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Comment by smarx007 | Hacker News Reader

Whitepaper: https://efforce.io/WP_ENG_V1.pdf. Please read at least some of it before posting harsh comments.

I think it would have been much better launched in EU. I can totally see this is as a platform for energy efficiency accountability and energy efficiency investment tracking for tax break purposes.

My problem with it is that (1) the whitepaper is too thin on tech details and (2) it seems to have a fixed energy project model connected to those EFFORCE tokens preventing it from being used on a national level where a country has its own legally mandated reward scheme different from EFFORCE vision.

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> the whitepaper is too thin on tech details and

Which is the #1 sign of every crypto scam (or a less maliciously: of a poorly constructed crypto project).

A whitepaper at the very least should outline the incentive mechanisms of _all_ the actors (and their actions) in the system (and not just the miners like they do).

On top of that it has the very traditional real world->blockchain problem of needing to have verified data about the real world on the blockchain for the token to work. "The data that each smart meter will transmit will be validated and certified by the blockchain" sadly are just empty words, as the blockchain can neither validate nor certify anything about the real world on its own (and any "smart meter" can be tempered with). That's also only a single data point that's required for the token to work (if everything else holds up). They would also need prior energy consumption, which the implementing companies would be incentivized to downplay.

The concept is as full of holes as your run-of-the mill 2018 bubble crypto project.

I implemented a POC project with s contract and payment settling system. We settled on a solution where both parties would invoke a etherum transaction and would provide the details of the (business) transaction from their POV. I.e the goods (electricity) provided and the payment etc details. If there was a difference the data for that transaction would be flagged as "needs inspection/resolution". Otherwise the smart contract would distribute the payment tokens as agreed and record the data in the ledger.

But yeah all the data eventually has to come outside of the blockchain itself. This is always the weakness and shifts the trust issue to whoever is providing the data. Blockchain itself is no Magic bullet to resolve the fundamental issue of "trust"

> This document is confidential and by accepting delivery of this document, you agree to keep confidential all information contained herein.

Sorry, we can't discuss it.

The massive "NOT FOR UNITED STATES PERSONS" disclaimer isn't exactly encouraging either.

> You may not, nor are you authorised to, deliver or disclose the contents of this document to any other person.

Very clear that we can't discuss it.

> EFFORCE Limited, a Bahamas based company limited by shares, formed for the purpose of issuing EFFORCE tokens on behalf of its controlling entity EFFORCE Ltd, a Malta company

Nothing says "I am not a crook" like using two different corporate entities in notorious tax avoidance jurisdictions.

While Malta is in the Eurozone, I'm not sure you could launch something like this in a country with respectable financial regulators. Mind you, those are in short supply after Bafin/Wirecard...

Starting a company on Malta is a pain so unless you live there or work in online gambling (where their regulations actually are decent) the only reason to do so is due to their lax regulations on the finance sector. Outside online gambling Malta is dreadful for startups, so that they are Malta based is indeed a bad sign.

My knowledge comes from having worked in the online gambling industry and knowing a lot of people who live in or have lived in Malta.

Indeed. The real parent company appears to be AitherCO2 SpA, and many of the staff listed are Italian. So there's a reason for not doing this as a SpA. On the other hand there appears to be a somewhat-genuine energy efficiency business under there. This reminds me of "Kodak gets into blockchain" or the Long Island Iced Tea fiasco (https://www.bloomberg.com/news/articles/2017-12-21/crypto-cr... )

The Bahamas are also not known for their regulatory rigor. Being based both in the Bahamas and in Malta seems even stranger, unless the company intends to engage in a level of shenanigans that would be beyond the tolerance of even a generally tolerant jurisdiction.

As a Swiss, I don't know whether I should be offended or relieved that our usual suspect, Zug, does not seem to be involved in this.

What's the story with Zug? It seems to be popular for several blockchain hawking companies.

