On the impossibility of paying all BitAssets debts on the Bitshares blockchain

[sahkan]

The proposed protocol recovers peg, eliminates GS, avoids hurting all debtors because it can be implemented to liquidate only the very lowest CR position once its CR falls below 1. What else do you want?

* It does NOT keep/recover peg when BTS price is low enough.
* It's essentially automatic-GS, but not eliminates GS.

Please think carefully, if you're talking about the idea proposed by Sahkan.
One scenario: assuming there are 1 million accounts holding 1 million bitUSD, when there is one debt position with 1K USD to be forcefully liquidated, whose bitUSD will be forcefully converted to BTS? Unless you mean all of them, technically it doesn't scale well (performance-wise) if considered fairness.

 I am not saying it is not complex on a larger scale but you have to make choices. You can close positions based on age, size or percentage of holdings. Age is hard to determine and percentage does not scale well. So you can pick size as an example. Based on size you can liquidate from the largest stake or the smallest. If we decided to go with the smallest, we could:
1. potentially avoid force settling CEX because they would arguable hold the largest amounts
2. liquidate small bit asset holdings which might promote larger investments
3. and the most important we would be able to hold the bit asset peg as it was designed to do in the first place, no fake feeds!

[Thul3]

They aren't be delisted now simply because the current mechanism IS better.

Maybe is better for people who went into debt and are intending to never pay pack and transfer all their loses to others, but not for the ecosystem. Maybe is better for people who is paying their bills with BitCNY to counterparties that are unaware of the peg being lost, but not for Bitshares in long run. 

* It does NOT keep/recover peg when BTS price is low enough.
* It's essentially automatic-GS, but not eliminates GS.

As far as Bts is used as collateral, no mechanism on this universe will work if Bts price is low enough. And no, this is not GS Because in GS, positions are taken all at once, thence the 'Global' in GS.

This is different, one position is liquidated at a time and its collateral is shared between all BitAsset holders, who will now have a little less of that asset.

Please think carefully, if you're talking about the idea proposed by Sahkan.
One scenario: assuming there are 1 million accounts holding 1 million bitUSD, when there is one debt position with 1K USD to be forcefully liquidated, whose bitUSD will be forcefully converted to BTS? Unless you mean all of them, technically it doesn't scale well (performance-wise) if considered fairness.

In your example, and assuming Sahkan idea, each of the BitUSD holder will have 0.001 BitUSD converted to BTS, they won't even notice. There would be no GS, No low collateral positions to worry about. It's a pretty neat idea.

You got really a bad understanding when writing something like that

[binggo]

en...

This problem has been talked about long long time ago in CN forum, nothing is new, and we also have had some ideas to handle these.

If really care something, we should design one or two rotating positions for the backup witness to maintain the activity of backup witness.

The backup witnesses who has a certain weight of votes can product blocks alternate on the rotating position，but the rotating position only can get half Pay-per-block, alternate time is one day?

[Sapiens]

They aren't be delisted now simply because the current mechanism IS better.

Maybe is better for people who went into debt and are intending to never pay pack and transfer all their loses to others, but not for the ecosystem. Maybe is better for people who is paying their bills with BitCNY to counterparties that are unaware of the peg being lost, but not for Bitshares in long run. 

* It does NOT keep/recover peg when BTS price is low enough.
* It's essentially automatic-GS, but not eliminates GS.

As far as Bts is used as collateral, no mechanism on this universe will work if Bts price is low enough. And no, this is not GS Because in GS, positions are taken all at once, thence the 'Global' in GS.

This is different, one position is liquidated at a time and its collateral is shared between all BitAsset holders, who will now have a little less of that asset.

Please think carefully, if you're talking about the idea proposed by Sahkan.
One scenario: assuming there are 1 million accounts holding 1 million bitUSD, when there is one debt position with 1K USD to be forcefully liquidated, whose bitUSD will be forcefully converted to BTS? Unless you mean all of them, technically it doesn't scale well (performance-wise) if considered fairness.

In your example, and assuming Sahkan idea, each of the BitUSD holder will have 0.001 BitUSD converted to BTS, they won't even notice. There would be no GS, No low collateral positions to worry about. It's a pretty neat idea.

[abit]

BitAssets situation cannot possibly worsen. As of today, they are pegged to nothing but debtors whim. Yet, no delisting has happened and none of your 3 points have occurred.

They aren't be delisted now simply because the current mechanism IS better.

