Is There a Safe Way to Decentralize or Spread Ownership of a Company Using Bitcoin or Altcoins?

Question

We are starting a social enterprise that is focusing on home oriented products and services - starting with real estate brokerage services. The profits from this organization will be used to battle homelessness. http://domogo.co/presskit (note the press kit just happens to explain the detail discussed here, its not meant as a link towards self promotion.)

One of our goals is to either decentralize ownership or spread ownership far enough that a few owners or shareholders can't later hijack the organization's purpose once it is producing revenue. At the same time however, we must maintain management structure so that we can compete against standard brands.

Our goal isn't decentralization in and of itself, our goal is to make the organization as trustworthy as possible and try to keep it as free from corruption as is possible. We would be pleased to be proven wrong but it seems at this stage there isn't a safe way to fully decentralize, however, it also seems that there might be ways to achieve varying degrees of our basic goal.

We do branding, marketing and business development and are quite clueless when it comes to Bitcoin, however, from our research it seems it may be possible to create color coins that could be tied to physical shares of the company. We could then distribute those coins to micro impact investors or individuals who have some skill set to add towards a collective operations board.

We would then want to tie voting on the "board" to the holding of a coin. Just for discussion let's say we spread out 100,000 shares to 100,000 people which would mean 100,000 possible board votes. Obviously we would need some mechanism in place to force voting or one would lose their coin/share...or something that would achieve the same purpose.

My questions are:

1. Is there a way to limit total possible holdings of the coin/share to say 1. I.e. the wallet couldn't hold more than 1 coin with the purpose of an individual only being able to hold 1 share of stock. Basically, we wouldn't want any single individual to be able to buy up or trade their way towards board control.

2. Is this too far fetched with current cryptocurrency technology or perhaps too cost prohibitive to create? (we don't have a massive budget)

3. Does anyone have an alternative solution to the same basic premise?

We are looking at more traditional solutions as well but feel this could be an interesting solutions that could effectively make ownership of a share as easy as downloading a wallet. This could be key as we would like for our beneficiaries to take on larger and larger control of the company as time went on. I.e. it needs to be just as easy for someone in rural India to own a share as for someone in London.

We are open to ideas and are obviously not experts in the matter, we would just like to find the most economical and safe approach to ensuring a few owners or shareholders couldn't turn Domogo into a profit for profit's sake corporation with a side effect of making it easy for those without birth certificates or similar paperwork to have access to the board.

Any Ideas?

Its a small thing we know, but if you leave your twitter handle the we'll send out a "thanks" to each responder.

@project_domogo is ours

Answer 1

Use multisig wallets for funds.

Use a SP (Service Provider) as a separate entity to handle your smart contracts.

Use Bitcoin and the Blockchain to act.

Answer 2

Our goal isn't decentralization in and of itself, our goal is to make the organization as trustworthy as possible and try to keep it as free from corruption as is possible. We would be pleased to be proven wrong but it seems at this stage there isn't a safe way to fully decentralize, however, it also seems that there might be ways to achieve varying degrees of our basic goal.

This is a good attitude to take - there are fully decentralized solutions, but they generally compromise either usability or flexibility.

• Ethereum Decentralized Autonomous Organizations are extremely flexible - any corporate structure that can be expressed in code is possible, and the actions of it will be checked and recorded by all Ethereum nodes. This feature isn't very mature, so if you don't know Python already, I wouldn't recommend it.

• On the other side of the flexibility/usability coin, Bitcoin multisignature wallets allow several people to manage funds, which will only be spent if enough of them agree on how to use it. This is less flexible, but there are multiple implementations that are pretty good.

There are partially-centralized systems that are still highly transparent. For example, you could keep a public record of who has voting privileges, and use a widely respected voting platform like Helios Voting.

Is there a way to limit total possible holdings of the coin/share to say 1. i.e. the wallet couldn't hold more than 1 coin with the purpose of an individual only being able to hold 1 share of stock. Basically, we wouldn't want any single individual to be able to buy up or trade their way towards board control.

That's challenging, because in most cryptocurrencies addresses are designed to be as cheap to create as possible. So, if you manage to restrict people to only have one share per address, then they could just spread them over many addresses.

I can't think of any perfect solutions to this, but you could partially combat it by requiring voters to provide some sort of information about themselves. Then, if someone provides information that appears to be fake, you could remove them from the vote.

If you're going the DAO route, you could select someone to have the ability to remove people's shares if they were found to be a sockpuppet of another person.

We are open to ideas and are obviously not experts in the matter, we would just like to find the most economical and safe approach to ensuring a few owners or shareholders couldn't turn Domogo into a profit for profit's sake corporation with a side effect of making it easy for those without birth certificates or similar paperwork to have access to the board.

Were it not for the requirement that long-term members gain a larger share in votes, I'd recommend Helios. As it is, I can't think of anything that will solve your problems out-of-the-box.

Answer 3

Bitshares allows you to setup DACs pretty easily right in their linux client. Their get started page has the client download for win and macs too. bitshares.org

Answer 4

1. 1.Is there a way to limit total possible holdings of the coin/share to say 1. i.e. the wallet couldn't hold more than 1 coin with the purpose of an individual only being able to hold 1 share of stock. Basically, we wouldn't want any single individual to be able to buy up or trade their way towards board control.

In this case, there is no point in a decentralized ownership, because you need a centralized ID verification to be able to define the "single individual" concept. For your use case, classical, non crypto shares are a best fit. No amount of clever cryptography can define what "single individual" means, the best system that does that is an old school ID + notary. Even for the old school system, this is not easy stuff to enforce at large scale. (a typical example is LVMH takeover of Hermès in France)

If you are ready to relax this condition, the easiest way to spread shares of a company is trough Open Asset protocol on top of Bitcoin (Coinprism is the first wallet implementing the protocol) Others proposition are not mature.

If you are programmer, you can see how to implement voting and shares in my book about blockchain programming.