[OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading

[CambioBTC]

The site is pretty unstable since last week.

I know bitfinex is already protected by Cloudflare. However, sometimes Cloudflare cannot reach your origin server (maybe it is down, timeout, whatever reason).

It is definitely not good for trading.....

Set your Stop orders and your Take Profit orders, brace yourself and "No Worries"

[nrd525]

I've been noticing above-expected interest received on loans.

I sent an email and Raphael said it could be from loans closing early (and that there wasn't a bug).

Today I got 307% APR, presumably after the commission was taken out (so the real APR is 340%).  And I'm lending out at the flash return rate - which I've only seen in the  145-175% range.

Unless the website has a different idea of how to calculate APR this is pretty weird.


I'm doing
APR=((daily interest / size of loan) + 1) ^ 365   - 1
And then multiply by 100 if you want percent.

[Spaceman_Spiff]

I got a question: How is the intrest calculated exactely?
If i got a 10000$ loan going for 1 Day, Lets say it got accepted at 00:00 and is running at the time of Intrest paying. The Interest rate is 100%.

My calculations would be: {10000* [(1+1)^(1/365)-1]}* 0.9 =  17.1$

But the interest is either way higher or lower... I couldn't figure it out until now

Please help me!

I believe it is:
(10000*100*0.9)/36500 = 24.65$
my estimates are generally pretty correct using this formula.  If it's way lower, might be that your loan got cancelled, and then renewed after a while.

[accord01]

I got a question: How is the intrest calculated exactely?
If i got a 10000$ loan going for 1 Day, Lets say it got accepted at 00:00 and is running at the time of Intrest paying. The Interest rate is 100%.

My calculations would be: {10000* [(1+1)^(1/365)-1]}* 0.9 =  17.1$

But the interest is either way higher or lower... I couldn't figure it out until now

Please help me!

I believe it is:
(10000*100*0.9)/36500 = 24.65$
my estimates are generally pretty correct using this formula.  If it's way lower, might be that your loan got cancelled, and then renewed after a while.

how did you get this formula?  I usually do 100/365= ~.27 , then move back 2 dec places = .0027 * 10000 = $27 per day

[Spaceman_Spiff]

I got a question: How is the intrest calculated exactely?
If i got a 10000$ loan going for 1 Day, Lets say it got accepted at 00:00 and is running at the time of Intrest paying. The Interest rate is 100%.

My calculations would be: {10000* [(1+1)^(1/365)-1]}* 0.9 =  17.1$

But the interest is either way higher or lower... I couldn't figure it out until now

Please help me!

I believe it is:
(10000*100*0.9)/36500 = 24.65$
my estimates are generally pretty correct using this formula.  If it's way lower, might be that your loan got cancelled, and then renewed after a while.

how did you get this formula?  I usually do 100/365= ~.27 , then move back 2 dec places = .0027 * 10000 = $27 per day

Bitfinex takes 10% of the generated interest as their fee, thats why you multiply by 0.9 .

[accord01]

oh they take 10% from the lender and borrower or just lender?

[Spaceman_Spiff]

oh they take 10% from the lender and borrower or just lender?

Borrower pays the annualized percentage of interest that is displayed.  From that interest payment, they take 10% as fee, so just the lender.

[accord01]

also, do you get charge interest for funds under the unused borrowed funds tab?

[Sukrim]

https://bitfinex.com/pages/fees

No.

[accord01]

https://bitfinex.com/pages/fees

No.

all it says regarding interests for borrowed funds:

LOANS
Charged on your existing uninsured credits interests, paid by the lender    10.0% (of the interests generated by active credits)
Charged on your existing insured credits interests, paid by the lender    30.0% (of the interests generated by active credits)


doesn't really specify about the unused borrowed funds though.

[Sukrim]

It doesn't say anything about opening orders, depositing anything besides "EgoPay"... whatever is NOT on there does not have a fee.

[nrd525]

Are they compounding the interest or not?

The fact that they give an APR (interest for 365 days) makes me think that they should be using compounding.  This is standard practice in the loan and banking sectors. Thus your daily interest rate should not be the annual rate divided by the number of days.  It should be lower.

For example, if you are earning  $25 interest on $10,000 that is 0.0025 rate of interest per day.

With compounding interest (and reinvestment), at the end of one year you will have
1.0025^365 = 2.4877
Which is an APR of 148.77%.


Whereas (without compounding) 0.0025*365= 91.25%.


