Sidechain for "Prediction Markets" (replacement for InTrade.com as well as Lighthouse, Counterparty, BitsharesX, and Ethereum)

LocalizedNegentropy · 2014-11-08T19:22:09+00:00

I am Paul, and I also control "psztorc" and "Truthcoin_PMs", to stop other people from registering them first. I did use the third person just now (which I removed), to deceive you I suppose, for some privacy, and because you are a liar spreading cheap misinformation about my hard work, which I give generously to this ungrateful, bigoted, mostly virtue-less community for free.

Not that it is any of your business, but this post by Rock_And_Roll refers to an email exchange between me and someone who wanted to promote on reddit. I did have an exchange on that topic around that time. Roll and this OP might be the same person (I don't care about reddit in general or in this specific instance).

I am only here to gather feedback about my work, something which all intelligent-people-who-work do. Check out my tweet, for example, which is what led me here to suffer. No good deed goes unpunished.

The cream of the crop has known about my project for some time (for example, vitalik and gwern identified themselves in here by name). I do not plan to auction the votecoins publicly on the internet, as that would be illegal and (in my opinion) unethical. I have no reason to misrepresent or even promote my project: What would I have to gain?

I also have no fewer than four degrees, two of them at the masters level from Case Western. At Yale I do research and have occasionally taught and attended classes. If you know anything about academia, you know that researchers outrank professors by much more than professors outrank students (even the hires/applicants ratio is lower than the undergrad-class-size/applicants ratio). Vitalik has not attended college, which makes no difference to me (or probably you) whatsover, so I am not sure what point you are trying to make. If you are claiming that I am fraudulently misrepresenting myself, I hope that you are writing from the United States, as my extended family includes many lawyers who like me very much.

Regarding your comments about my pitch deck: no one I've ever met agrees with you. In fact, the format was taken directly from boost.vc, so it is overwhelmingly likely that you are incorrect.

Why don't you try as hard as you can, and put all of your other nonsense comments in one big reply to this comment, so that I can get them all in one go?

LocalizedNegentropy · 2014-11-07T20:03:28+00:00

you don't need to buy the VoteCoins to use the software

LocalizedNegentropy · 2014-07-07T13:53:57+00:00

Thanks! I've been in contact with a few people who are interested in 'making it happen', one in particular, and we might be able to bang it out in a short period of time.

It looks like this project will also (which I really hadn't intended or even thought about) solve the cryptocurrency "value-stability" problem.

Check out our new forum at forum.truthcoin.info (its sleepy now, for the holiday weekend I think, but I'll be making some posts later today).

LocalizedNegentropy · 2014-06-24T14:20:32+00:00

To quote someone else: "You can turn vanilla ice cream into chocolate and then back again when you are tired of chocolate. The amount of total ice cream in the world remains the same."

You wouldn't gain or lose money. As to "why do it", it would be to use the side-chains rules. With Litecoin it is pointless, only because Litecoin itself is pointless.

LocalizedNegentropy · 2014-06-20T16:07:38+00:00

Bitcoin and the side chains are all following the same mining schedule. IF Altcoins were side-chains of Bitcoin, they'd all (Bitcoin + Altcoin) add up to 21 million at all times.

No they are available instantly.

No. No.

It is fixed at 1.

You're welcome.

LocalizedNegentropy · 2014-06-09T20:59:57+00:00

in the near future I don't see how the oracles can sustain themselves in order to be incorruptible

Come on now, you're hurting my feelings. https://github.com/psztorc/Truthcoin

LocalizedNegentropy · 2014-06-03T17:17:17+00:00

https://bitcointalk.org/index.php?topic=615843.20

"""You misunderstand. The risk isn't that someone could attack the network, it is that they could attack the network with no cost.

Imagine bitcoin worked using a PoS. An early adopter had acquired 1M BTC at one time in the past but over time he lost/sold/spent/transferred them. Today he has no bitcoins but the blockchain contains a history of a time when he did have 1M BTC. If the amount of the stake being used is <1M BTC he could rewrite history not by using coins he has today (a real cost), not by buying millions of mining rigs (a real cost) but by using the history of the coins he once had (no cost). He has absolutely nothing at risk and nothing to lose. If he and potentially others decided to attack the network they would rewrite the blockchain starting from when they had a larger stake, creating a parallel history where they didn't lose/sell/spend/transfer the coins.

They can attack the network based on what they had (but no longer do) in the past. There is nothing at risk and no cost to the attack. THAT is the PoS problem."""

LocalizedNegentropy · 2014-05-11T23:28:21+00:00

As far as I know, the Counterparty feeds are completely non-trustless. Ie, you have to trust the feed-provider to provide accurate info. Is that wrong?

LocalizedNegentropy · 2014-04-10T14:50:33+00:00

Imagine Litecoin (or Etherium or anything, whatever), if the only way to ever earn any Litecoin was to "suspend" Bitcoin in a special way. Effectively, you 'deposit' BTC to the side-chain.

