The post that caused the 50% fall.

Oh wow, you can do that.
Thats amazing.


Will the exchanges be able to figure out who should get the shares correctly? 

I'm glad to see this, hopefully it will help out those who bought DNS recently and help make a lot less people angry.

(Also, the trick about doing a snapshot and then posting!  Good way to help the people who actually had DNS, rather than to help whatever trader managed to see this post first).

Now that we have had some more time to analyze, I would like to make a counterproposal to Bytemaster's proposal which I believe is more fair.

First off, my stake is currently 100% in BTSX.  My proposal is not made to help my stake, but rather to help out those who I feel have been hurt in this allocation. 

We do not want a wounded community going forward, in which a majority of people made out just fine, but a significant minority of people are grievously hurt by the merger.


I hope that everyone can try to look at this proposal in a fair and rational way, and analyze its merits.


First, lets look at what each party gained and lost in the original proposal:

80% to BTSX:  Gains the benefit of becoming the superDAC, loses due to some dilution.  Price initially dropped and then recovered to about where it was before the proposal. 

3% to VOTE: Vote is basically just another allocation to AGS and PTS holders, but it is to only those who held AGS/PTS prior to its august snapshot.   This is *almost* the same group of people who hold AGS, PTS, and DNS, but not exactly. 

7% to AGS:  Gains the benefit of having liquidity eventually, where it previously would never have had liquidity!  Is down maybe 10% or so compared to the price that AGS 'should' have been valued at, if we assume that AGS is worth the same value as PTS was.

7% to PTS: Loses the benefit of liquidity, is instead subject to a lockout period.  Is down maybe 10% or so since the announcement.

3% to DNS: Loses the benefit of liquidity, is instead subject to a lockout period. 
During the release of DNS, prior to the announcement, DNS shares had traded in a range from about 180 to 400 satoshis.  This is a huge range, obviously.  At the time of the announcement, it was in the low 200s.   At the very least, one should value DNS at around 180 satoshis per share, which was the lowest point that it traded at.

It is true that there was "not much" liquidity in DNS, as it is small.   However, there was a reasonable amount for a patient trader who didn't simply limit buy or sell millions of shares at once.

DNS is down around 40-50% or so since the announcement.  It is roughly 30% lower than its lowest price before the announcement.

Toast has stated in this forum that the allocation to DNS was unfair.  Bytemaster has admitted in this forum that he thought he was giving DNS an allocation roughly equal or better than what he and toast had agreed to, but that he had made a mistake!


Summary:

BTSX: does fine.

VOTE: really just more shares to almost exactly the same people who currently have PTS/AGS.

AGS: loses slightly BUT gains liquidity, that it was supposed to never have. 

PTS: loses slightly AND loses liquidity.

DNS: loses greatly AND loses liquidity.



My solution to these issues:

1) We need to give DNS a slightly greater stake.  At a 4% stake instead of 3%, DNS rises in value to at least close to the low point it traded at prior to the announcement.   

2) We should not arbitrarily limit liquidity of DNS and PTS, which were already liquid.  We should also enforce a small cost onto AGS for the benefit of having its liquidity restrictions removed.

3) I believe that the total stake for AGS+PTS+VOTE+DNS needs to be 20%  (This is the "10% to AGS/10% to PTS" rule).  These are all *mostly* the same holders, with a small difference based on people who traded DNS or PTS on exchanges. 


Therefore I would make the following proposal:

80% to BTSX, no lockout.  Just as it is now.  This is necessary for community buy-in, most of us are BTSX holders.

2.5% to VOTE.  2 year restriction on liquidity.  The additional percentage I am allocating to DNS has got to come from somewhere.  DNS and VOTE were the exact same snapshot, so in changing the allocation from one to the other, I am not effecting anyone who has not messed with their shares.  It is ONLY effecting those who sold or bought DNS on an exchange!   My new allocation will ease the pain of those who traded DNS.

6.5% to AGS.  2 year restriction on liquidity.   AGS gets a tiny amount less, because it needs to pay something for the liquidity gain we are giving it. 

7% to PTS.  NO liquidity restriction.  PTS already got a 10% haircut, reducing its liquidity is unfair.

4% to DNS.  NO liquidity restriction.  This Makes DNS mostly whole again, and means that it only gets a maybe 10% drop from its prices before the announcement, not 40%+.  Also, there is no reason to hurt DNS holders further with the lockout period.



Summary of how this effects people:

To people who held AGS/PTS and did nothing with their shares:  They are not effected!  Since they hold all of the different shares already, the fact that one is slightly hurt and another helped doesn't end up changing their final result.

Note that someone who had AGS only and not PTS loses a *tiny* amount.  But this is a fair price to pay in exchange for now having liquidity of their AGS!


