Author Topic: 100% delegate pay in USD could be $200/month due to slippage  (Read 6042 times)

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Offline monsterer

Realistically, delegates who need to liquidate pay will set limit orders on exchanges or will hedge with bit assets out of savings or by using credit to borrow until bitAssets are more liquid.

As soon as you set a limit order you become a speculator. This is incompatible with the need to convert to fiat.
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Offline Ander

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You need to not look at the lowest volume market.

Nobody has any USD on bter, thats why there is no volume in that market.


btc38's CNY/BTS pair has generally at least 60% of the volume.  Yunbi's CNY/BTS and Bter's BTC/BTS pairs have almost all of the rest of the volume.  There currently is no USD market for BTS that has any reasonable volume at all.

(Yes, this is why we need onramps).
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pollux

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Delegates who choose to use market orders to liquidate pay will be basically sharedropping investors who opportunistically provide liquidity at a discount price.

Realistically, delegates who need to liquidate pay will set limit orders on exchanges or will hedge with bit assets out of savings or by using credit to borrow until bitAssets are more liquid.

Original point is still valid of course, but I think the lesson to delegates is "figure out how you will be liquidating your pay, if you do at all".

Offline ag

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Oh , I see where you are wrong .
There will not be 101 100% delegates .
By my est , there will only be 10-25 delegates who can have 100% payrate .
More than that , shareholders won't approve .
At this point , it's not even that easy to get all the developers to get a 100% delegate seat .

My calculations assume worst case, yes.

If there comes to a point that 101 delegates successfully vote in with 100% payrate , then it means the value of the system is big enough , the numbers you are talking about will no longer apply .

But the reality is , most of the delegates can only get 3% payrate . The shareholders would be foolish to vote in 101 full paid delegates just to let them dump on the market without making significant value for the system .
+5% good point.
« Last Edit: November 17, 2014, 04:51:01 pm by ag »

Offline monsterer

Why sell into the bid wall? just put up a sell order at slightly higher than best bid, and your order will execute quickly, within 1 hour, that has always been my experience.

Because there is no other way to value any order than to take the immediately actionable value; if people are saying the USD value of N BTS is N * top bid price, then the truth actually is that you have to take N and eat into the bid side of the book to get the true current value.
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Offline Riverhead

I guess this situation isn't unexpected; especially with such low volume. Much like C-Level execs that have most of their compensation paid in stock options. They have to divest very slowly to not disrupt the market.

For example Oracle. There are some big moves but a lot of "automatic execution" entries too.

https://finance.yahoo.com/q/it?s=ORCL+Insider+Transactions

Offline kokojie

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Yes but I can't totally catch you..
You mean the paid delegates can hardly sell out their earned bts? Or they earned too little?

They can sell their BTS, but the actual USD they get could be 100 times less than the amount you will often see estimated using the current 'price' of BTS.

Example: the commonly expressed estimate for 100% delegate pay is $2500 / month, but this could actually end up being only $200 / month due to slippage at the exchange.

Why sell into the bid wall? just put up a sell order at slightly higher than best bid, and your order will execute quickly, within 1 hour, that has always been my experience.

Offline monsterer

Yes but I can't totally catch you..
You mean the paid delegates can hardly sell out their earned bts? Or they earned too little?

They can sell their BTS, but the actual USD they get could be 100 times less than the amount you will often see estimated using the current 'price' of BTS.

Example: the commonly expressed estimate for 100% delegate pay is $2500 / month, but this could actually end up being only $200 / month due to slippage at the exchange.
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Offline abit

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Image when the price of bts get rising.. It should be much more than that.
Don't just look at current price.

Did you read the OP? The very point of this post is the problem *with* using the current price.
Yes but I can't totally catch you..
You mean the paid delegates can hardly sell out their earned bts? Or they earned too little?

I agree with these words posted by cn-members:
Quote
as for the delegates , we encourage them not to sell
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Offline monsterer

Image when the price of bts get rising.. It should be much more than that.
Don't just look at current price.

Did you read the OP? The very point of this post is the problem *with* using the current price.
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Offline abit

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Oh , I see where you are wrong .
There will not be 101 100% delegates .
By my est , there will only be 10-25 delegates who can have 100% payrate .
More than that , shareholders won't approve .
At this point , it's not even that easy to get all the developers to get a 100% delegate seat .

My calculations assume worst case, yes, but this is not an error, just the opposite end of the estimation bound.

So, lower bound is $200 / month, upper bound is $2500 / month.
Image when the price of bts get rising.. It should be much more than that.
Don't just look at current price.
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Offline cn-members

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Oh , I see where you are wrong .
There will not be 101 100% delegates .
By my est , there will only be 10-25 delegates who can have 100% payrate .
More than that , shareholders won't approve .
At this point , it's not even that easy to get all the developers to get a 100% delegate seat .

My calculations assume worst case, yes.

If there comes to a point that 101 delegates successfully vote in with 100% payrate , then it means the value of the system is big enough , the numbers you are talking about will no longer apply .

But the reality is , most of the delegates can only get 3% payrate . The shareholders would be foolish to vote in 101 full paid delegates just to let them dump on the market without making significant value for the system .
BTS中文区发言人公共账号,帮助社区有效沟通与交流。
Chinese Community Spokesman Account,to help the effective communication between Chinese and other members of the community.We're not translators to do regular translations , but will help with vital ones as we see fit and available at that time.

Offline monsterer

Oh , I see where you are wrong .
There will not be 101 100% delegates .
By my est , there will only be 10-25 delegates who can have 100% payrate .
More than that , shareholders won't approve .
At this point , it's not even that easy to get all the developers to get a 100% delegate seat .

My calculations assume worst case, yes, but this is not an error, just the opposite end of the estimation bound.

So, lower bound is $200 / month, upper bound is $2500 / month.
« Last Edit: November 17, 2014, 11:57:50 am by monsterer »
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Offline cn-members

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The order book can only see 30 lists  ? So I don't know all .

From current price to 0.0131USD , there are around 70000 USD worth of CNY buy orders .

And once the price is low enough , more people would want to buy , so the order book is not equal to reality .

So, that would be roughly 330 BTC worth of slippage. Or $700 / month at 100% pay.

Oh , I see where you are wrong .
There will not be 101 100% delegates .
By my est , there will only be 10-25 delegates who can have 100% payrate .
More than that , shareholders won't approve .
At this point , it's not even that easy to get all the developers to get a 100% delegate seat .
BTS中文区发言人公共账号,帮助社区有效沟通与交流。
Chinese Community Spokesman Account,to help the effective communication between Chinese and other members of the community.We're not translators to do regular translations , but will help with vital ones as we see fit and available at that time.

Offline monsterer

The order book can only see 30 lists  ? So I don't know all .

From current price to 0.0131USD , there are around 70000 USD worth of CNY buy orders .

And once the price is low enough , more people would want to buy , so the order book is not equal to reality .

So, that would be roughly 330 BTC worth of slippage. Or $700 / month at 100% pay.
My opinions do not represent those of metaexchange unless explicitly stated.
https://metaexchange.info | Bitcoin<->Altcoin exchange | Instant | Safe | Low spreads