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Offline fumanchu808

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Does BitUSD pull marketcap from BitsharesX?
« on: August 30, 2014, 04:29:53 AM »

Hi again team,

Does purchasing BitUSD or any BitAsset pull value from BTSX's marketcap? Or is it calculated in such a way that once we push value into the whole BTSX system via purchasing BTSX, BitsharesX's total market cap will reflect all all BTSX plus all BitAssets? Just trying to understand the dynamic there.

Would be a very easy explanation for the price drop on BTSX.

Offline mrbildo

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Re: Does BitUSD pull marketcap from BitsharesX?
« Reply #1 on: August 30, 2014, 08:52:51 PM »
I have also been wondering about this, it's quite a complicated subset of economies XD

Offline bytemaster

Re: Does BitUSD pull marketcap from BitsharesX?
« Reply #2 on: August 30, 2014, 09:01:00 PM »
Purchasing BitUSD adds value to BTSX because it takes 2x the value of the USD out of circulation and ties it up in collateral. 
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline bitcoinba

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Re: Does BitUSD pull marketcap from BitsharesX?
« Reply #3 on: August 30, 2014, 09:11:11 PM »
Purchasing BitUSD adds value to BTSX because it takes 2x the value of the USD out of circulation and ties it up in collateral.


Interesting. On http://coinmarketcap.com/ there is a view of Marketcap by Available Supply or Total Supply, but they give the same number as a result. Is that an error on their end?

I don't see any explication for the metrics or formula for calculation. Is there a better source?

Offline Riverhead

Re: Does BitUSD pull marketcap from BitsharesX?
« Reply #4 on: August 30, 2014, 09:15:56 PM »
Shorting bitUSD into existence adds value because it takes BTSX out of play that was otherwise liquid. Effectively reducing supply but not actually burning the share. This increases the price to obtain BTSX but keeps the supply multiplier the same and therefore marketcap rises. Shorts don't last forever though and it's conceivable that the average amount of BTSX shorted at any one time may stabilize as the market reaches a less volatile state.

As for their available supply and total supply those numbers will be the same because BTSX is DPOS and not mined. Therefore the entire supply comes into existence at once. This is different than Bitcoin where the theoretical max supply is known but only so many coins are mined so far.
« Last Edit: August 30, 2014, 09:20:28 PM by Riverhead »

Offline bytemaster

Re: Does BitUSD pull marketcap from BitsharesX?
« Reply #5 on: August 30, 2014, 09:18:33 PM »
Purchasing BitUSD adds value to BTSX because it takes 2x the value of the USD out of circulation and ties it up in collateral.


Interesting. On http://coinmarketcap.com/ there is a view of Marketcap by Available Supply or Total Supply, but they give the same number as a result. Is that an error on their end?

I don't see any explication for the metrics or formula for calculation. Is there a better source?

For all practical purposes the supply is 2 billion right now.  Any thing else is a rounding error as far as coin market cap is concerned.   
For the latest updates checkout my blog: http://bytemaster.bitshares.org
Anything said on these forums does not constitute an intent to create a legal obligation or contract between myself and anyone else.   These are merely my opinions and I reserve the right to change them at any time.

Offline theoretical

Re: Does BitUSD pull marketcap from BitsharesX?
« Reply #6 on: August 30, 2014, 11:49:41 PM »
Purchasing BitUSD adds value to BTSX because it takes 2x the value of the USD out of circulation and ties it up in collateral.

How much is tied up in collateral is really information that should be available from the client.  I've added a ticket for it at https://github.com/BitShares/bitshares_toolkit/issues/726
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Offline luckybit

Re: Does BitUSD pull marketcap from BitsharesX?
« Reply #7 on: August 31, 2014, 01:45:52 PM »
Purchasing BitUSD adds value to BTSX because it takes 2x the value of the USD out of circulation and ties it up in collateral.

That is the clearest explanation of BitUSD I've seen. This explanation should be quoted more often.

So when BTSX is a crashing and people rush to buy BitUSD to take cover would this effect the behavior on the chart? All the technical analysis patterns people learned dealing with traditional cryptocurrencies may be worthless when trying to predict the movements of BTSX.

Purchasing BitUSD adds value to BTSX because it takes 2x the value of the USD out of circulation and ties it up in collateral.

How much is tied up in collateral is really information that should be available from the client.  I've added a ticket for it at https://github.com/BitShares/bitshares_toolkit/issues/726

Agreed.
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