The case for bitGOLD and bitSILVER

[karnal]

And to stay on topic, same reasoning for bitMetals, there are no storage fees, no demurrage (like DGX), and you get to keep the purchasing power of gold and silver.

This is, I feel, something we should push forward.

Make it become a thing that online merchants take bitGold and bitSilver.

We have the software now, all that's left is beginning making some calls and sending some emails.

Also. STEALTH STEALTH STEALTH. I cannot understate how essential it is.

And then add liquidity to bitSilver:bitFiatWhichOurMerchantsUseMoreOftenProbablyUSD so they can unload silver for USD as they please.
(and bitSilver:bitBTC)


We're close. I really think we are.

[karnal]

Having this liquidity questions solved would enable so much.

With bitCAD, bitNZD, bitAUS, bitSEK, bitNOK and bitZAR we could begin catering to those domestic markets.

For capturing some of the forex market, providing liquidity in a few of the most common trading pairs (no idea what they are nowdays, should be easy to find out) would, I'm sure, bring a lot of investors in .. why pay $7 for trade when you can pay $.02 ?

Here's a thought: We should identify the major potential markets outside of EUR/USD/CNY (imo those three are the really obvious ones), and start writing material in the target languages about bitshares.

For getting funds into the Bitshares ecosystem, for now Bitcoin is a good choice .. ultimately I dream about a world-wide network of fiat onramps, so that someone from New Zealand doesn't have to send fiat anywhere else just to get started in the ecosystem.

At the moment it is very acceptable to do this through bitcoin, which is much better established.

To cut one conversion step for what will likely be a vaguely clueless newcomer without much crypto experience, we could aim liquidity efforts at BitBTC:bitFIAT markets instead of BTS:bitFIAT.

Think about it .. if we have liquidity, the backing learning material and the marketing, we can capture at least some of the forex market.

I know and have emailed in the past some big names in the forex/stocks/investing online investor community, could even perhaps get bitshares featured in a couple of podcasts related to investing (and that have nothing to do with crypto)

Take a look here.. these are pretty standard fees.. https://www.strateo.ch/en/our-fees/

Bitshares can do a lot better.

For this we need: 1. Liquidity 2. STEALTH and 3. Stop-loss and Stop-profit (VERY IMPORTANT!)

[Chuckone]

Are there any liquidity bots that a non-technical user like myself could run? Doesn't even need to make a profit, just not lose value.

And by non-technical I mean type in the the amount of BTS, choose the market and click go.

Click stop and the BTS go back into your account.

If providing liquidity was this simple I'll bet a lot of folks, including myself, would provide a lot of liquidity to bootstap the markets.

The problem is, it is not that simple. And risk of loss is very high in volatile markets.

If there was a liquidity pool that interested parties could throw funds into, then non-technical people could easily participate.  As for market risk, this would be mitigated if we offered liquidity rewards that the pool (or any liquidity provider for that matter) could earn.  Such risk could be further mitigated (and therefore more funds attracted to participate in the pool) if we used some of the burn worker funds to pay interest to anyone participating in the pool.  We should really try something like this.  Now is the time.

I would gladly throw some of my funds into market making pools for bitUSD, bitGold and bitSilver. But who is experienced enough to manage such pools? It seems like somebody is doing a good job making bitCNY:BTS liquidity. Can those guys do the same for other markets?

I would be in too. I have no plan of selling any BTS for a while, so helping to bootstrap liquidity is definitely something I would be interested into. It would be nice to see as much action on the bitUSD market as there is currently on the bitCNY market.

[yvv]

Are there any liquidity bots that a non-technical user like myself could run? Doesn't even need to make a profit, just not lose value.

And by non-technical I mean type in the the amount of BTS, choose the market and click go.

Click stop and the BTS go back into your account.

If providing liquidity was this simple I'll bet a lot of folks, including myself, would provide a lot of liquidity to bootstap the markets.

The problem is, it is not that simple. And risk of loss is very high in volatile markets.

