A Brief Loom Instructional
I just finished a couple of hours on Skype with Patrick Chkoreff, the gentleman who developed Loom Gold. Wow, it is simple, secure, private & very innovative. This system, is better and easier then anything I’ve ever seen. Enough small talk….let me share with you what I learned. Before reading any further, forget about all other online payments you have ever known and open your mind to the ‘Loom’.
“Loom Gold” is an Open Source software platform. That’s right it is Open Source and if Patrick will allow it you might even have one running on your own server. You would not be the first Loom on the block, there are a few successful Looms already in existence. Additionally you can customize your version with fancy colors, graphics, flash or secret access pages….basically you can do anything that floats your boat. However, when you visit this original Loom Gold web site you will notice it is pretty basic and designed for simplicity and easy navigation. “Welcome to Loom” is about all you will find on the main page.
From The Main Page…..
If you are new to the Loom system, you will need to follow the link labeled create a new folder. What is a folder? This is where you keep your assets, or perhaps I should say digital money and that might be a better description for my readers. However, in Loom Gold, there are no folder names. The identifying information you need for any Loom ‘folder’ is simply the passphrase. With this system, your folder will have no identifying features beyond the passphrase. So when asked to create a folder, all you are actually doing is making up the lengthy passphrase. Loom also offers suggestions for creating that large random code which is your passphrase. That’s all the access you will need to get into your Loom Gold ‘account’ …..the passphrase. Pretty simple eh?
Creating a folder requires two steps. As listed above, step one is creating the passphrase. Step two is having the usage tokens to ‘pay’ for the folder creation.
Getting the usage tokens from a ’sponsor’ is very simple. New users to the Loom system will receive an identifying ‘location’ within the Loom (a drop point). That location (phrase) looks like this: 1cbc212c4aa0869494a23fe54fbcb403. To set up the new folder, simply enter your passphrase, then enter your ‘location’ (big number) and instantly the program logs you into your new folder. Your sponsor can email, fax or Skype you that location (big number) and you are ready to go. Thats all……you have created a ‘new account’.
Users can have as many folders as they want – there is no limit, but those tokens you need to create a folder are not free. Each time you create a folder – you burn disc space and for the Loom operator that cost money. Consequently, those small costs are simply being passed on to you. Folder creation fees are what amounts to a small usage fee and customers really should not think too much about it. The amount is not a million Pesos, but wisely, that small fee prevents waste and helps regulate excessive usage. (Why? If email cost .25 cents each to send, there would be no spam, right?)
How many usage tokens will you lose in the folder creation? As a general guess, a new folder will eat about 60-70 usage tokens….in that range. So as a new user, that big number above, the ‘location’ you need to get started probably contains about 200 tokens. That’s enough tokens to set up one folder and leave you with about 130 usage tokens in your account.
As shown here, my new account had 133 usage tokens left after opening. The small cost of the folder depends on the length of the nickname, whether the system pads to 16 bytes for encryption and some other technical stuff I’m not really familiar with so let’s just say between you and me… as a rule its about 70 tokens. When you set up the folder and enter the program for the first time, you will also see the balance of usage tokens you have left.
Once you are logged in, you will see your folder and it should look something like this image:
The next image shows my handiwork and please note the upper Red area I have highlighted, is your folder area and will display all the assets in your possession. The lower blue highlighted area, shows ‘drop points’ and the assets currently positioned in each drop point. 
Your folder area (red highlighted) contains what I would call ‘protected’ assets. While the drop point area (blue) shows what I call ‘common area’ assets. They are still in your possession but may at any time be taken by the receiver. Assets in drop points can be taken by your receive if you have provided him the ‘location’ or you also have the option at any time to take assets back into your protected ‘folder’ area.
Again, let me describe what I would refer to as your ‘permanent’ assets which are all displayed above the drop down menu and the ‘common area’ assets listed in drop points, showing below the menu, may be taken by the receiver at any time. Just my way of thinking.
You can see from this graphic, that my sponsor, Patrick, gave me not only usage tokens but also 1 gram of Loom Gold and 25 grams of TEST gold. However, I have not yet ‘taken’ the Loom or the TEST items so they are still in their drop points awaiting me to ‘take’ them into my folder. 
Moving assets from the ‘drop points’ into your folder is instant and easy, you simply select from the drop down list, the asset, its location (nick names next to the green dots will also appear in the drop down lists) and click ‘Take’. That moves the asset from the ‘common area’ drop point to your ’secure’ folder. I’ve added some new locations below so let’s try to ‘Give’ and ‘Take’ some assets.
