about bfx and growing usd swaps...this is interesting.
https://www.reddit.com/r/BitcoinMarkets/comments/315ks5/daily_discussion_thursday_april_02_2015/cpywuly"In current system, USD swaps are only taken out if you open a position more than you actually have in underlying. Say you have $100 in underlying, you can open up to $100 in a long position without borrowing USD. You also don't show up in USD swaps stats yet, because you haven't borrowed anything. If someone is trying to figure out how many people are in long positions in Margin Trading, they can't tell that you've added $100 long.
OK, so moving on past your underlying. At $101, you take $1 of USD swap. What happens if a thousand traders do the same thing at $101, with same $100 underlying each? There'd only be $1K in USD swaps total, but there's $100K in long positions not visible. OK so basically there's no upper bound in how many not-visible long positions there could be. Only thing you can do is guess out of your ass at average leverage ratio.
However, we can know the lower bound of how many not-visible long positions there are. BFX max leverage is 1:3.33, or 30% initial margin requirement. Meaning, if you have $100 in underlying, max you can open in long positions is $333.33. Out of the $333.33 total, 30% ($100) is your underlying, 70% ($233.33) is how much you've borrowed in USD swaps. That ratio of 30%/70% = 42% btw.
So if we have $25M in borrowed USD swaps, the case where there is the least number of not-visible positions that are funded by sufficient underlying, is if every position was leveraged to max. Then there are an additional 42% of not-visible (sufficiently funded by underlying) longs on top of $25M. That's another $10.5M. So $25 + $10.5 = $35.5M total long positions in this minimum case.
So, you can start guessing average margin ratio that's more realistic than everybody being max-leveraged. Say that the average of leverage positions is at 1:2. This would be like if you have $100, borrow another $100 for total $200 in long position. Half and half. Applying this to $25M USD swaps would be another $25M in underlying-funded long positions. $50M in total long positions.
Compare this the old system. The stat of $31M in old system meant exactly $31M in long positions were being taken in BFX margin trading. Back then, didn't matter if you had underlying or not, if you had $100 and opened $100 in longs, you'd still show up on USD swaps +$100.
As such, I say that it's a certainty that we're above old ATH of long positions. Probably by quite a bit.
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So those USD swap numbers are positions that must be closed at some point. we are talking about 30 mil atm.
That supernova I was talking about earlier will be epic !
Poll
