Day 2-7: Polvos sells his 5000 BKC in small increments for BTC. At the end of the 7th day he has 20.000 BTC. He announces that he will send a dividend to anyone who was holding BlockShares at the end of Day 7.
Here, I suppose Polvos can sell the BKC in any exchange that accepts BKC.
After selling, he or she would have to transfer the BTC proceeds to his or her wallet (B&C client) and then distribute the dividends.
So the only ways to lose the BTCs are the followings:
- the exchange is hacked (in case the exchange is B&C, the likelihood of being stolen is very low since that would imply collusion between several trusted signers)
- his or her client is hacked.
I am correct?
Your assessment is correct, yes. We would also add that Polvos would only sell his BKC on an approved exchange(s) as outlined in the terms of his custodial agreement with shareholders, and so not necessarily just any exchange that supports BKC.