Today we had an excellent training session on how to increase our productivity. It will be paying dividends in the weeks ahead.
I also solved a major issue in the design of BitShares X as it relates to how we handle the case where the collateral is insufficient to back the short position and thus the result is unbacked BitUSD in circulation. Considering the value of BitShares X is directly related to the degree to which the holders of BitShares X are willing to guarantee the purchasing power of BitUSD it seems that a decentralized Bank should take the same approach as their centralized counterparts... Sell new shares in the bank to raise capital to cover the losses. In effect all BTS holders would provide 'insurance' against the 50% discontinuity event that would blow out a short position. The reason why BTS longs would insure the BTS shorts is because they entire value proposition of BitShares X is derived from the promise of BitUSD remaining pegged. If the BTS holders can increase the value of BTS by providing this insurance against a very rare event, it should in turn increase confidence and thus increase the value of BTS.
This change would shift the losses that BitUSD holders would currently pay to the BTS holders and thus collectively BTS holders are backing all BitUSD and BitUSD holders have something with much lower risks.