Lets bring " earn x% interest on 'anything' " back to Bitshares!

[tbone]

bitAssets represent the primary value proposition of Bitshares.  Increased demand for bitAssets will attract more liquidity providers.  More liquidity will attract more traders.  And so on.  This positive feedback loop would be accompanied by a rising price of BTS. 

So what is the missing ingredient?  Duh, it's demand for bitAssets!  We have a golden opportunity to fix this problem.  I don't know why people are having such a hard time understanding this.   But we better figure it out soon, otherwise we should just give up. 

[Pheonike]

My concern with the idea of paying interest to USD is that it incentivizes activity which hasn't been proven to generate profit for the Dex. While the idea the locked collateral reduces supply makes sense, I think it provides minimal price support as those creating the assets are already in for the long haul and aren't any more likely to hold because of their leveraged position. If any thing thing these people are now less likely to hold as they now the chance of selling against their will from a margin call. In addition if you view the amount to of bitasset as somewhat fixed (finite number of shorters with finite amount of funds) then increased holding of bitassets puts additional strain on those shorters in their efforts to provide liquidity.

IMO the end goal of any new incentive should  be to make the Dex more profitable by increasing the number of actions and fees generated. I think increases in the speed which USD changes hands would be more beneficial than an increase in the amount held. I think the increase in liquidity lately has been encouraging and I think an incentive be to increase liquidity and market making might be a better choice. Just my thoughts. I don't want to discourage the pursuit of improvement, but at the same time wanted to express my concern.

Sent from my XT1080 using Tapatalk

MLM is great when you have a product that has a large audience. First, I don't think the market for traders who want to use the DEX is significant enough to make a large dent for MLM. Also the MLM is not really MLM since it's only 1 level. You don't anything for the people the person you brought in brings in. 

Paying out dividends is a much larger audience to reach. Most people are lazy. They want to park there money somewhere and gain some amount of interest or a dividend. If we want to attract traders then a bond market with familiar margin trading is better option.

[lafona]

My concern with the idea of paying interest to USD is that it incentivizes activity which hasn't been proven to generate profit for the Dex. While the idea the locked collateral reduces supply makes sense, I think it provides minimal price support as those creating the assets are already in for the long haul and aren't any more likely to hold because of their leveraged position. If any thing thing these people are now less likely to hold as they now the chance of selling against their will from a margin call. In addition if you view the amount to of bitasset as somewhat fixed (finite number of shorters with finite amount of funds) then increased holding of bitassets puts additional strain on those shorters in their efforts to provide liquidity.

IMO the end goal of any new incentive should  be to make the Dex more profitable by increasing the number of actions and fees generated. I think increases in the speed which USD changes hands would be more beneficial than an increase in the amount held. I think the increase in liquidity lately has been encouraging and I think an incentive be to increase liquidity and market making might be a better choice. Just my thoughts. I don't want to discourage the pursuit of improvement, but at the same time wanted to express my concern.

Sent from my XT1080 using Tapatalk

[sahkan]

You have some interesting thoughts here for the way ahead ... So I thought maybe I will chime in as a new guy on the Bitshares scene. Has anyone of you done Amway? Well, it's a door to door MLM company selling cleaning supplies (and a lot more now days) but if you ever did it, they would ask you to listen to these success stories. I remember on one of the tapes the guys says, "I met guy X, recruited him and he quit, but before he did he introduced me to Y, and Y quit, but before he did he introduced me to Z and a month later Z went DIAMOND (build a sizable network)."   The point being let the system work  itself out. The Bitshares referral program has a very good structure that if properly advertised and taken advantage of, can create a stream of revenue for the users and increase the use of the exchange. It might catch on when people least expect it.

I could also see support for a dividend to all BTS holders (again a small adjustment, so no more than 10% of the fees) - the question here is how would we handle distro to exchange accounts, and would excluding them be the right thing to do?
The advantage of distributing the dividend to all BTS holders is that it would encourage them to keep their BTS on DEX and trade there vs centralized exchanges where they would not get any dividends on their holdings.

