NXT is a decentralized, free market ecosystem that incorporates its own peer to peer asset exchange. The NXT Asset Exchange is a virtual market place that allows NXT users to generate assets that can be bought, sold or traded on the open market. These NXT based assets can hold a value of their own, like a crypto currency or loan marker, or be a representation of some thing physical, that has a value, like livestock, precious metals, or what ever NXT users have the creativity and capacity to imply to the asset. The NXT Asset Exchange is also capable of accepting deposits of assets that have been generated outside of the NXT blockchain such as Bitcoin, Litecoin and other crypto currencies. These deposited assets can be bought sold or traded on the NXT Asset Exchange in a similar fashion to conventional private exchanges like Cryptsy or Bter. To compliment and facilitate this free market, NXT also provides a common, decentralized currency. The NXT Asset Exchange provides a means for NXT users to buy, sell, or trade anything. Is this accurate?
I don't exactly follow what you mean when you mention unicorn assets and managing inventory. Is that just a reference to the AE being able to accept crypto deposits for trade as well as generate assets?
NXT Assets currently are issued with all of them created at once. Kind of in the spirit of NXT. However, for creating a 1:1 correspondence between the NXT AE Asset and something tangible, this issue all at once model is not quite right.
For example, in the gateway I have to exchange deposited DOGE with NXT AE DOGE. Since there are 100 billion DOGE and only 1 billion NXT AE DOGE possible, that would create a problem if more than 1% of all DOGE is deposited. For a NXTcoins that are mined at a rate of 100,000 per day it is quite important that the number of NXT assets in circulation match the number that was mined.
In order to make it easy for people to deal with these type of cases, I am creating a NXTcoins development kit where you will be able to specify (within reason) the properties of the coin, especially as it pertains to total authorized, total in circulation, creation criteria, etc.
James
So then the gateway you are working on won't allow for external assets like Bitcoin to be directly deposited but will create an internal representative asset that reflects the real world characteristics of the external asset. This will allow the new internal asset be responsive to influences of those characteristics? The gateway will create a fully functional copy of the external asset but not truly accept the external asset as a deposit? Is this closer to what you mean?
I think you are overcomplicating things. Not sure where the disconnect is...
The gateway allows you to send REAL DOGE ->NXT AE
You then get issued a NXT Asset for the DOGE
You can then trade this asset inside NXT AE
Anybody that gets the NXT DOGE asset will be able to withdraw it to their DOGE account
[Replace DOGE with any bitcoind fork, including bitcoin]
All NXT AE assets are simply a name with a total quantity. It has no value in and of itself, regardless of what it is called. The issuer of the asset however can create value by linking an external item to the issued asset. With tangible goods like silver bars, you will need to trust the issue to honor the redemption commitment. However with crypto it is possible to have it in a publicly viewable account, so that everybody can see that there is 1 DOGE for every DOGE asset that has been issued. However withdrawal used to have a significant amount of trust that was needed. This is because even though you can see the balance, what is to stop the gateway operator (or hacker) to empty the account. Not much comfort to see the 1:1 backing go to 0:1!
To address this, I am using 2 of 3 multisig deposit accounts. All the gateway deposits (from all three gateways) go into the same multisig acct. For all withdrawals all three gateways must approve it and at least 2 have to sign it before it gets released.
Now the trust required has been reduced dramatically. You still have to trust that 2 of the gateway operators wont collude, or that two gateways wont get hacked simultaneously.
So, it is not totally trustless, but source code will be available and people can decide if they are comfortable with utilizing the automatic multisig gateway or take their chances on a traditional centralized gateway.
James
