Here is the Contract for Difference proposal idea, and i would like and discuss it and we need an estimation how much it will cost to implement this market.
I think with this kind of market, we will be more attractive to any trader in the cryptospace, because with this feature leveraged trading will be done really easy.
Lets talk
Party A wants to short 1 BTC against BTS
Party B wants to go long 1 BTC against BTS
They are matched on the CFD market on the Feedprice of 130.000 BTS
Both parties have to provide 50% of the needed collaterized asset or 65.000 BTS
Both parties have the right to settle anytime on the feedprice with a x% difference here 1%
the execution will cost a percentage fee paid to the CFD market owner (issuer)
In the beginning both parties have the same amount of collateral. Now the price of BTS is rising against BTC and you need 120.000 BTS in exchange for 1 BTC. So Party As contract is now worth 75.000 BTS if he settles and Party B got down to 55.000 BTS. This will go on so long as both parties have enough collateral and no one settles.
Party B wants now to settle because the risk is to high and instantly the least collaterized Party B holder is get settled with a win.
The difference ot a normal CFD is that you trade against a real counterparty and you can get forced to settle your tradingposition if you have the least collaterized position in the market.
To disuss:
1. Is it good to settle anytime or do we give something like. For the first 10 days you can not forced out of your position?
2. Parameters we can use and change:
- Percentage of collateral (feedprice/2*0.5)
- Percentage of collateral left to get a margin call (30/100)
- Settleprice away from feedprice ( >= 0 ) (30/100)
- Percentage of splitting fees (20% network/20% FBA/workercontract /50% issuer)(30/100)
- Time to make it possible to settle the position after agreeing on a contract (x hours) (30/100)