Incorporation of the Bank of Tantalus and New Britannian Stock Exchange

Discussion in 'General Discussion' started by Jatvardur, Jun 26, 2015.

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  1. Jatvardur

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  2. Jatvardur

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    That's a pretty good suggestion and could be useful.


    Not so convinced we need to worry about the colour coding since the book content is private. Using the trick above to bump content on to the next page could be useful though.

    The flourish was not really necessary, but it just looked better imo.

    All good stuff. A bit beyond my expertise, but if someone else knows how to make this work that would be great.


    Fair enough, didn't know that. Naively, I don't think we have to be so worried. Crypto is rather heavy weight a bit like taking the proverbial hammer to a jar of nuts in order to open it. Sure it gets the job done without any doubts, but perhaps a bit much. Given that we have public records which can be checked and calculated across each bank then we can probably get away with just a simple (non-crypto) check sum (or two).

    If we do go this route.... I presume the IV is replaced with hashes at the later iterations as I suggested (or would you do a different order?).
     
  3. David J Thompson

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  4. Jatvardur

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    This has been a long time in the making. Since Blake and I did the first stock transaction in Owl's Head we've been talking more behind the scenes. @aevans and I also did a bunch of trades the same day as Blake and I did, so we could say that the book shop in Owl's Head was the first ever stock exchange. Over the next week I will be decorating the keep in Vanguard to look more like a stock exchange. Guests can obviously arrive by airship and park outside. ;)

    In anticipation of running the getting the stock exchange properly up and running I booked a domain (not active yet):



    More details to come. :)
     
  5. GimmeUOPlz

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    I don't get it...

    So, someone would essentially purchase a book that says that they somehow own "shares" in something that another person or players are doing in a video game? What exactly would be the point of owning such a thing besides purely rp purposes? Surely youre not suggesting that they would actually have any real worth at all? What could someone possibly gain from owning such a thing?

    And furthermore, wouldn't any kind of accountability for any such system be just as imaginary as the goods?... If this is just for rp laughs then sorry I guess I'm just misunderstanding, but otherwise this all seems extremely suspicious. I doubt anyone would buy into it as a real stock exchange tho so the accountability probably doesn't matter.
     
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  6. Bubonic

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    I'm pretty sure this is 100% RP. However, im also sure there are plenty of players who will spend their in game gold for RP purposes.

    As far as accountability, like any RP system I would also assume there will be unsavory characters who will try and cheat the system.

    Just like Wall Street.
     
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  7. Jatvardur

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    Thanks for the reply. I am taking this as a genuine request for more explanation, I do understand the misgivings surrounding such an idea but I'm glad you had the courtesy to post this in a respectful manner. It is pleasantly refreshing after recent 'battles' with someone who never admits error. I will try my best to respond as respectfully. I don't expect to convert you, or anyone else reading your thread on Shroud Unlimited, but hopefully I can clear up some misunderstandings. I was surprised that Shroud Unlimited was not as hostile to the idea as I was expecting, while I don't expect them to like this idea I will give them my respect (even Caliya, I always thought she was a likeable person ;-) ).

    I've previously suggested that books can be used for loans and for stocks. There two ideas are really mutually exclusive.


    RP
    • Yes, that is part of it. However, RP is not the only aspect. I wouldn't force anyone to RP just as no one is forced to participate in this idea.
    • As these entities have no supporting in-game mechanic then the companies do not have a strict existence within the game. They only exist 'on paper'. This lends itself favourably to RP.

    Non- RP / Mechanics
    • Since there is no supporting mechanic then the idea is either purely RP or it requires a comprehensive mechanic created within the 'meta-game'.
    • What I mean by that is that I've been interested in creating a mechanic to facilitate the existence of a functioning stock market. This will take the idea beyond simple RP into something that can be considered a game (or meta-game, if you like). The idea is not to kill RP, or relegate it, but to enhance it.
    • I've been developing this idea before there were POTs, and so long before Tantalus existed. Actually been brewing the idea since I first heard about the game (i.e. Kickstarter).
    • This is not the first attempt as creating a stock market in a computer game, so not claiming that, but this is the first attempt to implement a functioning mechanic within SotA.
    • I believe the mechanics I've been developing are comprehensive but need testing.

