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Messages - yvv

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361
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 21, 2017, 12:12:29 pm »
Quote from: nmywn on April 21, 2017, 09:34:14 am

I wouldn't call this "workarounds",  better would be "not obvious". . I gues when you're closing position on polo it execute margin call.

No, it sells your collateral at the market. You can specify the amount and price to be settled or just settle all at current market price. Margin call is triggered when collateral ratio hits the limit, same as in bitshares.

362
General Discussion / Re: Each witness is getting paid $1200+ because of the price rise.
« on: April 20, 2017, 11:21:26 pm »
Should we raise this question again next week if BTS prise drops to what it was a month ago?

363
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 11:13:19 pm »
Quote from: nmywn on April 20, 2017, 09:33:54 pm
I understand that polo way is basically the same (just in different order), but much easier for use and have less friction.

Yes, this is what I am talking about. Just forget about their higher leverage for a moment (although this is also important factor). The hole process of shorting at polo is one simple action: you place a sell order. To settle your debt, you place a buy order. The final result is the same as in BTS, but everything is seamless, and you don't need to make unnecessarily  high deposits. The mechanics behind this is very simple, and I don't see a reason why it should not work at DEX. You can still use your bitAssets as money, i.e. buy/sell/transfer etc.   

The amount of collateral which you need to put upfront depends on the price at which you short sell your asset. If you short at feed price, you need to put only MCR-1 upfront, because the rest you get when you sell your asset, and before that you don't have no dept. If you sell at premium, you need to put less upfront, if you sell at discount, you need to put more. If you want to short, but don't want to sell, you need to put entire collateral upfront and then do what you want with your asset, same as you do now.

Same goes with closing position. It is ridiculous that you need to deposit additional funds on top of collateral to settle your debt on DEX,  or find other workarounds, because the only purpose of collateral is to be used to settle the debt. And again, the amount of collateral which you need to spend depends on the price at which you buy back you debt, cheaper you buy, less you spend. If somebody kindly sends you bitAsset for free, you just keep your collateral.


364
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 10:48:47 pm »
Quote from: abit on April 20, 2017, 10:10:36 pm

Well said. I wonder why @yvv didn't respond to this.

IMHO current design of MPA is not for high-risk seeking traders, but the opposite.

If we want to attract high-risk seeking traders, we need other products (done by 3rd party or not).

What do you expect me to respond? I agree with what the guy said. No, BTS can't offer 50:1 leverage at current market depth. This is not what I raise in OP.

365
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 10:45:03 pm »
Quote from: Chris4210 on April 20, 2017, 09:20:40 pm
What if creating a MPA and shorting an asset are two different features?

Maybe we just need to build an additional shorting feature like on Poloniex for only that purpose?

Why don't we fix MPA shorting instead? Would not this be much simpler?

366
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 09:04:33 pm »
Quote from: nmywn on April 20, 2017, 08:09:31 pm
I can buy any worthless UIA with borrowed bitUSD, which wouldn't be possible with polo scheme. Why? Because you MUST sell it against BTS to cover collateral. That sucks. Any fiat gateways  using MPA's instead of UIA would be forced to buy bitXXX from the market to build reserves. Now they can simply borrow, not for shorting purposes, but for operating deposit/withdrawals, making markets etc. without need of selling BTS power. It's not shorters heaven, because it wasn't designed for them. It is not dumb, look top volume markets for OPEN.BTC. It's working.

You do need to put the whole collateral upfront if are  not selling bitUSD for BTS (selling it for shit token or giving it away), there is no problem with that. But you don't need to put the whole collateral upfront if you are selling for BTS, and you are required to put it upfront, this is a problem. A better solution exists and it works on other exchanges.

In fact, although the base collateral asset for bitUSD is BTS, you don't actually need to keep BTS to back it. If you don't trust BTS, you could keep bitCNY or other bitAsset instead and that would be as good security as BTS. If this was allowed, BTS shorting would be really powerful. But this is another story which should be discussed somewhere else.

367
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 06:23:59 pm »
Quote from: Pheonike on April 20, 2017, 05:44:21 pm

Not the margin trading but in general, the whole system. Do they show proof of reserves for their system? I don't know.

As a centralized exchange, they surely can do all kind of bad things, no doubt in that. But we are talking about margin trading here. And this is what they do the right way. Not only higher leverage than bitshares, but trading mechanics is different too.

368
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 05:25:13 pm »
Quote from: Pheonike on April 20, 2017, 04:53:35 pm

You must also remember that when exchanges like POLO are providing leverage, all those transaction are just number in a database.  They are running a fractional reserve . 