To people who bought PTS in order to have liquidity:  They do not get their liquidity unfairly removed from them.


To people who bought DNS on an exchange:  They do not get a massive loss.  They get only a small loss, and are not going to have hurt feelings forever over this.  They also do not have their liquidity unfairly removed from them.



Who does my proposal help: 
DNS buyers who were severely hurt by the original proposal.  Slight help to PTS holders who were hurt by the original proposal.
Who does proposal hurt: 
Slight loss to AGS holders.  However, I feel this is fairly compensated by the fact that now they will become liquid over a 2 year period, whereas initially this was NOT supposed to happen! 
VOTE allocation is slightly reduced.  However, VOTE is in exactly the same snapshot as DNS, so everyone in that snapshot who got VOTE is also helped by the fact that DNS is getting more.  So this really doesn't effect anyone.


Conclusion:

I hope that Bytemaster and everyone else will read this with an open mind and use reason to analyze if it is more fair than the original allocation proposal.

I am in favor of the merger no matter what, and I am not affected by this proposal.  I merely wish to see the DNS buyers (which seems to be a lot of our chinese community!) made whole and not be driven away from Bitshares as a result of this. 

I want to see everyone be able to accept the merger without hurt feelings, and without taking more than a 10% or so loss on any given type of shares.

Accepting this proposal would give Bytemaster an opportunity to mend fences with the wounded DNS holders.

Thank you!

Quote from: toast on October 22, 2014, 01:45:34 pm

If the price doubled since launch you can't argue that the claimed stake "probably mostly hasn't changed hands".

People who held DNS but sold their PTS should not be treated as PTS holders.

People who bought DNS solely for DNS and who don't care about PTS also exist.

There was clearly some miscommunication because I am super angry at the result...

For sure we will talk when I get to the office today.  I just want to say that I *thought* I was giving a better deal to DNS than what I *thought* Toast and I had discussed.   Obviously, I did not want to piss off Toast or DNS holders.

Well, you didnt.  You instead gave DNS only 50% of its market cap, plus a 2 year lockout. 
(I dont have any DNS.  I am just stating that it was not a fair allocation and DNS should get a bit more).


Almost all of the anger right now is from DNS buyers who lost ~50% of their value, plus face a lockout period.   A little bit of anger from PTS holders, mainly because PTS used to be liquid, and now will be in a lockout period, which makes no sense.

DNS stake should be slightly increased and DNS/PTS should both have no lockout, if you want this deal to be fair and not anger a significant minority of the community.

I calculate the value of DNS to be about 120 satoshis. 


Somehow I managed to buy 3.4 million DNS at 150, realize that I had screwed up my math the first time, and then sell them again higher than I bought and make a $100 profit.   (Its a good thing my 3.4M buy sparked a rally apparently, lol!  I sold the hell out of it again during the rally to correct my mistake).


Of course, I might be doing my math wrong on the 120 figure and the current price might be more accurate.

This is all just way too confusing.

So, hodl DNS or get out while you can?

I'm so confused with this merger talk. If I hodl BTSX, does that mean I am basically benefiting from DNS (assuming this merger?) or do I have to continue holding DNS?

I have no idea.

When bytemaster posted that the dev stake in DNS would be removed, giving all the DNS holders more BTS, I bought 3.4 million shares at 14-150 sat.

And then Toast posted that there will eb about 4.1B DNS shares that will count towards the merger, I did the math I calculated that DNS should be worth about 120 satoshis, and I started selling the DNS again, and actually managed to sell all 3.4 million that I bought an hour earlier at a few percent profit.

BUT I could be totally off on my math, because its complicated and there are all these different exchange rates.  I'm comparing prices in yaun, to bitcoins, and multiplying by .03 and on and on...lol. 


I'm just going to sit in BTSX now, and not mess with it.  BTSX is safe.

I thought it was a priority to avoid a situation where an announcement gave someone an information advantage (meaning we were thinking only in terms of current % of market cap).

It doesn't matter anymore because the market has adjusted the price of all assets for this allocation. So any change after the OP would just be BM deciding which current asset holder (AGS, PTS, DNS, BTSX) gets more BTS... meaning this basically has to be the real allocation.

Except that DNS is still up in the air. 

If we interpret it one way, based on 5 billion shares of DNS in existence, then DNS should drop by 50% from current levels (which are alreayd way down).

If we interpret it another way (only the shares of DNS given by PTS/AGS count), then DNS should be much higher than it is now?


We still need clarity on this.

How many outstanding shares of DNS are there actually, that are going to be converted into 3% of BTS?

Is it the full 5 billion number, or a smaller amount?