Author Topic: Committee Proposal: Urgent call for help by the Chinese Community  (Read 28853 times)

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Offline cube

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There was active exploiting that uses inaccurate price feed and generates free money for the exploiter.

http://bitsharestalk.org/index.php?topic=20356.msg262329.msg#262329

we talked in the past already about inaccurate price feeds a lot.


It is not just an inaccurate price feed as in a feed with fluctuating price but a feed with a consistently wrong CNY price due to the fact that the algorithm does not pull in any China website sources.  It is like getting USD fiat prices not from the USA but from some other non-related places.  This price figure is simply wrong and cannot be relied upon.  And no matter how you want to call it, the price feed script is flawed.  The flawed price feed in the DEX allowed opportunistic flaw exploiters to gain unfairly at the expense of one side of the long-short players.

The rest of the points are really out of the scope of the proposal.  But for the sake of completeness, let's discuss them.



i wanted to have them as good as possible. with metaexchange we had the problem in exchanging bitBTC - BTC .

claiming not working pricefeeds - hurts only shorters, so i ask transwiser direct - why are you holding CNY shorts?

not working pricefeeds will happen again and again and if transwiser justs holds CNY and bitCNY it is not their concern.

it was also already stated - force settlement is in the command client since the beginning, so nothing new here at all.

this reaction tastes not good in my mouth.

the committee saved some speculators and hurt other speculators.

Out of Scope Discussion
=========================

As you said it, metaexchange "had the problem in exchanging bitBTC - BTC".  AFAIK, nobody - absolutely no businesses are pegging 1 bitBTC : 1 real BTC in the bitshares DEX.  But why?  IMHO, the risk of losses is probably too high to justify any profit.

Transwiser, on the other hand, is literally pegging 1 bitCNY : 1 CNY (with a small fee) and offering this bitCNY to CNY fiat onramp and offramp services to our users.  Transwiser is a real legitimate business that bitshares users benefit greatly.  To say that the Committee saved some speculators is simply a false statement.

The price feed flaw has been there all this while but it was not exposed publicly.  The recent introduction of the 'Settle' button exposes the price feed flaw.  Not surprisingly, the opportunistic flaw exploiters took advantage of it and gained unfairly at the expense of Transiwiser business, as well as other short players.

The 'Settle/Settlement' function has nothing much to do with the whole story.
« Last Edit: December 02, 2015, 08:04:27 am by cube »
ID: bitcube
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Offline bitcrab

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I'd like to explain once again that the price feed is actual "not wrong" given the set of exchanges it pulls its data from.

Issue 1): There is no such thing as a single true price if you have an asset traded on more than one exchange
Issue 2): Given a set of several exchange, you can derive either a mean, median, or weighted-by-volume price
Issue 3): If you weight your prices by volume, you need to be careful about exchanges that allow trading without fees

This is why the "old" price feed script does not take exchanges into account that allow free trading. The "new" price feed script allows to
pick different exchanges for different smartcoins (e.g. CNY) and adds those fee-free exchanges as sources.

Hence, once the scripts is proofed stable, witnesses can customize the sources for each asset and have USD be rather "stable" using
weighted-median while CNY can be derived as median over fee-free exchanges, or as weighted via non-free and free exchanges

@xeroc thanks a lot for all you have done for this, you always did great work.
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Offline xeroc

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I'd like to explain once again that the price feed is actual "not wrong" given the set of exchanges it pulls its data from.

Issue 1): There is no such thing as a single true price if you have an asset traded on more than one exchange
Issue 2): Given a set of several exchange, you can derive either a mean, median, or weighted-by-volume price
Issue 3): If you weight your prices by volume, you need to be careful about exchanges that allow trading without fees

This is why the "old" price feed script does not take exchanges into account that allow free trading. The "new" price feed script allows to
pick different exchanges for different smartcoins (e.g. CNY) and adds those fee-free exchanges as sources.

Hence, once the scripts is proofed stable, witnesses can customize the sources for each asset and have USD be rather "stable" using
weighted-median while CNY can be derived as median over fee-free exchanges, or as weighted via non-free and free exchanges

Offline bitcrab

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There was active exploiting that uses inaccurate price feed and generates free money for the exploiter.

http://bitsharestalk.org/index.php?topic=20356.msg262329.msg#262329

we talked in the past already about inaccurate price feeds a lot. i wanted to have them as good as possible. with metaexchange we had the problem in exchanging bitBTC - BTC .

claiming not working pricefeeds - hurts only shorters, so i ask transwiser direct - why are you holding CNY shorts?

not working pricefeeds will happen again and again and if transwiser justs holds CNY and bitCNY it is not their concern.

it was also already stated - force settlement is in the command client since the beginning, so nothing new here at all.

this reaction tastes not good in my mouth.

the committee saved some speculators and hurt other speculators.

everyone can hold CNY short, without explaining to others, and the market need the shorters to provide BitCNY liquidity.

the price feed has deviated, it appears always lower a lot than the actual price, this created an unfair market context that hurt all shorters, developers is now trying to remove the unfairness by refining the scripts, this is all why we paused the force settlement.

understand?
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Offline fav

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There was active exploiting that uses inaccurate price feed and generates free money for the exploiter.

http://bitsharestalk.org/index.php?topic=20356.msg262329.msg#262329

we talked in the past already about inaccurate price feeds a lot. i wanted to have them as good as possible. with metaexchange we had the problem in exchanging bitBTC - BTC .

claiming not working pricefeeds - hurts only shorters, so i ask transwiser direct - why are you holding CNY shorts?

not working pricefeeds will happen again and again and if transwiser justs holds CNY and bitCNY it is not their concern.

it was also already stated - force settlement is in the command client since the beginning, so nothing new here at all.

this reaction tastes not good in my mouth.

the committee saved some speculators and hurt other speculators.