In all, I would be very careful of introducing any drastic changes and new fee structures until we start taking full advantage of what is already in place.

[R]

I would argue perhaps we should offer 1% to anyone who holds BTS. It's a small amount but would be a great marketing tool and generate interest. Just like the dredit card companies like avertising 1% cashback on purchase.

Yeah, I believe that dividends should be distributed against both BTS and BitAsset holders. How much more should we incentivise holding bitAssets over BTS thpough?
Should it be that bitAsset fees go to bitAsset holders, and BTS goes to BTS holders?
I was listening to the 3rd Bitshares hangout (https://soundcloud.com/beyond-bitcoin-hangouts/bts3-w-christopher-hering) and they were talking about users specifying the asset they wanted their dividend to be payed in, which would be pretty cool!

Stay away from the not because it sounds a certain way, but once you start promising percent points on things in a network that is based on set fees and not percent points, you will just be setting up the network for failure.

What about 'x% on anything' a variable interest rate, or do you think this is more confusing than just 'earn a share of the BTS DEX profits' ?

• 1.  Implement our profit sharing code thanks to Peerplays development
• 2.  Implementing Chainbase (thanks to steem) so that we can have real trading tools in the GUI with historical charts and graphs. This will attract a lot of high end traders who want to be able to do analysis but cannot due to lack of metric tools in our GUI

Numbered your list for easier referencing.

1. The code you refer to, is that this: https://github.com/BunkerChainLabsInc/peerplays-profitshare Or are you referring to the updated Peerplays code base? If the later, could you elaborate on the software license in use for Peerplays? The above github repo is MIT, but I'm unsure about peerplays itself.
2. This? https://github.com/bytemaster/chainbase What are the potential benefits of integration for Bitshares?

[cryptosig]

You guys are being dumb, so I have to comment.

I have a choice to store my assets here or at an exchange that is paying me 0.03%-0.6% per day to loan it to the short traders. I would rather store it here because this exchange is safer, but you don't give me a reason to do that, so instead I keep my BTC there and hedge against value lost.

Somehow the "brick and mortar" exchanges seem to be making a profit and sharing profits. So maybe your system needs tweaking. If you can't get your exchange to perform better then the regular exchanges, and pay loans on assets, then why even bother? Just make it work like every other exchange out there that pays people to loan to short traders, make a lenders section and pay people to lend out to the short traders. Hell the exchange will still make money off the spending of BTS to publish the loan messages on the block chain, making everyone get paid.

[Pheonike]

I would argue perhaps we should offer 1% to anyone who holds BTS. It's a small amount but would be a great marketing tool and generate interest. Just like the dredit card companies like avertising 1% cashback on purchase.

[nomoreheroes7]

sorry I don't think there is any help with this.
in fact I prefer bitasset holder should pay interest for shorters  in many condition.
look at our SILVER , it's almost equal 1.2-1.3 real SILVER,
and don't foget 1 year ago bitUSD equal 1.1 fiat USD in a very long time.

it's very complex, let's just keep it simple, don't change anything.

I feel like this is the same thing that happens every time an idea is put forth on the forums.....

[alt]

sorry I don't think there is any help with this.
in fact I prefer bitasset holder should pay interest for shorters  in many condition.
look at our SILVER , it's almost equal 1.2-1.3 real SILVER,
and don't foget 1 year ago bitUSD equal 1.1 fiat USD in a very long time.

it's very complex, let's just keep it simple, don't change anything.

let me know if  I'm misunderstanding
I thought you are talking about attract more users with something like earn easy money.
you think this is huge, even want to change many rules.

my point is there is no  easy money totally,
we have profit as a DEX, but I don't think it's a good idea to wast these money attract some fake user.
I have no interesting in this easy money trick

if you are talking about something like adjust balance for the shorters and longers, it should be another thread.

bank have many real business to pay the divident.
where is the business based bitshares?
I believe we'll get divident too after we have some real business.
pay divident is the result, not the reason.

In fact I feel sick for the ""
this title make Bitshares looks like a scam
I wish never see this title in the official site.

