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Offline Empirical1

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Might Bitusd trade at a discount to real USD?
« on: November 26, 2013, 04:55:34 AM »

Hi newbie here, I didn't grasp all the information regarding bitshares so apologies if the following doesn't make sense...

As you mentioned in one of your videos, all BTC are not equal, the value of the BTC on different exchanges can vary based on things like the perceived riskiness of the exchange & expected time delay for receiving fiat.

Is it possible that Bitusd will trade at a slight discount to a real USD? Because in order to make a bitusd into a real USD you will still have to go through an exchange. So even though that is not the purpose of your exchange,  I think the market will price in the avg. fees, risks and time delay associated with changing a bitusd to real USD?

As also won't the biggest market for bitusd be real world merchants (or companies that service those merchants)?
Right now most merchants don't want to sell for BTC because they don't want to be exposed to the volatility but they may happily sell for Bitusd because then they can capture the BTC market without BTC volatility risk but only if the bitusd price reflects the costs to them of changing Bitusd into real USD. (Unless service companies can deposit real $ into merchants accounts in exchange for Bitusd for less than a 2.5% service charge, then I guess they BitUsd could = Real Usd if merchants are the ones willing to take the fee in exchange for access to the crypto-market the way they currently do with credit cards.)

Edit: I guess bitpay already offers the above service/market to merchants.
« Last Edit: November 26, 2013, 05:35:22 AM by Empirical1 »

Offline MrJeans

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Re: Might Bitusd trade at a discount to real USD?
« Reply #1 on: December 16, 2013, 01:52:47 PM »
interesting... This would factor in if BitUSD is used allot by merchants.
Then when perceived risk is high (at the start) BitUSD would be undervalued (maybe even less than 1 USD).
When perceived risk is reduced over time and benefits a realized then the price of BitUSD will go up.

I believe BitUSD will be used more for speculating on the price of USD and as a savings account for persons who want a safe place to keep their money at a decent return. For these uses there wont be allot of exchanging to USD going on so exchange costs wont be too significant.

Offline phoenix

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Re: Might Bitusd trade at a discount to real USD?
« Reply #2 on: December 16, 2013, 01:59:26 PM »
I think BitUSD will end up being fairly stable in the long run. What will be interesting is seeing how assets like BitGold react, since it should be a speculation on gold, which is already a heavily speculative commodity
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Offline luckybit

Re: Might Bitusd trade at a discount to real USD?
« Reply #3 on: December 21, 2013, 12:53:17 AM »
I think BitUSD will end up being fairly stable in the long run. What will be interesting is seeing how assets like BitGold react, since it should be a speculation on gold, which is already a heavily speculative commodity

The big difference is you can have asset classes which are technically impossible to have in the physical world. Forget BitGold, think bigger.

BitUSD will provide the stability necessary but what stops you from combining BitUSD, BitGold, and something else to make the perfectly stable currency?

Or you can create a currency which is perfectly stable but which gives 10% returns for years straight, or 20%, or 40%. There really aren't a lot of rules here and we don't know what can be created.


I think if BitUSD starts out cheaper than a dollar why not buy as much of it as your dollars can afford because it wont be cheaper than the dollar forever. If at any time in it's lifespan it is more expensive than the dollar then you will make extreme profit with minimal risk. I think it would be a better play than Bitcoin even because it's almost a sure thing that it will be a winner. Statistically it would be similar to 50% chance that you'll get your money back soon and the chance rises the longer you have your money in that form until it reaches almost 100%.

Of course that all depends on the system working as intended and the dollar staying as it is now.
« Last Edit: December 21, 2013, 12:57:47 AM by luckybit »
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Offline Method-X

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Re: Might Bitusd trade at a discount to real USD?
« Reply #4 on: August 29, 2014, 06:50:35 PM »
bump

Offline ifinta

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Re: Might Bitusd trade at a discount to real USD?
« Reply #5 on: September 11, 2014, 09:25:44 PM »
The BitUSD Market seems to be stable for now. You can sell your "poor virtual" BitUSD for about 1 real USD :) See https://bter.com/trade/bitusd_usd

Offline tonyk

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Re: Might Bitusd trade at a discount to real USD?
« Reply #6 on: September 11, 2014, 09:29:42 PM »
The BitUSD Market seems to be stable for now. You can sell your "poor virtual" BitUSD for about 1 real USD :) See https://bter.com/trade/bitusd_usd

Yes, but MeTHoDx beat you to that yesterday. I had not have checked this particularly boring pair   :) for a few days, also.
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.

Offline luckybit

Re: Might Bitusd trade at a discount to real USD?
« Reply #7 on: September 11, 2014, 09:29:48 PM »
Hi newbie here, I didn't grasp all the information regarding bitshares so apologies if the following doesn't make sense...

As you mentioned in one of your videos, all BTC are not equal, the value of the BTC on different exchanges can vary based on things like the perceived riskiness of the exchange & expected time delay for receiving fiat.

Is it possible that Bitusd will trade at a slight discount to a real USD? Because in order to make a bitusd into a real USD you will still have to go through an exchange. So even though that is not the purpose of your exchange,  I think the market will price in the avg. fees, risks and time delay associated with changing a bitusd to real USD?

As also won't the biggest market for bitusd be real world merchants (or companies that service those merchants)?
Right now most merchants don't want to sell for BTC because they don't want to be exposed to the volatility but they may happily sell for Bitusd because then they can capture the BTC market without BTC volatility risk but only if the bitusd price reflects the costs to them of changing Bitusd into real USD. (Unless service companies can deposit real $ into merchants accounts in exchange for Bitusd for less than a 2.5% service charge, then I guess they BitUsd could = Real Usd if merchants are the ones willing to take the fee in exchange for access to the crypto-market the way they currently do with credit cards.)

Edit: I guess bitpay already offers the above service/market to merchants.

Why would we need to turn it into real USD? To pay taxes? It depends on how frequently people need to do that.
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Offline tonyk

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Re: Might Bitusd trade at a discount to real USD?
« Reply #8 on: September 11, 2014, 09:32:17 PM »
Hi newbie here, I didn't grasp all the information regarding bitshares so apologies if the following doesn't make sense...

As you mentioned in one of your videos, all BTC are not equal, the value of the BTC on different exchanges can vary based on things like the perceived riskiness of the exchange & expected time delay for receiving fiat.

Is it possible that Bitusd will trade at a slight discount to a real USD? Because in order to make a bitusd into a real USD you will still have to go through an exchange. So even though that is not the purpose of your exchange,  I think the market will price in the avg. fees, risks and time delay associated with changing a bitusd to real USD?

As also won't the biggest market for bitusd be real world merchants (or companies that service those merchants)?
Right now most merchants don't want to sell for BTC because they don't want to be exposed to the volatility but they may happily sell for Bitusd because then they can capture the BTC market without BTC volatility risk but only if the bitusd price reflects the costs to them of changing Bitusd into real USD. (Unless service companies can deposit real $ into merchants accounts in exchange for Bitusd for less than a 2.5% service charge, then I guess they BitUsd could = Real Usd if merchants are the ones willing to take the fee in exchange for access to the crypto-market the way they currently do with credit cards.)

Edit: I guess bitpay already offers the above service/market to merchants.

Why would we need to turn it into real USD? To pay taxes? It depends on how frequently people need to do that.

yee I do not think that with bitUSD now present, the need to covert to fiat USD will be the rule much longer, for tax purposes....
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.

 

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