This example excludes the 10% commission to make things simpler and to focus on the difference between using compounded and non-compounded interest.

[Spaceman_Spiff]

Are they compounding the interest or not?

The fact that they give an APR (interest for 365 days) makes me think that they should be using compounding.  This is standard practice in the loan and banking sectors. Thus your daily interest rate should not be the annual rate divided by the number of days.  It should be lower.

For example, if you are earning  $25 interest on $10,000 that is 0.0025 rate of interest per day.

With compounding interest (and reinvestment), at the end of one year you will have
1.0025^365 = 2.4877
Which is an APR of 148.77%.
Whereas (without compounding) 0.0025*365= 91.25%.
This example excludes the 10% commission to make things simpler and to focus on the difference between using compounded and non-compounded interest.

They are not compounding the interest for the APR.  Relending your interest payments is your own choice.

[nrd525]

They should use compounding.  It is common practice to do so and misleading not to.   I didn't realize this until just now, and I've been lending for 10 months (I didn't do the calculations because my interest rates were often very different - only more recently have I been loaning out 100% at the flash rate)!

There is no such thing as "Rate (% per 365 days)".  This is a term that BFX has invented with an unclear definition and may be another English language mistake (recall the earlier site slogan which made absolutely zero sense in English).  If they wanted to give a rate for the day, they should call it per day - not per year (and list the APR in parentheses so that you can see both)!  I strongly recommend showing the APR!

The commonly used term is APR and there is an accepted way to calculate it.

I could possibly see that compounding wouldn't make as much sense for borrowers who are doing short-term loans, but it sure makes a lot of sense for the lenders - especially with auto-lend.  And it looks like many of the borrowers are doing fairly long-term loans.

[Spaceman_Spiff]

They should use compounding.  It is common practice to do so and misleading not to.   I didn't realize this until just now, and I've been lending for 10 months (I didn't do the calculations because my interest rates were often very different - only more recently have I been loaning out 100% at the flash rate)!

There is no such thing as "Rate (% per 365 days)".  This is a term that BFX has invented with an unclear definition and may be another English language mistake (recall the earlier site slogan which made absolutely zero sense in English).  If they wanted to give a rate for the day, they should call it per day - not per year (and list the APR in parentheses so that you can see both)!  I strongly recommend showing the APR!

The commonly used term is APR and there is an accepted way to calculate it.

I could possibly see that compounding wouldn't make as much sense for borrowers who are doing short-term loans, but it sure makes a lot of sense for the lenders - especially with auto-lend.  And it looks like many of the borrowers are doing fairly long-term loans.

I honestly don't see the issue here.   For the borrower, it shows the percentage per day in the margin trade tab.  For the lender, in the lending tab it shows you how many percent you get if the loan you issue stays in place for a year.  I see nobody being misled here.
Your interest payments are not automatically re-incorporated into the loan, nobody can promise you that you will get the same rate for them. Whether you do autolend or buy BTC with the interest depends on your own choice.  

Sure, APR is calculated differently for your bank account, but it's a different kind of product, where the funds automatically get reinvested (and the bank guarantees a certain return).  

[urwhatuknow]

They should use compounding.  It is common practice to do so and misleading not to.   I didn't realize this until just now, and I've been lending for 10 months (I didn't do the calculations because my interest rates were often very different - only more recently have I been loaning out 100% at the flash rate)!

There is no such thing as "Rate (% per 365 days)".  This is a term that BFX has invented with an unclear definition and may be another English language mistake (recall the earlier site slogan which made absolutely zero sense in English).  If they wanted to give a rate for the day, they should call it per day - not per year (and list the APR in parentheses so that you can see both)!  I strongly recommend showing the APR!

The commonly used term is APR and there is an accepted way to calculate it.

I could possibly see that compounding wouldn't make as much sense for borrowers who are doing short-term loans, but it sure makes a lot of sense for the lenders - especially with auto-lend.  And it looks like many of the borrowers are doing fairly long-term loans.

I honestly don't see the issue here.   For the borrower, it shows the percentage per day in the margin trade tab.  For the lender, in the lending tab it shows you how many percent you get if the loan you issue stays in place for a year.  I see nobody being misled here.
Your interest payments are not automatically re-incorporated into the loan, nobody can promise you that you will get the same rate for them. Whether you do autolend or buy BTC with the interest depends on your own choice.  

Sure, APR is calculated differently for your bank account, but it's a different kind of product, where the funds automatically get reinvested (and the bank guarantees a certain return).  

