Tag: ethereum

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Tradefor Puppets featured in Adobe Spotlight

David Werner is a brilliant User Experience Manager for Adobe’s Character Animator software.   He used Tradefor as a use case in his Community Spotlight video.  Thank you, David.

Tradefor is the latest start-up from Peter Seed — an online trading start-up veteran. His latest creation is a collection of peer-to-peer markets for trading tokenized assets. Customers can fund and withdraw from privately-held Ethereum wallets using the Metamask browser extension. A “gamified” trading platform, Tradefor supports one-to-one exchanges of ERC-20 and ERC-721 tokens offered by brand marketers.

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Our Currency Token

Building Tradefor has been a wild, exciting ride.  From the beginning, we wanted to create a user experience that broke new ground while embracing the emergence of blockchain technology.

Our go-to blockchain has always been Ethereum.  We liked the management team driving the Ethereum Foundation.  We liked Ethereum so much, in fact, that we decided we wanted Ether to be our in-game currency.

To come up with a name for our unit of Ether currency we consulted the well-established Ethereum chart above to select a fractional denomination that would be suitable for micropayments.  Ideally, we wanted a unit small enough so users would not have to enter decimals and large enough feel valuable.

The Ether chart gave us a couple of options. Our first option was to use Finneys.  One Finney is equal to 1/1000 of an Ether.  But when we dug deeper, we concluded that the Finney was not small enough.  One Finney equaled about fifty cents.  If we used Finneys, we concluded, we would have to accept decimal pricing.

So we went back to the denomination chart.  The next smaller denomination of Ether was a Szabo.  A Szabo was equal to 1/1000 of a Finney, or 1/1000000 of an Ether.  The Szabo, it turns out, is a little too micro.  One Szabo was worth $0.0005.   “What about the in-between denominations?”, we pondered.

After much thought, we decided to create our own denomination unit of Ether.  We settled on what we call a “Lubin” —  appropriately named after Joe Lubin, Founder of Consensys.

We decided to make the Lubin equal to 1/10000 of an Ether.

Then came the epiphany.  What if the Lubin also had some smart contract power?  Since we going to give a fair amount away,  we thought, let’s sweeten the pie.  Here is what we came up with:

    • One Lubin is equal to 1/10000 of one Ether.
    • A smart contract, incorporating Metamask, that helps Ethereum users to instantly fund or withdraw funds.
    • A second smart contract that allows Ethereum users to fund or withdraw directly from an Ethereum wallet.

So that is how the Lubin was born — as a big nod to your visionary  pioneer, Joseph Lubin who got us jazzed about Ethereum in the first place.

Thanks, Joe.

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Why Tradefor Limits Ethereum Withdrawals

If we were to allow our users to withdrawal profits earned from trading, we would run the risk of misrepresenting our capabilities. Tradefor is not a gambling site.  Nor is it a cryptocurrency exchange.  More accurately, we are an entertainment site that provides gamified trading experiences to a social network of game-playing individuals.

In order to eliminate any misinterpretation by regulators as to what we are (a trading game) we limit withdrawals of Ether to a maximum of the amount that you deposit into Tradefor.  

All withdraws must be in Ether.

Any profits gained from trading will not be disbursed to traders. Although you can continue to use your increased buying power gained from making profitable trades to trade for new gift cards,  you cannot withdraw profits accrued from trading in Tradefor in cash.

Example of permitted withdrawals

Say you deposit 0.05 Ether into Tradefor and you trade your way into a total buying power of 0.08 Ether.  At this point, you can withdraw up to 0.05 Ether (the amount you funded yourself) but you cannot withdraw the 0.03 you made in trading profits.  Any profits made from good trades will remain in your Tradefor account as increased buying power.

How do I make an Ether withdrawal?

To make fund or withdraw your Tradefor account, first download Metamask.   Metamask is a browser extension that only works in  Google Chrome or Brave browser.  It allows you to interact with smart contracts in the Ethereum blockchain and view your remote Ethereum wallet from sites like MyEtherWallet.

In the Tradefor site, go to “Funding” in the main menu.

  1. Then select the “Ethereum” tab
  2. Select “Fund” tab for deposit. and “Withdraw” tab for a withdrawal
  3. Enter amount of transfer you want to make.  One LUB equals about $0.05.
  4. Press the “Fund” button

 

IMPORTANT:  You will have to validate your funding request in Metamask before your transaction will process.

Open Metamask and select “Submit”.  This will send your request to the smart contract on the Ethereum public blockchain.

In about a minute, your transaction show be updated — both in Tradefor’s site and in your Ethereum wallet.

Here is a video of the process:

Funding with Metamask

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Showdown Trades

Lately the Ethereum-based prediction market has accepted the challenge of creating a decentralized exchange on top of Ethereum. If exchanges are completely decentralized on a blockchain, the theory goes, they could offer near-real-time, peer-to-peer clearing and settlement with no single point of failure. Cool.

The team responsible for this initiative wrote extensively about the need for an automated market maker. They created a mathematical model that tests a method for adding liquidity as a bot  – comp;letely automated.

But there is one little wrinkle. What happens if there was no liquidity in the exchange?

Unfortunately, low liquidity is a natural by-product of new technology. Early adopters are a small group. And because the exchange will be built on a blockchain, the number of active traders could be very small, indeed — as small as one or two traders.

This chart shows the potential for failure if the wrong model is applied to a one-to-one trading situation.

Since inventors are typically ahead of the curve, it is likely that blockchain exchanges will not succeed, initially, due to lack of liquidity. That’s another way of saying: “Nobody will come”. (Cue video of tumbleweed rolling down a deserted main street.)

There is a possible solution. If an exchange can cover all the squares in the matrix, then there is a glimmer of hope.

As developers, we should make many-to-many exchange capabilities a lower priority. Instead, we should concentrate on creating a process of negotiation between a single buyer and a single seller. That’s the logical starting point. Until we solve that problem, blockchain exchanges will be fighting an uphill battle.

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A Gamified Exchange

Sometimes trading can be tedious and boring. Yes, there can be reward in making a financial profit, but in a perfect world, trading should be a social exchange that has at least some entertainment value.

We built Tradefor as a gamified trading experience. Tradefor features all the usual capabilities of an exchange such as order placement, order management and order clearing. But unlike most online exchanges, Tradefor adds a distinct flare for the dramatic including the world’s first online trading pit.

Oh, and one more thing… we are passionate about the Ethereum blockchain. That is why we use Ether as buying power and also why we assign tokens on the Ethereum blockchain.