I want to create an asset thats price is based on an index of alt-coins...

  • Hey guys! The asset markets are definitely not what they use to be. Most assets have died off, especially the bigger ones. My goal is to create an asset that tops volumes in the burst asset exchange. Though I still have a lot of planning to do, Here is my idea:

    • Create an asset where each share represents a certain amount of a couple of the biggest alt coins + maybe some smaller speculative ones that people could vote in if they have ideas.

    • This asset would have the main goal of being a super high volume asset. I'm talking 200,000+ burst daily.

    • The main reasons for this asset would be to have a way to escape burst's price easily and have an in built way of converting burst to an index of other currency's without fees or 3rd parties.

    • I would manually do share exchanges for people if they wanted one for the value of there indexed cryptos, and the only fees would be the amount that poloniex takes for trading cryptos, withdraw fee, and transaction fee, thats it! Maybe i would have a small fee for myself (less than .2%), but my goal in this is not to make money through running the asset, but i would definitely trade it for profit!

    I need opinions on all this. Thats why i have posted it here. Please give me ideas if yall have any, and i also need people to say how much they would be interested it because i dont want to create this asset if it only ends up having volumes of less than 2000 burst a day. Thank You!

  • @stupendelious Hey man... I'm not sure if I can grasp your idea completely xP
    A couple of questions:

    1- How exactly would you make money for the asset? Activelly trading on exchanges or just by exchanging shares of the asset for BURST or other crypto in the portfolio?
    2- Would the portfolio change over time, right? I think that, before you launch the asset, you have to explain exactly how you intend to do that change when time comes...

    As for the reasons for this asset, we would still have to trust 3rd parties (you and the exchanger where you have the money xD)... Although, escape of the burst price and the fact that would provably offer more stability to Burst are good things to consider... I would love to hear more about your plan 😉

    Actually you could even eliminate the exchangers for some trades if the other coins were ACCT-ready and you could eliminate your part in the asset with a smart contract of some sort... But I guess that would be a futuristic view of how I can see this asset... hahahha

  • Great idea.

    I see where your going with this and like it. Recently I have been trying to think of a way a derivative asset could get going and just give traders something to trade. Like a 1oz gold derivative asset. However we might as well pump the hot potato asset and trade it if we go derivatives.

    Biggest problem I see is 3rd party. Everyone has to put their faith into you and your universe and hope nothing happens to prevent you from making those conversions when share holders want to cash in. Perhaps a kill switch could be implemented? IDK

    Love the idea and think it would be a great asset if it was 100% legit, backed up and trusted. Also you should charge a fee so you get something in return for your time and work. Look big picture, something like this could be a beast for helping asset trading as the index will fluctuate daily and give us something to buy low and sell high 🙂 but needs to be done right.

  • @gpedro @Dillion Thanks for your opinions!

    I'm just gonna try to respond to everything you two said right here:

    • This asset would not pay dividends ever (unless maybe I needed to end it in which case I would probably pay out one large dividend). Basically each share of my asset would represent a certain amount of other cryptos that I will be holding in a poloniex account. So say, as a basic example, I decide each share should represent .1 litecoin. The asset exchange would trade its prices based on the assumption that each share is .1 litecoin. Now say you wanna trade in a share for your .1 litecoin, then you will send your share to me through burstcoin and then i will go to the poloniex account and get the .1 litecoin and send it to you, or maybe i could also just trade the .1 litecoin to burst then send it to you, either one.

    • The portfolio could change over time. I believe that some sort of voting system would work best for selecting which coins at what amounts to use. The most important thing is that coin changes would be announced at least say a week before they happen, so you could cash out your shares if you don't believe in the value of a future coin that was decided to be add.

    • Yes we do need third parties still haha. I kind of just meant like that the trading of this asset will not need third parties, but the actual value behind the asset you gotta trust me. I've ran 2 assets in the past, one that ended with a value of $11,000 usd, so i think I'm up for the job haha. If you don't trust me then don't trade it. But I feel like I have already proved myself to be trustworthy through time on this forum.

