May I have some too, please?


Not that I know.*

The system outlined in the previous posts by somac., Biodom and others has only two outcomes: (a) more dollars, less (or equal) btc; (b) same dollars, more btc. In both cases, the total dollar value at the moment of the outcome is more than the value at the start.


* (As if I would tell you if I knew! All bitcoinz belongz to me!)

I didn't know about CBOE discontinuing BTC futures, or about CME futures being cash settled.

Transfer timing, 3rd party risk and other factors do exist. No trade is a free lunch: even arbitrages can go awry. However, the so-called inverse futures have a mathematical structure such that short positions with leverage < 1 can never get liquidated. Just sayin'.

EDIT in ELI5 form for OP - I have to add, though, that this arbitrage works either way - number go up or number go down - only because the profits are measured in fiat. When measured in bitcoin, there are profits only if number go down. So for a real hodler it's not really an arbitrage, but rather either (a) a sale (at over market price, though!), or (b) a btc gain. What it turns out to be depends if number go up/down.

In other words: if number go up, you end up with a higher dollar value, but your btc value has gone down (you still give up less btc than if you had sold, because the resulting effective price is over market). If number go down, you end up with a higher dollar value and a higher btc amount too: your btc quantity goes up, since number went down and the result must make up for that, PLUS the arbitrage profit.

This could be one of the reasons why short interest in futures is always so high, and futures expiry dates are so often bloody for the hodlers - just like now.

Artificial scarcity? That's the whole thing about bitcoin, I think. Come on, let the poor horse get a worthy burial already.

A serious response to my joking grimace of a post. Thank you.

There are a few possible objections to your legitimate (and probably informed) opinion that the fees are artificially high, apart from L2 - which I, differently from you, believe will solve or ease the issues.

- The actual block size has been made larger by the SegWit update. The bookkeeping has also changed to incentivize certain types of transactions over others. The new incentive system has deflected much public (uninformed) attention from the fact that there is more space in blocks today, not less.

- If the fees are artificially high now, why wouldn't they remain inflated after, say, a doubling of the size? The more the mining power gets centralized, the more room for abuse there is. A small size, at the very least, allows user nodes to check by themselves that there's no fuckery going on. Verify without trust.

My pleasure.

There are many much coin with big block, some are very nice and very work much wow, like super wide cool highway. Fees no artificial high there.

It is rumored that the exchanges delisting them were giggling through their teeth something like "highway your mom if you want highway", though no one could make any sense of that.

(I just had to post this for the benefit of anyone not aware.)

Did they sell you that "crypto" at "k56"?
I've got bad news for you.

I posted a link earlier, here it is again.
https://blog.bitmex.com/how-to-arbitrage-bitcoin-futures-vs-spot/

The WO sometimes must be combed thoroughly, but it usually does deliver good info - be it bitcoin or digital cameras.

Or you're just halftrolling and... username checks out? 

https://blog.bitmex.com/how-to-arbitrage-bitcoin-futures-vs-spot/

Mr. Hayes's blog is, as I said, an excellent source of technical info.

The rope provided there might turn into a tool to hang oneself, or into a lifeline for conversion of excess corn/fiat into income without selling.

The rule "no risk, no profit" remains solid IMHO. However, not all risks are equal, and being able to quantify risk is a precious, if difficult to acquire, skill.

... or a mature musician with properties in Mexico shopping for a private lake in his native Canada?

Don't worry for them. They won't let you go naked. The options we're talking about are covered - which means you have to post btc collateral before being able to write them.

Soon 100,000,000 units won't be enough. When hard fork?

Seriously, I think the time for a smaller minimum unit is approaching fast. Maybe a hard fork isn't technically needed, and two different "resolutions" can coexist for a while, but I hope that when 1 sat = 0.01$ happens, we're ready with further subdivisions.

I think it's perfectly fine to buy gold certificates with btc. Gold certificates are "as good as gold", amirite?
/s

Let's buy gold certificates with btc certificates. They send us paper gold, we send them a pretty email - a pdf file, even! - stating they own the btc. Of course, we keep the keys until we touch the yellow stuff. It's only fair.  

As I understand it, 5 million for approval is only if you want to write options at different (not preset) strike prices. If you are OK with 25k, 50k, 75k etc, there's no need for approval as long as you post the collateral.

Great post, Biodom. You're informative as usual. Thank you!

BTW @somac., I've checked FTX and they only seem to deal in futures - not options. Or maybe I have to sign up to see that?

Of course: a little like selling too early. But you do get advance money in return, after all. No free lunch and all that. I'm going to check the exchanges you suggested to get a feel for the premiums.

Hero status fully deserved, somac.

1. Lending makes me very nervous. The counterparty risk won't let me sleep easily. My precioussss!! The good side is, it is unlike selling because you don't forfait your btc, but cash in interest - that's how it works, right?

2. Sell futures for cash seems a little more acceptable. It is tantamount to selling, though.

3. I like this. I imagine it is something like this: sell covered calls by posting btc collateral, and actually sell the btc at the strike price on expiry. Do you have any idea where that is possible?

How about elaborating on that a little more, somac.?  ELI5...

We missed your 15m entirely. You are entitled to reclaim them. As a mild reparation for our failure to acknowledge your paternity of the "Laser Eye Bitcoiner" concept, please accept the following.

+1 WOsMerits


(Yes, sometimes it's appropriate to use the royal "we". Perhaps?)