Author Topic: [Poll] BSIP59:Reduce MSSR of bitCNY to 1.02  (Read 2768 times)

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Offline xeroc

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Instead of reducing MSSR affecting all borrowers, it is possible to implement dynamic individual MSSR dependent on CR of the position. Here is the example:

- borrowers with CR=1.75 got margin called with MSSR 1.01
- If CR dropped to 1.7, MSSR is 1.05
- CR = 1.6 -> MSSR 1.10
- CR = 1.5 -> MSSR 1.20
- CR = 1.4 -> MSSR 1.30
- and so on

I think you got the idea. So, borrowers are always incentivized to maintain higher CR. Undercollaterized positions will create an acute price pressure and stimulate arbitrage.
That idea is also part of ongoing discussions in the community.
Thanks for bringing it up again!

Offline dh

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Instead of reducing MSSR affecting all borrowers, it is possible to implement dynamic individual MSSR dependent on CR of the position. Here is the example:

- borrowers with CR=1.75 got margin called with MSSR 1.01
- If CR dropped to 1.7, MSSR is 1.05
- CR = 1.6 -> MSSR 1.10
- CR = 1.5 -> MSSR 1.20
- CR = 1.4 -> MSSR 1.30
- and so on

I think you got the idea. So, borrowers are always incentivized to maintain higher CR. Undercollaterized positions will create an acute price pressure and stimulate arbitrage.

Offline binggo

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the margin call will be arbitraged less at MSSR of 1.05 than 1.1, it's not a binary thing

If you see people buying the margin call at a lower MSSR, it doesn't mean that the previous MSSR did not have any effect

If the market didn't have enough buying mood, set MSSR to 150% or 200% is useless.

Yes, the MSSR have a little bit effect,but MSSR does not determine whether the margin call will be eaten, the market emotion does.

“arbitraged“ in the MSSR?  it can't solve the margin call problem, the market emotion determine the margin call could be eaten or not.

MSSR only squeeze the market like “The crash of 1929“.

Offline armin

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the margin call will be arbitraged less at MSSR of 1.05 than 1.1, it's not a binary thing

If you see people buying the margin call at a lower MSSR, it doesn't mean that the previous MSSR did not have any effect

Offline bitcrab

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actually lowering MSSR exponentially increases the chance of global settlement, because the margin call won't be arbitraged anymore

No, when MSSR=1.1 bitCNY has been at the edge of global settlement; when MSSR=1.05 the margin call orders are still being eaten, as what happened today.

traders will suppose 1bitCNY>1.05 fiat CNY when MSSR=1.05 and bitCNY is in phase 3. there will always be uneaten margin call orders either MSSR=1.1 or MSSR=1.05, if the bear is big enough.

MSSR does not determine whether black swan will come, the market emotion does.

« Last Edit: February 25, 2019, 12:29:28 pm by bitcrab »
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Offline armin

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actually lowering MSSR exponentially increases the chance of global settlement, because the margin call won't be arbitraged anymore

Offline bitcrab

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higher chance of global settlement

the main cause of GS is the big bear, either setting MSSR to 1.1 or 1.05 or 1.02 do not play the key role on triggering GS.

but the different MSSR will lead to different premium of smartcoin in phase 3, which is a key factor on smartcoin ecosystem grow.

and as BSIP58 is already implemented on bitCNY, we need not worry too much on global settlement.
Email:bitcrab@qq.com

Offline armin

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higher chance of global settlement

Offline bitcrab

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BSIP59 define a general process for adjusting MSSR and/or MCR through voting

This poll will decide whether to reduce MSSR of bitCNY from current value 1.05 to 1.02.

as described in BSIP59 Doc: https://github.com/bitshares/bsips/blob/master/bsip-0059.md, currently bitCNY is in phase 3 - always margin called orders stayed, bitCNY has a 6%+ premium, and the current MSSR value is 1.05.

MSSR of bitCNY has been changed from 1.1 to 1.05 for months, we found that in phase 3 the bitCNY premium depend heavily on MSSR, higher MSSR always lead to high bitCNY premium, but not always lead to in time filling of the margin call orders.

to enable bitCNY peg better in phase 3, I now suggest to reduce MSSR of bitCNY from 1.05 to 1.02, it can be expected the bitCNY premium can be reduced to 2%+ after this change, this will benefit the whole ecosystem.

Two worker proposals have been created for this poll:

1.14.168   Poll - BSIP59 - Reduce MSSR of bitCNY to 1.02

1.14.169   Poll - BSIP59 - Do Not Reduce MSSR of bitCNY

please vote according to your opinion.
« Last Edit: February 24, 2019, 09:24:15 am by bitcrab »
Email:bitcrab@qq.com