Topic: BitShare Simulation Game with Real Stakes 10 BTC (Read 1834 times)
This thread is being put on hold until I can get some software written to track this... will post back in a few days.
greBit placed a buy order for 20 cUSD at 0.51BS
Then he decides to mint 20 crypto-USD at that price.
No one with cUSD is willing to sell at 0.51BS... so his mint order goes through.
As a result the interest rate of cUSD just fell to 0.052 BS / year.
nomailing wanted to sell at 10 cUSD @ 1 BS...
Currently bytemaster is earning the highest yield (10% on sUSD and 10% on BS), everyone else is earning 0 on their sUSD and 9% on the cUDS.
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
Last: cUSD / BS = .51
Order Book cUSD / BS
Sell 10 @ 1BS (nomailing)
Buy 20 @ 0.51 BS (greBit)
Buy 10 @ 0.5 BS (bytemaster)
Buy 20 @ 0.25 BS (nomailing)
Bytemaster: 143 sUSD 873.95 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 99.8 BS 10.2 MBS for cUSD @ .51 20 cUSD
nomailing: 30 sUSD, 110.55 BS 10 cUSD
Total cUSD: 30
Total mBS: 15.7
cUSD is earning .052 BS per share per year.
Then he decides to mint 20 crypto-USD at that price.
No one with cUSD is willing to sell at 0.51BS... so his mint order goes through.
As a result the interest rate of cUSD just fell to 0.052 BS / year.
nomailing wanted to sell at 10 cUSD @ 1 BS...
Currently bytemaster is earning the highest yield (10% on sUSD and 10% on BS), everyone else is earning 0 on their sUSD and 9% on the cUDS.
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
Last: cUSD / BS = .51
Order Book cUSD / BS
Sell 10 @ 1BS (nomailing)
Buy 20 @ 0.51 BS (greBit)
Buy 10 @ 0.5 BS (bytemaster)
Buy 20 @ 0.25 BS (nomailing)
Bytemaster: 143 sUSD 873.95 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 99.8 BS 10.2 MBS for cUSD @ .51 20 cUSD
nomailing: 30 sUSD, 110.55 BS 10 cUSD
Total cUSD: 30
Total mBS: 15.7
cUSD is earning .052 BS per share per year.
Bytemaster is looking to get back into crypto-USD, so makes an offer IN THE BLOCKCHAIN to buy 10 cUSD for 5 BS and pay a 0.1 transaction fee.
greBit has posted an offer to buy 20 cUSD for 8 BS a price of 0.4 BS per CUSD and has paid a 0.1 BS transaction fee.
nomailing has posted an offer to buy 20 cUDS for 5 BS a price of .25 BS per CUSD ... no takers.. sorry
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
Order Book cUSD / BS
Buy 20 @ 0.51 BS (greBit)
Buy 10 @ 0.5 BS (bytemaster)
Buy 20 @ 0.25 BS (nomailing)
Bytemaster: 143 sUSD 873.95 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 110 BS
nomailing: 30 sUSD, 110.55 BS 10 cUSD
Total cUSD: 10
Total mBS: 5.5
cUSD is earning .055 BS per share per year.
greBit has posted an offer to buy 20 cUSD for 8 BS a price of 0.4 BS per CUSD and has paid a 0.1 BS transaction fee.
nomailing has posted an offer to buy 20 cUDS for 5 BS a price of .25 BS per CUSD ... no takers.. sorry
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
Order Book cUSD / BS
Buy 20 @ 0.51 BS (greBit)
Buy 10 @ 0.5 BS (bytemaster)
Buy 20 @ 0.25 BS (nomailing)
Bytemaster: 143 sUSD 873.95 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 110 BS
nomailing: 30 sUSD, 110.55 BS 10 cUSD
Total cUSD: 10
Total mBS: 5.5
cUSD is earning .055 BS per share per year.
Time has past, dividends now get paid.
Byte master withdrew 130 sUSD from the system because he had an investment that would pay 10% APR
All BitShares pay 10% return.
He forgot about transaction fees which should have been factored into prior trades but (lots of detail to track here).
