What about directly lending your bitcoin out in the lending section?
You can get collateral (so lower risk) and better interest rate.
Topic: Bitfenix's Liquidity Providing (Read 1937 times)
If you understand it, this thread is pointless.
Always factor risk into FV calculations.
[src] A statistically average bitcoin exchange lasts just over a year before closing up. Around 61% of those refund anything.
Unfortunately, we don't have a good trend in determining expectancy of an exchange to continue operating without theft after the first year, and it may be a bad trend since the source suggests Intersango and Gox were statistically safer.
Anyway -- I don't want to complicate things and put too much speculation in an example formula, so let's say there's just a 10% chance of total default per year.
I don't think anyone's published data on averages for USD lending rates (and please God don't keep BTC there, as much as I love BFX). I'll pull a number out of my ass and say the annual average is .04%/day after insurance fees, which comes out to ~15.72% annually, which - hey, is a Hell of a lot better than .2% at a bank!
Let's say you plan on keeping your USD in BFX for ten years.
The "nominal FV" would look like ((1+.0004)^3650), or 430.47%.
"Chance of return" is 4/5 per year for ten years, or (.9^10), or ~34.87%
Letting me "gut feeling math" is never a good idea, but I'll guess the formula here is 430.47*.3487=~150.10% (your EV after ten years)
-So let's say you spend one hour per week managing your BFX portfolio - 52 hours per year, times ten... 520 hours. If you put $500 USD in, you should expect (keeping in mind it's most likely you'll lose everything or almost everything) a $250.50 profit, which gives you around $4.82 profit per hour of labor if you averaged the pay/hr (without factoring cost opportunity in, of course!). Fwiw, you make more toward minimum wage at the end of those two years, almost like a promotion from hobo to illegal farm hand!
Let's say you put $1k in, all else the same. You'd expect to make $9.63/hr averaged out.
Let's say you put $10k in, all else the same. You'd expect to make $96.35/hr averaged out. That sounds good, so let's go with that and factor inflation in. I kid, I kid. (I did actually calculate it, though -- you'd end up making ~$23.67/hr averaged out)
-But no, seriously, it's a bad idea unless you have a special reason to trust BFX. There's not good data established to calculate the risk. I believe BFX and Raphael are especially trustworthy and dramatically less likely to run off, but that doesn't change the data available for an uninterested party.
Always factor risk into FV calculations.
[src] A statistically average bitcoin exchange lasts just over a year before closing up. Around 61% of those refund anything.
Unfortunately, we don't have a good trend in determining expectancy of an exchange to continue operating without theft after the first year, and it may be a bad trend since the source suggests Intersango and Gox were statistically safer.
Anyway -- I don't want to complicate things and put too much speculation in an example formula, so let's say there's just a 10% chance of total default per year.
I don't think anyone's published data on averages for USD lending rates (and please God don't keep BTC there, as much as I love BFX). I'll pull a number out of my ass and say the annual average is .04%/day after insurance fees, which comes out to ~15.72% annually, which - hey, is a Hell of a lot better than .2% at a bank!
Let's say you plan on keeping your USD in BFX for ten years.
The "nominal FV" would look like ((1+.0004)^3650), or 430.47%.
"Chance of return" is 4/5 per year for ten years, or (.9^10), or ~34.87%
Letting me "gut feeling math" is never a good idea, but I'll guess the formula here is 430.47*.3487=~150.10% (your EV after ten years)
-So let's say you spend one hour per week managing your BFX portfolio - 52 hours per year, times ten... 520 hours. If you put $500 USD in, you should expect (keeping in mind it's most likely you'll lose everything or almost everything) a $250.50 profit, which gives you around $4.82 profit per hour of labor if you averaged the pay/hr (without factoring cost opportunity in, of course!). Fwiw, you make more toward minimum wage at the end of those two years, almost like a promotion from hobo to illegal farm hand!
Let's say you put $1k in, all else the same. You'd expect to make $9.63/hr averaged out.
Let's say you put $10k in, all else the same. You'd expect to make $96.35/hr averaged out. That sounds good, so let's go with that and factor inflation in. I kid, I kid.
(I did actually calculate it, though -- you'd end up making ~$23.67/hr averaged out)-But no, seriously, it's a bad idea unless you have a special reason to trust BFX. There's not good data established to calculate the risk. I believe BFX and Raphael are especially trustworthy and dramatically less likely to run off, but that doesn't change the data available for an uninterested party.
I am willing to manage it for anyone for small fee. Only need login and password, you keep your own 2fa and I won't be able to withdraw money without 2fa.
Send pm if interested.
If you understand it, this thread is pointless.
Always factor risk into FV calculations.
[src] A statistically average bitcoin exchange lasts just over a year before closing up. Around 61% of those refund anything.
Unfortunately, we don't have a good trend in determining expectancy of an exchange to continue operating without theft after the first year, and it may be a bad trend since the source suggests Intersango and Gox were statistically safer.
Anyway -- I don't want to complicate things and put too much speculation in an example formula, so let's say there's just a 10% chance of total default per year.