If there was a liquidity pool that interested parties could throw funds into, then non-technical people could easily participate.  As for market risk, this would be mitigated if we offered liquidity rewards that the pool (or any liquidity provider for that matter) could earn.  Such risk could be further mitigated (and therefore more funds attracted to participate in the pool) if we used some of the burn worker funds to pay interest to anyone participating in the pool.  We should really try something like this.  Now is the time.

I would gladly throw some of my funds into market making pools for bitUSD, bitGold and bitSilver. But who is experienced enough to manage such pools? It seems like somebody is doing a good job making bitCNY:BTS liquidity. Can those guys do the same for other markets?

[tbone]

Are there any liquidity bots that a non-technical user like myself could run? Doesn't even need to make a profit, just not lose value.

And by non-technical I mean type in the the amount of BTS, choose the market and click go.

Click stop and the BTS go back into your account.

If providing liquidity was this simple I'll bet a lot of folks, including myself, would provide a lot of liquidity to bootstap the markets.

The problem is, it is not that simple. And risk of loss is very high in volatile markets.

If there was a liquidity pool that interested parties could throw funds into, then non-technical people could easily participate.  As for market risk, this would be mitigated if we offered liquidity rewards that the pool (or any liquidity provider for that matter) could earn.  Such risk could be further mitigated (and therefore more funds attracted to participate in the pool) if we used some of the burn worker funds to pay interest to anyone participating in the pool.  We should really try something like this.  Now is the time.

[yvv]

Are there any liquidity bots that a non-technical user like myself could run? Doesn't even need to make a profit, just not lose value.

And by non-technical I mean type in the the amount of BTS, choose the market and click go.

Click stop and the BTS go back into your account.

If providing liquidity was this simple I'll bet a lot of folks, including myself, would provide a lot of liquidity to bootstap the markets.

The problem is, it is not that simple. And risk of loss is very high in volatile markets.

[Geneko]

I totally agree...I might try that one too.

[oldman]

Are there any liquidity bots that a non-technical user like myself could run? Doesn't even need to make a profit, just not lose value.

And by non-technical I mean type in the the amount of BTS, choose the market and click go.

Click stop and the BTS go back into your account.

If providing liquidity was this simple I'll bet a lot of folks, including myself, would provide a lot of liquidity to bootstap the markets.

[karnal]

^^ Regarding the exchange integration, I'd say there's a time component to it (though it shouldn't be rushed ahead of liquidity, at the very least), as we'll likely become established as the go-to token for metals if we get listed before DGX.

[karnal]

Lets try again..


First of all, glad to see the post has generated interest and discussion amongst members. It seems I'm not the only one sensing a good opportunity here.

I'd like to propose a possible path forward for this.

First of, liquidity is absolutely essential. That should go without saying, so lets just assume (I know, big assumption) that's taken care of. What comes next?


It seems to me that we need to pen a bunch of articles in the right places (I can take a stab at doing the research and the writing), because few people outsite of the ecosystem are even aware of bitGOLD and bitSILVER.

Forum activity at bitcointalk (at the right time, and slowly dropping links to the articles we will have written in the step above over time) would also be welcomed.

After that, we can do is get some of our radio-voice guys interviewed at podcasts like Lets talk Bitcoin, The Ether Review, Epicenter Bitcoin, and of course, our own Beyond Bitcoin.

In the Bitshares-alien podcasts, we can spin it in such a way to make it attractive to the average crypto user, who wants some exposure to gold/silver price, either as a safe haven asset for the medium/long term, or simply to store profits between trades. All the advantages (and disadvantages!) outlined in the original post should be brought up and discussed.

By the way, unless it has changed, DGX has demurrage fees built in (to pay for the actual storage), which can be seen as an advantage for our bitMetals as well.


Now then, at that point we have:
  - Liquidity (easiest to begin with might be OPEN.BTC/bit{GOLD,SILVER} ? open to suggestions..)
  - Articles in prominent places.
  - A troll-filled thread in bitcointalk ()
  - A couple of interviews in a few podcasts.

.. which should mean that new users are arriving to try it out. It's more or less at this point (ideally, a bit before  ) that we write some tutorials over at steemit, because apparently it's a common complaint that the bitshares wallet "is confusing".

