@bitcrab: When we allow MCR of 1.5, we should also introduce a margin call fee of 0.1% to make the ecosystem more sustainable!
The 0.1% fee doesn't hurt anybody, but makes a huge difference on the income side.

We should also consider we have no interest rate for the borrower compared to Maker/DAI.

Quote from: bitcrab on August 06, 2019, 10:13:06 am

have gone through the paper without checking exactly the derivation of the formulas, just try to find what sense does the conclusion make.

it seems:

it make sense to set MCR<1.53, to make the optimal collateral ratio "snaps" to the right.

while MCR<1.53, then either MSSR=1.01 or 1.005 make little difference.

anyway, as the conclusion based on a simple model, so we need to consider more factors to evaluate the effect while changing these parameters.

It depends on what you're trying to do, and you're right - more study is needed.

If your goal is to incentivize low collateral ratios (more borrowing), then you need to set MCR low enough (in the paper, less than 1.53) to get that to happen.

However, low collateral ratios intrinsically increase the risk of undercollateralization, which is something that should probably be avoided.

On the one hand, low MCR should lead to tighter pegging; on the other hand, low MCR should lead to more risk of undercollateralization. This suggests that there is a tradeoff between tight pegging and solvency, which needs to be studied further.

For the research, we're starting to work up more-expressive models that should help capture these tradeoffs more clearly.

Quote from: bitcrab on July 30, 2019, 06:42:18 am

Quote from: sschiessl on July 30, 2019, 06:13:20 am

Before talking about this worker, please wrap up the DevCon worker by itself. It is not clear how this deficit came to be since the funds of the DevCon worker are not accounted for, or at least I don't understand how yet.

Now on this worker:
It is a good example of reporting and escrow intent gone wrong.

There is no public information available how much funds have been spent on what. Just looking on the blockchain, BTS with an equivalent value (at the time of transfers) of 130k bitUSD have been paid out, which exceeds the asked for budget. This has been done with no clarification on the increased spendings whatsoever, or even reporting what the money has been spent on. On top of that, the escrow that was publicly communicated was only for show. The worker owner still had access to the owner key of the escrow account, and made use of it.

I don't see at the moment how funds of this worker can be re-used without calling a vote of the community. If funds are to be returned, return it by burning and not to committee.

I feel there is some misunderstanding, the above account table is for the 1st DevCon in 2018, there is no worker for it, there is a worker for the 2rd DevCon in 2019.

Ah, I totally missed the "1st" .... apologies. It does not change the remainder of my comment, in particular the last sentence.