@alt, what's wrong with paying a rate of return to bitAsset holders?  Banks have traditionally offered interest on savings accounts.  And in crypto, chains like DASH, NEM, PIVX, and others enable users to get a return on their holdings.  There's nothing scammy about it!

Also, Bitshares used to pay an interest rate of return and had $1M+ bitUSD in circulation.  Now we pay no such interest and have just $100k bitUSD in circulation.  Is this just a coincidence?

Finally, as you know, currently the network gets 20% of collected fees.  This proposal wants to raise that to 50%.  Don't you love that?  You should.  You should love this whole proposal.

We are talking about paying the dividends by using a percentage of the fees collected.  Those are fees that users paid for utilizing the services offered by bitshares.  This is not real business being conducted?  This is not value created by bitshares?

No, please tell me if *I* am misunderstanding.  Are you saying that people who buy bitAssets are "fake users"?  Maybe you should let @bitcrab know about this.  After all, his transwiser business depends on demand for bitAssets.  Without such demand, he has no business.  And we know that demand is much lower now than it was in the past when bitAsset holders were able to earn a rate of return on their holdings.

So tell me, do you want bitcrab's transwiser business to have customers?  What about other shorters and traders in general?  Do you want an active market for bitAssets where a large number of users means there is always market activity because then, aside from the traders, there will always be someone looking to put some money into bitAssets...and there will always be someone looking to take money out?  There is no point in having bitAsset order books just so traders can trade back and forth with each other if there is no real use case for the asset they are trading.  Now THAT would be fake users!

So tell me, what is wrong with offering a better interest rate to people who store some money in bitUSD instead of in the bank?  It is very early in the game for cryptocurrencies right now.  To attract regular people, we need to give some extra incentive. In the future, it may not be necessary.  But at this point, it IS necessary.  This is just smart business.

Lastly, no one is talking about "changing many rules".  We are only talking about shifting a portion of the income that currently goes to the referral program (see below).  This enables us to: 1) replenish the reserve pool 2.5x faster, 2) drive much more demand for bitAssets, and 3) make the referral program more effective by rewarding LTM accounts.  This would be a huge win for all parties involved, and would be extremely bullish for BTS.


Current fee allocation:
20% -- network
80% -- referral

Proposed fee allocation:
50% -- network
20% -- referral program
20% -- interest to bitAsset holders
10% -- dividend to LTM accounts

[Geneko]

• Implement our profit sharing code thanks to Peerplays development

How does profit sharing work?

Like most online gaming platforms, the Peerplays network collects a small percentage of each jackpot, which is called the rake fee. These fees are automatically sent by the blockchain into a virtual account, where they accumulate until they reach a certain threshold or time interval. Then, they are automatically distributed to the accounts of Peerplays core token holders, according to the total percentage of core tokens belonging to each account.

This is closest to bitshares idea as you can get. However the trick is in details.

How does the referral program work?

Imagine if you refer a friend to open a bank account, and then for doing this you were automatically entitled to a percentage of every fee they paid the bank from that point forward. This is how the Peerplays account referral system is set up.
Each time a player registers a new account on Peerplays, someone must pay the initial account registration fee. This can be done through a faucet that is operated by an tournament hosting partner, or by any other Peerplays user. This means that each new account is tied directly to the account which paid the fee to register them. Peerplays then directs a percentage of every network fee paid by the new account from that point forward – every asset creation fee, rake fee, trading fee, etc., back into the account of the person who registered it. The remaining percentage then goes to the network to be paid out as profit sharing.


This looks the same as Bitshares model. But as said the trick is in details.
 
Could you please explain, in plain language, how the revenue split work in Peerplays?

If we decide to accept Peerplays model could you help implement it. We could organize worker proposal.
You are also long time member of Bitshares. Dont you feel responsible for its destiny too?

