Quote from: tonyk on March 12, 2014, 04:11:43 pm

The 10x margin is all well and good in preventing attacks discussed but it leads (in my opinion) to exposing system problems already existing in the proposed market – in particular small (and known/pre-determined) money supply. Adding to this small money supply a strongly unbalanced voting/price determination power is dangerous (and that is what the 10x margin does). What I mean is in order for the shorts to cast a vote (to say generally that the BitUSD is overvalued they need 9-10 times the resources/money  the counter party needs to say the BitUSD is undervalued). This misbalance will in itself  stay in the way of the market determining the fair price of the Bitassets but in the context of this discussion here is an example of market manipulation/attack that this misbalance facilitates.

One (the attacker) will need no more than 10% of the all BTXs to have full control over the demand for all BitAssets. That is to say he can match all asks in all assets even if everybody else is 1. Participating/actually placing orders in the market 2. everybody else is of the opinion that the BitUSD is overvalued (i.e. is placing a sell/short sale orders). In practice the attack will be possible with probably 1-3% of all BTXs to attack just one particular BitAsset.


Here is a very rough form of the attack (refining it is not that hard)
Having 10.01% of the all BTXs
1. Buy some arbitrary amount of all offered BitUSD (Let say 5%-10%) at the very beginning of the market at say price p1.
2.Place an ask order for the Bitasset bought in step#1 at let’s say 130.01% the purchase price p1.
3.Place big enough ask bid/s (as of quantity BTX offered up to 10% of all BTXs, but in practice you will need most of the time much smaller amount)  @ price sliding from 101% to  130% the p1 price. Effectively matching/swallowing all asks coming to the market.
The important thing here is that your demand for BitUSD is so big that you can ‘swallow’/match any possible ask coming to the market so you will inevitable drive the price to the desired level.
4. Keep a ‘hard bottom’ (placing a bid order/s @ 130% p1, for amount of BitUSD unsurpassable by any and all potential ask orders) until you have sold sufficient percent of the initial BitUSD (bought @100% p1and sold for 130.01% p1)
5. At your leisure push the price slowly from 130% p1 to let say 160% p1, as in step 3.
And cash in some more BitUSD @160.01% p the same way as in step 4.

If you asked me name the attack  -‘Unbalanced Forces Attack” (‘Unbalanced forces are forces that produce a non-zero net force, which changes an object's motion’)

This is a very solid consideration and worthy a tip for simply suggesting it.  I am going to think through this one a bit more. 

I am going to call this attack the BitUSD Monopoly Attack rather than Unbalanced Forces Attack because the premise is that once you monopolize a BitAsset you can set any price for it you want and thus trigger a margin call on the shorts and steal their money.   This attack is made possible by reducing the percentage of BTS required to buy all short positions.   

In the initial design it would require 50% of the BTS to pull of this attack.   Going to 10000x margin would allow almost anyone to pull of this attack.  And like you said, a 10x margin allows anyone with 5% to pull off this attack.      If I reduce it to 4x margin then the amount required to pull of this attack is 10-20%.   Now the assumption here is that someone who owns 10-20% couldn't actually profit by this move because it would entirely undermine his huge investment and while he may end up doubling his percentage ownership he would cause it to be worth 10% of the original value.   

Perfectly balanced (original design) is actually not quite perfectly balanced because the shorts can be squeezed.  I suspect there is a balance between various attacks.   We must assume intent to profit by the attack and I don't see how someone can profit in real terms with this attack.

PTS 和 BTC 的所有权，依 3i 声明，依然是整个社区。成立基金会，索回这些 PTS 和 AGS 理由上可以成立。但是那些 PTS 所换得的 BTS 是归 3i 所有的，这是 3i 事前明说的，任何投 AGS 的人都被认为自动同意这一条款。