Dude, do you need a job?



Giancarlo
Bitfinex Team

[TwinWinNerD]

They should use compounding.  It is common practice to do so and misleading not to.   I didn't realize this until just now, and I've been lending for 10 months (I didn't do the calculations because my interest rates were often very different - only more recently have I been loaning out 100% at the flash rate)!

There is no such thing as "Rate (% per 365 days)".  This is a term that BFX has invented with an unclear definition and may be another English language mistake (recall the earlier site slogan which made absolutely zero sense in English).  If they wanted to give a rate for the day, they should call it per day - not per year (and list the APR in parentheses so that you can see both)!  I strongly recommend showing the APR!

The commonly used term is APR and there is an accepted way to calculate it.

I could possibly see that compounding wouldn't make as much sense for borrowers who are doing short-term loans, but it sure makes a lot of sense for the lenders - especially with auto-lend.  And it looks like many of the borrowers are doing fairly long-term loans.

I honestly don't see the issue here.   For the borrower, it shows the percentage per day in the margin trade tab.  For the lender, in the lending tab it shows you how many percent you get if the loan you issue stays in place for a year.  I see nobody being misled here.
Your interest payments are not automatically re-incorporated into the loan, nobody can promise you that you will get the same rate for them. Whether you do autolend or buy BTC with the interest depends on your own choice.  

Sure, APR is calculated differently for your bank account, but it's a different kind of product, where the funds automatically get reinvested (and the bank guarantees a certain return).  

Dude, do you need a job?



Giancarlo
Bitfinex Team

haha that is a good idea, i like Spaceman_Spiffs posts very much!

[nrd525]

I'd at least explain how interest is calculated in the FAQ.  It currently isn't explained.

Can you name a mainstream business that doesn't use APR for loans?    It's the kind of thing loan sharks do to hide the real cost of the loans (eg. Pay Day loans, mafia, ponzi schemes) - unless they are banned for it by law.   There is a reason for laws that force you to display the APR.

"nobody can promise you that you will get the same rate for them"
I agree.  However this means that the 365 day rate also makes no sense.  With this logic, the only thing that makes sense is the one-day rate.

http://en.wikipedia.org/wiki/Annual_percentage_rate

[Spaceman_Spiff]

They should use compounding.  It is common practice to do so and misleading not to.   I didn't realize this until just now, and I've been lending for 10 months (I didn't do the calculations because my interest rates were often very different - only more recently have I been loaning out 100% at the flash rate)!

There is no such thing as "Rate (% per 365 days)".  This is a term that BFX has invented with an unclear definition and may be another English language mistake (recall the earlier site slogan which made absolutely zero sense in English).  If they wanted to give a rate for the day, they should call it per day - not per year (and list the APR in parentheses so that you can see both)!  I strongly recommend showing the APR!

The commonly used term is APR and there is an accepted way to calculate it.

I could possibly see that compounding wouldn't make as much sense for borrowers who are doing short-term loans, but it sure makes a lot of sense for the lenders - especially with auto-lend.  And it looks like many of the borrowers are doing fairly long-term loans.

I honestly don't see the issue here.   For the borrower, it shows the percentage per day in the margin trade tab.  For the lender, in the lending tab it shows you how many percent you get if the loan you issue stays in place for a year.  I see nobody being misled here.
Your interest payments are not automatically re-incorporated into the loan, nobody can promise you that you will get the same rate for them. Whether you do autolend or buy BTC with the interest depends on your own choice.  

Sure, APR is calculated differently for your bank account, but it's a different kind of product, where the funds automatically get reinvested (and the bank guarantees a certain return).  

Dude, do you need a job?



Giancarlo
Bitfinex Team

Lol  , thanks but no thanks, I just got a new one (unless you are offering me mad cash of course  ).

[CambioBTC]

The problem that I'm finding is locating a good "Trading Chart"
for Bitfinex, the chart located at:

http://bitcoinwisdom.com/markets/bitfinex/btcusd

Leaves a lot to be desired when compared to the charts at:

https://www.tradingview.com/

If I had to guess at it, that's the reason why everyone is
routing their orders to BitStamp, just to be able to use
the good BitStamp charts that are available to trade on.

It's useless trying to trade without a good chart, tried
trading Bitfinex yesterday with a BitStamp chart and that
was scary.

Wow,

Sent another USD Wire Transfer to Bitfinex
from Mexico, practically received in my account
in 12-Hours !