[proposal discussion] Unification of same gateway IOUs

[severo]

The best solution, and the most simple and decentralized one, at least for the currencies with the largest market cup, would be that the different gateways would generate enough Smartcoins, such as BitBTC.

Bitshares users could use the gateways to buy these smartcoins, or exchange them for real assets.

Nothing is needed to implement this, only serious gateways with liquidity.

[Crypto Kong]

Another approach is market making among these UIA's, it's safe as long as the gateways are still trustworthy, and everyone can do it. Combined with the arbitrage bots running in the market, real liquidity will be improved.

Better if UI can show combined market depth. Best if the back end supports auto-bridging: https://github.com/bitshares/bsips/issues/45.

I'm gonna start looking into making the market on similar assets at different gateways, good idea. Thanks

[sschiessl]

This is one of the strategies of DEXBot, isn't it?

First issue will always be the price if combining assets.

[abit]

Another approach is market making among these UIA's, it's safe as long as the gateways are still trustworthy, and everyone can do it. Combined with the arbitrage bots running in the market, real liquidity will be improved.

Better if UI can show combined market depth. Best if the back end supports auto-bridging: https://github.com/bitshares/bsips/issues/45.

[Ivan K]

I believe combining the IOUs is a good idea but should be up to the end user as some may not want to end up with a certain gateways IOU if perhaps they have had withdrawal issues or something similar in the past.

agreed, user should have granular control on who retains IOUs and who will be used as a withdrawal gateway. This may require exchange of custody between two or even more gateways leading to the idea of the "roaming" fees exisiting between gateways as a form of incentive.

If there was a "combined" markets section on the DEX where users could select their preffered trusted gateways and combine the order books

It is to be decided whether combining is made low level with only one order book existing or high level combining with separate order books which requires more complicated trading logic. In my opinion reliability of a gateway is not an issue while an IOU is within the DEX, but mostly when user want to withdraw crypto to the outside world.

[Victor118]

As a user I think it's a very good idea, cumulating volumes of all the gateways is extremely interesting, the BTC market should have a very good liquidity.
As a developer, I guess it's not easy but I hope i'm wrong.

[Crypto Kong]

There are some great points here and could lead to some very interesting discussions and ideas.

I believe combining the IOUs into one market is a good idea but should be up to the end user as to which markets they combine. Some may not want to end up with a certain gateways IOU if perhaps they have had withdrawal issues or something similar in the past.

If there was a "combined" markets section on the DEX where users could select their preffered trusted gateways and combine the order books, that would be great. For example I could select to combine the order books of OPEN, BRIDGE & GDEX assets for BTC - USD market. Then when I placed an order and it was filled I would perhaps end up with a combination of one or more of the assets in my wallet for BTC.

This would not only benefit the user by better liquididty but also the gateways as orders may get filled on lesser liquid gateways as they top up the liquidity of more frequently used markets.

It could also allow users, who wish to do so, to lower the risk of holding just one gateways asset in some cases.

It would also serve as a great incentive for exchanges to setup a DEX on the bitshares blockchain as they could piggy back off the liquidity that is already present.

[MarkoPaasila]

This would of course concern only the reference client?

[Ivan K]

Putting this discussion here to formulate a formal worker proposal.

FACTS:
1)   Different gateways introduce the same currencies under different names. Example: OPEN.ETH, GDEX.ETH, WIN.ETH.
2)   All such IOUs are traded as separate assets

CONSEQUENCES:
1)   Such separation leads to fragmentation of market liquidity across the BitShares platform
2)   Same but different IOUs cause constant confusion and misunderstanding among users.
3)   Same but different IOUs have different prices attached which is hardly justifiable.
4)   Such differentiation in assets is against the spirit of the BTS community being unite, on the contrary leading to fragmentation of common efforts to capitalize the DEX platform.

PROPOSED SOLUTION:
1)   Elimination of gateway differentiation for IOU assets. There should be only uniform BTCs, ETHs, LTCs as seen by an end user, but in fact pooled from all gateways together. Gateways should still secure assets by themselves but interoperability between gateways and liquidity of choice for change of gateway in the process should be seamless and transparent to extent possible.   
2)   Establishment of uniform standard for services provided by gateways. Each gateway still be a unique venture with different clientele but will be obliged to provide at least the same level services as any other gateway.

ANTICIPATED IMPACT:
Eliminations of doubling and tripling of assets will have following potential impact:
1)   Uniform price which means greater overall liquidity
2)   less confusion which means simpler interaction and greater acceptance by recent adopters
3)   could potentially encourage other exchanges to use BitShares as they could jump straight in with liquidity already here.
4)   gateways will be strongly motivated to compete in the field of added value-services instead of seeking other ways to gain profit to the detriment of the interests of common users.

Still there is no full understanding of feasibility of proposed solutions and means of their implementation. So I invite all interested parties to contribute to this discussion