Invictus

Unconquered Horizons
Newsletter 01 - October, 2013

Crypto-Currency Conference 2013

The Atlanta Crypto-Currency Conference is in the history books. We sensed a lot of excitement and were delighted with the reception we received. Dan Larimer offered Decentralized Solutions to Centralized Problems and Charles Hoskinson presented A New Approach to BTC Exchanges. You can read all about the conference here and access the videos and downloads here.

Dan Larimer introducing Keyhotee ID.

Charles Hoskinson foreshadowing Keyhotee Pod.

Announcements
BitShares, DAC and DomainShares, DAC.
We will be releasing both of these Distributed Autonomous Corporations (DAC) phased for test, experimentation, training, and full-scale operations in 2014.

ProtoShares.
ProtoShares miners for shares in BitShares, DAC and DomainShares, DAC are coming in November 2013. You can mine and trade on Windows, Macintosh, or Linux platforms.

Keyhotee Mail and Keyhotee ID.

Keyhotee is your digital life, secured. Keyhotee Mail and Keyhotee ID components will be released in beta form in December 2013. Many more features will be added in 2014.

Keyhotee Pod.
Start mining with you own phone, tablet, or PC, then add lots of more of the worlds most affordable mining and digital security pod hardware in the first half of 2014. Find out whats been already said about these at Invictus-innovations.com. Newsletter archives will be there as well. But subscribers always get to see the latest newsletter first, so let friends know about our contacts page. We will be releasing new details on each of these in coming newsletters, beginning with ProtoShares in the remainder of this edition.

Visit us at Invictus-innovations.com to learn more.

Invictus

Unconquered Horizons
Newsletter 01 - October, 2013

You heard it here first

One of the benefits of subscribing to this newsletter is early access to the inside details of what Invictus is planning next. By far the most frequently asked question from you has been, When can we start mining? Charles gave the short answer at the conference, next month! As subscribers, you are entitled to a more detailed answer. The reason early adopters will get to start mining and trading our products much sooner than originally planned is because, along the way weve invented ProtoShares! ProtoShares are a way to let interested investors gain a stake in a new Distributed Autonomous Corporation (DAC) while it is still in development. Gone are the days of pre-mining where insiders get their ownership positions first. Now anybody can get in on the ground floor as soon as they are smart enough to recognize the value of an idea. Invictus plans to use ProtoShares to launch all of its DACs, including the first two this very year: BitShares, DAC and DomainShares, DAC. Others will follow in 2014. This means you will want to learn everything you can about DACs and the ProtoShares used to launch them. The rest of this newsletter will give you a first look at an executive summary on the topic. A more detailed white paper is in the works.

DACS and their ProtoShares

First, we need to make sure everyone is up to speed on Distributed Autonomous Corporations (DACs). Much has been written about them already at invictusinnovations.com. Well just review the minimum needed to understand this primer.

What is a Distributed Autonomous Corporation (DAC)?

Distributed Autonomous Corporations (DACs) are a generalization of the concept of a crypto-currency where the currency is backed by the services its miners perform rather than a real-world commodity like gold, oil, or, ahem, thin air. If we can barter for goods and services, why cant we back currencies with goods or services? DACs may be simultaneously viewed as crypto-currencies and unmanned businesses. As businesses, they perform services intended to be valuable to their customers. Such services might include money transmission (Bitcoin), asset trading (BitShares), domain name services (DomainShares), or a thousand other business models sure to emerge as people realize that DACs are not mere altcoins. DACs pay for the services they need (like computer resources and bandwidth) with shares of their own company stock. They charge for their services using those same shares. Finally, they transfer all profits they earn to their shareholders denominated in

Visit us at Invictus-innovations.com to learn more.

Invictus

Unconquered Horizons
Newsletter 01 - October, 2013

those shame shares. To the extent that their services are in demand, those same shares will be in demand. Just like a brick and mortar and flesh and blood company. To the outside world a DAC is nothing but a crypto-currency backed by the value of the services it provides. But as owners of shares in a DAC, you may be entitled to a share of the profits that DAC earns from providing those services. Every DAC will have its own terms and conditions. You can always choose to view your DAC shares polymorphically either as spendable coins or as shares in a profitable, perhaps dividend-paying business.

What are ProtoShares?

ProtoShares are a class of crypto-currencies that let you capture a position in a cool new DAC before it is ever implemented. The speculative value of a DACs ProtoShares is a subjective mix of three market perception pillars. These pillars are the markets assessment of: The speculative value of a future DAC share. The probability that the DAC can and will be successfully fielded. Confidence that the ProtoShare maps to an equitable share in the implementation.

