I think the biggest risk of DACs is that it incentivises people to fund contracts they don’t actually want fulfilled to milk the proposer for cash.
My expectation is that if this becomes mature you’ll get traders which try to predict which contracts won’t be fully funded, and then push them up to say 50% (after which pushing them further risks them actually getting fully funded).
This not only discourages proposers from putting up contracts (to easy to lose money), but also makes it harder for users to easily see which contracts are worth funding and which aren’t. There’ll be a lot of contracts mostly funded, some because they’re actually good and people want them, and some because they’re bad and traders are trying to make money.
Interested to hear your thoughts in how to solve this?
Isn’t whether a project is “worth funding” depend on whether you think it’s proposed output is an actually valuable public good? If it is, then you shouldn’t mind not getting a refund that much. If it isn’t, there are other places to look for arbitrage.
I think the biggest risk of DACs is that it incentivises people to fund contracts they don’t actually want fulfilled to milk the proposer for cash.
My expectation is that if this becomes mature you’ll get traders which try to predict which contracts won’t be fully funded, and then push them up to say 50% (after which pushing them further risks them actually getting fully funded).
This not only discourages proposers from putting up contracts (to easy to lose money), but also makes it harder for users to easily see which contracts are worth funding and which aren’t. There’ll be a lot of contracts mostly funded, some because they’re actually good and people want them, and some because they’re bad and traders are trying to make money.
Interested to hear your thoughts in how to solve this?
Isn’t whether a project is “worth funding” depend on whether you think it’s proposed output is an actually valuable public good? If it is, then you shouldn’t mind not getting a refund that much. If it isn’t, there are other places to look for arbitrage.