    • I dont know how to do any of the smart contract stuff so I cant really help with technology but that would be amazing!

    • If i have a fee i want it to be small enough that the transfer from shares to what the shares are back by is less that like 2%, But i will take that into consideration 🙂

    Thanks you guys for responding again 🙂

  • @stupendelious ,

    So you're an intermediary for me sending Burst to Pononeix/Bittrex and converting it to LTC? And your fee is only 2%? Sounds like a great idea.

  • @rds I think your being sarcastic? This is an index. It would help trading within the burstcoin asset exchange a lot i think. Trading fees will only be the 1 burst you have to fee in order to make a transaction on the burstcoin network. Any fees will only be on trading the index shares into the coins behind it, and like I said earlier, i want to make fees as low as possible. I don't get why people bring statements like this to markets and financial ideas. Make a logical statement and we can have a useful discussion on if this is a good idea or if its a bad idea. Acting like a know it all is what destroyed this community in February and its why I left it. I was hoping maybe I could help it grow closer to the community it once was with this asset.

  • @stupendelious ,

    I read your pitch and my previous statement was what I got out of it.

    In one or two sentences, what is the value added for someone who buys this asset. There is no dividend, so why would I buy it? One or two sentences.

  • @rds The value is the ability to trade burst vs an index of altcoins (like ethereum, litecoin, dash, etc.) within the burst wallet. This means:

    • no trading fees like poloniex would charge (the cashing in of the index will probably not happen a lot because I expect that it will almost always be better to just sell you shares to others.)

    • no wait times for burst to be credited to your account on poloniex

    • price would always be changing because it is based on outside markets so this would mean assets price would always be changing around unlike other assets where prices almost never change. The buyers and sellers of the asset would know where the price should be, so it will move with that price. The reason to buy this asset is because you think that burst's price will go down and the other alt coins will remain the same or go higher. Then if you are correct, you can receive profit in burst through the price of each share in burst.

  • @rds
    The value added. For example.
    Say the index got 10k STR at 600sats which accounted for 10% of the overall index. Now with STR being at 1100sats 10% of the index grew by 90% which means the liquid value of your shares grew.

    P.S. I think shares traded in should be paid in Burst only. This will create one more transaction fee on polo however if goal is to help Burst it will.
    Also a limit should be set like 100 shares minimum have to be converted. This way you won't have people making you jump through hoops and loops to convert like 5 shares.

  • @dillion Yes great insight! Paying just in Burst should actually, in theory stabilize burst's price! So say we sell the first batch of shares and convert the burst invested into the different coins we want. Now, if our shares go up in the burst value, when people cash in there shares it should provide buy support for burstcoin because the amount of burst sold to create the index will have been less than the amount of burst being bought back to pay out. Vice-Versa is also true!

    I will have some way of managing fees for the share cash in but I know 1 burst fee will be added no matter what to the fee to pay for the withdraw fee from poloniex. I don't know how much I want each share to be, but I like a target of around 10 to 20 burst. I think a minimum cash in of $25 from the index sounds fair, so:

    at burst being $.02, $25/$.02=1250 burst minimum per cash in.

    that equates to 1250 burst/20 burst per share= 62.5 share minimum cash in (Ill probably round that down to 50 shares).

    If you have less than this amount of shares, you can always still just trade them on the asset exchange. If you put your shares at sale below what the value of each share should be according to the coins its backed by, then someone will buy it. Because its basically free money for them :).

    It seems like this idea could actually work very well and help burst out a lot the more I think about it. But first we need to figure out which coins to use at what percentages. So everyone that is interested in this idea or has altcoins they like, please leave a comment here stating which ones they think should be included!

  • @stupendelious

    Yes I think a asset like so would be a great boost for the coin. First it must be done right. Every possible scenario needs to be thought of and prepared for,etc..... It won't be easy.

