Thoughts on new OMO fund

[bitcrab]

I drafted a suggestion on this, hope you can also review it. https://bitsharestalk.org/index.php?topic=29278.0 @Thul3

[bitcrab]

Where does the initial fund come from?

I feel the accumulated BTS and accumulated smartcoin fee in committee-account can be used.

I don't think it's good to get BTS via worker proposal, but I feel we can keep the possibility open, to get BTS via a worker proposal need another independent voting.

how to organize the operation team? will the operators be paid? and how?

A mulitsig account will be built to operate the fund, either 2/3 or 3/5 multisig is OK.

members who want to do this job and are also trusted by the community can join.

the fund will be calculated BTS based net value every quarter, if net value increase >0, then 50% of the net value will be paid to the operation team, otherwise there will be no payment.

[bench]

When does OMO fund start?

[bitcrab]

While BTS price is underevaluated, borrow smartcoin and buy more BTS.
While BTS price is overevaluated, sell BTS to close the debt positions.

Could you define that please what exectly eans undervaluated and overevaluated ?

first suppose that 0.2175CNY is the long term bottom price.

for undervaluated price I'd like to define like this:

0.2175*MCR = 0.348 CNY, or 0.05 USD

which means, if the price is undervaluted, if you borrow with setting your margin call price < GS price, you have no worry for margin calling.

top price in the last 9 months is 0.5377CNY

overvaluated price = 0.5377/1.05 = 0.512CNY, or 0.073USD.

[Thul3]

While BTS price is underevaluated, borrow smartcoin and buy more BTS.
While BTS price is overevaluated, sell BTS to close the debt positions.

Could you define that please what exectly eans undervaluated and overevaluated ?

[bitcrab]

what's the mission of the New OMO fund?

There are proposals to burn BTS in committee-account, that is one action for the community to push up the price of BTS.

But that proposals is not supported by committee members, in my view to burn BTS make little sense, more than 200K BTS are released every day via worker proposals, comparing to this amount the BTS to burn is too few.

Comparing to just burn the accumulated BTS in committee-account, I believe it's better to put the BTS into the so called New OMO fund.

A debt position will be managed under this fund.

While BTS price is underevaluated, borrow smartcoin and buy more BTS.
While BTS price is overevaluated, sell BTS to close the debt positions.

The fund will show that it's possible to manage a debt position well, especially with continuous income.

[Sapiens]

I support only if the so called OMO fund is planned as a mean to pay the workers using stable SmartAssets instead of bts.

Also, aside from BitFiat, the fund should help revibe BitBtC

[bitcrab]

The new OMO Fund should have imo 4 accounts which would be splitted into  USD,CNY,EUR,USDT .
Focus should be on bitUSD and bitCNY with bigger focus on bitUSD.
The fourth account for USDT should be funded once the big bad debt from bitUSD disappears.
USDT should be offered 1:1 against bitUSD with a (0.2% growth margin).
By creating a liquid USDT/BitUSD market on DEX we hopefully will support bitshares prices on CEX'es via arbitrage with the strong inhouse demand we have here on DEX(it should also close the current big spreads on other major assets).Price manipulation on CEX would be more difficult and any downtrend on CEX could be decreased with the help of the liquidity on DEX.
BTS prices of 3% above the DEX feed prices (CEX) are happening very often which would support prices on CEX when a liquid bitUSD/USDT market on DEX exist.

I don't think USDT should be involved.
actually we are running a bot for arbitrage in BTS/GDEX.USDT between DEX and binance, there's not so much trading opportunity and do not make big sense.
the new fund should focus on BTS/smartcoin trading, and currently, it should ignore BTS/CNY pair and focus on BTS/USD pair, maybe also BTS/EUR pair.

what shall we learn from previous OMO fund?
I admit that as the key organizer of the previous OMO fund I have some unfeasible idea at that moment, I have hoped that OMO can provide a strong sustain to BTS price, but the market told that no one can counter with extreme market trend, even you have hundreds of millions of BTS.

another key factor is that, at that moment, smartcoin rules is not robust enough to resist shorting attack. that's why I tried my best to push GS protection and MSSR&MCR reduction after the disaster.

[finn-bts]

Support please implement as soon as possible

[bitProfessor]

Support

[bitProfessor]

The funds should be used to finance a bitUSD/BTS DEXbot worker with RO strategy. Profits can be used to finance other workers.

Some liquidity in the bitUSD/USDT market with tighter spreads are also needed!

+5

[R]

Would it only focus on core bitassets? Or could private smartcoins like the norns be in scope?