    In-game companies
    • A company is a collection of people. As there is no formal in-game mechanics then this group can be from any guild (or un-guilded).
    • You need to use your imagination that a company exists (RP).
    • To become part of this meta-game I'm requiring that players 'incorporate' (i.e. create) their company by providing the names of the players involved and their respective ownership percentages. I would then 'publish' an in-game book that holds these details. This information would be publicly accessible both in-game and online (e.g on the website I'm building).
    • What does a company do? Well, that's completely up to the players that created it. They could do nothing, that's an option. They could conduct mining operations and try to make a profit. Companies which are better organized will be more productive (not necessarily more profitable, of course).
    • How is a company valued? Well, there isn't a short / simple answer to that. As with valuing any real company: people disagree. The fact that people do disagree leads to changing values, and hence fluctuating stock prices. This isn't actually a problem but a natural phenomenon of any market. Allowing for a market to function runs contra to price-fixing (which I'm against and have criticised price fixing in other threads). As such I'm going to leave that topic for another day, but I'd say that it will be related to the money taken in and then paid out. This is where players can gain: money paid out to investors.

    Regulation / Accountability
    • It's tricky. Can't deny that. Bubonic made a good point that unsavoury types will be attracted. That's part of the risk.
    • However, just because it is tricky doesn't mean I'm going to give up. Something that really grinds my gears is when I'm told something is too difficult to implement and the opposer has no interest in having a civil discussion... or admitting they are wrong. (that's not aimed at either of you :) ).
    • I'm still brewing my ideas here, so I can't offer any silver bullets. There will always be risk even if I find a system which is completely satisfactory. Some element of risk is necessary in this idea, by definition.
    • Part of the mechanic to provide accountability will be to link people's names to the companies they run and / or own. I mean in-game name / forum name. People with thousands of posts, or with hundreds / thousands of dollars invested are less likely to run the risk to ruining their reputation. As stated previously, details of ownership will be posted in-game and on the website so it is possible for transactions and ownership to be traced. If someone behaves badly then people will know about it.
    • An important distinction should be made between loans and stocks:
    • Loans: the monetary risk is on the side of the lender. The reputational risk is on the side of the borrower.
      • An example: if I don't know you then I won't lend you a million gold.
      • If I do know you / like you, but don't know you that well, then I'd at least consider lending you 1000 gold or maybe even 10,000 gold. I fully understand that someone may not pay me back, but I'm not going to lend to them the second time. This is where one commenter on Shroud Unlimited may have missed the point.
      • Guarantee of getting your money back? None. Is it still worth it? That's up to the lender. I'd happily trust Winfield, Blake or Kazyn. I don't see those guys reneging on a debt, unless it is accidental. So you can see that the level of trust is different from person to person.
    • Stock: the monetary risk is shared across the investors (who are also owners). The amount of investment made reflects the amount of risk taken, so this value is rarely going to be equal for all players. If would-be investors don't trust the company then they won't invest.


    Real money
    • No, never. I can't be any clearer on that.
    • While it is possible to sell in-game gold for real money, that is not something I can condone here. There are serious legal implications if anyone tries to do that.
    • Therefore I have to re-state that in no uncertain terms can I condone or allow a player to sell shares for real money. I can't be in all places at all times, but if I hear of it then I'd have to remove that person from this aspect of SotA.


    Feel free to ask questions.
     
  8. David J Thompson

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    I want to get some stock today.
     
