I propose a fund, with the purpose of making sure that there is always some money left to pay for peer4commit projects. This is realized by hedging PPC against BTC, i.e. if PPC collapses in value against BTC, the fund will be able to buy cheap PPC.
To avoid confusion the rules would be simple, starting with:
Of fund net worth, 20% of the fund would be allocated in BTC.
This means that if PPCBTC goes up a great deal, PPC would be sold to buy BTC to keep the ratio at 20%. If PPCBTC goes down a great deal, BTC would be sold to buy PPC.
The Bitcoin and Peercoin wallet would have to be a multi-sig thing, so that several people have to agree on sending coins to an exchange. Only small amounts at the time would be sent. No coins should ever be left on the exchange, after exchange is completed.
Allocation rules could be more complex, to improve on things, but I think this is enough to start off with for a discussion about it.
Because of NuBits, this will of course be totally pointless. But anyway… EDIT: we still don’t know what NuBits is, so I retract this statement.
edit: do you know if there is some script that does the same as what gribble does for bitcoin (on #bitcoin)
;;market sell 100
gribble: Bitstamp | A market order to sell 100 bitcoins right now would net 59358.5544 USD and would take the last price down to 592.4600 USD, resulting in an average price of 593.5855 USD/BTC. | Data vintage: 0.0296 seconds
My first reaction is that this may not be the best idea. Risks:
[ul][li]The fund is exposed to risk of the exchange seizing up, Mt Gox style[/li]
[li]The fund is exposed to risk of human error (transfer of funds to wrong address, buy/sell the wrong amount)[/li]
[li]The fund is exposed to risk of embezzlement[/li]
[li]The fund requires active management, which is a burden on its operator(s)[/li]
[li]The fund is hedged against BTC, which is also volatile
[/li][li]The fund is only partially hedged (20%), so this doesn’t completely solve the problem[/li][/ul]
I agree that volatility of PPC value is an issue for Peer4Commit funds, but I think we need a better solution than periodic manual trading on a centralized exchange by humans.
Best solution in my mind is to fund the same projects that are on peer4commit with btc by donating to tip4commit, just need the btc to fund the projects, this is great publicity for the peercoin projects to.
Note that tip4commit and peer4commit are now very different. You can’t send free amounts in tip4commit for example, and you can only send BTC to commit authors.
About this thread: another option is to enable bitcoin projects in peer4commit. It’s some work I don’t have time to do for now, but it’s feasible (and planned).