I remember a long time ago I used to trade "short" ETFs on the stock market, and there's a problem with them- they continually diminish in value over time due to how the math works out. Check this out:

http://monevator.com/short-etf-maths/

I'm not sure if this is an issue here, but we should make sure that it's not.

Yeah, I remember reading about that somewhere too. I thought it was because of management costs, but the article you linked is saying it's a fundamental mathematical thing... Makes sense, I think. I wonder if the price feeds could be adjusted to accomodate for that? Short ETFs are tuned to deliver inverse daily returns, but maybe you could tune it instead to deliver inverse returns on a longer timescale.

Howdy all - I just posted the following on Steemit: https://goo.gl/H0LdfX

I'm cross-posting here because I'm sure people here will know the answers:

What I'd like to do, but am not sure how:
I want to save my old BTS owner key somewhere and then update the BTS owner key to a new one. Once it's updated, the old key won't give access to the account, so I can go and drop the old key into the peerplays wallet without fear of unforseen security leaks.

How is the BTS owner key changed? I've looked at the permissions tab in the bitshares.org wallet and it's not obvious enough to me to be worth going and modifying all my permissions.

The results of this poll are probably among the easiest to predict in the history of polls.

Yes, obviously, add it.

I was away from bitshares for a long time and I'm definitely not up to speed on all the discussions that got us here, but this feels a tiny bit like using a second hack to cover the issues created by a first hack.

Doesn't the global settlement operation seem like it's what should be fixed? rather than saying "oops, global settlement puts us in an incredibly awkward position so we better create a new operation to clean up that mess."

But anyway, maybe it's easier to add a new operation than fix the old one. In that case, I just have one concern with your proposal:

The way your proposal is worded makes it sound like a single account would have to buy the entire settlement pool. I would think about a slight variant instead:

Instead of requiring the settlement pool to be purchased all in one go, why not let multiple accounts "bid" for it? Anybody who wants to can say "I want X amount of settlement_funds, and I'll commit Y amount of additional_collateral and Z amount of additional_bitasset." Then when all the settlement funds have been accounted for and there is sufficient collateral committed, all the bidders' bids are filled and the bitasset is revived. I haven't thought through how exactly you'd split the funds between the bidders, but I suspect there's a natural way that will be obvious once someone sits down and plays with the math.

Also I'd let people cancel their bids if they want.

BTW, I pull-requested a couple typos in the github document.

In the pres you showed a graph that bitcny had taken off  lately.   Is there a website or block explorer type site I can see that data?

Coinmarketcap shows it quite dramatically.

So if I was to collateralize it with my BTS I should be getting floor price and not trading price. What is the method to exchange collateral for Hero's other than the trading site

No matter what you do with a smartcoin you'll be interacting with the open market. Either you're borrowing to short sell (I assume what you mean by collateralize), or you're buying outright because you want to collect the 5% gains.

You get the floor price if you own a HERO and you request settlement, which you'd do if the price we're consistently well below the floor price.

Quote from: biophil on May 15, 2017, 03:25:23 pm

Quote

Is bts Martketcap = Smartcoin + UIA Marketcap expected?

I see no reason to expect this, and I believe the match you found is probably a coincidence. Why would ordinary UIAs have anything to do with the value of BTS? In principle, UIAs could have a market cap many thousands of times greater than BTS. There isn't really anything explicitly linking the two.

Smartcoins should be related because they're backed by BTS. Just add up the smartcoin mkt caps.

Total value of all SmartCoins is ~$6.3MM. Hmm..

Are a lot of the large-volume UIA's backed by real assets held in a hot wallet?
For example, a larger volume UIA is OPEN.BTC - which is at least perceptually backed by bitcoin. Is this ENTIRELY irrelvent to the value of bts?
The fact that bts can facilitate services for $3MM OPEN.BTC must have some (even if teeny tiny) effect on the psychological perception of value of the BTS 2.0 network?

The other largest volume UIA's are OBITS, OPEN.ETH, OPEN.MUSE ($17MM).
These UIA's are at least partially backed by real assets, albeit not the bts asset.

Do we know what the total volume of SmartCoins/UIAs was before the recent price increase?

Yeah, probably not entirely irrelevant. But the connection isn't an explicit analytical one like with smartcoins. I don't even know how to guess at the magnitude of the connection. I use my Bitshares account for several things. One of the things is to trade BTS, but I also use Openledger's services to trade between BTC, Steem, ETH, and smartcoins - often bypassing BTS entirely (except that I still owe fees in BTS). So it's not even clear to me how much value BTS obtains by being the base currency of the Openledger exchange. It's so complicated.

Quote from: biophil on May 11, 2017, 08:56:21 pm

I don't think it's likely that HERO will pay effective returns of 5%. If you look very closely, HERO can only offer a maximum of 5% return; if it consistently trades above the price feed, it will offer lower returns. Sadly, if it trades above the price feed, it isn't 100% backed by BTS in collateral, which destroys one of its main value propositions.

Stan is talking like this thing is a free lunch (cue him telling me that he's not; judge for yourself), but it's rarely that simple. I don't frequent this forum much any more, but I've been posting about HERO over on Steemit:

https://steemit.com/bitshares/@biophil/will-hero-work-or-can-you-brute-force-the-free-market
https://steemit.com/bitshares/@biophil/who-will-pay-the-interest-on-hero

Here is an example when a person got completely confused by "5% return" claim. There is not 5% return, 1 HERO will always stay 1 HERO. 5% is a rate of increase of underlying peg index relative to USD.

I'll assume you didn't read my articles. I do understand the distinction, hence the word "effective." I'm arguing that HERO is very unlikely to average 5% appreciation, because it will probably ​trade at a large premium (on average) to the price feed. Simultaneously, if it trades at a large premium to the price feed, it will be subject to unpredictable price swings because the smartcoin mechanism only stabilizes price effectively when you're close to the feed. If HERO shorters aren't careful with Stan's bullish language, they're going to lose a lot of money while they're wondering why the price of HERO won't fall.

If you're bullish about HERO, you should read my articles and tell me why I'm wrong. I welcome the feedback!