Nomailing had 10 cUSD so earned the dividends on 5.5 BS which equal .55
Bytemaster earned 10% on his sUSD and 10% on his BS, but 0 on his mBS.
Bytemaster: 143 sUSD 873.95 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 110 BS
nomailing: 30 sUSD, 110.55 BS 10 cUSD
Total cUSD: 10
Total mBS: 5.5
cUSD is earning .055 BS per share per year.
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
Byte master withdrew 130 sUSD from the system because he had an investment that would pay 10% APR
All BitShares pay 10% return.
He forgot about transaction fees which should have been factored into prior trades but (lots of detail to track here).
Nomailing had 10 cUSD so earned the dividends on 5.5 BS which equal .55
Bytemaster earned 10% on his sUSD and 10% on his BS, but 0 on his mBS.
Bytemaster: 143 sUSD 873.95 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 110 BS
nomailing: 30 sUSD, 110.55 BS 10 cUSD
Total cUSD: 10
Total mBS: 5.5
cUSD is earning .055 BS per share per year.
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
nomailing has just purchased 10 crypto-USD from bytemaster for 10 sUSD.
bytemaster placed a bid on the network to buy 10 crypto-USD for 5.5 BS
No crypto-USD is in existence so there were no takers and the bid got into a block chain.
bytemaster then mortgaged 5.5 BS to back 10 crypto-USD and then sent nomailing the crypto-USD who gave bytemaster sUSD.
cUSD = cryptoUSD
Bytemaster: 130 sUSD 794.4 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 100 BS
nomailing: 30 sUSD, 100 BS 10 cUSD
Total cUSD: 10
Total mBS: 5.5
cUSD is earning .055 BS per share per year.
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
bytemaster placed a bid on the network to buy 10 crypto-USD for 5.5 BS
No crypto-USD is in existence so there were no takers and the bid got into a block chain.
bytemaster then mortgaged 5.5 BS to back 10 crypto-USD and then sent nomailing the crypto-USD who gave bytemaster sUSD.
cUSD = cryptoUSD
Bytemaster: 130 sUSD 794.4 BS 5.5 mBS for cUSD @ .55
greBit: 40 sUSD, 100 BS
nomailing: 30 sUSD, 100 BS 10 cUSD
Total cUSD: 10
Total mBS: 5.5
cUSD is earning .055 BS per share per year.
Exchange Rates:
Last: sUSD / BS = 0.6
Last: sUSD / cUSD = 1.0
nomailing made an offer to buy 100 BS for 60 sUSD, bytemaster accepted and they made a successful exchange in person.
Bytemaster has an open offer to mint up to 10 crypto-USD earning interest equal to the dividends from 0.6 BS per crypto-USD and sell them for 65 sUSD.
Bytemaster: 120 sUSD, 800 BS
greBit: 40 sUSD, 100 BS
nomailing: 40 sUSD, 100 BS
Exchange Rates:
Last: sUSD / BS = 0.6
Bytemaster has an open offer to mint up to 10 crypto-USD earning interest equal to the dividends from 0.6 BS per crypto-USD and sell them for 65 sUSD.
Bytemaster: 120 sUSD, 800 BS
greBit: 40 sUSD, 100 BS
nomailing: 40 sUSD, 100 BS
Exchange Rates:
Last: sUSD / BS = 0.6
greBit made an offer of 60 sUSD for 100 BS which was accepted by Bytemaster. They meet up on localbitcoins and make an exchange in person.
Bytemaster retracts his prior offer. (As this was the first offer and it dealt with sUSD, we have now established the price of sUSD).
Bytemaster: 900 BS
greBit: 40 sUSD, 100 BS
Exchange Rates:
Last: sUSD / BS = 0.6
Bytemaster retracts his prior offer. (As this was the first offer and it dealt with sUSD, we have now established the price of sUSD).