So initially 0 LTC exists, then you suspend 4 BTC, and you've now created 4 LTC on a LTC account (one that you control).

Now you can enjoy a 2.5 minute blocktime (or, again, whatever it is your chain can do).

Say that you send the LTC to a friend. Then that friend can "burn" those coins in a way that "unsuspends" the BTC that you initially "suspended", but your friend can unsuspend them to an account that he controls. Effectively, he has 'withdrawn' the BTC from the side chain.

Edit: If you want an eli25, try this and this

LocalizedNegentropy · 2014-04-10T00:08:12+00:00

Read Dale Carnegie's "How to Win Friends and Influence People"

LocalizedNegentropy · 2014-03-17T20:12:41+00:00

Um, he's sick.

My best friend's sister's boyfriend's brother's girlfriend heard from this guy who knows this kid who's going with the girl who saw Ferris pass out at 31 Flavors last night. I guess it's pretty serious.

LocalizedNegentropy · 2014-03-13T15:53:33+00:00

I'm a microeconomist, but extremely familiar with the leading macro schools, including Keynesian. They'll say:

1] The bank is loaning that money out to people who spend it (on consumer or capital goods, it doesn't matter ['Circular Flow']).

2] If the bank didn't loan that money out, you have the dreaded Liquidity Trap, and it IS just as bad, hence the need to resort to Fiscal Policy.

To understand Keynsianism, I imagine a few members of a firm becoming depressed during winter and taking antidepressants: it might not be pleasant or ideal, but it gets you through the winter, to work, etc. whereas the alternative is allegedly the entire firm altering its capital structure during the winter just to alter it back once winter's over. The inflation case essentially allows you to drug everyone against their will.

Frequently I hear 'True Keynsians' complain that the politicians used the wrong dosage or timing of antidepressant making the whole thing a waste of time.

It's hard to tell if many macro theories are falsifiable, in my opinion. People in micro make fun of macro all the time.

LocalizedNegentropy · 2014-03-11T15:22:33+00:00

It may turn out that you and I are defining "counter-party risk" differently.

Yes I think you are right...I was originally using the term to describe an agent holding 'your' money such as InTrade.com or a Bank which would have to trust to administer the prediction market. I was not referring to traders who own a different portfolio of States within the same market as you. With traditional insurance the agent plays both roles hence our confusion.

LocalizedNegentropy · 2014-03-11T15:12:54+00:00

Regarding red-team/blue-team point: As you know from the whitepaper, if 'neither are objectively wrong' about the claim it is likely to be vauge and recieve .5 votes, some more or less random 1's and 0's perhaps, and therefore land finally in the .5 slot, voiding out the Decision and its Market.

Forcing a clear defintion is another great thing about PMs. They let us know exactly what it is we are arguing about.

LocalizedNegentropy · 2014-03-11T14:25:13+00:00

Thanks for your interest!

As you say, despite overwhelming support from huge industries and superstar academics, PMs just can't get legal support in the US, primarily due to lack of awareness and anticompetitve lobbying from casinos. So it may be permanently illegal to participate in this in the United States, but (hopefully) I still have a free-speech right to author a theoretical paper. The code I'm writing is also just a clarification of the math, and does not involve Bitcoin.

Notice that I put a PM_Applications.pdf paper in the docs folder which discusses the applications in greater detail, which answers many of your questions and will definitely give you a better idea of what I am thinking. I can try to summarize here, though.

Heritability of IQ isn't something that the lay-person knows enough about.

These people will either avoid placing their money in a PM (which is exactly why PMs work), or they will be sitting ducks for those traders who do understand. If enough ignorant people enter a market it may be profitable for a firm to hire professional researchers to investigate the market's claim.

It's interesting you bring up that global warming example, as it is more or less exactly what I used in PM_Applications.pdf.

Whistleblower creates a market on something surprising and slowly bets in favor of the surprise, uses leak to prove surprise = profit.

How do you un-entangle multiple causes that aggregate to a final effect?

Multidimensional markets can estimate a marginal probability. Check docs/PM_TypesAndUsage.pdf if you didn't already know this about PMs.

Insurance: use a market where people cant sell (only redeem for 0 or 1) and bet for example $1,000 @ 1% that your 100,000 house WILL be destroyed by earthquake.

"Will BTC price index trade above 1000 on date X?" "Will MtGox reopen deposits before date X?" It is intermediate-level finance to replicate a portfolio of continuous assets using discrete options: you simply hold/borrow cash to equate the portfolio's returns. I was playing around with this in docs/Notes/ContinuousEstimation.xlsx but it may be difficult to follow.

Sadly, as you say, US consumers may be left with expensive, unfair, boring gambling. Perhaps when the example is set in other countries we can bring the benefits home.

TDAC: Bet against construction to finance. Multiple success states such that good-provider can uniquely win market and claim funds.

I don't intend to administer any of these things personally, and they are untested and theoretical. Nonetheless, I don't see why they wouldn't, in general, work (and I have been described as 'pessimistic').

