The Main Problems with Bitshares

[tonyk]

As  I see it, the devs have done phenomenal job understanding the implications of blockchain technology and designing a system that fully leverages this novel technology for a more transparent, robust and efficient financial network.

With that being said, they are trying to make an exchange without understand how to make an exchange. Time and time again they have added features that are not used by centralized exchanges that we must compete against. For example there was the "you get what you pay for" rule and now there is the margin rule which has lost several people substantial amounts of bitshares. Most disappointing is that these individuals are the ones that have the greatest level of interest in bitshares and would have used those bitshares to provide liquidity (like transwiser) or provide auxiliary services running atms or dedicated servers to maintain the network and provide value for the system indirectly.

Furthermore the reason for the short squeeze was a lack of coordination between the dev team and exchanges, particularly those exchanges that provide liquidity for the bitasset market. If a short wished to close his or her position they could not do so because yunbi, metaexchange and transwiser have not upgraded to 2.0. The short squeeze would have been mitigated if this were the case.

Additionally, Dan has made assumptions about which positions would be called by these price movements and this illiquid market that were not at all true. I had short positions that carried over from bitshares1.0 and all of those positions with an initial 3x collateral were margin called. My margin price for my positions was 0.025 cny which is a price that was not seen on exchanges that have been the backbone for bts trading for the past year, mainly yunbi and btc38. But of course delegates took their feeds from the one exchange that has been upgraded, the one exchange that has margin trading and can thereby drive down the price of bts such that the price on this exchange is 20% lower than the price on others, the one exchange that is clearly a more speculative market where pump and dump groups do their trading.

I know Dan's intentions are good but time and time again he has been wrong in judging the dynamics of the market that bitshares finds itself, which has subsequently driven the bts price down to the levels we see now. I no longer trust the dev team or Dan to do what is in the best interest of Bitshares. I can no longer promote bitshares to friends, because they have already lost more than $100,000 from this venture and the dev team and cryptonomex have little to know idea how to secure outside funding.

If we want bitshares to be competitive to other exchanges we have to take the same business models as these exchanges.
- We have to lower fees, which means lower trading fees (transfer fees can stay the same) and there needs to be no deposit and withdrawal fee (currently at about 2% each way via blocktrade.us).
- We need to incentivize liquidity providers in the primary markets we wish to target. That means getting exchanges to open bitasset markets. That means reducing fees for those that create liquidity on the internal exchange.
- We need improve the user interface so that it is comparable to what traders are accustomed ( Graph of historical trade price at the top, order form beneath this graph, order book beneath order form and not on the side in weird format that we find it now. )
- We need to stop advertising bitshares as a cryptocurrency and just advertise it as an exchange. People don't care how technology works they just want the same level of convenience that they are accustomed to on other platforms.

Lastly, to those that say the price doesn't matter, the price fucking matters. The price factors into the security of the network, the price factors into the provision of our core product (bitassets) and the price factors into the perception of the general crypto community from which we are trying to generate new membership. Dan stop doing things that kill the price of bts, because you are effectively killing the potential of a system that is better than alternative solutions a system which you have tirelessly worked on for the past 2 and half years.

We need to vote in new committee members and more decentralize control of the network. Dan has said that he wanted this network to work autonomously without the need for his intervention, the current system allows for that and we as a community need to come together and provide better oversight of the network's functionality and business model. This whole centralized system of governance where Dan arbitrarily decides the rules needs to stop.

That's my rant for the day. I'm thoroughly pissed off. Please add any additional grievances to this thread so that we can address them as soon as possible.

+ 1 on all that. These are my thoughts and experience... written in way calmer tone, cause "thoroughly pissed off" does not even begin to describe it.

The thing I find extremely suspicious is why this change was kept secret from everyone... every other change was announced.
So it is not only " Dan arbitrarily decides the rules needs to stop. " but "decides the rules and keeps them secret."