[tbone]

let me know if  I'm misunderstanding
I thought you are talking about attract more users with something like earn easy money.
you think this is huge, even want to change many rules.

my point is there is no  easy money totally,
we have profit as a DEX, but I don't think it's a good idea to wast these money attract some fake user.
I have no interesting in this easy money trick

if you are talking about something like adjust balance for the shorters and longers, it should be another thread.

bank have many real business to pay the divident.
where is the business based bitshares?
I believe we'll get divident too after we have some real business.
pay divident is the result, not the reason.

In fact I feel sick for the ""
this title make Bitshares looks like a scam
I wish never see this title in the official site.

@alt, what's wrong with paying a rate of return to bitAsset holders?  Banks have traditionally offered interest on savings accounts.  And in crypto, chains like DASH, NEM, PIVX, and others enable users to get a return on their holdings.  There's nothing scammy about it!

Also, Bitshares used to pay an interest rate of return and had $1M+ bitUSD in circulation.  Now we pay no such interest and have just $100k bitUSD in circulation.  Is this just a coincidence?

Finally, as you know, currently the network gets 20% of collected fees.  This proposal wants to raise that to 50%.  Don't you love that?  You should.  You should love this whole proposal.

We are talking about paying the dividends by using a percentage of the fees collected.  Those are fees that users paid for utilizing the services offered by bitshares.  This is not real business being conducted?  This is not value created by bitshares?

No, please tell me if *I* am misunderstanding.  Are you saying that people who buy bitAssets are "fake users"?  Maybe you should let @bitcrab know about this.  After all, his transwiser business depends on demand for bitAssets.  Without such demand, he has no business.  And we know that demand is much lower now than it was in the past when bitAsset holders were able to earn a rate of return on their holdings.

So tell me, do you want bitcrab's transwiser business to have customers?  What about other shorters and traders in general?  Do you want an active market for bitAssets where a large number of users means there is always market activity because then, aside from the traders, there will always be someone looking to put some money into bitAssets...and there will always be someone looking to take money out?  There is no point in having bitAsset order books just so traders can trade back and forth with each other if there is no real use case for the asset they are trading.  Now THAT would be fake users!

So tell me, what is wrong with offering a better interest rate to people who store some money in bitUSD instead of in the bank?  It is very early in the game for cryptocurrencies right now.  To attract regular people, we need to give some extra incentive. In the future, it may not be necessary.  But at this point, it IS necessary.  This is just smart business.

Lastly, no one is talking about "changing many rules".  We are only talking about shifting a portion of the income that currently goes to the referral program (see below).  This enables us to: 1) replenish the reserve pool 2.5x faster, 2) drive much more demand for bitAssets, and 3) make the referral program more effective by rewarding LTM accounts.  This would be a huge win for all parties involved, and would be extremely bullish for BTS.


Current fee allocation:
20% -- network
80% -- referral

Proposed fee allocation:
50% -- network
20% -- referral program
20% -- interest to bitAsset holders
10% -- dividend to LTM accounts

[BunkerChainLabs-DataSecurityNode]

Been reading.. just wanted to share a few thoughts on this since Bunkerchain Labs created the profit sharing code that is mostly being talked about here.

Learn to walk before you run. What we have available as a profit sharing code mechanism will provide value to end users who use UIAs and will also enable profit sharing of smartcoins deriving benefits to holders of said currencies based on volumes alone.

I agree the refer program is a mess, which is why we have completely redone it in Peerplays. Until that can be settled I would not even mention it in Bitshares.. let those who have it continue to use it, but remove all mention of it for now.

Stay away from the not because it sounds a certain way, but once you start promising percent points on things in a network that is based on set fees and not percent points, you will just be setting up the network for failure.

Stop calling it deflationary.. call it profitability.

