Yes. Centralized trusted exchanges, similar to MtGox, Tradehill, or Bitcoin7, all susceptible to laws, regulations, errors, seizures, shutdowns, and being central targets for attack. The unsolved problem is p2p exchange. I fear that problem may not be solvable.


Friend to friend and trust (with a sword as an incentive). I do believe that system (like Ripple) will work, but my problem (and I'm sure it's one I share with others) is that I don't have any friends who use Ripple, and maybe one who uses Bitcoin. There's no Ripple network for me to hook into
Maybe eventually the network will be that of stores you can walk into who can exchange your fiat for BTC for you in person, with a proof of I'd and other things.

You can pay for the bitcoins with ripple and then settle the debt with your friend using cash.

I've used  #bitcoin-otc to get a few grand last summer, with escrow service run by Gavin. Good point about that being a p2p exchange.

Just giving a little update here. For the moment I'm only working on crypto-crypto trades because it is not possible to get fiat into a p2p environment at the moment. I've made some updates to the GUI. You can see picture of it here: http://litebit.co/project-item/p2px/ I'll upload some pics here later.

Also, in order to encourage developers to volunteer their time, I am releasing the source to my GUI. It can be downloaded here: http://pro2host.com/cryptocoin/p2px/

DISCLAIMER: This is a non-functional GUI! Only design and layout!

I've also been brainstorming a lot of ideas on this project. I'm a bit strapped for time now but I'll be writing about them later. I really want to get this project off the ground. It's been sitting for too long. I have zero developers!

Thank you once again to everyone that has posted their interesting ideas. However, I've canceled all work on this project a while ago. That's why I posted my GUI source. So if anyone wants to work on it then go right ahead! I'm only one man who has absolutely no programming experience and can barely manage to create the non-functional GUI. There was one coder involved at one time but he bailed out before he had even done any substantial work. Realistically, due to the scope of this project, a fairly large team would be needed to develop the many features and above all, ensure that everything is secure. I haven't even been able to develop a secure method in theory. It may not even be possible. Then again, nothing is impossible really. But this is just something that is beyond my own capabilities of bringing to life.

Please continue brainstorming! Maybe one idea that somebody puts forth here will actually be workable. Brainstorming never does any harm. Good luck to whoever decides to give a go at this project!

All Best,

Michael

I think the solution to trade across chain should part from the contract defined in the wiki which enables an atomic trade.

Everytime i read such statements i am in awe at the possibilities and thankful to the devs making this possible!

You could have a p2p USD or EUR derivatives. Suppose someone colors a satoshi and assigns a one dollar face value to it, promising to exchange this Satoshi for one USD of bitcoins in the future at the current bitcoin/USD market price. Suppose colored bitcoins and regular bitcoins can be traded via a p2p exchange.

Why would a company do this? Well, they can invest a percentage of the bitcoin they borrow by coloring satoshis (fractional reserve).

Why would anyone buy the colored Satoshi (i.e. lend to the company)? Well it might be convenient to acquire USD units of value. In addition to this, the company might pay some interest on these colored satoshis in exchange for the ability to raise debt.

If you have multiple companies doing this, then they could discount each others' colored satoshis which would increase liquidity. It would be like free banking and thus unstable. It would be nice to have a more stable solution as well (for example an overfunded reserve with company profit coming from txn fees rather than interest), but this seems more complicated to implement at this point.

I think of these as possible long-term goals for this project. A BTC/LTC exchange would be a good starting point.

Yes, but you still need trust. Existing exchange could issue USD deposits certificates by coloring satoshis and users will be happy to hold the proof themselves while still having to trust the company, not for the exchange anymore, which is conducted in the blockchain with colored coins, but for the deposits. Users should still be able to withdraw the paper by sending their usdCoins back to the issuer.


Bonds, IOUs, future contracts, currencies, vouchers, tickets, ETFs, discounts, smart property, votes, certificate of deposit, academic certificates, property registry, beer tokens and poker tabs with friends.
The question is, why would a company want to use another technology for anti-counterfeiting?

You may need more privacy than what can the chain can offer, which I think will be enough for most if not for all with hardcore obfuscation. Maybe it's about the confirmation time.
The ripple protocol solves this same problem in a different way that is stronger in these two points, but there's many cases in which the public accounting is actually a feature. You don't need the issuer online to move the asset, the chain signs the movement for him. For the smart car property example, you want to be able to sell it even if the company that sold it to you goes broke.
I hope that there can be more coin colors than people (everybody issues, but only your neighbors accept yours, so you ripple your satoshi to pay). I don't think all of us will have our own server always online. So we will need to trust a ripple server for the assets we issue or just use the chain.


A BTC/LTC is feasible but requires changes in the current protocol (enable nLockTime and transaction replacement), but colored coins don't.
Maybe we have the p2p fiat/coin exchange than the p2p coin/coin after all.
I remember when I writed about exchangeCoin, which was a protocol which listened to other protocols to enable atomic exchanges with it. Other chains could do the same to be tradeable for others apart than from exchangeCoins. Now that I think about it...what a stupid idea I had then.

Not sure if serious. The company could very easily and happily release more satoshis if its debt appreciated.  Keeping the window open to redeem debt at face value would prevent any depreciation, except in the event of bankruptcy (closing the window). Again, not sure if serious. Yes, you need to trust the company.