- Monetary policy: all the rules defined in the blockchain and in the post **ARE** indeed components of the monetary policy, including price feed, borrowing, margin call, force settlement, the related parameters and incentives.
- Fixed exchange rate: people would be able to exchange between one of the created assets (e.g. HONEST.USD) and another asset that is pegged to the target asset (e.g. [gateways].USDT) at around 1:1 almost all the time, aka the "peg" with liquidity;
- Free capital flow: anyone can freely place orders onto the order book to exchange between one of the created assets (e.g. HONEST.USD) and another asset (e.g. [gateways].USDT) at any price, any volume, and any time.
We operate under the assumption that markets should determine exchange rates, NOT state actors. We as price feed operators have a duty to provide HONEST price feeds representative of live median global rates. Given honest feeds, market participants have the greatest incentive to trust that borrowing of our MPA's can be a wise business venture and that the MPA will in the long run hold value relative to global pricing.
Monetary policy can be either restrictive or permissive. We choose permissive liquidation of mal investment wherever possible:
Whereas Bitassets have a highly restrictive MSSR of 101, we choose MSSR 125; as free as possible to induce liquidation of individual mal investment; without risking market meltdown from global force settlement.
Whereas Bitassets charge a restrictive "service fee" upon liquidation paid to the borrower: Honest MPA's charge no service fee to encourage free and fair liquidation.
Whereas Bitassets delay liquidation restrictively by up to 24 hours, Honest MPA's liquidate within 60 minutes upon default.
Whereas Bitassets periodically peg MPA's to the underlying collateral asset to prevent liquidation of mal investment, we promise to never take such actions.
Whereas Bitassets have closed source pricing mechanisms. Our pricefeed scripts are open source, our whitepaper is clear as to our intentions, and our live data matrix supplied by each of our feed producers is updated hourly at
www.jsonbin.ioSo, yes... there is of course monetary policy involved in Honest MPA's. We like to believe ours is a niche offering in an entirely new direction.