good!

If  1 bitusd is make at least 1 usd, then people will not hold bitusd.
Because they have to pay more usd to get bitusd, and then spend them like usd. People loose some money in this process.

I do not think large companies will mainly be attracted by the yield, but solutions for the problem they are facing. Think about the rules, what are they designed for?

We would better with little rules, we can add if needed.

Here is a voice from business.

http://www.coindesk.com/seagate-ripple-investment-shows-were-serious-about-blockchain-tech/

A desire to become an "active participant" in the blockchain technology space is what drove $13bn data storage company Seagate to invest in Ripple Labs, according to its senior vice president Dave Morton.
...
He said:
"Our supply chain is very broad. There's over 286 components that go into each of our drives, we pull over 51 elements out of Mother Earth and obviously we manufacture in a lot of foreign locations where there's a lot of exchange risk."
The difficulty of managing this development process is what makes the "Internet of Value" made possible by Ripple Labs appealing, he added.
...

"We have 3 million components a day in flight, so you can just imagine the power that this can possibly have down the road from a supply chain perspective, whether that be cash flow or economics," he said, adding:
"We process over hundreds of thousands of invoices a quarter, you get into the process of how this improves the supply chain, it's pretty remarkable."

"You can do commodities,dollars, yen, euros versus it being just bitcoin. We want to take more of a holistic approach," he said, adding that he remains a fan of bitcoin.

In this light, Morton said Seagate remains primarily interested in seeing whether blockchain technologies can help solve real problems for its business, whether that solution comes from a provider like Ripple Labs or an alternative.

"We're serious about some of these use cases being thought about and resolved. We think there are some technology and business gains to be had."

Quote from: maqifrnswa on May 21, 2015, 03:31:14 pm

I think this is fascinating how everyone approaches this from different points of view (and models) since this is really a multifaceted problem. There is demand side and supply side economics to think about here. Most are thinking of the demand side (how to set up a system that people want to use). I don't want to derail that, but here's my latest on the supply side thoughts. In theory, a simple system which properly manages supply will provide all the necessary features for a healthy and attractive investment.

Summary
Ideal system:
1) The system rewards market players for destroying BTA when there is an oversupply
2) The system rewards market players for creating BTA when there is an under supply

BTA2.0 Implementation of above:
Case (1) is handled by forced calls at 99% of the price feed.
Case (2) is unhandled, but the assumption is market players will do it with no explicit incentive because 1 BTA is supposed to equal the underlying asset.

New thoughts
To handle case (2), people have been offering the idea of yield for holding BTA - either positive or negative. However, I've been contesting that you can't peg a floating asset to itself, that is you need a mechanism by which there is market incentive to push towards the feed.
To do that how about the following:
A variable fee is charged on new shorts which is valued at X% of the difference between the feed and the short. This is a progressive "tax" paid by the parties (longs or shorts) pushing away from the feed and paid to the party that is pushing towards to feed. This fee is either in BTS or BTA depending on oversupply or undersupply and goes to a yield account paid out to all BTA shorts or for longs just like the current yield. It is market driven and leaves us with simple rules that are easy to explain.

The the market says that shorts need to be rewarded, there will be an auction for the size of the reward. The current market would be paying a yield to BTS shorters at one rate and longs at another. BOTH longs and shorts get a yield, and it is based on the fees that were collected when the asset was created.

Proposed, KISS, rules:
1) If a BTA is created (shorted) when there is an under supply, then the buyer would pay a fee in BTS based on how much the price was from the peg. That fee goes to a yield account. All shorts will be paid a fraction of that yield whenever they cover, and the yield is proportional to the fraction of the total BTA supply they are covering and how long they held the collateral (like the current system).
2) If a BTA is created when there is an over supply, the shorter pays a fee in BTA to a yield account which is paid out to longs similar to the current system.

Example:
Feed is 1 BTS per 1 Asset. I want to short at 1.10 BTS per 1 BTA, which means there is an under supply. Someone buys 1 BTA from me for 1.10 BTS. I put 1.10 in collateral so there is 2.20 in collateral, I owe 1 BTA, and the long is long 1 BTA. The buyer also pays a fee of some percentage of the 0.10 BTS they are from the peg, paid in BTS, to the short yield. Whenever any short covers, they are paid a yield proportional to the length of their short (capped at one year) and the percentage of their short. The is the contapositive of the current system.

If I want to short at .90 BTS per 1 BTA, that means there is an over supply of BTS. Someone buys 1 BTA from me for 0.9. I put 0.9 in collateral so there is now 1.90 BTS in collateral, I owe 1 BTA, and the long is long 1 BTA. I also pay a fee based on some percentage of the 0.1 BTS I am away from the peg, in BTA, to the long yield. It is paid out just like the long yield is paid out now. This is very similar to the current system.

Thoughts?

The idea that it is as simple as this:

The forced settlement price has a fee equal to the average delta between the trading price and the price feed.    As shorts "back away" from the feed, the forced settlement backs away in the opposite direction.   As shorts get closer to the fee the forced settlement creeps up.  This allows the market to control the feed and keeps things centered on the price feed.

