Remember this thread? https://bitsharestalk.org/index.php/topic,12724.msg167490.html#msg167490

Bitshares are slowly moving in right direction. I could provide you few months ago with design even better than bitasset 2.0. You might have avoided loosing over $20 mil in market cap.
BTW: With current proposal bts is still overpriced imo.

Banks have created very liquid secondary market for bonds, where they can instantly sell bonds to cover liquidity requirements. In fact much more liquid than bitassets are likely ever to be, because bonds are instruments with yield. BTS does not pay any yield as far as I know, so demand for it will always be smaller.
In any case there is far greater probability that you won't get your dollars back from bitusd than from well managed bank. If banks are ponzi then bitusd are even 'more ponzi' :).

Banks have assets to cover all their liabilities. Banks assets are for example mortgages, which can be sold on open market when bank needs liquidity. There are regulatory requirements that bank have to maintain some level of reserves, so basically deposits are always covered in more than 100%. Not so different than bitshares.

Of course there are times when bank assets are temporary illiquid or permanently loose value, but same thing can happen to collateral in bitshares.

I understand there is no bounty on ideas since ideas are cheap. On other hand bounty on idea that ends up to be working and improves product are other matter. You pay only for results.

I would gladly invest in bitshares but it trades well above reasonable levels for quality of service it provides. I'll wait for lower prices and/or time when you independently came up with my or better solution to poor bid depth. Sorry to waste your time. See you later.

I don't have any bitshares and since I am little greedy man I need to ask if there are any bounties currently held that I could claim if my proposal would get implemented?

I watch bitshares for some time now and there is almost always problem with liquidity on bid side of bitassets. This is really sad, because it is only side of market that really matters for widespread adoption. If someone is wondering if he should accept bitUSD as payment he looks up how much he can get for it and realizes that it would be few percent of significantly less if he has large amount to sell.

With all the tools and information on bitshares blockchain I can propose few simple changes to market engine that could guarantee that holders of bitUSD can always sell it for good price. Are you interested in such changes or are you happy with how system currently works?

Quote from: Riverhead on October 08, 2014, 03:22:24 PM
I just read about bail-in because I had never heard the term before. Holy crap >:( .

If bank is doing well customers get 0% or 0.1% interest and the shareholders get rich. If the bank starts to fail the customers are forced to buy the nearly worthless shares at market value and the very people that caused the failure get the cash.

I suppose this saves the bankers the hassle of physically robbing their own bank with ski masks and guns.

When you put money to the bank you actually lend it to the bank. If bank fail to repay you then, you took the risk and lent money into risky bank, so who is suppose to take a hit? We love free market, don't we?

Quote from: liondani on October 07, 2014, 07:44:57 PM
what about making a USD deposit with egopay on bter (2% fees) and then buying bitUSD with a 5% discount for a total net profit of 3%  ?
(I assume it cost a % to deposit on a egopay account also...  didn't check how much it is but maybe it is still worth(?))

And then convert bitUSD to btsx for a fee adn probably below feed, because there is no demand. Next step is to convert btsx to usd and then withdraw. I am pretty sure it won't be profitable.

Quote from: bytemaster on October 07, 2014, 04:17:50 PM
Short squeezes are not really an issue because new shorts can cover into the squeeze at the feed price.

Short squeezes are huge issue. You basically require 1/30 of entire outstanding supply to be rolled over every day. Even worse - due to nature of randomness it would be clustered once in a while. Just wait and such spike are bound o happen in period when there is diminished demand for shorts.

Quote from: bytemaster on October 07, 2014, 02:24:38 PM
You cannot arb yield difference.  That is like claiming the interest rate at two banks will be arb away.

You can arbitrage yield. You have money and face with two possibilities. You can park it in bank or in bitusd. If bank and bitusd have same risk you choose bitusd as long as it gives better yield. Every time such decision is made bitusd supply is increased until yields are equal. Better yet, you can actually borrow new usd and park it bitusd and bank yield difference.

Of course this is unlikely that bitusd risk would be treated equal to usd in bank, but you get the idea.
Any extra yield earned by bitusd will be compensation for additional risk of holding bitusd over usd.

Quote from: Gonzo on October 07, 2014, 01:02:07 PM
I don't think you're considering the 5 to 15% returns that BitAssets get in a mature system?

There is no way that asset will yield this much if btsx matures. For example if bitUSD is mature and one can freely convert USD<>bitUSD any yield difference between USD and bitUSD will be arbitraged away.

Quote from: emski on September 25, 2014, 11:49:49 AM
However you end up with lots of BTSX as collateral.

Nevertheless result is that I effectively entered short position below peg, so why bother with shorting restrictions if they can be circumvented? If collateral is the issue then why don't we just demand more collateral for shorts below peg instead of banning them?

BitShares does not allow shorting bitUSD below feed price to prevent driving price from falling below peg. This restriction can be easily bypassed.
You just take two accounts and trade with yourself at valid price. This way you create bitUSD and simultaneously enter short position on second account. Your net position is unchanged, but now you can freely dump bitUSD below peg, because restriction does not apply to selling bitAssets.

Quote from: arhag on September 19, 2014, 05:46:05 PM
Also, I think it is important that we don't advertise that we are promising any specific yield on BitAssets. That is a promise that we cannot really deliver since it is out of our hands. We should be saying BitAssets provide yields up to 5% per year (or whatever we think the number should be). Meaning that it is possible that the yield rate could be 0%. These yields are added benefits of holding BitAssets in the system, but it is not necessary for BitShares X to be valuable.

I was confused with all these promises of fixed yield payed from shorts to longs. It won't work this way, but if yield is variable and comes from fees than it might be ok.

Quote from: arhag on September 06, 2014, 05:32:19 PMI do like how you are focusing on where the actual growth is coming from. So where is the growth coming from in the case of BitShares X that allows for such high (expected) interest rates? The answer is that it comes from the expected increase in value of BTSX. As more people adopt the system, meaning transfer their wealth outside the blockchain into BitAssets, this should drive the market cap of BTSX up. Shorts and BTSX holders get to benefit from that price increase.

I think that what you described is some kind of ponzi design. Bitshares plans to promise high fixed interest rates, but only under condition that there will be ever expanding flow of new money to system. If that fails to materialize entire thing will collapse, because there will be no way to pay promised interest.