We don't want new users to come look and leave in disgust, which is what will happen if there's no liquidity, and if there's not a clear-cut procedure for people to follow in the beginning. Once they have hundreds of $fiat worth in bitMetals, then they're not as likely to leave .. essentially, it's necessary to make a good first impression.


So at this point there's a buzz, there's new users, the markets are active, and it's time to go to the major exchanges to get BTC/bitMetals, ETH/bitMetals (see what I did there) and (in Poloniex) USDT/bitMetals (ditto) listed.

Add another round of tutorials about how to deposit/withdraw/buy/sell bitMetals in the major exchanges, and voila.


Maybe I missed a step or two, but what do you think?

[karnal]

Great, just lost a giant post thanks to cloudflare captcha ...

[Methodise]

I intend to have a crack at liquidity provision, including in bitMetals.

this bitCNY sounds a bit characterful tho. Not convinced the parameters should differ from those of bitUSD / bitEUR etc.

Makes life difficult for those of us trying to flood ALL OF THE MARKETS will liquidity.

[yvv]

Interesting, this does not stop people from force settling bitCNY.

[pc]

or not advertised a 1:1 redeemability via settlement.

How about stopping that ongoing advertisement? Then we'd at least no longer be scamming new investors.

[xeroc]

Yeah, banks always change fees and interest rates and fraction of reserve, and nobody says that bank account is not backed by anything. My understanding is that committee  moved bitCNY settlement because Chinese community wants a tighter peg to CNY. What is wrong with this?

One could argue that you robbed bitCNY longs 1% of their money.
Then on the other hand, they can still "sell" at the peg because the 1% only affects settlements.
Putting a higher fee for settlements wouldn't have resulted in the same setup because flat fees go to shareholders while the settlement offset of 1% goes to the shorter ..
It dicourages settlements and encourages shorting.

I can still see @pc's issue with "robbing" the longs 1% of their money and I wished we had started by a 1% offset in genesis block .. or not advertised a 1:1 redeemability via settlement.

[yvv]

It's like adding a transaction fee.  Or in our case maybe it was more like shifting a fee from one party to another.  Of course some will not like that, but it's not the end of the world.  I don't see any reason to make such a big deal and continuously carry on about it.  Especially since periodic tweaks are needed...and the community decided on this.  Can't you accept that and give it a rest already?

Yeah, banks always change fees and interest rates and fraction of reserve, and nobody says that bank account is not backed by anything. My understanding is that committee  moved bitCNY settlement because Chinese community wants a tighter peg to CNY. What is wrong with this?

[tbone]

Yes... until the committee decides that they're not. Like they did with bitCNY.

don't be unfair to the committee, please. It has been voted for by shareholders.

I don't mean to be unfair.

Fact is, the committee alone has the power to make such changes. With the power comes responsibility.

Settlement of CNY has been moved from 100% to 99%.

It is still backed by BTS collateral. Just one parameter was tweaked. I don't see a problem here.

Well... suppose you had a number of DGX tokens that are redeemable for 1 ounce of solid gold. Some day digix.io comes along and says "Oh, btw, from now on your tokens will be redeemable for 0.99 ounces of solid gold."
Would you also call that "just a parameter tweaked"?

It's like adding a transaction fee.  Or in our case maybe it was more like shifting a fee from one party to another.  Of course some will not like that, but it's not the end of the world.  I don't see any reason to make such a big deal and continuously carry on about it.  Especially since periodic tweaks are needed...and the community decided on this.  Can't you accept that and give it a rest already?

[yvv]

Well... suppose you had a number of DGX tokens that are redeemable for 1 ounce of solid gold. Some day digix.io comes along and says "Oh, btw, from now on your tokens will be redeemable for 0.99 ounces of solid gold."
Would you also call that "just a parameter tweaked"?

BitGold is not like DGX token, there is a big difference between them. DGX is an IOU, bitGold is not. It is an index following ETF. You should realize that its market price vs gold may vary by design. And of course tweaking it to stimulate shorting is absolutely legit.

[pc]

Yes... until the committee decides that they're not. Like they did with bitCNY.

don't be unfair to the committee, please. It has been voted for by shareholders.

I don't mean to be unfair.

Fact is, the committee alone has the power to make such changes. With the power comes responsibility.