  • can you explain this like I'm 5? because I don't understand.

  • @hidevin

    Have u ever heard of a S&P 500 index? It's a basket of stocks, 500 companies. Also refered to as a index. I own many index funds. One is the Wisdom Tree small cap growth ETF. It's ran by the wisdom tree company. It invests in a index made up of small cap stocks that are predicted to grow. If the majority of the stocks in the index grows and increase in value so do the shares I hold of the wisdom tree small cap index.

  • @dillion
    To put a little simpler.

    I start my own stock index fund.
    It's a basket of 4 stocks. Walmart. Kroger Costco and Target.
    The shares of my index fund will be valued by the stocks held by the fund. NAV- net asset value of shares of my index fund will be determined by the daily fluctuations of those four stocks held by my index.
    Now when I say NAV of shares of my index I mean shares that were issued of the index. Basically the index is a company. You own shares of the index. The index owns shares of the four companies which is what gives the shares of the index value.
    Hope that helps Devin.
    He's looking do the same thing but instead of a basket of stocks it'll be a basket of cryptos. Youll own shares of the basket. The basket will own a handful of alt coins. As the value of the basket of alt coins fluctuate so will the net asset value of each share which will make opportunities for burst asset traders to speculate on where good entry and sell points are.

  • @dillion ,

    So if I already have a basket of main and alt coins like BTC, ETH, LTC, DASH, XRP, and a couple of tokens, PAY and MCO does this replicate what your asset is trying to do?

  • @rds this isn't my asset.

    To answer your question, no. You cannot easily trade out of your basket of cryptos. With a index asset that would become a possibility. To easily trade out of or back into the basket with one move.

    I think the overall main goal is to put something on the Burst exchange that will create a lot more volume.

  • @dillion ,

    So, for example, if the asset has 3 LTC and 2 ETH and 1 DASH, and the value of that is connected to 1000 total Asset shares issued.

    I own 100 shares of the Asset and I want to liquidate. The asset manager has to go to the Exchange and exchange 10% of each of the 3 coins for BTC.

    Then use the BTC proceeds to buy Burst, then wait the normal 1 hour for the Exchange to send the Burst to the Asset account, then send the Burst minus the 2% fee to me.

    Does that represent how a sell would work?

  • @rds He will have to work that part out in the planning of how he will manage the asset but in essence yes that is correct. I imagine if their are buy orders on the exchange for at least NAV then you'd sell into them. Now lets say their are no buy orders or the buy orders on the exchange are way under NAV then yes you would liquidate through the manager. He will have to work all this out, it will be a bit tricky. Sometimes index funds do trade under their NAV sometimes over.

  • @rds Yes this represents how an exchange would work, except i would not take a 2% fee, that's just too high in my mind. 1% or less would be my fee, and usually you would not have to cash in through me anyways. That's the whole point. You should be able to sell to other people on the asset exchange. This is where the high volumes of an asset like this would be derived. The price of the cryptos of the index would always be moving, so the price on the asset exchange of each asset would always be moving also. Selling to other on the asset exchange would be, other than the 1 burst needed to make a transaction on the burstcoin network, completely fee-less.

  • @stupendelious said in I want to create an asset thats price is based on an index of alt-coins...:

    Yes we do need third parties still haha. I kind of just meant like that the trading of this asset will not need third parties, but the actual value behind the asset you gotta trust me. I've ran 2 assets in the past, one that ended with a value of $11,000 usd, so i think I'm up for the job haha. If you don't trust me then don't trade it. But I feel like I have already proved myself to be trustworthy through time on this forum.

    Sorry for the late reply mate and yeah I trust you for sure... Your first asset was the only asset that I bought and never sold until now, and I hold like 25% of the shares on the market...

    The more I read the more I get interested so I think you have a lot of planning to do, but I very much like the idea and will help if I can... 😉