Interest on BitUSD - A Proposal for Review

[Method-X]

Accuracy isn't actually important for marketing. If you want to be accurate then Bitcoin mining isn't really mining, it's minting. Because you don't mine coins from the ground do you?

Maybe accurate isn't the right word - I'm actually talking about marketing.

When I hear "rewards" I think of a marketing gimmick. When I hear "dividends" or "interest" I think of banking. The better marketing decision may be to not use a "marketing" word.

I own a marketing firm here in Ontario, I've spent my entire adult life as a marketer...

Go with whichever has the most "perceived value". For me, it's unquestionably "interest". I put my wealth into something that has a high interest rate. I choose a credit card that gives me "rewards". The underlying incentives are totally different for each. BitUSD early adopters will park their wealth for the interest, not rewards.

Ultimately we're discussing semantics / psychology. The words we choose to describe our product are very important. If we use the wrong ones, someone else will use the right ones.

[maqifrnswa]

"dividends" and "interest" are difficult words to legally market.

ah got it, that trumps all!

[bytemaster]

"dividends" and "interest" are difficult words to legally market.

[oldman]

I am think of calling them "USD Rewards" like a credit card "rewards program".

Definitely call it interest.
It's already been done in the crypto community https://mcxnow.com/ .
So it's already accepted as interest.

Is the term "Rewards" already decided? To me that sounds more like frequent flier miles than money. Does the word "Reward" have certain legal advantages over dividend or interest?

Rewards is terrible. If every other exchange is calling it interest why should Bitshares X be the one to call it rewards?  It's actually not unusual for people to get interest on their cryptocurrency deposits.

dividends might be more accurate since it is a distribution of profit (fees). I agree the "rewards" sounds like a marketing thing. Interest and dividends sounds like a finance thing.

This.

[bytemaster]

1) If you hold a balance for less than 1 month, you earn nothing.

This might be a bad idea because initially people might only hold for a few weeks as the market isn't going to be mature enough that people will hold for months at a time. I think the interest should kick in immediately on a daily or even hourly basis just as what happens with https://mcxnow.com/

Their economic model is proven to work already for an exchange. Why not just copy exactly how they do it? People seem to like receiving frequent rewards even if they are very small each day or each hour. If you can feed them interest in real time that is even better for attracting holders and then once you get them holding you hook them in by increasing the rewards the longer they hold (more consecutive days is better).

So minimum could be 5% but if they hold beyond a certain amount of consecutive days then the 5% limit is removed and it can go as high as it goes.

As implemented it is continuos.

[biophil]

1) If you hold a balance for less than 1 month, you earn nothing.

This might be a bad idea because initially people might only hold for a few weeks as the market isn't going to be mature enough that people will hold for months at a time. I think the interest should kick in immediately on a daily or even hourly basis just as what happens with https://mcxnow.com/

Their economic model is proven to work already for an exchange. Why not just copy exactly how they do it? People seem to like receiving frequent rewards even if they are very small each day or each hour.

I think the same thing. Maybe older balances are eligible for a larger fraction of the rewards, but I think every balance should get something.

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[luckybit]

1) If you hold a balance for less than 1 month, you earn nothing.

This might be a bad idea because initially people might only hold for a few weeks as the market isn't going to be mature enough that people will hold for months at a time. I think the interest should kick in immediately on a daily or even hourly basis just as what happens with https://mcxnow.com/

Their economic model is proven to work already for an exchange. Why not just copy exactly how they do it? People seem to like receiving frequent rewards even if they are very small each day or each hour. If you can feed them interest in real time that is even better for attracting holders and then once you get them holding you hook them in by increasing the rewards the longer they hold (more consecutive days is better).

So minimum could be 5% but if they hold beyond a certain amount of consecutive days then the 5% limit is removed and it can go as high as it goes.

[Shentist]

bank interest == bit interest

so what about "bitinterest" ?

or "bit%"

[luckybit]

I am think of calling them "USD Rewards" like a credit card "rewards program".

I have a Dividend Credit Card and a Rebate Rewards Credit, they are same actually. But I prefer the word "dividend", it's a more professional financial word.

Stocks give dividend. Dividend should be reserved for BitAssets which are acting as stock. Interest should be reserved for BitAssets which act as currency. Rewards should be reserved for BitAssets which act as IOUs such as if Overstock issued some sorta Overstock rewards gift token.