Settlement of CNY has been moved from 100% to 99%.

It is still backed by BTS collateral. Just one parameter was tweaked. I don't see a problem here.

Well... suppose you had a number of DGX tokens that are redeemable for 1 ounce of solid gold. Some day digix.io comes along and says "Oh, btw, from now on your tokens will be redeemable for 0.99 ounces of solid gold."
Would you also call that "just a parameter tweaked"?

[yvv]

What happened with bitCNY? I don't see anything different from other bitassets.

Settlement of CNY has been moved from 100% to 99%.
https://github.com/bitshares/bsips/blob/master/bsip-0016.md

It is still backed by BTS collateral. Just one parameter was tweaked. I don't see a problem here.

[xeroc]

Yes... until the committee decides that they're not. Like they did with bitCNY.

don't be unfair to the committee, please. It has been voted for by shareholders.

What happened with bitCNY? I don't see anything different from other bitassets.

Settlement of CNY has been moved from 100% to 99%.
https://github.com/bitshares/bsips/blob/master/bsip-0016.md

[yvv]

Yup. It's really unfortunate that bitGOLD and bitSILVER are backed by empty promises, too. They could've been a real success..

No, they are not. They are backed by 1 once of gold and silver worth of BTS.

Yes... until the committee decides that they're not. Like they did with bitCNY.

What happened with bitCNY? I don't see anything different from other bitassets.

[chryspano]

Yup. It's really unfortunate that bitGOLD and bitSILVER are backed by empty promises, too. They could've been a real success..

No, they are not. They are backed by 1 once of gold and silver worth of BTS.

Yes... until the committee decides that they're not. Like they did with bitCNY.

You have a point but still it's better than the "real asset" backing joke.

[pc]

Yup. It's really unfortunate that bitGOLD and bitSILVER are backed by empty promises, too. They could've been a real success..

No, they are not. They are backed by 1 once of gold and silver worth of BTS.

Yes... until the committee decides that they're not. Like they did with bitCNY.

[bitsharesbrazil]

I really dont like system like dgx tether...... Its more the same that will lead to fraud n scams

Its is unfair to call bitgold is backed by promisses....its  strongly backed by a pretty good asset in crypto world, n the best thing  in a decentrilized way.

Like ivy said.....if tweak is needed lets do it.....but bitassets concept as a whole is the best that crypto space ever created to decentrilize n guarantee what you own......

[yvv]

it is considerably different to own a gold etf, backed by empty promises, and which may or may not be redeemed for fiat at a time of your choosing, and owning a "gold etf-token" in the blockchain .. which, provided there is enough liquidity, traders can always get rid of, or acquire, at will.

Yup. It's really unfortunate that bitGOLD and bitSILVER are backed by empty promises, too. They could've been a real success..

No, they are not. They are backed by 1 once of gold and silver worth of BTS. There is one advantage of bitGold/Silver over tokens backed by physical gold/silver: anybody can issue them easily on  blockchain, just put BTS collateral in, no audit required. You can't do this as easily with DGX token, since a trusted party needs to buy and store a proven reserve of physical gold.

[yvv]

I would invest into bitGold,Silver market making pool with my pleasure if it is done the right way.

What is 'the right way' ?

First off all the pool has to be transparent. Funds allocations and statistics have to be public. This is a job of fund manager. And dividends have to be attractive.

[pc]

it is considerably different to own a gold etf, backed by empty promises, and which may or may not be redeemed for fiat at a time of your choosing, and owning a "gold etf-token" in the blockchain .. which, provided there is enough liquidity, traders can always get rid of, or acquire, at will.

Yup. It's really unfortunate that bitGOLD and bitSILVER are backed by empty promises, too. They could've been a real success..

[BunkerChainLabs-DataSecurityNode]

I would invest into bitGold,Silver market making pool with my pleasure if it is done the right way.

What is 'the right way' ?

[yvv]

I would invest into bitGold,Silver market making pool with my pleasure if it is done the right way.

[BunkerChainLabs-DataSecurityNode]

Regarding the dividend part.

