Communist Bitshares Wealth Redistribution IS THEFT!
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Chew Kok:



















DecentralizeEconomics:
Quote from: testz on May 02, 2015, 09:10:32 AM

Quote from: DecentralizeEconomics on May 02, 2015, 08:06:27 AM

Quote from: testz on May 02, 2015, 07:04:13 AM

Quote from: DecentralizeEconomics on May 02, 2015, 06:16:59 AM

If you are a "BItassets" (derivatives contract) holder, ask yourself this.  What happens when the market capitalization of BTS is too low to fully collateralize all the outstanding "Bitassets" (derivatives contract)?

Hmm, you really understand how BitAssets works!?


Do you?  If the marketcap of all outstanding "bitassets" exceeds the marketcap of BTS, how do you propose to settle all of the outstanding derivatives contracts?  All "Bitasset" derivatives contracts are settled in BTS.


Today marketcap of all BitAssets $300 000, how much should cost BTS in order to this happened?
BTW if all contracts will be closed by peoples the marketcap of BitAssets will be 0 as at beginning.


Let's take the following example.  If the marketcap of BTS falls below the entire marketcap of all the outstanding "BitAssets", then how can BTS fully collateralize the "BitAssets"?  It is my understanding that "BitAsset" long positions are 100% collateralized with BTS and "BitAsset" short positions are 200% collateralized.  The answer I'm expecting to get to this question is if all the "BitAsset" holders of a certain class, say BitUSD, want to liquidate their position then they will exert buying pressure on BTS thus driving the price of BTS higher allowing all the "BitAsset" holders of that class to successfully exit their position.  But, what happens if this buy pressure on BTS/BitUSD doesn't cause a price increase do to greater sell pressure on the BTC/BTS side of the trade?  It seems that in this scenario a falling overall BTS price would prevent 100% collateralization of the "BitAssets" resulting in a situation where the there isn't enough BTS in existence to cover all the open positions.
testz:
Quote from: DecentralizeEconomics on May 03, 2015, 06:12:15 AM

Quote from: testz on May 02, 2015, 09:10:32 AM

Quote from: DecentralizeEconomics on May 02, 2015, 08:06:27 AM

Quote from: testz on May 02, 2015, 07:04:13 AM

Quote from: DecentralizeEconomics on May 02, 2015, 06:16:59 AM

If you are a "BItassets" (derivatives contract) holder, ask yourself this.  What happens when the market capitalization of BTS is too low to fully collateralize all the outstanding "Bitassets" (derivatives contract)?

Hmm, you really understand how BitAssets works!?


Do you?  If the marketcap of all outstanding "bitassets" exceeds the marketcap of BTS, how do you propose to settle all of the outstanding derivatives contracts?  All "Bitasset" derivatives contracts are settled in BTS.


Today marketcap of all BitAssets $300 000, how much should cost BTS in order to this happened?
BTW if all contracts will be closed by peoples the marketcap of BitAssets will be 0 as at beginning.


Let's take the following example.  If the marketcap of BTS falls below the entire marketcap of all the outstanding "BitAssets", then how can BTS fully collateralize the "BitAssets"?  It is my understanding that "BitAsset" long positions are 100% collateralized with BTS and "BitAsset" short positions are 200% collateralized.  The answer I'm expecting to get to this question is if all the "BitAsset" holders of a certain class, say BitUSD, want to liquidate their position then they will exert buying pressure on BTS thus driving the price of BTS higher allowing all the "BitAsset" holders of that class to successfully exit their position.  But, what happens if this buy pressure on BTS/BitUSD doesn't cause a price increase do to greater sell pressure on the BTC/BTS side of the trade?  It seems that in this scenario a falling overall BTS price would prevent 100% collateralization of the "BitAssets" resulting in a situation where the there isn't enough BTS in existence to cover all the open positions.


Today all shorts force to cover every 30 days, it's makes buy pressure.
http://bytemaster.bitshares.org/article/2015/01/27/BitAssets-and-Black-Swan-Events
DecentralizeEconomics:
Quote from: testz on May 03, 2015, 06:24:47 AM

Quote from: DecentralizeEconomics on May 03, 2015, 06:12:15 AM

Quote from: testz on May 02, 2015, 09:10:32 AM

Quote from: DecentralizeEconomics on May 02, 2015, 08:06:27 AM

Quote from: testz on May 02, 2015, 07:04:13 AM

Quote from: DecentralizeEconomics on May 02, 2015, 06:16:59 AM

If you are a "BItassets" (derivatives contract) holder, ask yourself this.  What happens when the market capitalization of BTS is too low to fully collateralize all the outstanding "Bitassets" (derivatives contract)?

Hmm, you really understand how BitAssets works!?


Do you?  If the marketcap of all outstanding "bitassets" exceeds the marketcap of BTS, how do you propose to settle all of the outstanding derivatives contracts?  All "Bitasset" derivatives contracts are settled in BTS.


Today marketcap of all BitAssets $300 000, how much should cost BTS in order to this happened?
BTW if all contracts will be closed by peoples the marketcap of BitAssets will be 0 as at beginning.


Let's take the following example.  If the marketcap of BTS falls below the entire marketcap of all the outstanding "BitAssets", then how can BTS fully collateralize the "BitAssets"?  It is my understanding that "BitAsset" long positions are 100% collateralized with BTS and "BitAsset" short positions are 200% collateralized.  The answer I'm expecting to get to this question is if all the "BitAsset" holders of a certain class, say BitUSD, want to liquidate their position then they will exert buying pressure on BTS thus driving the price of BTS higher allowing all the "BitAsset" holders of that class to successfully exit their position.  But, what happens if this buy pressure on BTS/BitUSD doesn't cause a price increase do to greater sell pressure on the BTC/BTS side of the trade?  It seems that in this scenario a falling overall BTS price would prevent 100% collateralization of the "BitAssets" resulting in a situation where the there isn't enough BTS in existence to cover all the open positions.


Today all shorts force to cover every 30 days, it's makes buy pressure.
http://bytemaster.bitshares.org/article/2015/01/27/BitAssets-and-Black-Swan-Events


While forcing shorts to cover every thirty days does exert buying pressure, it doesn't necessarily prevent a situation like I described from occurring.  There is a significant amount of BTS sitting on the sidelines not invested into any "BitAsset" class.  If these BTS are sold and the sell pressure this creates overwhelms the buy pressure exerted from "BitAsset" holders exiting their position, it seems that potentially a situation could develop if BTS drops low enough that there simply wouldn't be enough BTS to allow everyone to exit from their "BitAsset" positions without taking a loss.
testz:
Quote from: DecentralizeEconomics on May 03, 2015, 06:34:25 AM

While forcing shorts to cover every thirty days does exert buying pressure, it doesn't necessarily prevent a situation like I described from occurring.  There is a significant amount of BTS sitting on the sidelines not invested into any "BitAsset" class.  If these BTS are sold and the sell pressure this creates overwhelms the buy pressure exerted from "BitAsset" holders exiting their position, it seems that potentially a situation could develop if BTS drops low enough that there simply wouldn't be enough BTS to allow everyone to exit from their "BitAsset" positions without taking a loss.


I understand what you're talking about, if BTS price will drop to near 0.
To cover your old positions you can always short BitAsset for yourself at current price and cover your old positions. It's like when you get new loan to cover or pay percentages for your old loan in real life.
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