[clout]

@lil_jay890 My problem is not that I have lost money. I am not a risk adverse individual and the money I have lost doesn't really affect me as I'm not using for anything other than speculative investments. My problem is that over the past two years, every change that was supposed to be good for bitshares has driven the price down to where we see it now. I can't in good conscience tell anyone else to invest in bitshares because I can't say that there won't be an arbitrary change that confuses the market and drives down the price of bts further. As the price of bitshares goes down so does the capital available to create an infrastructure around this network. I think you misunderstood my grievance as personal. It is not it is one we all share and if not corrected this project will not get where it needs to be and the more centralized alternatives like hyperledger, SETL, and ripple will win out and bitshares will go the way of bitcoin.

Last night I had a discussion with a friend of mine that I was trying to get to invest in bitshares. He is really into now as I sold the value proposition well. The one concern he had was the trust model. He said "someone is creating this code and I have to trust that person. why would I trust them", to which I responded you don't have to trust them you just have to trust the code which is open source. I now realize the flaw in that logic as you very much have to trust the coders behind this project and I no longer trust them. That's not to say I don't think Dan has the best intentions, but there is a divergence between intention and outcome and I can no longer trust that the well intentioned proposal or course of action will beget the best outcome. I simply don't trust Cryptonomex in that capacity anymore.

In regards to your comment about copying incumbents. Where we should not copy incumbents is in their lack of transparency and incompetent management of user funds, which is why we utilize the blockchain as the back bone of our operation. We shouldn't reinvent the wheel and assume growth when there is no growth. We should not create barriers to user acquisition. In a competitive market, the players that win out are those that provide the highest quality service for the lowest price. We are not doing that now, which ultimately will lead to the death of bitshares.

[Thom]

@alt:  to what?

My take away from clout's OP is something I see a serious lack of concern for: campaigns and discussions about governance. As a witness I have made my choice of roles, which puts me in a politically neutral position. Does that mean I have no opinion? Of course not! I'm expressing it now, which is

Let the Games Begin!

I want to see people step up and take responsibility for the direction this ecosystem is headed. You want change? THEN BE AN AGENT FOR IT and stop putting it onto someone else to do for you.

If this community fails to do so it only proves DPoS is an abject failure, just like the American experiment and trust in The Constitution is. If you want change you need to be willing to work for it. You now have the tools, GET ON WITH IT ALREADY!

[jsidhu]

If funds were lost due to an upgrade those funds should be refunded if they can prove it.

[alt]

 

[topcandle]

Remember you are trading an ultra high risk and volatile asset... I don't understand why you are so angry when the risk of total loss has been there and stated since the very begining.  Yes high reward can come, but the risk doesn't disappear.

These things mentioned above have also been thought about by the dev's for the last year... making knee jerk decisions is not how business's are run, including the centralized exchanges you mention above.  Tweeks are viable, but changing the fee structure now after it has been up for debate for months would be stupid.

We are trying to change the current paradigm of money exchange.  Copying what the incumbent exchanges are doing won't result in anything but our project's death.  Real change and improvement happens when we step out of our comfort zone and challenge the status quo.

I'm sorry you lost money, but you are talking in absolutes and out of emotion.  Wildly accusing Dan of killing the project is totally out of line.  He has worked tirelessly on the project and is one of the brightest minds in crypto.  You are incredibly lucky to have him working on this project.

Clout is frustrated and venting his anger.  We should commiserate with him.  What happened was bad, and the assumption that was taken without informing others is detrimental.  Voicing our problems is the only way we can make bitshares better.

If the new BTS 2.0 was truly developed and is implemented, what happened to the BITUSD shoudl nto be an issue.  The feed does not have much influence in the new BTS 2.0 implement with 24h settlements.  I just don't know why nobody has created an asset for it and is trading on it. 

[lil_jay890]

Remember you are trading an ultra high risk and volatile asset... I don't understand why you are so angry when the risk of total loss has been there and stated since the very begining.  Yes high reward can come, but the risk doesn't disappear.

These things mentioned above have also been thought about by the dev's for the last year... making knee jerk decisions is not how business's are run, including the centralized exchanges you mention above.  Tweeks are viable, but changing the fee structure now after it has been up for debate for months would be stupid.