Developers use ProtoShares to raise capital with which to implement a new idea. They are a new decentralized form of crowd sourcing using incorruptible blockchain technology in lieu of lawyers, bankers and regulators to fund and launch a start-up company. Investors use ProtoShares to get in on the ground floor of an idea they recognize as having potential. They continue to trade them to motivate vetting of the idea in public debate forums and to increase the likelihood that other investors and developers will get involved in making the idea a reality. As the public vetting unfolds, everyone can compete using their own wisdom to decide whether they want to own more or less shares. Developers and Investors start on a level playing field for obtaining ProtoShares. Both may begin mining and trading ProtoShares on a pre-announced Launch Date. The developers only advantage is in believing more in the value of what they are developing and acquiring their ProtoShares before the general market demand heats up. The slow release of new shares keeps supply in line with demand so that share price can reflect the consensus value of the shares as the market takes an ever closer look at the idea.

How do ProtoShares work?

In its simplest form, a developer of a new DAC creates a ProtoShares blockchain good for shares in the DAC they plan to develop. This allows speculators to begin mining and trading early and provides the developer a way to raise capital based upon the (hopefully) growing market-perceived potential of the idea. DAC developers publish a social contract to honor all ProtoShare positions the day their DAC goes live for mining on its own. Visit us at Invictus-innovations.com to learn more.

Invictus

Unconquered Horizons
Newsletter 01 - October, 2013

A ProtoShares instance can be a clone of Bitcoins open source, or any existing altcoin a developer may like. Invictus will use standard Bitcoin software with a new proof-ofwork algorithm that is resistant to centralization via specialized hardware. This keeps mining in the hands of ordinary people with ordinary computers. You just download our free software and start mining ProtoShares on an equal footing with everyone else. Then you start trading. As you study the idea, and see it debated in various forums, you may decide to buy more of its ProtoShares if the idea appears to be catching on, or sell the ones youve got if you begin to see insurmountable flaws. The price of the DACs ProtoShares will reflect the market consensus of what a stake in the idea is worth. Meanwhile, the developer is doing its best to convince the market that (1) the idea has merit, (2) it will be implemented well, and (3) that a ProtoShares position will translate into equitable ownership in the DAC. Insufficient evidence supporting any of these pillars can depress the demand for its ProtoShares. Success in all three translates into higher ProtoShares prices that the developer can monetize by selling some of its own stash presumably acquired early in the IPO when the market price was lower. Convincing the market that the price should be higher works like an ongoing crowdsourcing proposal. The developer makes its case by participating in forums, publishing white papers, performing demonstrations and/or releasing beta software and related products. Solid execution builds market confidence and drives ProtoShares prices higher.

What about that Third Pillar?

The third Public Perception Pillar is confidence that owning a DACs ProtoShares will translate into actual ownership of an equitable share in the objective DAC. It is up to the DAC developer to convince the market that this will happen using whatever social contract the market will accept. The Invictus Innovations General Social Contract for our ProtoShares is as follows:
At our DACs pre-published launch time, Invictus will initialize the DACs genesis block to precisely match the current unspent outputs of its corresponding ProtoShares blockchain.

For every one of that DACs ProtoShares you hold at that launch time, you now have a corresponding share in the DAC accessible via the same public address to which you hold a private key. Thats it. Simple. Easy to understand. Real hard to renege. And you get to keep your ProtoShares to use again and again to capture positions in any other DACs of the same type that we (or our participating competitors) may release in the future. If we ever release MarsRealEstateExchange, DAC, owners of BitShares ProtoShares at that launch time will get a stake in that it as well. You are investing in the idea and get social contract rights to every instance of that idea. Visit us at Invictus-innovations.com to learn more.

Invictus

Unconquered Horizons
Newsletter 01 - October, 2013

What do you mean real hard to renege on your social contract?

Who would want to abandon the entire universe of informed early adopters by reneging on their rights as founding shareholders? In this business, the network effect of market share is everything. Besides, if someone deploys an open-source DAC without honoring the social contract to its ProtoShares holders, someone else will simply fork the open source code, and honor that contract. Bingo, theyre in business! The network effect of informed early adopters will do the rest and the reneging developers implementation will go into the dustbin of history. Can you imagine if you had owned ProtoShares for the idea of a web browser? By the time Netscape, Firefox, Internet Explorer, Safari, and Chrome had been implemented, you would own shares in every one of them! Who would try to introduce a new browser without honoring the market share of current browser ProtoShares holders? ProtoShares are like ownership in a patent that never expires entitling you to royalties in all future implementations of the idea! All without the need for government-applied force.

Watch, for you dont know the hour or the day, unless
This letter has announced the season, but not the hour or the day for our near-term releases. Keep watching our web site and newsletters for announcement of precise release dates and times for each of our products. Everybody gets a chance to start mining the same time we do, but watching Invictus-innovations.com and these newsletters is the only way to be in the know when the trumpet will blow! Thanks for your interest and support. Stan Larimer, President Invictus Innovations Incorporated

Visit us at Invictus-innovations.com to learn more.