I don't think anyone's published data on averages for USD lending rates (and please God don't keep BTC there, as much as I love BFX). I'll pull a number out of my ass and say the annual average is .04%/day after insurance fees, which comes out to ~15.72% annually, which - hey, is a Hell of a lot better than .2% at a bank!
Let's say you plan on keeping your USD in BFX for ten years.
The "nominal FV" would look like ((1+.0004)^3650), or 430.47%.
"Chance of return" is 4/5 per year for ten years, or (.9^10), or ~34.87%
Letting me "gut feeling math" is never a good idea, but I'll guess the formula here is 430.47*.3487=~150.10% (your EV after ten years)
-So let's say you spend one hour per week managing your BFX portfolio - 52 hours per year, times ten... 520 hours. If you put $500 USD in, you should expect (keeping in mind it's most likely you'll lose everything or almost everything) a $250.50 profit, which gives you around $4.82 profit per hour of labor if you averaged the pay/hr (without factoring cost opportunity in, of course!). Fwiw, you make more toward minimum wage at the end of those two years, almost like a promotion from hobo to illegal farm hand!
Let's say you put $1k in, all else the same. You'd expect to make $9.63/hr averaged out.
Let's say you put $10k in, all else the same. You'd expect to make $96.35/hr averaged out. That sounds good, so let's go with that and factor inflation in. I kid, I kid. (I did actually calculate it, though -- you'd end up making ~$23.67/hr averaged out)
-But no, seriously, it's a bad idea unless you have a special reason to trust BFX. There's not good data established to calculate the risk. I believe BFX and Raphael are especially trustworthy and dramatically less likely to run off, but that doesn't change the data available for an uninterested party.
Always factor risk into FV calculations.
[src] A statistically average bitcoin exchange lasts just over a year before closing up. Around 61% of those refund anything.
Unfortunately, we don't have a good trend in determining expectancy of an exchange to continue operating without theft after the first year, and it may be a bad trend since the source suggests Intersango and Gox were statistically safer.
Anyway -- I don't want to complicate things and put too much speculation in an example formula, so let's say there's just a 10% chance of total default per year.
I don't think anyone's published data on averages for USD lending rates (and please God don't keep BTC there, as much as I love BFX). I'll pull a number out of my ass and say the annual average is .04%/day after insurance fees, which comes out to ~15.72% annually, which - hey, is a Hell of a lot better than .2% at a bank!
Let's say you plan on keeping your USD in BFX for ten years.
The "nominal FV" would look like ((1+.0004)^3650), or 430.47%.
"Chance of return" is 4/5 per year for ten years, or (.9^10), or ~34.87%
Letting me "gut feeling math" is never a good idea, but I'll guess the formula here is 430.47*.3487=~150.10% (your EV after ten years)
-So let's say you spend one hour per week managing your BFX portfolio - 52 hours per year, times ten... 520 hours. If you put $500 USD in, you should expect (keeping in mind it's most likely you'll lose everything or almost everything) a $250.50 profit, which gives you around $4.82 profit per hour of labor if you averaged the pay/hr (without factoring cost opportunity in, of course!). Fwiw, you make more toward minimum wage at the end of those two years, almost like a promotion from hobo to illegal farm hand!
Let's say you put $1k in, all else the same. You'd expect to make $9.63/hr averaged out.
Let's say you put $10k in, all else the same. You'd expect to make $96.35/hr averaged out. That sounds good, so let's go with that and factor inflation in. I kid, I kid.
(I did actually calculate it, though -- you'd end up making ~$23.67/hr averaged out)-But no, seriously, it's a bad idea unless you have a special reason to trust BFX. There's not good data established to calculate the risk. I believe BFX and Raphael are especially trustworthy and dramatically less likely to run off, but that doesn't change the data available for an uninterested party.
I need some help with this. I understand that i'm providing funds for people to use to margin trade, but how do i set this up and is it actually worthwhile?
https://www.bitfinex.com/pages/howitworks#lending
Quote
Liquidity Providing
Our liquidity feature goes hand in hand with the margin trading feature described above. If you are not a trader and prefer safer investments, this feature is for you. Bitfinex allows you, using your deposit wallets, to provide liquidity in the form of Bitcoins and/or dollars to traders. You can enter offers with your own chosen terms (return rate, duration, and amount). When an offer is taken by a trader, the money in your wallet will be used to buy or sell Bitcoins, and a CFD (credit) will be opened. When the position expires (the trader closes his position), Bitcoins are bought or sold back and the money is returned to your wallet.
You are not exposed to exchange risk when you lend with Bitfinex. The exchange risk is taken on by the trader, and, in case his position loses money, he will cover the loss with funds in his trading wallet.
Our liquidity feature goes hand in hand with the margin trading feature described above. If you are not a trader and prefer safer investments, this feature is for you. Bitfinex allows you, using your deposit wallets, to provide liquidity in the form of Bitcoins and/or dollars to traders. You can enter offers with your own chosen terms (return rate, duration, and amount). When an offer is taken by a trader, the money in your wallet will be used to buy or sell Bitcoins, and a CFD (credit) will be opened. When the position expires (the trader closes his position), Bitcoins are bought or sold back and the money is returned to your wallet.