For one thing, it has the lowest tax rate in Switzerland

Low tax rates, lax regulation, and a relatively efficient and impartial court system (our courts are definitely in the pocket of capitalism, but not so much in the pocket of individual capitalists) have led to a proliferations of companies there, many of whose existence in Zug consists solely of a mailbox.

This has also led to a proliferation of local talent which looks passable in a suit, can open mailboxes, is versed in law and/or accounting, and does not steal excessive amounts of money.

The business model is basically "stuff that is not provably illegal yet". During the Cold War, Switzerland got away with a lot, but in recent years, many formerly lucrative areas of business started drying up thanks to stricter money laundering laws etc. So for an ecosystem that has evolved to accommodate financial engineering right at the edge of legality, cryptocurrency seemed almost a custom made niche.

> work in online gambling (where their regulations actually are decent)

This claim is false. The internet is littered with corpses of Malta-based gambling sites that exit scammed their playerbase. This doesn't occur in jurisdictions where the gambling regulations are "decent".

Edit: unless you mean "decent" from the perspective of unscrupulous gambling sites who are looking to scam people out of money.

While I'm skeptical of the project, as expressed in another comment, that's not really an unusual disclaimer for a project like this on first announcement. It takes time to figure out all the legalities in all the different jurisdictions, and not having such a disclaimer could get them into a lot of trouble down the road.

> (1) the whitepaper is too thin on tech details

I read a little bit and it seems critical. EFFORCE is dedicated to energy saving, but it mentions "mining" without any algorithm details. Assuming it is Proof-of-Work like Bitcoin (since it does "mining"), then why would they use the absolutely energy inefficient algorithm to save energy?

How an energy saving platform not mention any efforts to save energy in their tech itself?

> Poof of Work

Best cryptocurrency typo since hodl.

Oh my god, I fixed it lol

Using blockchain for energy efficiency is like using a machine gun for suicide watch.

> where a country has its own legally mandated reward scheme

Knowing my country, that would lead to gaming the system.

for the confused, here's the key:

> For the entire duration of the contract, the Beneficiary pays a part of the energy savings generated to the E.s.Co. This gives a return on the initial investment.

> The greater the energy savings obtained by the Beneficiary, the greater the returns for the Esco and the Contributors, since the savings generated are the actual financial performance of the initial investment.

So, contractors figure out how to make a company more energy efficient, and in return they get a cut of the savings they saved the company.

> the company can use EFFORCE to look for the necessary crowdfunding to proceed with the energy redevelopment projects, in exchange for sharing the savings generated.

Ignoring the blockchain aspect of this for a second, the underlying model her makes me a little hopeful it can tackle some of the more frustrating problems I've experienced in designing energy-efficient buildings, if it ever catches on.

In the building construction industry, there's a huge gap between an optimal energy performing construction and what finally gets built, due to the immense reluctance of clients to deal with the upfront cost or uncertainty associated with newer, high-performing constructions and technologies. It's somewhat mitigated in the commercial sector since commercial clients have incentive to "brand" their buildings as sustainable, but it's depressing as hell in the residential sector. Although it would definitely be harder (albeit, have way more impact) to use the EFFORCE model during new construction versus retrofits.

> immense reluctance of clients to deal with the upfront cost or uncertainty

This is why human society invented regulations.

Unfortunately human society also created conservatives, so we're not actually able to implement regulations.

Ok, so this makes sense:

"So, contractors figure out how to make a company more energy efficient, and in return they get a cut of the savings they saved the company."

Which is why it is a real world job. And companies contract such people to either want to save money on their own, or because they have to, because of some law.

"> the company can use EFFORCE to look for the necessary crowdfunding to proceed with the energy redevelopment projects, in exchange for sharing the savings generated. "

But this and the whole need of the blockchain, sounds so vague and overly complicated and the outcome either, that I doubt, you find enough gullible people, wanting to do the hassle of studying it with enough detail, to not oversee some nasty catch, costing you even more in the end, than you could ever save. Because Efforce ... wants to somehow make money, too.

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