Question about Ethereum's Capabilites

For starters, let me say that I am a non-technical-unfrozen-caveman-waiter that is in love with the ideas (non-technical, of course) and principles that Ethereum is built on.

My idea is one that I had a long time ago after losing an ass of money when the tech bubble collapsed (I thought I was a gifted trader... I was not). I have made my living by identifying talented people, and would much rather invest in an individual than a corporation.

Would Ethereum be capable of powering a DAPP that would allow me to invest in an individual person with a chance at earning a return? There are several financial mechanisms by which this could be done, but I am not sure how the tech works. For example, I'd have a significant amount of money invested in Vitalik.

Any input is greatly appreciated... Thank you

Comments

  • gaetanocaruanagaetanocaruana Member Posts: 28
    I can understand your first part - but how about ROI? Who will pay the return on your investment?

    So you put $10,000 on Mr X. What is your return?
  • pilasunderlandpilasunderland Member Posts: 7
    The return could be ownership of a portion of funds that flow through the investee's future income on the ethereum platform, perhaps. This is contractually quite easy, no?

  • MicahMicah Member Posts: 8
    You can setup a contract in Ethereum that will execute exactly as programmed. The two hard parts are getting truths into the system and writing a contract that is enforceable.

    For the first, there are things like Auger that are designed to get truths into the system so that contracts can assert on those truths. This is not a generally solved problem and you either need to trust *someone* to enter truths into the system or you need some kind of reputation system for allowing incentive truth reporting en masse.

    If you can get truths into the system, then the second hard problem is writing up a contract that is enforceable. Say you write a contract that gives money to some account and then is programmed to take money out of that same account once every month *after* some event occurs (as reported by the truth reporting mechanism). The problem of course is that the individual you invested in could simply take the money you invested out of the account and never put funds back into the account. So while the contract can enforce taking funds from the account, it can't do that if the account has no funds. So even if you did manage to get a truth into the system (company is now profitable) it relies on the other party putting money into the account that the contract is setup to take funds out of.

    I think realistically the best course of action is to get the government involved, as much as everyone in this sort of community hates the government. Draft up a real-world contract and have it signed/notarized/etc. and in that contract put in some wording about how funds must flow through Ethereum via a specific account (or something similar). The idea here is that the government is used to enforce the human side of the contract and Ethereum is used to enforce the technical side of the contract (money changing hands in a pre-defined way).
  • JabulonJabulon Member Posts: 45
    edited February 2016
    This is a fascinating topic. I think a decentralized solution to the problem of enforceability might emerge from a cross-collaboration between Ethereum and Blackcoin, one of whose developers has already created a contract enforcement software called BlackHalo. It relies on a double-deposit escrow system in which all parties to a contract (e.g., buyer and seller) have deposits at risk, and all deposits are lost in the event any party fails to meet their obligations. The solution is both elegant and crude, depending on how you look at it. But it is a working, decentralized approach to creating binding and 'enforceable' terms in a value exchange. There was an interesting thread on this 3 months ago on the Blackcoin subreddit. For anyone interested, here you go: https://www.reddit.com/r/blackcoin/comments/3qrv40/eth_vs_blackhalo_bithalo/
    Post edited by Jabulon on
  • MicahMicah Member Posts: 8
    G416G said:

    How you would you do that ? What govt would want an interest in eth which is essentially highly disruptive to govt when you think it through. And what govt would that be ? Canada is slow and bent on the queen, the US has corrupted or ruined virtually every thing it could get its hands on. Govt is still trying to figure how to fix the problems of yesterday. I would say avoid that route.

    The government doesn't have anything to do with the Ethereum. You just leverage your countries tort laws to "force" them to obey the real-world contract you drafted with them. Tort law in most countries doesn't require that you only use a particular currency for a contract. For example, in the US today I can draft a contract up with my business partner for a business that only deals in Chinese Yuan. If me and my partner both live in the US and he double crosses me, I can take him to court and force him to abide by the contract.
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