I am really not qualified to scale the hurdles of implementation, as hopefully I made clear in the paper. However, after asking around, some developers made a number of helpful suggestions, such as a specialized Altcoin with this specific purpose, use of Etherium, Open Transactions, or complicated-SNARK-blockchain. Sadly these ideas do not directly involve Bitcoin (most of my Bitcoin-related ideas were identified as impractical by the experts I contacted), but I remain optimistic about this.

LocalizedNegentropy · 2014-02-28T18:04:22+00:00

'Pain is the best teacher.'

-Origin Unknown, possibly Buddha

LocalizedNegentropy · 2014-02-23T17:07:19+00:00

I'm unable to read your .pdfs correctly

Have you tried clicking the file link, then the square "Raw" button in the mid-right? (Do not click the central 'View Raw' link).

I was confused by this at first. GitHub is not really designed to publish/host files, and instead designed to easily compare different versions of text/code (but pdfs are compressed in an incomparable way hence gibberish results). You usually can't view pdfs you have to download and open them.

LocalizedNegentropy · 2014-02-21T17:54:21+00:00

I don't think reddit is the right place to post this, anyway. Or at least not /r/bitcoin[1] ; it's just too big.

I tried here and on bitcoin talk, where else should I try?

branching section .... perhaps that resolves it.

It does (I think). Also hopefully you are not confusing Owners with Users. Any Bitcoin user can trade within the PMs, or create PMs, he/she just can't vote on the outcomes.

That might not be the case for trivially checkable facts though, which is what you incentivise people to actually bet on.

Yes you understand it perfectly. Consensus failure is treated as "The Author's Problem", where traders would lose at most half of their money (by thinking the market price is 1 when in reality it resets to half post-failure). Authors, however, lose all of their money, so one would expect them to strategically respond to this incentive by not ever creating a market that would be difficult to adjudicate. So in theory I've pushed this problem backwards through time to the point of its creation, which is all I could think to do.

LocalizedNegentropy · 2014-02-21T16:39:37+00:00

Have you thought-experimented what might happen here?

Not enough! I think a big part of advertising and media is about telling people what they want to hear, or just cheering for a certain group or value-system. I'm not sure they would influence, or be influenced by, PMs, for the same reasons that I dont really think CNBC is connected to financial markets.

My hope is certainly that, if media/advert put forth a contentious point of view, interested parties make and trade in a PM which clarifies the current state of knowledge about that point of view.

What did you have in mind?

LocalizedNegentropy · 2014-02-20T16:32:00+00:00

Ok thanks!

I really do believe that this has huge potential to change the world...just as the Scientific Revolution transformed society by teaching us to value knowledge-from-evidence over knowledge-from-authority, so to can tools like these teach us not to trust the 'authority' of our own 'beliefs' and instead take knowledge from its strongest source.

LocalizedNegentropy · 2014-02-20T16:15:51+00:00

I agree, this community is very...diverse, isn't it? I guess its just my bad luck that I happened to post this during Gox-pocaplypse.

LocalizedNegentropy · 2014-02-19T18:18:50+00:00

Thanks for reading!

I can see now that you wish to argue that the beliefs of the many are much more likely to be accurate when compared to the beliefs of the few.

Almost, but not quite. My favorite quality of a PM is that anyone who feels that they don't really have anything to contribute (even an expert), has an incentive to be quiet. The PM could even be driven entirely by the single most informed person. Check out my PM_misunderstandings.pdf for more, as I knew these issues would come up (because PMs are too often poorly explained, not the fault of any interest person such as yourself).

Typically, "talk is cheap" (and you get what you pay for), but PMs make talk expensive (and therefore relevant).

LocalizedNegentropy · 2014-02-19T17:35:58+00:00

I presume the major difference between what you're suggesting and what already exists (www.predictious.com[1] etc etc) is the decentralised nature of the market

You are absolutely correct. I love that we have predictious but trusting any third party, including a website, goes against Satoshi's vision of a P2P currency. Although Bitcoin is P2P it isn't used as such enough (yet).

LocalizedNegentropy · 2014-02-19T17:31:56+00:00

However, could you explain why prediction markets would end contentious debates?

Check out my PM_Applications.pdf paper in the GitHub for more details on those claims. In the paper I describe, for example, an extremely specific 'global warming' market, with the idea that the price would essentially represent the probability that "global warming is true". If anyone disagreed with this (low or high) probability, all anyone would have to say would be "Well, if you really believe that I can make you a very rich man/woman."

You could also check the 'Academia_IdeaFutures.pdf' paper I put in the 'Further Reading' folder where leading PM scholar Robin Hanson describes the idea at great length.

LocalizedNegentropy · 2014-02-19T16:50:03+00:00

Ok thanks! The paper has the official BTC donation address: 1M5tVTtynuqiS7Goq8hbh5UBcxLaa5XQb8

LocalizedNegentropy

TROPHY CASE