Below is the same folder and I renamed my drop point ‘Mark’s Drop Point’, created some additional drop points and now have a 
balance of TEST gold and usage tokens.
That is the basics of the Loom system, its super simple to use. Ah, one very important NOTE I will make here is that transactions between users, the Give and Take, have NO fees. There is currently no monthly fees and no transaction fees. The only fee you should prepare yourself for is the third party independent agent’s fee for selling you Loom Gold. You send them national currency, they place Loom Gold on a drop point and you pick it up….thus funding your account.
There are about a dozen other items to address when operating a folder ‘account’, but we’ll look closer at those in our tutorial video series. Next up, I’ll give you the tips and inside scoop on what makes this system so different & special to Internet users and we will discuss a bit more about the technical features of daily use.
Loom is fantastic. I love it! Thread yourself into the fabric of the future: get into Loom!
Loom sets the bar for privacy, security, and ease of use. It’s internal architecture and external presentation are elegant and tight in the manner of a mathematical theorum. The ‘Drop point’ model is unique and more cash-like than other digital currencies. Patrick Rocks!
Thank you for the comments, I agree. The simplicity of the system is just amazing. Patrick explained the e-commerce uses and as an example we discussed Amazon accepting it and wow, its simple for both users and vendor, no personal or financial information is EVER exchanged so no fraud risk there and even with the monster security of the system, the set up for use is quick and easy. I’m amazed each time I learn more about it.
MARK
Thanks so much for your kind comments here and your constructive criticism elsewhere. I’ll continue to hone the system and make the user experience as enjoyable as possible.
Also Mark, I appreciate the amazing journalistic and educational work you do at digitalmoneyworld.com, dgcblog.com, and on youtube.com — especially your compelling coverage of the miscarriage of justice against e-gold. You’re a powerhouse!
How can I get those tokens so that I can try this out?
I’m excited to try this new and creative concept.
Thanks!
http://www.thecyberspaceatm.com/
This is a working example of a Loom. It shows what you can do with the program.
Mark
Hi Mark,
The link that you provided above does not work “parse error”. Maybe the host is down or something.
Will try again later on.
Thank you,
Steve
Yes, how do I get the tokens to start a folder?
This was posted to an email list, these are good question…..
I am very interested in the system, but have not really had time to study it extensively. I have a few questions that I hope you as an experienced early adopter can answer.
It concerns me is that there is no info at all on the loom site about the actual gold. No mention of backing, or guarantees etc.
So my questions:
1. Where is the gold reserve for Loom Gold?
2. Has any independent party verified that the gold actually exists in a quantity adequate to cover all the Loom Gold issued?
3. Since I see no information about this subject at all on the loom site, what recourse do I have and against whom would I take action if it turned out that Loom “gold” was as worthless as OS “gold”?
Regards,
The reason there is no mention of reserves or guarantees on the loom site is that Loom is a generic site. There is nothing special about “loom gold” or any other asset type hosted on the system.
I recommend that you only use asset types issued by people you trust, for example yourself and perhaps some close friends and associates. If you choose to use an asset type issued by someone you do not fully trust, you should discount its value accordingly to account for the risk.
Moreover, if you do not trust a particular Loom server, do not use it. Use a different one, or run one of your own. If you choose to use a Loom server run by someone you do not fully trust, you should discount the value of any assets hosted on that server to account for the risk.
The free market is all about pricing and risk management.
Yiwel wrote:
Yes, how do I get the tokens to start a folder?
I wish I could help you, but I live in a society where if I trade my own property freely, armed people are willing to lock me in a cage and steal everything I own. They probably would have locked up Tom Sawyer for trading dead rats, marbles, kites, and doorknobs. Besides, what could you give me in exchange anyway? I’d accept six fire-crakcers, but you can’t ship those. Can you ship a tin soldier, or would that set off the metal detectors?
……let me take a stab at it here. Loom is providing “economic dial tone” for people to have economic conversations (peer to peer) or one might say “monetary intercourse.”
Loom itself provides usage tokens. Different individual issuers provide various types of gold, held in various ways.
There isn’t anything special about gold issued by the Loom operator, except that he knows something about it. I could put 10 grams of e-gold on a Loom location, which would be e-gold, itself, circulated Loomishly.
Patrick notes that one should only accept assets from people you trust, or have reason to trust. Otherwise, discount according to your perception of risk. He notes the same about the various Loom servers. It is an open source technology which means that some Loom servers are going to be operated by open and honest sorts, and nothing prevents other types from operating one.
Loom is a technology for swapping anything. Cows. Digital bearer instruments. Whatever. Doesn’t have to be gold. Could be labor hours, cash, diamonds, Moon dust, you name it.
