Some Opinions on the Default Unit of BTSX
Before the description of this question, I would like to talk about my understanding of how BitUSD will anchor to USD.
(If you have been to the bitfinex Futures Exchange(bitfinex.com), you should know that nowadays the BTC futures prices on bitfinex anchor to the BTC prices on Bitstamp by selling short or buying long.)
BTSX anchors to USD in the same way. The difference is that 796 uses BTC as collateral while BTSX uses XTS.)
What kind of price reference is uesd to anchor to 1USD by 1BitUSD?
Assume that, the price of 1XTS now in centralized exchange market is 20USD.
Then we make 1BitUSD=1USD,
which means 1BitUSD=0.05XTS=1USD.
Normally, 1BitUSD should be close to 0.05XTS in the BTSX system.
When we sell short or buy long, we must refer to the XTS price in centralized exchange market.
Assume that n
is the price of long buying and short selling in BTSX, and m
is the real-time price in centralized exchange market,
then the indicative price formula will be: n * m = 1.
In the example above, it will be 0.05*20=1
We can see that the higher the XTS price m is, the lower the n is. And here comes my question, isn't the 4-million system setting too few?
Maybe you would say electronic currency is infinitely divided and there's no the so-called "too few".If 1XTS is bullish to 200USD, 1BitUSD in BTSX would tumble to 0.005XTS.When we refer to price to sell short or buy long in BTSX, it's not that intuitive just like centralized exchange which uses legal tender to settlement directly. We still need to determine what kind of price to operate by refering to the real-time price in centralized exchange.There is already a calculation made in this process. If the transaction price is the decimal 0.00X, it will add calculation burden undoubtedly.I read a report yesterday. It said one of the reasons why Dogecoin was on the rise was its enormous amount, which made small transactions more convenient and intuitive. It also said for most of people , the ability to do mental arithmetic was not strong. It would be a headache to see many decimal places.
I think it makes sense. 56.3mBTC is surely more intuitive than 0.0563BTC. Definitely for an excellent product design, the easier to use, the better.This is very important. Our human brain isn't omnipotent. It has been processing massive data all the time. So in order to be more efficient, it would like to accept more intuitive and simple data to cut down calculation amount. If the learning cost is too high, it will keep people stay away. So my advice is:
In order to let BTSX be easier to use, I suggest using mXTS as default unit directly in the very beginning of BTSX's first release.
(Refering to BTC, once XTS is used to be the default unit, it won't be easy to change mXTS as the common unit any more. Besides, I believe a small unit is more beneficial for market depth.)
I believe that, 50mXTS*0.02USD will make BTSX system more simple and elegant than 0.05XTS*
20USD. Just let those guys in centralized exchange do the decimal math. And they like cheaper coin better, i mean, which seems cheaper.
One thing I would like to add:
Why will changing a smaller default unit be more intuitive? Because most of numbers we usually see are integers. Comparing to how much 0.001347 is bigger than 0.000134, we are more familiar with how much 1347 is bigger than 134.
Another reason is that we have a familiar integer algorithm. Ten 1 is ten, ten 10 is a hundred, ten 100 is a thousand.
We've got familiar conversion rules about the number on the left of decimal point. But on the right of it, we have nothing. We can count 53672 fifty-three thousand six hundred and seventy-two. But when it comes to 0.53672, we can only read it zero point five three six seven two. There is no "ten 0.01 is ?" any more.