Since you cannot print shares (past 3.7b) then you can reduce future flood risk if you let the fund be burned. How are people seriously trying to argue its the same thing?

Of course since "don't break share cap" is apparently not enforceable when shareholders can coordinate vote to hard fork then you should assume future owners will try to print shares and so we should just accept it.

Quote from: bytemaster on June 11, 2015, 09:04:23 pm

1) Options Market
2) Escrow / Payment Channels (off-chain micro payments combined with arbitration)
3) Scripting Engine

For starters...

Yes, yes, and yes.

But if the Options Market is anything like the Collateralized Bond Market (no automatic matching with market engine, no margin calls), I can't imagine it would be too difficult or too much of a penalty in performance for anyone to implement the Bond Market, Options Market, and Escrow / Payment Channels as smart contracts using the Scripting Engine. In which case, I would think #3 would be next priority feature over #1 and #2. Or is there a reason why #1 and #2 need to be native?

That also makes me wonder. Would the scripting engine allow for the creation of new object types (I think that means the x in 1.x.y ID numbers)? And how would long-term memory usage of objects stored in the database be fairly charged? I guess I will just have to wait until it is time for the official proposals.

Also, I was going to suggest another feature that would allow UIAs to elect their own delegates which could jointly control an account (like BTS elected delegates) and end up running child/side chains nested into the BitShares blockchain, but then I discovered this.    I also love the references to SPV in that page.   Very excited for all the other things in store for 2.0 that haven't yet been discussed.

Quote from: merivercap on June 11, 2015, 12:08:36 am

Quote from: starspirit on June 10, 2015, 11:46:43 pm

I'm still wondering how this affects market transactions. Efficient markets must accommodate micro transactions. What would this look like for buy and sell orders? What would be the impact on market-makers?

And how do we deal with this...

Quote from: monsterer on June 10, 2015, 07:15:25 pm

Quote from: profitofthegods on June 10, 2015, 06:50:05 pm

How do you buy anything with a credit or debit card? They do the same. When a merchant sets up their systems to accept Bitshares they will know that there is a fee taken off what they receive, just the same as if they were accepting cards or paypal or pretty much anything else.

Except that the fee will be different depending on the 'class' of user.

Yeah I also forgot to mention microloans, microinvesting, microtrading in developing nations.

Depending on the avg trade size 20 cents can be better or worse for traders.  Typically Bitcoin exchanges charge 0.2% on each side and give a big discount for the maker.  That means your avg trade size has to be $100 to equal the trading costs of an avg. Bitcoin exchange.  At least the BitShares platform won't have counterparty risk.

Yeah but its even worse for market-makers. On external exchanges, there is zero cost for setting, cancelling and moving orders, only for fills. In comparison, based on my current understanding, moving a single pair of bid/offer spread orders 100 times per day (to adjust to movements in the fair price of the asset) would cost $16 per day (net of cash backs if you're a lifetime member). I'm concerned about the economics of this, especially for privatised bitAsset issuers that wish to support their tokens.

I also need to clarify what happens if a market-maker's wall is chewed at by lots of small orders (usually the case with market-making). Does that mean the market-maker experiences a fixed cost for each small fill? If so, this would give the market-maker a lot less control over cost than on external exchanges, and make it even less economic.

Since it's price takers that have the control over their trade size, and market-makers are providing the efficiency in the market, would it be better to always put the combined fee on the price-taker?

Also, allowing market-makers to place relative orders (that do not need constant changing on the network) would help a lot, though I know there have been past issues raised around the technical implementation of this.

As another consideration, could the following be considered:
- setting a percentage fee on market transactions, consistent with other exchanges
- setting a lower fee on market transactions compared to other token transfers

Apologies if I am misunderstanding the intended application of these higher fees in market exchanges, but the efficient operation of the markets is critical to the entire success of bitShares.

[Xeldal's comments also reflect the same concerns]

Quote from: arhag on June 11, 2015, 05:00:07 am

By the way starspirit, I don't see how the BitAssets backed by a mix of collateral types would be fungible unless a fixed mix ratio was specified as part of the BitAsset definition that all shorts of that privatized BitAsset had to satisfy. And in that case, I would imagine the only practical way to short new BitAssets with mixed backing collateral into existence would be through a self-short. The logic for margin calls would also get more complicated with mixed collateral.

Correct. With self-shorting and self-cancellation, shorts get to control the mix of collateral they want. I've been working on just such a structure. Collateral can then be completely independent of the markets in which the token trades. Also margin calls could be satisfied by applying each collateral token in sequence to covering the debt until it is satisfied, and then returning the residual collateral tokens to the short. This sequence could even be determined by the short.

Quote from: starspirit on June 11, 2015, 03:14:55 am

But I can imagine it might be possible to create UIAs on the bitShares block-chain that are backed by BTC, LTC, NXT, you-name it, as long as there are ways to minimise counter-party risk through appropriate operations like multi-sig, escrow or the like. To be honest I don't know if side-chains help with that or not, I'm naive in that area, though I've asked the question before.

Yes, UIA gateway assets (like GATEBTC) + the new privatized BitAssets should make this possible. The only question is if the trust can be decentralized out to many parties to keep the counterparty risk is low enough for people to use it for more than just a means of quickly getting value in an out of the system to/from assets without counterparty risk. On the BitShares side, the new multisig features provide a lot of flexibility for managing the UIA properly (e.g. not diluting its value). The limiting factor is on the Bitcoin side. It doesn't make sense to have more decentralization on the BitShares side than on the Bitcoin side when the UIA could become worthless if the reserve is stolen. Ignoring advances in ECDSA threshold signatures (and assuming Bitcoin does not adopt new cryptography like EdDSA or radically increase the limits on their scripts), we are currently limited to an M-of-15 multisig for the BTC reserve backing the gateway UIA. You want M to be large to reduce the risk of compromise but obviously not too large that it dramatically increases the risk that the reserve holders get locked out of access to the reserve because some of them become unresponsive or disappear. Not sure what would be the ideal value for M, but the main question is if a well selected group of 15 individuals/organizations can be trusted to not collude to steal a potentially huge reserve. If not, very few people would trust holding the BTC-backed UIA for long term or holding BitAssets that derive their value from such UIA.

By the way starspirit, I don't see how the BitAssets backed by a mix of collateral types would be fungible unless a fixed mix ratio was specified as part of the BitAsset definition that all shorts of that privatized BitAsset had to satisfy. And in that case, I would imagine the only practical way to short new BitAssets with mixed backing collateral into existence would be through a self-short. The logic for margin calls would also get more complicated with mixed collateral.