts it at a disadvantage to an otherwise identical blockchain business which doesn't enforce a proprietary currency.
unless they can achieve scale extremely quickly (maybe they can) they are vulnerable. and at worst they are frauds just forcing tokens into their business models for no other reason than to capitalize on the crypto bubble. the whole native token scheme itself seems like a red flag for a business to some extent. |
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Date: January 17th, 2018 7:18 PM Author: Vigorous umber space party of the first part In the case of BAT, you use BAT coins to tip youtube stars, Ta Nehisi Coates, Moldbug, Breitbart etc on their Brave browser if they sign up to receive them. Kind of like a patronage system. (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35179067) |
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Date: January 17th, 2018 7:39 PM Author: Transparent Water Buffalo you're not wrong, but many altcoins aim to become the "dominant" currency. the speculative bet in these cases is that coin x will become dominant because it is faster, more private, etc than competitors.
there are also other limited purpose models. for ex OST is a white label solution for business that want to tokenize their rewards programs but do not want to develop their own infrastructure to do so.
that said most of the retards trading crypto right now could care less about rational use cases. |
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Date: January 17th, 2018 8:07 PM Author: Trip Plaza Hominid it seems like a lot of the ostensibly legitimate token projects are just aiming to be sustainable blockchain businesses. and yet a proprietary currency doesn't really make sense unless you have absolutely massive scale.
the only way that it could make sense for REQ is if they were to become the next visa. and yet that doesn't really seem like their business model.
or projects like SPHTX which people have been shilling on here - it seems like a sensible project run by well-meaning people, and a good use of blockchain technology. but why do they need a token? its likely potential market isn't big enough to support that. i don't think they're aiming for "dominance" outside of their niche and even then it's too small to support a proprietary currency.
i don't know what the answer would be other than that they're using it as a way to crowdfund/avoid VC costs and to take advantage of market froth. but in doing so they're throwing a wrench in their business model. and if they were to ever rectify it and get rid of the token, do coinholders get left holding the bag? does management try to convert it to equity? what kind of a regulatory mess would that be? |
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Date: January 17th, 2018 8:10 PM Author: passionate messiness dog poop decentralized access to the use? (http://www.autoadmit.com/thread.php?thread_id=3859777&forum_id=7#35179378) |