You are not exposed to exchange risk when you lend with Bitfinex. The exchange risk is taken on by the trader, and, in case his position loses money, he will cover the loss with funds in his trading wallet.
If I understand it correctly, the only possible loss is that the exchange gets down and runs away with your bitcoin. And so, it should be pretty safe IMO.
I said i already understand it, i was asking how would i set it up and would it be worthwhile/profitable?
The rate is high compare to the bank rate. So, yes, it is worthwhile.
i was asking how would i set it up and would it be worthwhile/profitable?
Just register a "Deposit" account, and after login, you can enter three fields ("Period", "Rate" and "$") in the "Offer Swap" tab.
If your offer matches with a demand, it will be filled (your bitcoin will be lent to the trader).
It really depends. Right now, the daily return rate for bitcoin is 0.0055% https://www.bitfinex.com/pages/stats
Thank you.
I will wait for sig campaign payout, and start offering this service.
i was asking how would i set it up and would it be worthwhile/profitable?
Just register a "Deposit" account, and after login, you can enter three fields ("Period", "Rate" and "$") in the "Offer Swap" tab.
If your offer matches with a demand, it will be filled (your bitcoin will be lent to the trader).
It really depends. Right now, the daily return rate for bitcoin is 0.0055% https://www.bitfinex.com/pages/stats
I need some help with this. I understand that i'm providing funds for people to use to margin trade, but how do i set this up and is it actually worthwhile?
https://www.bitfinex.com/pages/howitworks#lending
Quote
Liquidity Providing
Our liquidity feature goes hand in hand with the margin trading feature described above. If you are not a trader and prefer safer investments, this feature is for you. Bitfinex allows you, using your deposit wallets, to provide liquidity in the form of Bitcoins and/or dollars to traders. You can enter offers with your own chosen terms (return rate, duration, and amount). When an offer is taken by a trader, the money in your wallet will be used to buy or sell Bitcoins, and a CFD (credit) will be opened. When the position expires (the trader closes his position), Bitcoins are bought or sold back and the money is returned to your wallet.
You are not exposed to exchange risk when you lend with Bitfinex. The exchange risk is taken on by the trader, and, in case his position loses money, he will cover the loss with funds in his trading wallet.
Our liquidity feature goes hand in hand with the margin trading feature described above. If you are not a trader and prefer safer investments, this feature is for you. Bitfinex allows you, using your deposit wallets, to provide liquidity in the form of Bitcoins and/or dollars to traders. You can enter offers with your own chosen terms (return rate, duration, and amount). When an offer is taken by a trader, the money in your wallet will be used to buy or sell Bitcoins, and a CFD (credit) will be opened. When the position expires (the trader closes his position), Bitcoins are bought or sold back and the money is returned to your wallet.
You are not exposed to exchange risk when you lend with Bitfinex. The exchange risk is taken on by the trader, and, in case his position loses money, he will cover the loss with funds in his trading wallet.
If I understand it correctly, the only possible loss is that the exchange gets down and runs away with your bitcoin. And so, it should be pretty safe IMO.
I said i already understand it, i was asking how would i set it up and would it be worthwhile/profitable?
I need some help with this. I understand that i'm providing funds for people to use to margin trade, but how do i set this up and is it actually worthwhile?
https://www.bitfinex.com/pages/howitworks#lending
Quote
Liquidity Providing
Our liquidity feature goes hand in hand with the margin trading feature described above. If you are not a trader and prefer safer investments, this feature is for you. Bitfinex allows you, using your deposit wallets, to provide liquidity in the form of Bitcoins and/or dollars to traders. You can enter offers with your own chosen terms (return rate, duration, and amount). When an offer is taken by a trader, the money in your wallet will be used to buy or sell Bitcoins, and a CFD (credit) will be opened. When the position expires (the trader closes his position), Bitcoins are bought or sold back and the money is returned to your wallet.
You are not exposed to exchange risk when you lend with Bitfinex. The exchange risk is taken on by the trader, and, in case his position loses money, he will cover the loss with funds in his trading wallet.
Our liquidity feature goes hand in hand with the margin trading feature described above. If you are not a trader and prefer safer investments, this feature is for you. Bitfinex allows you, using your deposit wallets, to provide liquidity in the form of Bitcoins and/or dollars to traders. You can enter offers with your own chosen terms (return rate, duration, and amount). When an offer is taken by a trader, the money in your wallet will be used to buy or sell Bitcoins, and a CFD (credit) will be opened. When the position expires (the trader closes his position), Bitcoins are bought or sold back and the money is returned to your wallet.
You are not exposed to exchange risk when you lend with Bitfinex. The exchange risk is taken on by the trader, and, in case his position loses money, he will cover the loss with funds in his trading wallet.
If I understand it correctly, the only possible loss is that the exchange gets down and runs away with your bitcoin. And so, it should be pretty safe IMO.
I need some help with this. I understand that i'm providing funds for people to use to margin trade, but how do i set this up and is it actually worthwhile?
Depend on your risk appetite.
Putting money on any exchange is always risky.
I need some help with this. I understand that i'm providing funds for people to use to margin trade, but how do i set this up and is it actually worthwhile?
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