@bitstopia2049 & clockwork, thank you for the replies.
Please confirm the following hypothetical bid for BitUSD
mcr 1.75
GS 0.051
Debt I will take 10,000 bitUSD
Additional Collateral I provide 400,000 bts
CR 59.608
call price would be 0.029
Based on the formulas and bitUSD revives with my bid being inclusive, I am essentially "rewarded" an additional 200,000 bts as collateral in the long position?
I think the easiest way to approach it to make it less confusing..is to settle on what level of CR you want and then work from there...
Let's say upon revival you wish to maintain a minimum CR 3.00 with 10k debt position; Settlement price = 19.55496 bts/bitUSD
So you will need in total $30,000 in collateral.
and the revival price is 11.17426 bts/bitUSD (without bids)
So total BTS required = 335,228
The collateral associated with 10k debt in the settlement fund = 195,550
Therefore additional collateral required = 139,678 with your starting call price = 0.02983 bitUSD
and your bid position 13.96 bts/bitUSD and CR = 0.831
Always keep in mind however that you are taking on debt,I wouldn't consider the settlement collateral a "reward"....It is a bet.
You can do the same calculation using the revival price including bids if you want.[/quote]
Thanks again.
I misunderstood the steemit article thinking by bidding the system was providing additional collateral as incentive to bid however the bts received at the end of the day is just what you would get by selling bitusd at a certain price?
Using the system before GS was simple, borrow bitusd with safe CR, sell bitusd at market price for bts. If bts went up in price, your in the green, if it went down, your in the red.
That brings up the question with bidding. in the UI there is the label of "bid price." Does this mean that if the system revives and our bid is included that is the price we borrow and sell bitusd for bts at? Or is the price the system revives at where bitusd is sold for bts?