"When liquidity runs dry it goes south" is the very definition of a ponzi scheme. The fact that this applies to other financial instruments (which BTC2 is not, it is nothing more than a token with different smart contract parameters) is definitely not an indicator that BTC2 is any more reliable or stable than anything else.
The fact is that BTC2 is not reliable, it is not stable, and liquidity is a risk that would cause people to lose money outside of the parameters. Meaning, there's no sound reason for someone to join this protocol, considering this risk being always prevalent amongst the other risks already associated with it.
"When liquidity runs dry under any financial instrument it go south its not only applicable for BTC²" BTC² is a derivative type power perpetual product and hence is a financial instrument. What is your definition of a financial instrument?
There is a transparent mechanism in place and related to your previous question on where the "extra money" comes from this is the mathematical calculation for the same, BBBTC returns = 2r + r^2 - premium decay
The extra returns would be coming from the r^2 portion
We will be publishing the Whitepaper and in-dept research paper with backtesting and a simulation model very soon before launching on main-net.
We have not launched on mainnet yet and i do not understand the basis of your claim on "BTC2 is not reliable, it is not stable, and liquidity is a risk that would cause people to lose money outside of the parameters" BTC² is reliable, stable and liquidity cannot be at risk as it follows the price action of BTC, the demand and supply of BTC² does not change the mechanism it runs on, the underlying asset i.e BTC.