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  9. CaptainJackSparrow

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    Captain Jack's compass suddenly points towards the bank of tantalus...
    [​IMG]
     
  10. GimmeUOPlz

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    It is an interesting idea. I think to work completely it would have to have some kind of in game mechanic to facilitate it somehow. Maybe the mechanic could keep some of the companies worth tied up somehow so that if the group quits what they are doing or quits the game entirely there would be some sort of lesser compensation for people that invested.

    That's the main concern as I see it, people walking away from the company but still getting to keep the money they got from people. IRL there are legal ways to go after such people, but in a video game there wouldn't be.

    Another concern of mine would be people exploiting this type of system and creating a sort of Ponzi scheme within the game, or maybe not even that maybe just screwing over specific players that they have falling outs with.

    I'm not sure it can be done safely without some kind of mechanic down the road. For rp sounds like it'd be an interesting thing for people who enjoy that sort of thing, but it could draw the scammer crowd which could end up giving the whole project a bad name whether it'd be justified or not. I have infact seen "prominent" and respected people in past games suddenly flip and screw over an entire guild. In UO i actually knew people like this and saw them running slow play scams against large groups of people for large profit. This unfortunately kind of opens the door for that but even x1000 if it's the entire community. Not at all saying that anyone connected to it at this point would try something like this, but it's not out of the question.
     
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  11. Greyfox

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    EVE Online had player ran banks and investments. They never ended well for anyone except the owners. Google all the ISK lost by investors.

    I do wonder how long before the IRS and other government tax agencies get more involved with virtual assets. Some virtual goods already charge tax and VAT. Trust me if financial profits are made the tax man is coming.

    In game gold only transactions, as mentioned, should avoid the tax man hopefully.
     
  12. Spoon

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    At some point there is gonna be really wealthy players (in game gold) these are going to want to play some high end - end game stuff.
    A stock exchange and risky investment is perfect for such. Micro-lending as well.

    Now we know that there will be times when groups or guilds or such are going to need some gold fast (like the deed auctions).
    So coming up with schemes to facilitate such high game, risk investments and group borrowing will be a real fun and community building activity. I look forward to this.

    Is someone going get scammed out of gold? Most likely.
    Is someone going to get rich on investments? Most likely.
    Is a thriving banking/investment scheme going to facilitate the meta game? Definately.

    But here we also have stuff that lots of other games don't. For instance one could operate a pawn-shop type lending based on rare items as equity. If someone who has built up a great trust from transactions over time then most wouldn't be as hesitant with them holding such equity.

    "Sure with an Oracle Head as equity we can lend you 100 000 gold at 3% monthly interest. "

    Then the books/receipt scheme works as security both ways.
    In the "secured trade window" both parties add books as receipt for the other, so that before hitting the Accept button you check that the content match the receipt.
    The loaner or lender can't falsely accuse the lender or loaner of wrong doings to ruin their reputation since the paper trail can be shown. Etc.

    Now if we could only get Portalarium to let us add 2xBlank Books to the trading window so that these receipts write themselves in a non exploitable manner that would be even better.
     
  13. Jatvardur

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    Which bank would offer you rum when you visit? I can only think of one.

    They are already 'interested', but at the point when you make real money. If you read my reply above then you will see my response to this point. No need to trust you on this, I already know the answer. There is a bigger issue than tax here, but I'll leave that to you to research. ;-)



    [Getting to the other posts]
     
  14. Poor game design

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    Agreed on all counts.

    I would add however that "RP" doesn't devalue the use of bank deeds by players.

    During one of the releases (maybe a year ago) I visited an RP "farmers market" and bought some produce, even though there was no use for produce and no use for the gold I was paying for it (since a wipe occurred a few days later). I think that's the type of RP you're talking about, the using your imagination play acting type.

    That's not where I this going. For players that have a good reputation, the ability to support a "banking system" and provide real services, I see no reason why there will not be value that goes well beyond RP. I suspect this is a foreign concept to some people. But groups like the BMC, Pax Lair, and Tantalus seem to have a good start in making this a reality.