Instead of changing a core principle they could've just:

- asked witnesses to shutdown CNY market
- shutdown transwiser
- pay for a professional price feed provider (via worker)

but it's easier to push your own agenda out of greed. I hope those involved will get voted out sooner rather than later, unfortunately, the language barrier prevents this.

to me one thing is strange, you are not an active committee member, but why it's you that manage the committee management board?

strange reasoning there.

Offline bitcrab

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There was active exploiting that uses inaccurate price feed and generates free money for the exploiter.

http://bitsharestalk.org/index.php?topic=20356.msg262329.msg#262329

we talked in the past already about inaccurate price feeds a lot. i wanted to have them as good as possible. with metaexchange we had the problem in exchanging bitBTC - BTC .

claiming not working pricefeeds - hurts only shorters, so i ask transwiser direct - why are you holding CNY shorts?

not working pricefeeds will happen again and again and if transwiser justs holds CNY and bitCNY it is not their concern.

it was also already stated - force settlement is in the command client since the beginning, so nothing new here at all.

this reaction tastes not good in my mouth.

the committee saved some speculators and hurt other speculators.

Instead of changing a core principle they could've just:

- asked witnesses to shutdown CNY market
- shutdown transwiser
- pay for a professional price feed provider (via worker)

but it's easier to push your own agenda out of greed. I hope those involved will get voted out sooner rather than later, unfortunately, the language barrier prevents this.

to me one thing is strange, you are not an active committee member, but why it's you that manage the committee management board?
Email:bitcrab@qq.com

Offline fav

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There was active exploiting that uses inaccurate price feed and generates free money for the exploiter.

http://bitsharestalk.org/index.php?topic=20356.msg262329.msg#262329

we talked in the past already about inaccurate price feeds a lot. i wanted to have them as good as possible. with metaexchange we had the problem in exchanging bitBTC - BTC .

claiming not working pricefeeds - hurts only shorters, so i ask transwiser direct - why are you holding CNY shorts?

not working pricefeeds will happen again and again and if transwiser justs holds CNY and bitCNY it is not their concern.

it was also already stated - force settlement is in the command client since the beginning, so nothing new here at all.

this reaction tastes not good in my mouth.

the committee saved some speculators and hurt other speculators.

Instead of changing a core principle they could've just:

- asked witnesses to shutdown CNY market
- shutdown transwiser
- pay for a professional price feed provider (via worker)

but it's easier to push your own agenda out of greed. I hope those involved will get voted out sooner rather than later, unfortunately, the language barrier prevents this.

Offline Shentist

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There was active exploiting that uses inaccurate price feed and generates free money for the exploiter.

http://bitsharestalk.org/index.php?topic=20356.msg262329.msg#262329

we talked in the past already about inaccurate price feeds a lot. i wanted to have them as good as possible. with metaexchange we had the problem in exchanging bitBTC - BTC .

claiming not working pricefeeds - hurts only shorters, so i ask transwiser direct - why are you holding CNY shorts?

not working pricefeeds will happen again and again and if transwiser justs holds CNY and bitCNY it is not their concern.

it was also already stated - force settlement is in the command client since the beginning, so nothing new here at all.

this reaction tastes not good in my mouth.

the committee saved some speculators and hurt other speculators.

Offline clayop

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There was active exploiting that uses inaccurate price feed and generates free money for the exploiter.

http://bitsharestalk.org/index.php?topic=20356.msg262329.msg#262329
Bitshares Korea - http://www.bitshares.kr
Vote for me and see Korean Bitshares community grows
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Offline Shentist

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sry to say this, but you could only loose via force settlement if transwiser holds shorts in CNY

if transwiser claims to be in the business of transfering CNY -- bitCNY the question is how did they ended with shorts?

probably, because they needed to created the bitCNY by them self.

i think to shut the force settlement down, is and was a bad example for the committee reaction. i am not clearly understanding this feature and i am only using GUI, so i am not shorting at all.

i will end with a statement of Warren Buffett "never invest in something you don't understand".

Offline xeroc

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please give me and the witnesses some time to thoroughly test the changes to the script .. I had to change alot algorithmically and don't want to cause any problems

Offline mindphlux

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Initial test run results show a 'deviation' towards the real price of about 2% and we're quite happy about that. So no, we're not expecting the price to be meet the precision of 10^-7. A deviation is a given.
Please consider voting for my witness mindphlux.witness and my committee user mindphlux. I will not vote for changes that affect witness pay.

Offline tonyk

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@tonyk I want to get it re-enabled ASAP and we have a 'meeting' scheduled tomorrow for a witness test-run, once that is through we'll get to the proposal ASAP.

even if the scripts fails to meet the expected precision of 10^-7? Cause let me tell you something, no test run needed, it will fail this test.
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.

Offline mindphlux

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@tonyk I want to get it re-enabled ASAP and we have a 'meeting' scheduled tomorrow for a witness test-run, once that is through we'll get to the proposal ASAP.
Please consider voting for my witness mindphlux.witness and my committee user mindphlux. I will not vote for changes that affect witness pay.

Offline tonyk

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Actually, TonyK, that is wrong. Please see:

https://bitsharestalk.org/index.php/topic,20299.msg261819.html#msg261819

However, we're considering to create the proposal as soon as the new script is tested and adopted by the majority of the witnesses. Which could be as early as tomorrow.

Sure you should take your sweet time fixing the mess, rushing is only needed for creating it.
Lack of arbitrage is the problem, isn't it. And this 'should' solves it.