Read deep in the what digix is doing.. they are charging fees EVERYWHERE... and what is scarier is the whole system is rigged so you will really continue to pay FOREVER.. or take hefty fees on exiting. So when you are taking money in hand over fist like that, it is really easy to offer a dividend bone.

Not saying we can't do the same.. we just have to solve where the payment might come from... can't be from the blockchain.. it seems clear the community won't support that... good idea or not.

[xeroc]

I agree with much of what you say ..
It obviously is not enough to "just providing the platform" for people to come and use it.

The general difficulty of BitShares (in contrast to Steem) is that we are dealing with money and if you want to do something here, you need legal clarity, bookkeeping, and a tax accountant.
There certainly is money to be made by providing bitAsset liquidity (e.g. GOLD), but you need brave people to go take those profits first. Providing liquidity to markets is nothing that comes on its own, we should know that by now.

How can we convince people that providing liquidity in bitGOLD is the way to go?

[karnal]

https://steemit.com/beyondbitcoin/@karnal/the-case-for-bitgold-and-bitsilver

Just in case things had changed in the mean time, I opened the bitshares client to confirm that the situation in these markets is still bleak.

(It is).

Some of you may not have noticed, but the people at https://digix.io/ have slowly been gaining traction in the ethereum space. If you don't know them, essentially they have a DGX token, which is backed by real gold, secured in a vault they control. There's some fancy proof of audit (by a 3rd party) scheme going on as well, not worth going into.

There's also the DGD token, which pays quarterly dividends (!) for hodlers, the funds come from DGX transfer fees.


They're aiming to use "gold as money" online, and being a frequent lurker in their slack, I can tell you that their concerns about fraud are keeping the company on edge -- just you wait until DGX begins being used for illegal activity .. in their case, there IS a central company the "authorities" can go after.

In fact, Digix recently announced that they'll be requiring KYC/AML documents (yet another company that can pull identity theft on you, fantastic!) for simply purchasing DGX at their exchange (https://app.digix.io) !

Now, of course, one can simply pull the DGX from another source (DGX will likely be available at shapeshift, poloniex, in the near (<3mo? guesstimation) future.

But it speaks volumes about the bind they've got themselves into.


Now, when people ask me about gold and silver, I give them the standard answer that unless you have the real physical deal, then you don't really own it. And to a large extent, I still stand by that.

But these tokenised assets in the blockchain do, I believe, bring something new to the game .. it is considerably different to own a gold etf, backed by empty promises, and which may or may not be redeemed for fiat at a time of your choosing, and owning a "gold etf-token" in the blockchain .. which, provided there is enough liquidity, traders can always get rid of, or acquire, at will.


I believe we're missing on a giant piece of the cake here, by not having these markets liquid. Sure, fiat currency mpa are also fine for this, but many people (yours truly included) like having some considerable hedging for them with metals.

We can position ourselves - favorably, even - against Digix. Other than dividends, Bitshares does everything their platform does, and at least as far as I can see, better. Our DGD is BTS, our DGX is bitGold.

If only BTS paid dividends But I digress.. and I don't think that by itself, that's enough reason to say Digix is a superior solution.

Of course there is no real gold behind bitGold, so there is that, some people will be turned off by that, others (who just want price exposition) couldn't care less. There's plenty of space for healthy competition, and while there is significant overlap in what DGX and bitGold can offer (mainly using gold for trading / saving online), each solution has its own unique advantages and disadvantages as well.

I do believe we are not making enough (any) of an effort to let this be known.

While Digix is gaining slow but very steady traction in the ethereum camp, how many people outside of Bitshares know of bitGold and bitSilver?
(also, can we have bitPalladium? :])


Hell, later on we can even get together and scheme for a shiny plastic gold card, and market it as "the gold-backed debit card!!oneone" .. people will go crazy. Crazy, I tell you.


I think OUR platform is much better for what they're trying to achieve (it has nothing to do with having been brainwashed by the cult of Bitshares! I promise!).

I think that if we mount a coordinated marketing campaign, make some pretty websites, and maybe get a few people together to brainstorm getting that plastic card going, there might be something here.

There's also liquidity, of course, but since we already have the bot infrastructure, it's "only" a matter of putting some pooled funds into them (could we obtain them from a worker proposal?)

Let me know what you think ..