Quote from: dacoinminster on October 26, 2013, 12:16:30 AM

Quote from: alp on October 26, 2013, 12:09:04 AM

Why would you need to use the copy? The alt-coins would be cheaper to acquire to use for the same effect.

You don't build Mastercoin2, you simply fork Mastercoin1 and there you go. There is no advantage from network effect, everything can be cloned, and you have useless tokens.

Yeah! Just like what happened to bitcoin!

Oh wait . . .

The claim that Mastercoin1 will not become secondary to Mastercoin2, and using bitcoin as an example is really not the best argument. The community revolving Mastercoin1, the first to market exposure, and branding will all play a role in helping Mastercoin1. Unfortunately if bitcoin was premined among satoshi and co, and was hoarded in hopes of speculative riches, litecoin would be the big player today. People underestimate the adoption role distribution methodology serves. This is one of the key reasons Ripple has not received mass adoption by the bitcoin community so far (Not to say Ripple1 and Mastercoin1 won't be successful).

Additionally since the claim here is that Mastercoin is a unit of measurement, there is in fact a huge incentive for competing Mastercoin networks. In the end, the only advantage I see Mastercoin1 having is a speculative advantage which will probably pop along with the first big market crash. Associating a separate value to Mastercoins is a self-hindering feature which is really only there to serve an ROI pathway for the original investors (something which I recognize was needed for the crowdfunding to succeed, capitalizing purely on people's dreams and hopes of getting rich...not their altruistic motives). Yes I understand the claims of why mastercoins "NEED" a value, but it sounds to me more like circular logic and a crippled solution.

Quote from: Luckybit on October 26, 2013, 02:32:50 AM

Colored Coin is a technology but it's design in my opinion is ugly and unnecessarily complicated. Maybe it will work but I don't see how it can work without the value going somewhere. If someone is issuing credit or currencies then it's got to be backed by something somewhere and represented somewhere. If it's backed by Mastercoins then you'd say it's represented by Mastercoins which act as the unit of measurement. If I wanted to issue a currency or credits through Colored Coin then perhaps it's possible but I don't know what their specification is or how they intend to do it. I'll believe it when I see a prototype.

Colored coin technology is actually superior to Mastercoins in terms of being "backed". You can color whatever amount of bitcoins you would like as a single unit, directly. So for example 15 btc = 1 goldcoin; that goldcoin is in fact 15 bitcoins forever.

Oh the other hand, Mastercoin proposes a controversial feature of escrow backed currencies which my economic sense tells me cannot work. The issuance is not being measured on the value of Mastercoins; in reality it is being measured by the MSC to BTC relationship since BTC is where the trust and redeemability exists today. So if for example you issues gold through mastercoin, potential for loss of trust and catastrophic collapse can occur on 2 levels, both if BTC losses value AND if MSC losses value.

Regardless the only way to truly back an asset in the REAL WORLD is to have that asset on hand, or hedge the position elsewhere (otherwise it's a bucket shop). No magic voodoo self fulfilling prophecy escrow account can change that, and if it could you'll see JR receiving a nobel prize.

So while colored coins is backed directly by bitcoin, Mastercoin issued coins are at much higher risk of speculative attack. That's not to say Mastercoins don't have their own advantages, but when it comes to representing value or a unit of measurement, MSC falls short.

Yes I do help run buymastercoin.com, yes I am realistic about the technology, NO I'm not hyping magic fairy tales of pots of gold at the end of the rainbow. Caveat emptor.