    I don't know why that's troublesome to some people. It seems like if players have a good track record, there might be something to gain from interacting with them financially. Of course, as you say this is prone to scams and fraud and players should be careful. But as you also rightly say, this is exactly as it is in real life. So is this really the RP you're talking about? I personally fail to see the difference.
     
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  15. Jatvardur

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    Thanks, again, for the reply. It would be safer with an in-game mechanic, no doubt about that, but it isn't strictly necessary. As I mentioned earlier in this thread I'm not going to request special mechanics from the devs (at least, not pre-launch). If they come to me and ask for my opinion on it, then that's another topic. I'd rather they launch the game than spend time on activities like this. They are already giving us books which is great. I think more can be done with books and it would be preferable to see them develop books further (since they enable more ideas and affect more people).

    What happens when someone quits is a key problem. It is perhaps the biggest problem after trusting someone not to be malicious. Even someone with good intentions can become inactive, which may be through no fault of their own. Let me address the accidental inactivity rather than malicious case first:

    My initial thoughts would be to have the ownership of their shares (their ownership percentage) return to the company (i.e. they become treasure shares). If I owned 10 percent but then went inactive beyond the threshold time, then my ownership would return to the company. This means that the company would not own 10 percent in itself. This means that they are not automatically given out to another player, but must be purchased from the company. That money goes directly into the company rather than a single player.

    That's my first pass at tackling that idea and would prevent shares becoming lost because investors go inactive. The trickier part is the implementation: how to void the shares given out to the inactive player. It isn't impossible but will take a bit more administration.


    This is probably the biggest problem and the biggest risk. Ultimately it comes down to trusting people. As you say there are legal ways IRL to combat this. In this game we will have to do everything via reputation. I think having some sort of public 'scoreboard' will point out who is more trustworthy. Obviously, a simple trust doesn't protect against the slow burn scammers. That said, I think more people will place trust in a POT owner. If someone has spent 1k on a town (for example), are they really going to want to risk their reputation for an extra 100 bucks? Sure if they sold their town and ran off with the money made but ultimately this may come down to 'buyer beware'.

    How much I give out will depend on how well I know them. I don't think we can ever prevent all problems but that's not to say that problems can't be overcome.

    I would probably try to have some sort of reputational requirement in place before someone can found a company. This is an extra layer of red tape that I hope will make it easier to regulate.

    This comes back to how to value a company and also what profits does an owner get (i.e. a dividend). A company paying no dividend will be less trusted. A company that regularly pays dividends for years (hoping SotA lasts that long) will also be more trustworthy. In addition, I'm considering to have a requirement that a company has to hold a certain percentage of their value in gold (possibly held at Tantalus Bank). That way if a company goes bankrupt then some recompense can be made to shareholders. More discussion is needed here with people who want to get involved.

    I have my fingers crossed. I will take the idea slowly and build it up. It will require a lot of testing.
     
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  16. Jatvardur

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    Indeed. Potentially a way to transfer money easily too. I've stated a number of times that books could be used to create a form of currency (earlier posts here, and other threads). :)

    Books weigh almost nothing but their notional value is whatever we determine it to be.


    Agreed on all points.

    There are challenges here that need to be overcome. It requires more planning and consideration.


    Escrow can also help with the facilitation of lending. Someone borrows to buy an oracle head, but instead of it going to the borrower or lender it goes to escrow. Once the debt is paid the oracle head is transferred to the borrower, otherwise it goes to the lender.

    The scheme I proposed was initially for deposits / loans (can't recall if we discussed). I didn't extend it to shares, but I could. In my suggested implementation the players have reasonable protections during the process of the trading the books, but requires implicit trust in the bank (in the case of deposits / loans) or implicit trust in the underlying company if we are talking about equities (stocks).



    That would be cool. Would make the system less error prone and cut down on administration.
     