When you open a margin position at polo, you are required to back it with minimum 140% collateral, which is allowed go down to 120% later. How does this become a fractional reserve?

369
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 03:47:58 pm »
Quote from: Thom on April 20, 2017, 03:35:45 pm

It seems I'm not the one who lacks understanding here.

This is very simple to understand. Let me show this to you ELI5 style. Suppose, you have 1 USD worth of BTS in your account. With double collateral (no leverage), you should be able to short 1 bitUSD, right? Tell me step by step, how would you do this in bitshares. Just answer my question, and I will repeat myself how I would do the same at poloniex to make the difference clear. @Thom

370
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 02:37:43 pm »
Quote from: xeroc on April 20, 2017, 02:32:39 pm
Quote from: yvv on April 20, 2017, 02:25:46 pm
MPA is a lending on blockchain, but it is crewed.
His point is that bitassets are borrowed FROM the blockchain while in p2p lending, you borrow from actual people.

This would be a huge advantage of bitshares over other exchanges, if it was not implemented a dumb way. How does this dumb implementation add more safety?

371
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 02:35:19 pm »
Quote from: Thom on April 20, 2017, 01:24:24 am

The leverage you like so much is merely an illusion of safety made attractive by potential profits. That safety will evaporate faster than a bot can place an order when the inevitable collapse begins.

You didn't even understand what am I talking about.  Yes, I like leverage, because this is what gives motivation to short assets instead of just holding them. And since MPA are created through shorting, no shorting means no liquidity. Let's forget about it for a moment. Suppose we are fine with 1:1 leverage, then BTS shorting is still screwed. You still need to put unnecessary high amount funds when you open and close position. How does this make BTS more safe than polonoiex? I say, it does not. In fact, it hurts BTS a lot.

372
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 20, 2017, 02:25:46 pm »
Quote from: MarkoPaasila on April 20, 2017, 08:19:25 am
If someone implements lending on the blockchain, leveraged margin trading, like on Poloniex, will be possible. Once that is done, Bitshares will be the first leveraged trading platform where everything is transparent and nothing fishy going on. The world has never seen one before.

MPA is a lending on blockchain, but it is crewed.

373
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 19, 2017, 08:38:46 pm »
Quote from: mf-tzo on April 19, 2017, 08:10:22 pm
Every bitasset created in bitshares is backed up by min 2.5 collateral value in bitshares.

No, it is not. I have short bitSilver position which is currently backed by 1.9 collateral. And it went down to 1.55 recently. Anyway, regardless of mandatory collateral ratio, it is not necessary to put all of it upfront. This is very important for market making, and poloniex does it right.

Quote
This is not a flaw in bitshares!! This is the superior market selling point of bitshares!!

No, this is a bullshit flaw, which repels shorters away. That's why they all trade at poloniex, not at bitshares.


374
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 19, 2017, 07:36:33 pm »
Quote from: nmywn on April 19, 2017, 06:57:09 pm
Quote from: yvv on April 19, 2017, 04:43:53 pm
(...) and to settle the debt we need to deposit 100% on top of double collateral.
You can set your CR = MCR and wait for margin call. If there is enough buyers close to feed, you shouldn't be at loss. This is maybe not what you want, but  will close your whole position without additional funds.
OR
If you have safe CR, you can reduce it for a moment, use funds to partially cover your debt - at the end you have still 0 funds, but better CR, so you can repeat your operation with better effect each step.
For example: 2.0 => 1.8 => 2.25 ... 2.25 =>1.8 => 3.2

Am I wrong?

Yeah, I know that there are ways around, but this is not how margin trading is supposed to work. All these workarounds create friction for traders and make them leave to poloniex, where things are done correct way. Market maker should make a margin deposit, and buy/sell back and forth seamlessly. Debt should be issued and settled automatically and there is no need to make 2x deposit upfront.

375
General Discussion / Re: Bitshares shorting is flawed and needs to be fixed ASAP
« on: April 19, 2017, 06:08:24 pm »
Quote from: Customminer on April 19, 2017, 05:49:01 pm
How would we cover the 100% collateral though? Poloniex does this with a centralized insurance fund..

No, it does not need no centralized insurance fund. You  deposit 1 BTC, then you short sell 2.5 BTC worth of ETH, and these 2.5 BTC which you get become your collateral. At the end, you have 2.5 BTC worth of ETH dept insured by 3.5 BTC collateral. Your dept is 140% insured. Everything is clean and simple.

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