It's great to dream of all the ways things can be changed.. but all of this comes to a head when you find out how much it will all cost to develop and deploy... not to mention the computational costs that have to be considered. Otherwise you end up with this:

Graphene (I didn't say Bitshares) has a lot in its toolkit... if we are going to offer a Bitshares DEX, then strip it down and make it the best damn DEX anyone has ever seen:

So keep it simply... walk with the lowest hanging fruit of what is available for Bitshares for now:

• Implement our profit sharing code thanks to Peerplays development
• Implementing Chainbase (thanks to steem) so that we can have real trading tools in the GUI with historical charts and graphs. This will attract a lot of high end traders who want to be able to do analysis but cannot due to lack of metric tools in our GUI
• Continue to improve the GUI and API calls so that more applications can be created to utilize Bitshares DEX

All of these things are within reach in a far shorter period of time than the multitudes of concepts that have been discussed that will require far more extensive specing out and testing beyond just the casual forum discussion. Everything I have listed above has been completely iterated, well planned, and thought through. Bitshares community just needs to make the decision to use them.

All of these things can be tied into a marketing campaign as well as things are introduced. The best way to make news is to have news worthy updates.

Whatever else you want to imagine Bitshares to be, give it another name, and give it another project to build from. Bitshares needs to continue to make the steps its been making to leave behind operating like "The Homer".

Bitshares should be exchanging all world commodities, currencies, crypto assets, and stocks completely decentralized by 2019.

[alt]

let me know if  I'm misunderstanding
I thought you are talking about attract more users with something like earn easy money.
you think this is huge, even want to change many rules.

my point is there is no  easy money totally,
we have profit as a DEX, but I don't think it's a good idea to wast these money attract some fake user.
I have no interesting in this easy money trick

if you are talking about something like adjust balance for the shorters and longers, it should be another thread.

bank have many real business to pay the divident.
where is the business based bitshares?
I believe we'll get divident too after we have some real business.
pay divident is the result, not the reason.

In fact I feel sick for the ""
this title make Bitshares looks like a scam
I wish never see this title in the official site.

@alt, what's wrong with paying a rate of return to bitAsset holders?  Banks have traditionally offered interest on savings accounts.  And in crypto, chains like DASH, NEM, PIVX, and others enable users to get a return on their holdings.  There's nothing scammy about it!

Also, Bitshares used to pay an interest rate of return and had $1M+ bitUSD in circulation.  Now we pay no such interest and have just $100k bitUSD in circulation.  Is this just a coincidence?

Finally, as you know, currently the network gets 20% of collected fees.  This proposal wants to raise that to 50%.  Don't you love that?  You should.  You should love this whole proposal.

We are talking about paying the dividends by using a percentage of the fees collected.  Those are fees that users paid for utilizing the services offered by bitshares.  This is not real business being conducted?  This is not value created by bitshares?

[kani]

Benefits over transaction fee distribution:
1. Market Fees produce bitAsset of choice -- no need to convert BTS to bitAsset for dividend payment.
2. Does not violate LTM agreement
3. Does not mess with referral expectations

"Your share in the Decentralized Exchange"

Producing revenue from market activity is a natural income source for an exchange.  Sharing it with Bitshares users makes sense to me.

We already produce revenue from market activity via transaction fees without the need for additional market fees.

I've numbered your points for easier referencing:
1. You can pay transaction fees in assets other than BTS, so we can already immediately distribute bitUSD to bitUSD holders instead of converting it from bitUSD -> BTS prior to redistribution. Unless this is an automated process right now? The committee in charge of the fees assigned to the reserve pool could provide additional information here.
2. The agreement was that the membership you purchased was to exist for a lifetime, not that the benefits were permanent for the lifetime of your account. These benefits should be subject to change, given sufficient network consensus.
3. The referral system being allocated 80% of transaction fees was unfair to begin with, there was an expected replacement income stream for asset holders in the form of a bond market which never materialized. It's time for asset holders to have a slice of the pie allocated to them. Referrals don't keep users around, dividends do.

Thank you for the thoughtful reply.

In regards to #1 response:

Yes, that is theoretically true.  But the number of transactions which are paid in bitAssets is very small.  Which means it is not terribly useful source of revenue for a bitAsset dividend.

[R]

This is all dandy, but misleading.  The claim that this proposal does not raise user fees is absolutely FALSE!