Bytemaster: 900 BS
greBit: 40 sUSD, 100 BS
Exchange Rates:
Last: sUSD / BS = 0.6
Balance Sheet:
Bytemaster: 1000 BS
greBit: 100 sUSD
Outside the Blockchain: I am offering to sell 50 BS for 39 simulated USD (sUSD)
Bytemaster: 1000 BS
greBit: 100 sUSD
Outside the Blockchain: I am offering to sell 50 BS for 39 simulated USD (sUSD)
It is clear that simply debating how the BitShare system works is insufficient. It is difficult to grasp how a crypto-USD will follow actual USD and to have confidence that No One could cheat the system. So I am going to dedicate this thread to the simulation of transactions on the BitShare blockchain. Anyone can play and if you end up with a strategy that allows you to 'legally' steal the 10 BTC backing the virtual game currency using a consistently applied set of rules according to my white paper and cause the Crypto-USD price to deviate from simulated-USD then you will get to keep any profits you earn as a result as real BTC. If not, it will cost you nothing.
I am not a computer and so may make some calculation errors. Calculation errors may always be corrected provided the recalculated results accurately follow the rules.
*edit* Because there is often misunderstanding of exactly what the rules are, I will be the sole judge of deciding what is a valid transaction. The only caveat being that my rules must be consistently applied for all transactions like the software would enforce. *end edit* If there is debate regarding the calculation of a particular transaction and how the rules are applied to it, that debate should be carried out in another thread: https://bitcointalksearch.org/topic/bitshare-simulation-game-discussion-theory-economics-in-old-thread-218596 and any resulting corrections I will post here.
To propose a transaction you should describe what you want to do in https://bitcointalksearch.org/topic/bitshare-simulation-game-discussion-theory-economics-in-old-thread-218596, I will present you the resulting network transaction and if you agree to the transaction, I will post the transaction to this thread and update any relevant balances.
By definition, the most I can lose in this game is 10 BTC there is no open-ended losses.
It will be considered 'cheating' to turn down any transaction that a reasonable person would consider 'profitable' because if it were profitable then someone in the market would accept such a transaction. In effect, if the only reason a transaction is not 'profitable' to you is because by not taking it you would win the game, then it would not be an accurate simulation of the real world.
How do you win this game? You can win this game if you can cause the value of crypto-USD to permanently decouple from the value of simulated USD and in the process scam me and other players out of the value of our crypto-USD deposits. It is fully expected for the price of crypto-USD to fluctuate above or below the price of simulated-USD in response to demands for deposits / withdraws. This price fluctuation is little more than a transaction fee similar to the one charged by BitInstant.
Rules of the Game
---------------------
1) I will start out with 100% of the crypto-currency initially backed with 10 BTC. There will be 1000 BitShares issued and therefore each starting BitShare has a value equal to .01 BTC.
2) Each day I will distribute a dividend of 10% + Transaction Fees to everyone who has a balance in BitShares.
3) The 10% dividend will be created by simulated mining and thus issuance of new BitShares. These new BitShares will not be backed by any more BTC just like current new Bitcoins are backed by any 'new value'.
4) All 'block-chain' transactions will incur a 1 BitShare transaction fee (for simplicity).
5) Because this is simulating the 'real world', I will be playing to make a profit and increase the value of my holdings to be more than 10 BTC. This means that new value will have to enter the game via other players. I will not ask anyone to actually risk their real money (like I am), but when someone 'deposits' simulated USD in exchange for crypto-USD we will "assume" the simulated USD has a market value equal to to real USD. All profits/losses will be measured in BitShares. Therefore, my goal is to increase my BitShare balance by more than 10% interest paid. Your goal is to increase your simulated USD by more than 10% interest alone would yield.
6) Anyone who posts to THIS THREAD other than me is disqualified from playing, please do not post to this thread. If you have comments / questions about this thread, please post to https://bitcointalksearch.org/topic/old-bitshare-economic-theory-10-btc-bounty-to-prove-me-wrong-paid-215488. The purpose of this thread is to act as the simulated block-chain and anyone who posts will be asked to delete it / move it to the other thread.
7) The rules of this game may change as necessary to more accurately reflect the actual economics behind BitShares. No rule changes that cause this game to less-accurately reflect BitShare economics will be allowed.
To simulate actual volatility, each day the BitShare to simulated USD exchange rate will adjust by about the same percent as the change in BitCoin to Mt.Gox USD does. This should make BitShares as equally volatile as Bitcoins and thus provide a realistic simulation.