[bitcrab]

1. Do not creater worker to get more BTS, just use the current accumulated BTS in committee-account and the smartcoin market fees which is generated everyday.

2.maintain a USD debt position.
A.the margin call price should always be under GS price, otherwise, the coming funds can only be used to increase the CR of the debt position.
B.if BTS price is underestimated, "borrow and buy", if BTS is common, do nothhing, if BTS price is overestimated, sell.
operaters need to reach consensus on whether the BTS is understimated, common or overstimated.

in my view, currently we can adopt below prices as merits:
<0.05USD: underestimated.
0.05-0.075USD: common.
>0.075USD, overestimated.

[ripplexiaoshan]

I support this proposal. BTS price is in a very safe region.

[bench]

The funds should be used to finance a bitUSD/BTS DEXbot worker with RO strategy. Profits can be used to finance other workers.

Some liquidity in the bitUSD/USDT market with tighter spreads are also needed!

[Thul3]

-Bad time of opening an OMO fund.It was opened at a way to high price in a bearish market for altcoins
-No strict rules
-lack of governance
-low CR (under consensus)
-No risk reduction with falling BTS price



Currently we have the oposite in the market.
Have a look at the charts



Currently BTS like majority of altcoins are in accumulation mode.
BTS is slowly growing against BTC .

There are of course way more big indicators but that would be an extra thread .


What would be also important is to raise CR of the OMO fund with raising BTS prices as the risk of bigger decreasing prices increases

[pc]

IMO a proposal for a new OMO fund must first and foremost

* analyze what went wrong with the previous OMO fund - AFAIK there are still many unanswered questions here in the forum
* identify the cause(s) of that total desaster
* propose solutions that will plausibly eliminate these causes

Furthermore, the apparent lack of self-reflection from most people involved in the previous OMO fund (including those who voted for it) gives me a very bad feeling about future operations of the same kind, *especially* if will be run by the same persons again!

[bitcrab]

I think the several million BTS in committee-account and the accumulated market fee can be put in fund, I don't think it's good idea to get fund via worker.

[Thul3]

I haven't seen it.
I only saw the proposal on usdoperator.

Just saw committee bought out debt of the cny operator and is now trying to burn 1 million BTS.
Thats a total waste and i think something like that should be announced by the committee to the community.

At current stage decreasing liquidity and burning BTS makes totaly no sense.


Please give more input about the OMO fund so we can open an OMO worker asap

[bitcrab]

A proposal is there to burn 1M BTS. and at the same time we get BTS from worker for a fund?

don't you think that's reluctant?

why not just get the 1M BTS for the fund? why?

now there are 3.9M BTS in committee-account, with setting margin call price at the GS price, 94K bitUSD can be borrowed, why not borrow bitUSD and release to the market but burn these BTS?

[Thul3]

I'm planning for a longer time to open a worker for a new OMO fund which would be replacing the old one.
The timing seems to be perfect to open a new OMO fund to support both liquidity and price of Bitshares.
The new OMO Fund should have imo 4 accounts which would be splitted into  USD,CNY,EUR,USDT .
Focus should be on bitUSD and bitCNY with bigger focus on bitUSD.
The fourth account for USDT should be funded once the big bad debt from bitUSD disappears.
USDT should be offered 1:1 against bitUSD with a (0.2% growth margin).
By creating a liquid USDT/BitUSD market on DEX we hopefully will support bitshares prices on CEX'es via arbitrage with the strong inhouse demand we have here on DEX(it should also close the current big spreads on other major assets).Price manipulation on CEX would be more difficult and any downtrend on CEX could be decreased with the help of the liquidity on DEX.
BTS prices of 3% above the DEX feed prices (CEX) are happening very often which would support prices on CEX when a liquid bitUSD/USDT market on DEX exist.

 

The OMO funds should be controlled by 5-6 people where 3/5 authorisation is needed.
Personly i would love to see
bitcrab
Schiessl
Clockwork
Openledger
abit
blockchainlabs

Current unclaimed market fee's should be used to buy BTS mainly from bitshares foundation (over 27 million BTS and increasing) to decrease its sell pressure and to obtain a bigger stake without influencing the bitshares price on DEX to much .


There should be strict rules about maintaining CR's and at which timeframes orders from these accounts can be executed.
Buy or sell orders should be only allowed once a week (if there is no emergency) which static day should be announced so traders can prepare for it.
USDT/bitUSD pair can be placed daily.
Buying margin calls with the OMO Fund will not be allowed till DEX will have enough liquidity which will be decided by the community.


Any thoughts on this ?