It seems to me Stellar (the organization) will be "the Central Bank" a la Bank for International Settlements at the global level or Federal Reserve for Stellar (the cryptocurrency).
This is what makes me uncomfortable. The biggest point about cryptocurrencies is that they are not centralized. In that sense Stellar seems a lot worse than regular currency. With a regular currency, at least the respective Central Bank or other monetary regulatory authority has credibility and accountability in the sense that they are indirectly elected by citizens as they are selected by the elected government. As such they have to have a history of integrity and monetary experience, and can be removed if they act unethically.
Stellar's board, on the other hand, is self-elected, and with all due respect, don't need to have the level of accountability or have the credibility of running such an organization, which even if it owns "just 5%" (+2% of Stripe's) of the currency can potentially have substantial control over it. And being a non-profit doesn't add a stamp of either, means little.
Thanks for sharing the details. My core problem isn't with the details, mainly because I haven't gone through it or even what percentage of Stellar is controlled by the organization. My problem is with the basis of having such a self-selected organization which seems to have given itself the de facto control over the flow of the monetary system.
As a good example what you mentioned: "As needed, the organization will also hold open auctions to raise funds from its remaining pool of stellars".
This is a huge thing! Who decides when "as needed" is? If it's the board, what's the basis of their authority? Just being a non=profit doesn't stop one or more of the board members to act in self-interest.
>The Stellar Foundation will actually control relatively little. The creation of new stellars, for example, will be done in a fully distributed fashion
It's not fully distributed. All the decision-making nodes are controlled by Stellar. Just because there is stake-based voting involved does not mean the underlying system is distributed.
Maybe I'm misunderstanding your objection, but you can actually run your own stellard, which is a first-class member of the network: https://github.com/stellar/stellard. The Foundation runs a public stellard for convenience, but you're under no obligation to use it. The client and wallet powering launch.stellar.org are similarly open-source, and can be hooked up to your local stellard.
Stellar is a fork of Ripple. It is not a decentralized system, in the sense that, if you want to use any given currency (such as stellars), you must trust a number of centralized, trusted nodes. This is Ripple's/Stellar's "solution" to the double-spend problem.
How is that worse than trusting that the top 2 BTC mining pools aren't colliding?
I'll take a semi-centralized system with respected public figures as advisors over a theoretically decentralized system that is actually ran by a few anonymous miners.
That thread understates just how centralized the consensus system is. If your node isn't on the trust list of the official Stellar Foundation nodes, they do not participate in the consensus-building process of those nodes and cannot affect their consensus. Those official nodes have the ability to freeze accounts, change the fees charged, and probably to issue new money arbitrarily if they collude.
Now, technically your node can have a different trust list and come to a different consensus. You don't want to do that, though, because then you're stuck on a different version of the transaction history from the one everyone else accepts and any money you receive is likely worthless because it's not recognised by the rest of the network.
Meh, I'm not that big on 'totally decentralized'. Most of the time when nobody is in charge, it just ends up as a clusterfuck (bitcoin being an obvious example, or Occupy Wall Street which had a governance structure so impossibly idealistic that it was doomed to failure...by design, IMHO). So yeah, you have a small self-appointed elite of 'leaders' who essentially have more power than everyone else. That's how human society functions, most of the time. If enough people like it, it will take off and that self-appointed elite will become disproportionately powerful and rich...but at least you know who they are and they're in a well-defined governance structure subject to specific laws and can be challenged well-defined procedural tactics. The creates a large degree of predictability, and business likes predictability, as do consumers. So while it may fall short of purely democratic ideals, if more poeple use it and it actually results ina greater consumer suprlues, then it enhances the lives of mroe people to a greater degree than an ideologically pure alternative that never acquires sufficient traction to deliver a significant economic benefit.
Cynical, maybe, but as a good utilitarian I'll take results over ideals any day.
This is what makes me uncomfortable. The biggest point about cryptocurrencies is that they are not centralized. In that sense Stellar seems a lot worse than regular currency. With a regular currency, at least the respective Central Bank or other monetary regulatory authority has credibility and accountability in the sense that they are indirectly elected by citizens as they are selected by the elected government. As such they have to have a history of integrity and monetary experience, and can be removed if they act unethically.
Stellar's board, on the other hand, is self-elected, and with all due respect, don't need to have the level of accountability or have the credibility of running such an organization, which even if it owns "just 5%" (+2% of Stripe's) of the currency can potentially have substantial control over it. And being a non-profit doesn't add a stamp of either, means little.