9) Because we are all 'profit-seeking actors', the only reason to sell a crypto-USD/etc would be if there was something else we wanted to do with the proceeds that was of equal or greater value. Therefore, I will assume that anyone who receives simulated USD from the network will be yielding 10% return while outside the network. If I did not make this assumption, then I would never sell my BitShares because I would 'instantly' lose due to the 'debasement' / reallocation that occurs via mining. We will also assume that before simulated USD enters the network it was yielding LESS than 10%. The exact amount doesn't matter, we just assume that buying BitShares or crypto-USD with simulated USD is profitable or it wouldn't happen.
10) Each player starts with $100 simulated USD balance which pays 0 interest. After they deposit and withdraw from the network the withdrawn simulated USD will pay 10% interest.
If there are any questions, or clarifications about the rules, or suggested changes to the rules then post them in the discussion thread: https://bitcointalksearch.org/topic/old-bitshare-economic-theory-10-btc-bounty-to-prove-me-wrong-paid-215488. Once we have at least 4 players (myself included) who agree to the rules, the game will begin. Other players may join at will.
Valid Transactions / Orders:
"I want to purchase X BitShares for Y simulated USD, send BitShares to address Z"... someone must accept the offer.
"I want to purchase X Crypto-USD for Y simulated USD, send CryptoUSD to address Z" ... someone must accept offer.
"I want to purchase X Crypto-USD for Y BitShares, send CryptoUSD to address Z" ... someone must accept offer.
"I want to purchase Y BitShares for X Crypto-USD, send Bitshares to address Z" ... someone must accept offer.
"I want to cancel order W"
"I want to purchase X simulated USD for Y Crypto-USD" ... someone must accept offer.
"I want to purchase X simulated USD for Y BitShares" ... someone must accept offer.
"I want to do an direct exchange (outside the bid/ask exchange) of X CryptoUSD for Y BitShares" ... someone must accept offer.
"I want to wire X simulated USD from my account to another users account"
"I want to do a direct spend from Account A to account B"
"I want to mint X crypto-USD in response to the highest bid B"
You may suggest other proposed transactions and I may add them to the list of valid transactions.
This could get "complicated", but I will do my best to keep the 'blockchain' orderly and easy to follow.
Let the Games Begin!
*edit* Move discussion of this game / interested parties to new thread: https://bitcointalksearch.org/topic/bitshare-simulation-game-discussion-theory-economics-in-old-thread-218596 THe transactions will remain here.
I am not a computer and so may make some calculation errors. Calculation errors may always be corrected provided the recalculated results accurately follow the rules.
*edit* Because there is often misunderstanding of exactly what the rules are, I will be the sole judge of deciding what is a valid transaction. The only caveat being that my rules must be consistently applied for all transactions like the software would enforce. *end edit* If there is debate regarding the calculation of a particular transaction and how the rules are applied to it, that debate should be carried out in another thread: https://bitcointalksearch.org/topic/bitshare-simulation-game-discussion-theory-economics-in-old-thread-218596 and any resulting corrections I will post here.
To propose a transaction you should describe what you want to do in https://bitcointalksearch.org/topic/bitshare-simulation-game-discussion-theory-economics-in-old-thread-218596, I will present you the resulting network transaction and if you agree to the transaction, I will post the transaction to this thread and update any relevant balances.
By definition, the most I can lose in this game is 10 BTC there is no open-ended losses.
It will be considered 'cheating' to turn down any transaction that a reasonable person would consider 'profitable' because if it were profitable then someone in the market would accept such a transaction. In effect, if the only reason a transaction is not 'profitable' to you is because by not taking it you would win the game, then it would not be an accurate simulation of the real world.
How do you win this game? You can win this game if you can cause the value of crypto-USD to permanently decouple from the value of simulated USD and in the process scam me and other players out of the value of our crypto-USD deposits. It is fully expected for the price of crypto-USD to fluctuate above or below the price of simulated-USD in response to demands for deposits / withdraws. This price fluctuation is little more than a transaction fee similar to the one charged by BitInstant.
Rules of the Game
---------------------
1) I will start out with 100% of the crypto-currency initially backed with 10 BTC. There will be 1000 BitShares issued and therefore each starting BitShare has a value equal to .01 BTC.
