Quote from: Pansyfaust on March 04, 2016, 04:02:36 PM

Indeed, if the exchange goes on the blink, then I've lost it all. But then again in this way it's similar to hosted pooled MN services--counterparty risk. If they decide to take my dash and run, I can do shit all about it (unless there is some sort of governance model that is being used with multi-sig protection). Me trusting the exchange to not go under is similar to trusting the hosted Pooled MN service.

@Tok: Isn't holding and lending BTC an asset class in itself? With a dash MN you are essentially doing the same thing--loaning out your Dash to provide MN for the network, as well as enable InstantX.

Yes, but there comes a point where such a market gets 'mature' enough for the loan to actually turn into an asset.

For example take government treasuries. That's basically a loan but you get a certificate in exchange for your money which is known as 'bond' (Treasury, not James). Over time those bonds became an asset in their own right and had a price which was independent of the loan amount. So bonds have returns and they can also be traded.

Cryptocurrencies will form a basis for such secondary markets in the future - it's just a question of time. But any source that is able to pay a return on such a 'loan' is fertile ground for it to start off from.

So if we follow the same model, Splawk would sell bonds in masternode collateral in exchange for Bitcoin, Dash or $USD. No crypto would have to change hands (in terms of moving stuff around the blockchain). The bonds would simply form a secondary market, have a fixed return which was denominated in Dash and trade on the open market at a price set by that market. The masternode collateral bond holders could rely on that fixed return and in turn would assume the exchange rate risk against any other currency (just as they do with dollar denominated, Swiss Franc denominated, Sterling denominated or Euro denominated treasuries).

Obviously there is counterparty risk. But there is in everything except base collateralising assets and a very small portion of the world holds those. So you've got to look at the broader market as mainly this type of "bond" market - not people with cryptocurrency wallets. 99% of the world's population are not interested in that and it's those 99% that we've got to be interested in, not the 1% crypto-geek market.

P.S. Another complimentary line of business which naturally springs to mind in this type of industry is an insurer to assume the default risk (counteraprty risk as you call it). Thats where the free market policing function would emerge from, making sure that vendors had mega security, were trustworthy etc. So to complete the picture, you'd buy your masternode collateral bond from Splawk and hedge it with a default swap from supplier X in who's interest it is to impose the most strictest of security standards on all their covered assets.