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Re: No Price Discovery for LTBCoin is a Problem, But There is a Solution

@adam

Sounds like you guys are making the right moves. Looking forward to the changes. Thanks.

Re: No Price Discovery for LTBCoin is a Problem, But There is a Solution

@drewmik Kinda. I avoided addressing "improvement" since it's subjective. Looking at it from LTB's perspective, what constitutes an improvement to the coin depends on what other objectives they have in mind. Making it a coupon makes it a better coupon obviously, but the value promised would have serious implications for those promising that value. They need to be pretty careful given the committed distribution and because of this I'd probably advise leaving it as a failing currency.

Also, though we agree on the likely outcome, if you think of LTBCoin as an appcoin, it is a bit unique in the sense that it is not primarily a gambling instrument like most coins, and the "app"—LTB advertising/content—cannot be forked (I assume everything is copyrighted and not free to distribute). So I might consider LTBCoin most valuable as an experiment or example. Let's watch what happens with a coin of no promised value, even within an application and ecosystem that can't be cloned.

If I were to instead advise changes, I would simply suggest that within the LTB network Bitcoin replace LTBCoin everywhere possible. I don't know exactly how things are currently set up here, but it would be pretty ironic if one of the few things within the Bitcoin community that you could not buy with Bitcoin is an ad on LTB.

Making the change I mentioned in the OP or switching to bitcoin seem like the only options to me. I suppose we could wait until it fails, but it'd be better to just make the change now. If you need an example of a failed appcoin experiment, just look at the price of mastercoin over the course of 2014.

@hesham3del May I ask you to PM @adam and take his e-mail and send him the url of this topic and continue talking with him about it.

I find what you are talking about is making sense actually.

Off-topic : May I encourage you to write start writing articles as I enjoyed reading your thread ?

@Cryptonaut, what do you think about this as an older member than me and a main member in the LTBn team ?

I'll go ahead and email this topic to Adam now. I've actually written one piece for LTB in the past, and I've been meaning to start writing here on a regular basis for the past few weeks. CryptoCoinsNews, InsideBitcoins, and a few other obligations have kept me busy for now. You can follow me at @kyletorpey on Twitter if you'd like to follow my work.

Re: No Price Discovery for LTBCoin is a Problem, But There is a Solution

Judging from that post, it seems that you agree with my proposition. LTBCoin is a currency without the ability to act as a coupon, and there's no way it can compete with bitcoin. I think my view on it right now is to call it a token that wants to be a currency but will fail. It needs to be a coupon instead.

Re: No Price Discovery for LTBCoin is a Problem, But There is a Solution

If you're going to keep the LTBDISPLAY tokens in the mix, then the price would need to be fixed at something like 50,000 LTBCoins per LTBDISPLAY tokens. Without that pegged price, there's no reason for LTBCoins to grow in value as the network becomes more popular. The auctions mean the price of LTBDISPLAY tokens can change as the LTBCoin/BTC market changes. In other words, the price could crash to 1 satoshi tomorrow and it would cost much more LTBCoins to get a LTBDISPLAY token. There's no price bottom to the price because no one knows how many LTBCoins it takes to pay for an ad.

This is what the #Appcoin debate was all about. David Johnston was trying to make the gift card or coupon analogy, but the reality is that it doesn't apply when the appcoin is trying to be a currency. Without a set price for a certain good or service, LTBCoin is just a currency. People will prefer to hold bitcoins, which means LTBCoins should eventually go to nearly zero. They have no value because there's no reason to hold them. The fix I proposed allows speculators to have an idea of how many USD or BTC each LTBcoin should be worth based on the value of ad spots on the LTB network.

Re: No Price Discovery for LTBCoin is a Problem, But There is a Solution

That's not fixing the price in terms of LTBcoin though, which is the key. The free market is still allowed to do its job in the example I gave. The bidding process is simply moved to the exchanges where other currencies are used to bid up the price of LTBcoin. LTBcoins should be viewed as a commodity or asset rather than a currency. When you collect 50,000 LTBcoins, you can turn them into an advertisement.

The problem right now is speculators have no way to price LTBcoins, which means they have no reason to hold them. They have no idea what the price of a LTBcoin should be because they have no reference point.

No Price Discovery for LTBCoin is a Problem, But There is a Solution

First off, I'm not really a fan of altcoins or appcoins, but a network coin is one of the few exceptions when it comes to these kinds of alternative cryptocurrencies. LTBCoin is a special kind of appcoin that I think could actually work if implemented in the correct manner. The main issue that I see with it right now is that there is no mechanism for price discovery. I view these network coins basically as crypto-assets. They can rise in value as the network grows, but the coin can only grow in value if people know what it can be used for. In the case of LTBCoin, there is no way to find the right price because there isn't something that can always be traded for X amount of LTBcoins.

The solution here is to fix costs of different ad spots on the LTB Network in terms of LTBcoins. For example, it could cost 50,000 LTBcoins to get the top banner ad on the letstalkbicoin.com website. Perhaps it would be 100,000 LTBcoins for ads on episodes of the actual podcast. Letstalkbitcoin should set as many prices as possible in this manner to make price discovery much easier for the market. Right now there are people bidding on LTBcoins with bitcoins and then bidding on ad space in the auction house with those LTBcoins. This confuses the market as it isn't clear what you'll be able to do with LTBcoins.

In addition to setting a clearer picture of the value of LTBcoins, this also has the effect of increasing the value of LTBcoins as the network becomes more popular and gains more views. For example, someone may think the top banner ad on the homepage is worth $50 for one week. This means they'd be willing to purchase 50,000 LTBcoins for $50. If the network doubles and size and starts receiving twice as many views/listens/etc., then that same person may value 50,000 LTBcoins at $100. This means that the value of LTBcoins has also doubled in the eyes of the individual (and the market in general. everyone will have their own prices, but the general trend would be the value of LTBcoins increasing as those ad spots had more eyes/ears on them because people would bid up the price of LTBcoins on the exchanges).

I think LTBCoin would be greatly improved by making this adjustment. It would help the market figure out how much they should bid for LTBcoins. Please let me know if you think this is a good or bad idea.

Edit: I was thinking of this concept in the context of another project I'm working on, but it should still be possible without the need for a complete premine and burning coins. Simply burn all advertisement payments and send newly created coins to those who deserve them each week.