2) Each day I will distribute a dividend of 10% + Transaction Fees to everyone who has a balance in BitShares.
3) The 10% dividend will be created by simulated mining and thus issuance of new BitShares. These new BitShares will not be backed by any more BTC just like current new Bitcoins are backed by any 'new value'.
4) All 'block-chain' transactions will incur a 1 BitShare transaction fee (for simplicity).
5) Because this is simulating the 'real world', I will be playing to make a profit and increase the value of my holdings to be more than 10 BTC. This means that new value will have to enter the game via other players. I will not ask anyone to actually risk their real money (like I am), but when someone 'deposits' simulated USD in exchange for crypto-USD we will "assume" the simulated USD has a market value equal to to real USD. All profits/losses will be measured in BitShares. Therefore, my goal is to increase my BitShare balance by more than 10% interest paid. Your goal is to increase your simulated USD by more than 10% interest alone would yield.
6) Anyone who posts to THIS THREAD other than me is disqualified from playing, please do not post to this thread. If you have comments / questions about this thread, please post to https://bitcointalksearch.org/topic/old-bitshare-economic-theory-10-btc-bounty-to-prove-me-wrong-paid-215488. The purpose of this thread is to act as the simulated block-chain and anyone who posts will be asked to delete it / move it to the other thread.
7) The rules of this game may change as necessary to more accurately reflect the actual economics behind BitShares. No rule changes that cause this game to less-accurately reflect BitShare economics will be allowed.
To simulate actual volatility, each day the BitShare to simulated USD exchange rate will adjust by about the same percent as the change in BitCoin to Mt.Gox USD does. This should make BitShares as equally volatile as Bitcoins and thus provide a realistic simulation. 9) Because we are all 'profit-seeking actors', the only reason to sell a crypto-USD/etc would be if there was something else we wanted to do with the proceeds that was of equal or greater value. Therefore, I will assume that anyone who receives simulated USD from the network will be yielding 10% return while outside the network. If I did not make this assumption, then I would never sell my BitShares because I would 'instantly' lose due to the 'debasement' / reallocation that occurs via mining. We will also assume that before simulated USD enters the network it was yielding LESS than 10%. The exact amount doesn't matter, we just assume that buying BitShares or crypto-USD with simulated USD is profitable or it wouldn't happen.
10) Each player starts with $100 simulated USD balance which pays 0 interest. After they deposit and withdraw from the network the withdrawn simulated USD will pay 10% interest.
If there are any questions, or clarifications about the rules, or suggested changes to the rules then post them in the discussion thread: https://bitcointalksearch.org/topic/old-bitshare-economic-theory-10-btc-bounty-to-prove-me-wrong-paid-215488. Once we have at least 4 players (myself included) who agree to the rules, the game will begin. Other players may join at will.
Valid Transactions / Orders:
"I want to purchase X BitShares for Y simulated USD, send BitShares to address Z"... someone must accept the offer.
"I want to purchase X Crypto-USD for Y simulated USD, send CryptoUSD to address Z" ... someone must accept offer.
"I want to purchase X Crypto-USD for Y BitShares, send CryptoUSD to address Z" ... someone must accept offer.
"I want to purchase Y BitShares for X Crypto-USD, send Bitshares to address Z" ... someone must accept offer.
"I want to cancel order W"
"I want to purchase X simulated USD for Y Crypto-USD" ... someone must accept offer.
"I want to purchase X simulated USD for Y BitShares" ... someone must accept offer.
"I want to do an direct exchange (outside the bid/ask exchange) of X CryptoUSD for Y BitShares" ... someone must accept offer.
"I want to wire X simulated USD from my account to another users account"
"I want to do a direct spend from Account A to account B"
"I want to mint X crypto-USD in response to the highest bid B"
You may suggest other proposed transactions and I may add them to the list of valid transactions.
This could get "complicated", but I will do my best to keep the 'blockchain' orderly and easy to follow.
Let the Games Begin!
*edit* Move discussion of this game / interested parties to new thread: https://bitcointalksearch.org/topic/bitshare-simulation-game-discussion-theory-economics-in-old-thread-218596 THe transactions will remain here.
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