We are trying to change the current paradigm of money exchange.  Copying what the incumbent exchanges are doing won't result in anything but our project's death.  Real change and improvement happens when we step out of our comfort zone and challenge the status quo.

I'm sorry you lost money, but you are talking in absolutes and out of emotion.  Wildly accusing Dan of killing the project is totally out of line.  He has worked tirelessly on the project and is one of the brightest minds in crypto.  You are incredibly lucky to have him working on this project.

[clout]

As  I see it, the devs have done phenomenal job understanding the implications of blockchain technology and designing a system that fully leverages this novel technology for a more transparent, robust and efficient financial network.

With that being said, they are trying to make an exchange without understand how to make an exchange. Time and time again they have added features that are not used by centralized exchanges that we must compete against. For example there was the "you get what you pay for" rule and now there is the margin rule which has lost several people substantial amounts of bitshares. Most disappointing is that these individuals are the ones that have the greatest level of interest in bitshares and would have used those bitshares to provide liquidity (like transwiser) or provide auxiliary services running atms or dedicated servers to maintain the network and provide value for the system indirectly.

Furthermore the reason for the short squeeze was a lack of coordination between the dev team and exchanges, particularly those exchanges that provide liquidity for the bitasset market. If a short wished to close his or her position they could not do so because yunbi, metaexchange and transwiser have not upgraded to 2.0. The short squeeze would have been mitigated if this were the case.

Additionally, Dan has made assumptions about which positions would be called by these price movements and this illiquid market that were not at all true. I had short positions that carried over from bitshares1.0 and all of those positions with an initial 3x collateral were margin called. My margin price for my positions was 0.025 cny which is a price that was not seen on exchanges that have been the backbone for bts trading for the past year, mainly yunbi and btc38. But of course delegates took their feeds from the one exchange that has been upgraded, the one exchange that has margin trading and can thereby drive down the price of bts such that the price on this exchange is 20% lower than the price on others, the one exchange that is clearly a more speculative market where pump and dump groups do their trading.

I know Dan's intentions are good but time and time again he has been wrong in judging the dynamics of the market that bitshares finds itself, which has subsequently driven the bts price down to the levels we see now. I no longer trust the dev team or Dan to do what is in the best interest of Bitshares. I can no longer promote bitshares to friends, because they have already lost more than $100,000 from this venture and the dev team and cryptonomex have little to know idea how to secure outside funding.

If we want bitshares to be competitive to other exchanges we have to take the same business models as these exchanges.
- We have to lower fees, which means lower trading fees (transfer fees can stay the same) and there needs to be no deposit and withdrawal fee (currently at about 2% each way via blocktrade.us).
- We need to incentivize liquidity providers in the primary markets we wish to target. That means getting exchanges to open bitasset markets. That means reducing fees for those that create liquidity on the internal exchange.
- We need improve the user interface so that it is comparable to what traders are accustomed ( Graph of historical trade price at the top, order form beneath this graph, order book beneath order form and not on the side in weird format that we find it now. )
- We need to stop advertising bitshares as a cryptocurrency and just advertise it as an exchange. People don't care how technology works they just want the same level of convenience that they are accustomed to on other platforms.

Lastly, to those that say the price doesn't matter, the price fucking matters. The price factors into the security of the network, the price factors into the provision of our core product (bitassets) and the price factors into the perception of the general crypto community from which we are trying to generate new membership. Dan stop doing things that kill the price of bts, because you are effectively killing the potential of a system that is better than alternative solutions a system which you have tirelessly worked on for the past 2 and half years.

We need to vote in new committee members and more decentralize control of the network. Dan has said that he wanted this network to work autonomously without the need for his intervention, the current system allows for that and we as a community need to come together and provide better oversight of the network's functionality and business model. This whole centralized system of governance where Dan arbitrarily decides the rules needs to stop.

That's my rant for the day. I'm thoroughly pissed off. Please add any additional grievances to this thread so that we can address them as soon as possible.