Vertoro is happy to help customers build new folders on Loom. Contact us at http://vertoro.com/ with your Loom token needs. If you aren’t yet a customer, YOU! Buy something! NOW! Please.
Thank you!
Regards,
Jim
If you check out the loom instructional above, you can find this picture. From the drop down, you can see which assets are currently used on this Loom system.
–Loom Gold (this asset is backed by gold held or issued by the operator)
–TEST gold (this is the test asset and not backed by anything)
–usage tokens (this will be on all Loom systems standard, unless requested different)
If you operate your own Loom or find another on the Internet , they may have added their own different assets, which circulate within their community. Here are some examples,
(1) The Boy Scouts of Amerika, set up their own Loom to trade and transfer between their Scout region. Their unit of value is “Scout Hour” and each hour is worth one Boy Scout visiting your establishment and working manual labor, your choice, for one hour. Perhaps they have a money raising campaign, selling hours in their community, cash comes in and Digital ‘Scout Hours’ go to each person or business in the community who buys one or two for charity. Once the work is accomplished, the ‘Scout Hour’ is moved back to the ‘Scout Account’. As long as everyone in the community realizes that one Scout Hour is the equivalent of a Boy Scout sweeping their warehouse or raking their lawn for exactly one hour, everyone could use the units and envision exactly what that value = one hour of work.
(2) You are a e-commerce rock star on the Internet, selling offshore hosting to people all over the world, accepting a Scout Hour will not work, so you chose a Loom offering units with something everyone you do business with recognizes, Euros. One LEU (Loom Euro Unit) equals one Euro. Sell a hosting package for 24euros and receive 24 LEUs into your account. In this case, the operator would have to keep EUROs on hand or in a bank to back any outstanding LEUs. You would either trust him to do so (I’m reminded of EVO and INT but both are bad analogies) or if you don’t trust them they need to provide an audit or similar disclosures…..Or simply don’t use them. Trust in important with any online system containing value. That loom, the drop down menu would show:
–LEU -Euro Unit-
–TEST Gold
–usage tokens
(3) Another Gold Loom, you could back the units with digital gold currency and each Loom unit equals on Pecunix Gram or one e-gold gram? Drop down menu:
–Loom DGC
–TEST Gold
–usage tokens
(4) From within Loom Gold, there is a button for “Types” here is that page:
Types
Here is a list of the asset types currently recognized in your folder. If you click a green dot next to an asset type, you will see options to edit the type’s nickname or moving it up or down in the list. Soon we will provide options to add and delete asset types.
If there are asset types listed here which you do not understand, don’t worry about it. Those came over automatically from the old system. When we get this page finished, you will be able to delete anything you want from this list.
–usage tokens
–grams loom gold
–grams loom 1mdc
–grams TEST gold
If you operate your own Loom, like mine is being setting up now at Loomster.net you may want all of the above, plus other ‘types’ of assets for transfer between users. Of course you will still need to have multiple third party agents, who would accept your “Loom Units” in exchange for national currency. One one hand I don’t think that Scout Hours will have to many agents, but now Linden Dollars, Liberty Reserve, Webmoney etc all of these are wide open, especially the virtual currencies now becoming popular. How many Loom Systems could you create integrating virtual game currencies?
Mark
I have been in contact with the operator of CyberSpaceATM and the downfall as I see it is that the only exchange that maintains a market for their e-gold is exchangesplus which is owned by the same individul who ownes CSATM. I wouldn’t feel comfortable putting too many eggs in one strangers basket like that. Great technology but I think I’ll wait till it grows up.
Mike
Ps. How can I subscribe to your e-mails Mark?
Mike,
With a new reader like Thunderbird, you can grab the feed
http://feeds.b5media.com/b5media/DigitalMoneyWorld
or you can get on the mailing list over at American Chronicle,
http://www.americanchronicle.com/articles/viewArticle.asp?articleID=30334
Thanks,
Mark
PS or email direct anytime Panama@cryptoheaven.com
Great work with Loom Patrick!
Fantatstic article Mark. This article was concise and
and showed how simple and versitile it is to use Loom.
William Maderas
In June (another) Mike complained that cyberspaceATM had only one exchanger working with it but when I checked a while back they had 3 exchangers working with them.
Mike – Also :)
I don’t know if anyone is still working this blog but I have a really dumb question… Is LoomGold and it’s ilk based on the Power Loom language developed by USC? If so, what are the advantages of AI when brought to bear on what is essentially a data base?
Mike
No relation to the language, and no need for AI as you suggest.
Is the source code available or is it no longer open source?
Mike