The proposed protocol recovers peg, eliminates GS, avoids hurting all debtors because it can be implemented to liquidate only the very lowest CR position once its CR falls below 1. What else do you want?

* It does NOT keep/recover peg when BTS price is low enough.
* It's essentially automatic-GS, but not eliminates GS.

Please think carefully, if you're talking about the idea proposed by Sahkan.
One scenario: assuming there are 1 million accounts holding 1 million bitUSD, when there is one debt position with 1K USD to be forcefully liquidated, whose bitUSD will be forcefully converted to BTS? Unless you mean all of them, technically it doesn't scale well (performance-wise) if considered fairness.

[Thul3]

1.Delisting of all bitassets outside of DEX
2.Dumping of BTS for other stable coins on CEX
3.Dead market on DEX ,starting from ZERO

Pure FUD. BitAssets situation cannot possibly worsen. As of today, they are pegged to nothing but debtors whim. Yet, no delisting has happened and none of your 3 points have occurred.

The proposed protocol recovers peg, eliminates GS, avoids hurting all debtors because it can be implemented to liquidate only the very lowest CR position once its CR falls below 1. What else do you want?

At least open your eyes to whom i'm replying

[Sapiens]

1.Delisting of all bitassets outside of DEX
2.Dumping of BTS for other stable coins on CEX
3.Dead market on DEX ,starting from ZERO

Pure FUD. BitAssets situation cannot possibly worsen. As of today, they are pegged to nothing but debtors whim. Yet, no delisting has happened and none of your 3 points have occurred.

The proposed protocol recovers peg, eliminates GS, avoids hurting all debtors because it can be implemented to liquidate only the very lowest CR position once its CR falls below 1. What else do you want?

[Thul3]

The debt would be replaced by Joe's collateral. So Joe's debt gets settled to Ana, his debt is 0, and Ana has 1000BTS instead of BitUSD. Joe gets to keep 500BTS that he was trading with + the profits he made on trading. That's in that scenario, if CEX is holding bitAssets and they get settled then yes they would have to swap funds for users, but that would be their problem to solve; DEX is build for DEX not for CEX.

1.Delisting of all bitassets outside of DEX
2.Dumping of BTS for other stable coins on CEX
3.Dead market on DEX ,starting from ZERO

[pc]

It's not quite so simple, but possible. See BSIP-17 for some details.

[Sapiens]

The debt would be replaced by Joe's collateral. So Joe's debt gets settled to Ana, his debt is 0, and Ana has 1000BTS instead of BitUSD. Joe gets to keep 500BTS that he was trading with + the profits he made on trading. That's in that scenario, if CEX is holding bitAssets and they get settled then yes they would have to swap funds for users, but that would be their problem to solve; DEX is build for DEX not for CEX.

Sounds like a plan to me. Simple and slick. Solves a lot of our problems and no pool implementation is needed.

Now, in the real scenario the whole bunch of 500 BitUSD will not be in the hands of Ana but of 100 diferent people, each of them with a certain amount of BitUSD. So, the distribution of the liquitated collateral would have to be in accordance.

[abit]

... CEX is holding bitAssets and they get settled then yes they would have to swap funds for users, but that would be their problem to solve; ...

The most possible scene I could imagine is that CEXs would delist bitAssets and/or never list bitAssets. Too troublesome.

DEX is build for DEX not for CEX.

This is correct though.

[sahkan]

How about if we change the rules? And instead of GS where the blockchain takes over the debt, it simply gets settled to Ana. So Ana gets 1000 BTS and all debts are wiped out.

CEX would then have to replace their held bitassets with BTS in user portfolios, no? Doesn't sound right.

The debt would be replaced by Joe's collateral. So Joe's debt gets settled to Ana, his debt is 0, and Ana has 1000BTS instead of BitUSD. Joe gets to keep 500BTS that he was trading with + the profits he made on trading. That's in that scenario, if CEX is holding bitAssets and they get settled then yes they would have to swap funds for users, but that would be their problem to solve; DEX is build for DEX not for CEX.

[Sapiens]

Hey everyone,

I've modified the original post after noticing that the solution I proposed is no solution at all.

[R]

How about if we change the rules? And instead of GS where the blockchain takes over the debt, it simply gets settled to Ana. So Ana gets 1000 BTS and all debts are wiped out.

CEX would then have to replace their held bitassets with BTS in user portfolios, no? Doesn't sound right.

[sahkan]

How about if we change the rules? And instead of GS where the blockchain takes over the debt, it simply gets settled to Ana. So Ana gets 1000 BTS and all debts are wiped out.