[Shentist]

against the word "rewards"

we already have the slogan "earn 5% or more"

5% is not a reward it is interest or dividend, but not a reward!

[ripplexiaoshan]

I am think of calling them "USD Rewards" like a credit card "rewards program".

I have a Dividend Credit Card and a Rebate Rewards Credit, they are same actually. But I prefer the word "dividend", it's a more professional financial word.

[luckybit]

1) What are your thoughts on putting the "daily burn" toward BitUSD? This way, there is more electoral control over the interest rate.

2) Does this apply to all BitAssets or just BitUSD specifically?

Wouldn't that create unbacked bitUSD?

No, since you could use the burned BTSX to purchase bitAssets on the open market. It would be pretty cool, no? You'd have constant buying pressure for bitAssets.

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So said another way the burn rate isn't sending shares off into oblivion but being donated to the network to pay out as dividends/interest to bitUSD holders? That's pretty interesting. It could't be all of it though as the burn rate is the only mechanism to reduce supply.

Yeah, so burn some and convert others to bitAssets. Some of the burn is implicit dividends for BTSX holders, some is explicit dividends for bitAsset holders.

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Why is extra deflation even necessary? Even without the burn, BTSX is deflationary by default. Investing 100% of the burned shares into interest bearing assets would be much more strategically beneficial to adoption and therefore BTSX holders.

PS: Love your tagline!

I think we need some burning too. The reason is some people need to be encouraged to hold BTSX and buy BTSX. At least until we reach a point where BitAssets are what people buy and not BTSX you will need dividends for holders of BTSX, interest for BitAssets.

[maqifrnswa]

Accuracy isn't actually important for marketing. If you want to be accurate then Bitcoin mining isn't really mining, it's minting. Because you don't mine coins from the ground do you?

Maybe accurate isn't the right word - I'm actually talking about marketing.

When I hear "rewards" I think of a marketing gimmick. When I hear "dividends" or "interest" I think of banking. The better marketing decision may be to not use a "marketing" word.

[Method-X]

1) What are your thoughts on putting the "daily burn" toward BitUSD? This way, there is more electoral control over the interest rate.

2) Does this apply to all BitAssets or just BitUSD specifically?

Wouldn't that create unbacked bitUSD?

No, since you could use the burned BTSX to purchase bitAssets on the open market. It would be pretty cool, no? You'd have constant buying pressure for bitAssets.

Sent from my SCH-S720C using Tapatalk 2

So said another way the burn rate isn't sending shares off into oblivion but being donated to the network to pay out as dividends/interest to bitUSD holders? That's pretty interesting. It could't be all of it though as the burn rate is the only mechanism to reduce supply.

Yeah, so burn some and convert others to bitAssets. Some of the burn is implicit dividends for BTSX holders, some is explicit dividends for bitAsset holders.

Sent from my SCH-S720C using Tapatalk 2

Why is extra deflation even necessary? Even without the burn, BTSX is deflationary by default. Investing 100% of the burned shares into interest bearing assets would be much more strategically beneficial to adoption and therefore BTSX holders.

PS: Love your tagline!

[luckybit]

I am think of calling them "USD Rewards" like a credit card "rewards program".

Definitely call it interest.
It's already been done in the crypto community https://mcxnow.com/ .
So it's already accepted as interest.

Is the term "Rewards" already decided? To me that sounds more like frequent flier miles than money. Does the word "Reward" have certain legal advantages over dividend or interest?

Rewards is terrible. If every other exchange is calling it interest why should Bitshares X be the one to call it rewards?  It's actually not unusual for people to get interest on their cryptocurrency deposits.

dividends might be more accurate since it is a distribution of profit (fees). I agree the "rewards" sounds like a marketing thing. Interest and dividends sounds like a finance thing.

Accuracy isn't actually important for marketing. If you want to be accurate then Bitcoin mining isn't really mining, it's minting. Because you don't mine coins from the ground do you?

We are speaking in metaphors. The metaphors don't have to be real world accurate they just have to get the point across in the most simple to the point way. All this legalese financial speak is just going to confuse people. Talk of rewards will make people think it's a video game with points.