Witnesses: Can you please add 'GRIDCOIN' to your price feed please?

[R]

Minimum required changes to revive an MPA after a black swan event: https://bitsharestalk.org/index.php/topic,23334.15.html

Very relevant to this thread.

[R]

Price feeds can no longer be published after a black swan.

Currently, there is no way to revive an MPA after a black swan event. Therefore, like someone mentioned on mumble today, this requires a hardfork.

Basically, what needs to be done is to pay out all holders from the settlement_fund. There is currently no mechanism to enforce this. Holders must settle individually. I believe forcing settlement of all holders wasn't implemented because it's computationally expensive (has to walk the list of all account balances).

Once all holdings have been settled and the settlement_fund has been emptied, the settlement_price has to be removed. I think it would be safe to do this at that point. This is something that has to be implemented, however.

That's unfortunate & quite a short lived experiment in BitShares by the Gridcoin community then. We're still on track for otherwise integrating gridcoin into Bitshares. I hope black swan handling/recovery functionality is added into BitShares in the future.

[pc]

Price feeds can no longer be published after a black swan.

Currently, there is no way to revive an MPA after a black swan event. Therefore, like someone mentioned on mumble today, this requires a hardfork.

Basically, what needs to be done is to pay out all holders from the settlement_fund. There is currently no mechanism to enforce this. Holders must settle individually. I believe forcing settlement of all holders wasn't implemented because it's computationally expensive (has to walk the list of all account balances).

Once all holdings have been settled and the settlement_fund has been emptied, the settlement_price has to be removed. I think it would be safe to do this at that point. This is something that has to be implemented, however.

[R]

I believe we experienced a 'black swan' event on 8th September 2016 (lol).

Here's a breakdown of the massive spike in trading volume we experienced: https://steemit.com/gridcoin/@cm-steem/08-september-2016-gridcoin-foldingcoin-and-curecoin-spiked-signifcantly-in-value

TL;DR: Gridcoin spiked to ~ $5 million market cap from ~$2mil w/ approx $800k trading volume, after about 36hrs we dropped down to $2.7 million and now after a week we're sitting around $3-3.5 million market cap with between $20-100k daily trading volume.

The Gridcoin MPA no longer has actively updated price feeds for 7 days now, perhaps this is due to the 7 day forced settlement delay that I implemented.

I'd really appreciate some input regarding how MPAs recover after a blackswan event and input on Gridcoin's MPA settings/variables.

Cheers,
CM.

[R]

***BUMP***

We've now got two witnesses providing price feeds for the GRIDCOIN MPA, looking for more to step forwards.

Edit: Worth pointing out that over the last few days we've exceeded $800k trading volume, would have loved to have seen some of this traded on BTS via OPEN.GRC (soon to be launched) & the GRIDCOIN MPA.

I made my second appeal to BTS witnesses in #172 of beyondbitcoin hangouts: https://steemit.com/beyondbitcoin/@officialfuzzy/guest-signups-beyond-bitcoin-hangout-172-9-9-16-rsvp-to-friday-s-hangout-refer-projects-for-rewards

I'll be continuing the appeal in the #173 and #174 etc until we have more witnesses.

Thanks

[R]

@pc is correct. Market Pegged Assets against a thinly-traded token are a recipe for disaster and abuse. I would not recommend having this price feed managed by the elected Bitshares witnesses.

When you say not managed by witnesses, would you be more comfortable with it being managed by a committee instead?

No, not by the official BitShares committee. That wouldn't be any better. What I had in mind was a private group providing the feed, to absolve BitShares itself of any liability in case of abuse.

Yeah, I don't think that handing control of price feeds to a private/unknown un-elected group is appropriate.

Ultimately, I don't think witnesses are liable in any case of abuse, especially when they're reporting legit price feeds (unlike if they were to provide fake price feeds).

If witnesses are liable for external abuse of legit price feeds then that's a risk that witnesses have acknowledged by becoming a witness in the first place.

I'm willing to vote for witnesses that do decide to provide the GRIDCOIN MPA price feeds.

I've changed the GRIDCOIN MPA variables:
I've reduced the required quantity of price feeds from 7 to 1.
Changed the "Force settlement delay" to 1 week.
Set the "Max force settle vol" to 0.1%

Just spotted there is the ability to disable forced settlement too, could enable that to take forced settlement out of the equation.. but I assume that would be bad because that would then mean that if the price tanked or soared then you would still have the coins you purchased at a high/low value, so yeah probably not going to do that as long as there is no manipulation of the Gridcoin market.

I have disabled the following permissions (first MPA to do so!) so that I have less power over the GRIDCOIN MPA:
Require holders to be white-listed
Issuer may transfer asset back to himself
Issuer must approve all transfers
Disable confidential transactions

[Chronos]

@pc is correct. Market Pegged Assets against a thinly-traded token are a recipe for disaster and abuse. I would not recommend having this price feed managed by the elected Bitshares witnesses.

