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Technical Support / Re: [Python] Price Feed Script for BitShares 2.0
« on: October 16, 2015, 11:33:31 pm »the question is , how much we can set short_squeeze_ratio to?
which is better? which is bad?
if witness set it to 1000%, all short position will force margin call, and sell at 10% price. I think it's bad.
if 500% is bad? if 200% is bad? if 150% is bad? what's the rule? do we need to set a hard code limit? what's the value?
will you short bitUSD if there is no limit?
in my opnion, 110% should be the hard code limit, if we don't protect short position, nobody dare to short, bitUSD die.
I don't think there is one economically "correct" answer since it depends on collateralization. Well collateralized markets can have it set much higher than lower collateralized markets. At this point, you have to go by "feel" and adjust accordingly. Or we can use the price feed script to publish a squeeze ratio that is a function of SWAN or average collateralization for each market.
Maybe 1.25xSWAN is a good number? That means:
1.25xSWAN_PRICE = FEED/SQR
SQR= (FEED/SWAN_PRICE) X .8
Has no one else here noticed that the market is broken? Adjusting the SQR to something more reasonable would be a start, at least it would minimize the damage.
Seriously, witnesses need to be paying attention to this.