A LTM account pays 20% to network, and gets 80% back in vesting.  And anyone who has self-registered sub-accounts, is the same -- 20% to network and 80% back to the registering account.  Don't mess with this -- any changes represent a major breach of trust to anybody who paid the $80-$150 to become a Life Time Member.

I see what you mean now, you're right that to LTM users this proposal represents an increase in user fees, as up to this point the LTM benefits include 80% cashback on fees spent.

I'd argue that the only guarantee provided by the LTM membership is that the membership lasts the lifetime of your account, not that the benefits associated with an LTM account will last a lifetime. The wording on LTM membership acquisition page does not imply that the benefits are permanent, and thus are subject to change at the discretion of network consensus.

Do it with market fees.  Then there is no worry about how to convert to a chosen bitAsset, and is market driven -- more volume creates more revenue.

[ ... ]

EDIT: And another reason market fees are better than transaction fees is that is does not change the rules 'retroactively'.  Anybody who doesn't like new market fees can choose not to trade in that market.  Whereas changes which lessen LTM benefits are forced on those who thought they got something different.

So instead of changing the distribution of existing transaction fees, you're proposing new fees to be imposed on the network to pay for the dividends functionality? Wouldn't this potentially have a negative effect on the DEX considering that it would become more expensive to use, as opposed to reallocating transaction fees which would have no change in charged fees to the end user?

Also consider openledger who graciously faucets new user accounts.  They do so with the understanding that they get a cut of the user's transaction fees via registration (and referral, if not otherwise filled) percentages.  I think it's a bad idea to change this now.[/i]

I acknowledge that registrars/referrers will be negatively affected initially by the reduction in their earnings, however if the introduction of dividends/profit-sharing drives a larger user base to the BTS DEX this could be somewhat negated.

------

In fact I feel sick for the ""
this title make Bitshares looks like a scam
I wish never see this title in the official site.

I disagree that this is a scam, it's simply a proposal to change the distribution of currently collected fees to pay asset holders on the BTS DEX.

I agree that we should not explicitly state a static percent as a 'guaranteed interest income', as the income is dependent on the amount of transaction fees generated by the BTS DEX. This could be lower or higher than 5% depending on future use.

bank have many real business to pay the divident.
where is the business based bitshares?
I believe we'll get divident too after we have some real business.
pay divident is the result, not the reason.

The Bitshares business is the utilization of the BTS DEX - the transaction fees generated within the DEX can be utilised to pay dividends to asset holders.
External companies can certainly pay dividends using the BTS DEX (like obits/icoo, etc) but we can also do this for the BTS DEX (without issuing new tokens or buying tokens for the distribution).

---

I tend to agree with alt on this. I would much rather have us start actually burning the fees instead of recycling them into the reserve pool so that bitshares would eventually go deflationary.

You can already do this by utilising the worker proposal mechanism to burn BTS within the reserve pool.
Sending fees to the reserve pool is temporarily deflationary as it will take a long time to burn through these assets at the current spending pace.

---

Benefits over transaction fee distribution:
1. Market Fees produce bitAsset of choice -- no need to convert BTS to bitAsset for dividend payment.
2. Does not violate LTM agreement
3. Does not mess with referral expectations

"Your share in the Decentralized Exchange"

Producing revenue from market activity is a natural income source for an exchange.  Sharing it with Bitshares users makes sense to me.

We already produce revenue from market activity via transaction fees without the need for additional market fees.

I've numbered your points for easier referencing:
1. You can pay transaction fees in assets other than BTS, so we can already immediately distribute bitUSD to bitUSD holders instead of converting it from bitUSD -> BTS prior to redistribution. Unless this is an automated process right now? The committee in charge of the fees assigned to the reserve pool could provide additional information here.
2. The agreement was that the membership you purchased was to exist for a lifetime, not that the benefits were permanent for the lifetime of your account. These benefits should be subject to change, given sufficient network consensus.
3. The referral system being allocated 80% of transaction fees was unfair to begin with, there was an expected replacement income stream for asset holders in the form of a bond market which never materialized. It's time for asset holders to have a slice of the pie allocated to them. Referrals don't keep users around, dividends do.