When you say not managed by witnesses, would you be more comfortable with it being managed by a committee instead?

No, not by the official BitShares committee. That wouldn't be any better. What I had in mind was a private group providing the feed, to absolve BitShares itself of any liability in case of abuse.

[R]

@pc is correct. Market Pegged Assets against a thinly-traded token are a recipe for disaster and abuse. I would not recommend having this price feed managed by the elected Bitshares witnesses.

When you say not managed by witnesses, would you be more comfortable with it being managed by a committee instead?

Can you provide links regarding black swan scenario & how MPAs handle them?

I'd really appreciate the bitshares documents on MPA's being updated to provide information regarding limitations surrounding low-volume assets - I've been hyped for the last 2 months since creating this MPA trying to get it live lol, at least we'll have our OPEN.GRC UIA in the near future.

[Chronos]

@pc is correct. Market Pegged Assets against a thinly-traded token are a recipe for disaster and abuse. I would not recommend having this price feed managed by the elected Bitshares witnesses.

[pc]

But you previously stated "This will trigger a black swan, and bitGRC holders are forced to settle at about 20% of the normal price." - how can force settlement occur without force settlement?

In the event of a black swan, all settlements will happen instantly at the price of the least collateralized short. The usual settlement parameters do not apply, AFAICT.

[R]

No, neither of these scenarios relies on forced settlement, and you don't have to sustain the price manipulation for a significant amount of time. Only long enough for the price feed to adapt, which is typically much less than one hour.

But you previously stated "This will trigger a black swan, and bitGRC holders are forced to settle at about 20% of the normal price." - how can force settlement occur without force settlement?

[pc]

No, neither of these scenarios relies on forced settlement, and you don't have to sustain the price manipulation for a significant amount of time. Only long enough for the price feed to adapt, which is typically much less than one hour.

[R]

Ok, so only those shorting the Gridcoin MPA would potentially be affected, not those holding the MPA (because they'd be saved by forced settlement) ?

In the scenario I described, yes, for some definition of "only".

But an attack in the opposite direction is also possible:

* Attacker short-sells a lot of bitGRC near the feed price.
* Then, he dumps the GRC price to (for example) 10% of its normal value.
* He creates another (small) short with minimum collateral, i. e. about 20% of the normal GRC price.
* Then, he pumps GRC to >20% of its normal value. This will trigger a black swan, and bitGRC holders are forced to settle at about 20% of the normal price.

You'd need to sustain such a manipulation of the external trading value for the full length of the 'Force settlement delay' setting though right, which for the 'GRIDCOIN' MPA is 24hrs?

What if we increased the 'Force settlement delay' to like.. 168hrs so that market manipulation would need to be sustained for a full week before forced settlement occured?

Likewise, what if we significantly reduced the 'Max force settle vol' variable? That too would reduce the impact of an attacker manipulating price feeds, right?

[pc]

Ok, so only those shorting the Gridcoin MPA would potentially be affected, not those holding the MPA (because they'd be saved by forced settlement) ?

In the scenario I described, yes, for some definition of "only".

But an attack in the opposite direction is also possible:

* Attacker short-sells a lot of bitGRC near the feed price.
* Then, he dumps the GRC price to (for example) 10% of its normal value.
* He creates another (small) short with minimum collateral, i. e. about 20% of the normal GRC price.
* Then, he pumps GRC to >20% of its normal value. This will trigger a black swan, and bitGRC holders are forced to settle at about 20% of the normal price.

[Samupaha]

I was just thinking that there is probably very little demand for gridcoin-MPA. It's a financial derivative that is useful only for traders. And if the real coin can be traded easily somewhere else, or even in Bitshares via gateway, MPA is not very interesting to anybody.

IMHO MPAs are useful only for highly traded currencies and assets, like fiat-currencies, precious metals, etc.

[R]

What is the usecase for Gridcoin MPA? If nobody is trading the real thing, why would they want to trade MPA?

We're rewarding ~1800 users, we've got 7000 in our team, there are 400k active BOINC users and 4 million registered BOINC users in total. All it would require to jump from 7000 to 400k users is removal of the team requirement in the future: https://steemit.com/gridcoin/@cm-steem/gridcoin-s-mandatory-team-requirement-should-it-stay-or-should-it-go

I'm investigating extending project rain (tipping thousands of users based on their BOINC computation) to BTS UIA, so there's the potential for driving significant quantities of new users to the Bitshares platform. https://steemit.com/steem/@cm-steem/gauging-interest-would-you-be-interested-being-able-to-tip-boinc-users-your-crypto-asset-of-choice

Sure, Gridcoin might currently have a low market cap and/or trading volume, but that's not going to be the case forever & the Bitshares platform has much to offer the Gridcoin community even if liquidity will be a problem in the short term.

[Samupaha]

What is the usecase for Gridcoin MPA? If nobody is trading the real thing, why would they want to trade MPA?