  17. Bubonic

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    Yes, I agree, and the fact that there is no difference is what I was trying to get across. :) I think this kind of thing sounds fun.

    It would certainly be nice to have an official system/mechanic of some kind, but I would argue that it would have to come after launch, as we certainly don't need any more tasks on the schedule.
     
  18. Poor game design

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    For those that have interest in this type of activity, one key to being "careful" is to avoid any financial situations that appear to be "ponzi scheme".

    It would be EASY for players to take in-game (or out) money from players, always promising them a greater return on their investment down the road. Meanwhile, they could be using this money for all sorts of nefarious things with no intention of ever keeping their promises. Or they could intend to keep their promises but be a financial moron incapable of doing so - either way your money is lost.

    That is why this system of "trust" is probably best left up to people that have a good foothold in the game, but are also backed up (read: insured) by others that would like to keep their name clean.

    For fun, I'll give you (the reader) an example of the type of in-game financial situation that I personally would feel comfortable with.

    EXAMPLE:

    Let's say that the Tantalus Consortium began promising players a rate of return on any gold invested in their "bank". The questions I'd have immediately would be as follows:
    1. What's the rate of return?
    2. How secure is this transaction?
    3. What happens when the whole thing goes bust? (how do I get my money back?)

    Now if the answer to number 1 is "HUGE!" and the answer to number 2 is "VERY" and the answer to number three is "We PROMISE". That's not something I'd feel comfortable with.

    However, if the answer to number 3 was "Because we're insured by Winfield and Pax Lair as well as several other POT owners that have pledged to make good on any defaults from our bank." Well then I'd like to sign up for that because now I have multiple people that I can go collect from, and surly a few of those people will want to do the right thing! ;)

    That's how I think this could work.
     
    Last edited: Nov 18, 2015
  19. Jatvardur

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    Fully agree. :)
     
  20. Spoon

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    @Baron Drocis Fondorlatos

    1)
    Did you read through the texts because you seem to be tilting at something else?
    2)
    If a "company" has a known quantity of bonds then it cannot be turned into a ponzi scheme. It just doesn't work.
    Since the "company" type proposed above has a fixed number of "shares" with known "stockholders" then you cannot continue to sell them.
    3)
    This proposal is not looking for investors. The idea is not that you invest in the bank itself. Instead the idea is that the bank creates the infrastructure that allows a stockmarket to be plausible. Such a stockmarket would rely on other players to create the companies and selling/buying stock from eachother.
    Many such ventures will most likely utterly fail, and take all the gold with them, that is how it should be. That is how risk investment works. Because the basic concept of any such stockmarket is that even if some fail, most will profit and such profit will be larger then the failures.
    4)
    "What happens when the whole thing goes bust? (how do I get my money back?)"
    This shows a complete misunderstanding of what risk investment and stockmarkets are all about.
    If a company goes bust you do not get your money back. If the owners decide the company is dead then you liquidate and if there are any assets they are divided according to the number of shares.
    5)
    "Because we're insured by Winfield and Pax Lair as well as several other POT owners that have pledged to make good on any defaults from our bank."
    Why would anyone agree to any such a silly thing?
    IRL states recognize the need for banks to have interest accounts to accumulate capital for loans as a mean to facilitate risk investment which leads to higher productivity. Thus they give guarantees to interest account deposits so that people will trust banks. But even states have no interest whatsoever to guarantee risk investments in companies.
    But since there are no taxes to be had on productivity in SotA, nor on population or anything like that. Then there is no potential revenue or power or growth rate etc to be had by in-game "state" equivalents, none.
    Which means it would be a pretty stupid thing for anyone to make any such guarantees because there is nothing to be gained.
    6)
    In the texts linked to any so called banking is of the reversed nature, which is common in MMO gaming, which is not interest accounts but rather "self storage". They hold your stuff in a safe place - for a fee. Just like the NPC banks in the game does.


    I'm going to stop here, knowing the inevitable end result.
     
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