But the feed comes from the centered exchange.
Check the nxt assets, there is no price feed, but the assets just price normally in and out the decentralized exchange.
We just need market make to peg.

They have a very clear aim. It is huge and urgent. And it seems their system and organisation is enough to realize it (though it is not decentralized).
Must to admit It is a fact. (though I still have some day-dreaming about Bitshares).

Quote from: bytemaster on May 15, 2015, 01:02:21 pm

Quote from: starspirit on May 15, 2015, 02:33:18 am

To make a wise choice on the yield vs no-yield option for BTA 2.0, it is important to consider what will give bitShares the best ongoing advantage in the pegged currency space.

The key is to remember that we are always in competition with others. It's not a good enough argument to say yield can be provided in the bond market, so no yield is required in BTA 2.0, if it turns out that a competitor can create a yield-earning equivalent and also have a bond market, a combination that may be superior to our own.

Imagine if a bank, in the face of competition against other banks that were offering interest on their at-call accounts, took the stance that they did not need to offer interest because customers could get interest in their term deposits instead. How do you think that bank might fare?

It is valid to compare the yield and no-yield options, and decide on one as being a better product than the other. Because then we are saying that if a competitor develops the yield option, then we are comfortable we still have a better product. We have to imagine that anything we could build could be built by others, and we need to believe we have the best product available.

This is a fair point.

Do also keep in mind that bitAssets are advertised pretty much everywhere  to give the average joe investor/merchant a yield. Even the forum-own "5%" meme refers to the yield on bitAssets, if I remember correctly.

I have bought in a few investors who deposited into bitUSD instead of their savings bank account just because of the advertised yield. I'm pretty sure they'd leave the BitShares space if that yield would no longer exist. A "bond market" where one can earn interest is not the same, it is too complicated for someone without a financial background to grasp, all the passive investors care about is a simple yield on bitUSD.

My two bitshares.

We need businesses which need BTA.
People who use BTA to save their money for 5 % yield, can easily find other way to get that amount yield.

What kind of people we want attract? the people just hold BTA and not use it, or the people use it and spread it everywhere?
The businesses on bitshares are much precious than people doing saving. I do not know whether you think so too.

Why we have this many huge changes in bts?
Why there are so many announcement?

We are building a platform, we should be stable, so others can do something on it.

I am sorry I start a new post. Other posts are too long. I hope some of you may consider this. The ideas come from inspiration by the the community members' discussion.

1. Market trade and peg
They are different.
Market trade mainly concentrate on the fair trade. The longs and shorts need to match each other, so the game can be played forever.
Peg mainly concentrate on the relationship of bitAsset price and real asset price.

2. About the market trade
Our purpose is let the market run very long time. The longs and shorts are two sides of the market. If it is not equal, the market will fail to continue some day.
The market design is just to let bitAsset exist, and under well collateral. (As to the peg, we'll discuss later)

Problem of old BitAsset rule
In old BitAsset, the BTA shorters have an expiring date, but the BTA holders have not. This means holding BTA have advantage than holding BTS（or the bts collateral）. So the BTA holders are winner, and BTS price is falling all the way.

Problem of the idea that BitAsset holder can settle for bts
BTA holders have an advantage: can settle back BTS whenever they want. This leads to the same result as the old rules.
For a healthy market:

• if market mainly want to sell, sellers need place lower price orders to match buyers'.This leads the price to go down.
  if market mainly want to buy, buyers need place higher price orders to match sellers'. This leads the price to go up.

In the settlement rule, the settlement function make the market do not work normally. Hold BitAsset to settle for BTS, will not leads BTS price go up, but hold BTS to get BitAsset leads BTS price to go down.

Market rules summary and proposal

• cancel short orders' time limit;
  let shorts can cover any available amount, at any time and with the collateral itself;
  force bad collateral shorts to cover when the collateral is under some level, because the shorts enjoyed the leverage. (Say 120% the bitAsset value. The system auto place market order for the shorts, and give the rest bts to the shorts after order filled))

3. About the peg
Purpose of peg, is to let bitAsset price follow real assets'. We mainly can achieve this from two ways.

The market make way
We need some people to accept 1 bitusd as 1 usd. If nobody do, we the community should be the first.

• establish market make funds, and the profit dividend to the fund's share holders.
  establish gateways or bridges to do the 1:1 exchange (this is real peg)

In fact, with larger and larger market fund, we can cancel the price feed for some bitAsset.

The supply control way
There will be some different ways to do the control. I just want to talk about the yield.

I am against the yield to the long and short holders. But maybe yield to the short traders will work.

Why?

What I mean "traders", are the people who are placing orders.
Placing orders will affect the price instantly, and this affect the peg directly.

• if the bitUSD price is lower than realUSD,  new short orders pay instant interest. (to the system fund, not to the bitUSD seller. bitUSD can be sold to both short and buyer with BTS)
  if the bitUSD price is premium than realUSD, new short orders get instant interest. (from the system fund. not from the bitUSD holder.)

What I mean "holders" are people already hold bitasset or short orders.
We should not do the yield thing to the longs and shorts.  This will not help the instant price, but make the two sides much complex.