[R]

I'm not talking about settlement.

Suppose that the feed price is derived from external exchanges, that the total trade volume on these exchanges is low (as seems to be the case right now).
Suppose that external exchanges have not only low volume but also little liquidity and possibly a high spread (I haven't checked this). That means it is possible to move the price by a large amount with only little trade volume.

* An attacker with sufficient BTC in their pockets would try to buy up as many bitGRC on OpenLedger as he can get, at a price slightly above the feed. This may take a couple of days.
* Immediately before the attack, the attacker examines the short positions and their respective collateral. For each short position, he computes the black swan price.
* To execute the attack, the attacker positions a sell order for each short near the black swan price.
* Then he starts "manipulating" the price on the external exchanges.
* As the price of GRC goes up and takes the feed with it, the short positions will be margin called and will buy into the existing sell orders, consuming (almost) their entire collateral.

The attack is profitable if the cost for price manipulation is low in comparison to the value of the bitGRC the attacker has amassed.

The price manipulation attack has been considered before. AFAIR bm's response was that the attacker will end up with BTS that's worth less than what the attack costs. This argument is valid when you try to manipulate the price of BTS against FIAT, or against a high-volume currency like BTC. However, I think with a low-volume asset the attack can be profitable, in particular because the price of BTS itself is not damaged by the attack.

Ok, so only those shorting the Gridcoin MPA would potentially be affected, not those holding the MPA (because they'd be saved by forced settlement) ?

What if witnesses tracked market volume? If it's under a certain volume, shorting wouldn't be allowed/enabled for said MPA within the BTS DEX?

If such an idea is out of the question, then I guess it's a risk that those shorting the MPA would have to take into account?

Hopefully Gridcoin won't stay a low volume asset forever, hah!

[pc]

I'm not talking about settlement.

Suppose that the feed price is derived from external exchanges, that the total trade volume on these exchanges is low (as seems to be the case right now).
Suppose that external exchanges have not only low volume but also little liquidity and possibly a high spread (I haven't checked this). That means it is possible to move the price by a large amount with only little trade volume.

* An attacker with sufficient BTC in their pockets would try to buy up as many bitGRC on OpenLedger as he can get, at a price slightly above the feed. This may take a couple of days.
* Immediately before the attack, the attacker examines the short positions and their respective collateral. For each short position, he computes the black swan price.
* To execute the attack, the attacker positions a sell order for each short near the black swan price.
* Then he starts "manipulating" the price on the external exchanges.
* As the price of GRC goes up and takes the feed with it, the short positions will be margin called and will buy into the existing sell orders, consuming (almost) their entire collateral.

The attack is profitable if the cost for price manipulation is low in comparison to the value of the bitGRC the attacker has amassed.

The price manipulation attack has been considered before. AFAIR bm's response was that the attacker will end up with BTS that's worth less than what the attack costs. This argument is valid when you try to manipulate the price of BTS against FIAT, or against a high-volume currency like BTC. However, I think with a low-volume asset the attack can be profitable, in particular because the price of BTS itself is not damaged by the attack.

[R]

Guys,

this is dangerous. CMC shows the total trade volume of GRC in the last 24 hours to be less than 3k USD. An attacker who is long in bitGRC can easily steal collateral by manipulating the external trade price.

Could this be negated by changing the "Max force settle vol" and "Force settlement offset" variables? Could you elaborate on your concerns? The bitshares documentation doesn't cover any of this.

[pc]

Guys,

this is dangerous. CMC shows the total trade volume of GRC in the last 24 hours to be less than 3k USD. An attacker who is long in bitGRC can easily steal collateral by manipulating the external trade price.

[karnal]

[R]

Xeroc has integrated 'GRIDCOIN' into his python price feed scripts: https://steemit.com/graphene/@xeroc/changelog-python-graphenelib-0-4-4

Could some witnesses please provide feeds for gridcoin?

https://steemit.com/gridcoin/@cm-steem/gridcoin-market-pegged-asset-soon-to-go-live-on-the-bitshares-dex

[R]

Hey,

I've been trying to get the 'GRIDCOIN' MPA (https://www.gridcoin.us) added to the python price feed script: https://github.com/grctest/python-graphenelib/blob/master/scripts/pricefeeds/config-example.py

http://cryptofresh.com/a/GRIDCOIN
https://bitshares.openledger.info/#/asset/GRIDCOIN

https://www.poloniex.com/exchange#btc_grc
https://c-cex.com/?lpm=btc&p=grc-btc
https://bittrex.com/Market/Index?MarketName=BTC-GRC

I've been unable to test the changes, I've run into several issues and am currently stuck at: http://pastebin.com/WTCGNCmw

Can some witnesses please check out the above? Unfortunately the script doesn't support c-cex, is 2 feed sources sufficient?

https://github.com/xeroc/python-graphenelib/pull/44

Thanks for your time.