Topic: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading - page 135. (Read 723903 times)

Another thought:

Build even more on BitBits idea: Fill the FRR to a predetermined amount.  Once that bucket is filled, close it and open a new one at FRR+0.05.  Fill that and then open a new one at FRR+0.10.  Continue ad nauseam. You will need a mechanism to reset the rate buckets.  You could probably just wait 24 hours after the the first bucket is exhausted and then adjust the higher tiers down to the FRR.

Herojuana's 'problem' has been solved.

So, just so everyone knows...there was no glitch, the situation has been resolved. Could have been solved by looking at trade history.

The absolute simplest way to fix it is to remove the FRR.  It does not seem like you are willing to entertain that idea.

First, let me say this, I think the FRR was a good idea at the time, when the swap market had active lenders and the returns where high. The FRR was a good way to let the lenders stay active if they were away from their keyboards for a while.  That is not the case now.  In the past the FRR was the exception, now it is the rule.

As I said before, I don't think the FRR can be fixed but if you will not entertain removing it I can supply you with some of my thoughts.

If your goal is to achieve a distribution of FRR I don't think that FRR±x will work to produce a bell curve of offers.  A distribution is a natural thing that does not exists when people are involved, much less when competing with each other.  One way or another the offers will coalesce around the FRR.

You could try to create multiple FRRs. Maybe a FRR for a 2, 7, 15 and 30 day term.  I do not see this working either as I think traders will most likely favour the 30 day.  If not, lenders will dump into whichever bucket is most profitable.  If for some (implausible) reason the buckets are filled equally, you will now have created 4 walls to deal with.  They might not be as high but I would wager that they will be within 0.01 percentage points of each other.  I also think that this will add more complication for the traders, but you would have to ask them.

You could address the issue by making the FRR less attractive to lenders to begin with.  The less attractive the FRR the less it will be used.  Some things that could be done:

• Higher fees for FRR swaps.  They need to be high enough to make a lender think about it, maybe an extra 15-20%.
• Do not float the active swaps.  You get the advantage of a floating rate for the initial offer but no advantage over a fix rate once the swap is made.
• Float the rate down but cap it at the rate is was accepted (traders would love this). I think this is a terrible idea but it is a thought.
• Apply a system wide offset to the true FRR (it's just a number, right?).  Have the new FRR offer rate be the true FRR+0.05.  You might still have a wall but it will be pushed away from the true FRR and give the fixed rate lenders some room to maneuver.
• Apply a system controlled variance to all FRR offers when they are put back in the queue.  This will allow you to create whatever distribution you would like.  Once again I would make the range from FRR to FRR+0.05.  You would need to break large offers into smaller chunks so the system can't be gamed.
• Delay adding a closed swap to the FRR queue by 12-24 hours.  (Good luck figuring out how to implement this one).
• Leverage the idea BitBits had.  Limit the amount of money in the FRR to a set value.  If a FRR swap is closed and there is room in the FRR, add it.  If not, the funds are returned to the lender's wallet until they make a manual offer or try the FRR again.
• Change how the FRR is calculated.  If you think about it, the FRR doesn't make any sense at all. Why use the mean?  Why not the median or mode?  Why base anything on existing swaps?  Should my new house mortgage be based on all current mortgages?  How does that reflect on what is happening now?
  Why not:
  
  • Pull a number out of thin air, say 0.2%?  It reflects the current market just a well as average based on the past.
  • Base the FRR on the weighted average of the rates in the current swap book.
  • Adjust the FRR so it reacts to upward movement quicker than downward pressure.
  • Base the FRR on just the last 12-24 hours of taken swap offers.
  • Adjust the FRR so that there is always a fixed amount or percentage dollars in offers above or below it.
  • Put a floor on the FRR, don't let it go below 0.15%.

Does anyone think any of these idea are viable?

Edit: Cleaned up trailing CRs.

Yes, I am a little confused about how Bitfinex's behavior can be programmed (preferably without utilizing their API with a trade bot).
I find their "How it works" a little oversimplified. I would prefer a more detailed documentation (may be including some examples) instead of this short and easy to read text about the very basics.

I am not a veteran trader. I didn't even do margin trades before. And every BTC exchanges are slightly different anyway, let alone that they might change over time (even without proper notice).

For example, I had used Kraken before. At first I could place multiple orders and let the executed one(s) indirectly cancel the other(s) (all orders were effective on the same common fund(s) which could run out) or create advanced order(s) (still possibly coexisting redundantly while overlapping on the same fund(s) for indirect cancellation by the other order(s), so it could possibly get too redundant on multiple levels...). Later they changed and got rid of the redundancies but they were too harsh. I had to start with their advanced order, I couldn't just place multiple orders on the same funds anymore (even if one advanced order offered slightly less than multiple orders could, still without too much redundancy). Note that I have never read about all this in their "documentation". I learned using Kraken by trial and error and noticed the change on the same way... And now it seems I have to do this with Bitfinex as well (learn by experimenting with small amounts).

Now back to Bitfinex, I have had an open position, not an open order when I posted. (I closed it in the mean time.) I bought some BTC with leveraged $ (based on my BTC deposit).
I learned by trial and error that OCO parameters affect the order but not the position. I ended up buying less BTC than I could and I wished to (just to see if the OCO limit stops buying on market price as price rises as liquidity disappears). However, I didn't have anything at place which could automatically close my position while I slept (I missed some possible profit because I closed the position @401 after waking up, instead of @410 where I hoped to close).

Ahh, well, it was still closed with profit (not bad after some pause and a resume on a new exchange) and I did learn a bit about the OCO parameters.
But I still don't know how to automate "profit taking" and/or "stopping the loss" on open positions (not just on the yet to be executed orders).

--- I hope you will understand this question (bad English here...):
What happens with a margin buy produced open position when a parking limit price margin sell order kicks in?
Do I automatically buy the underlaying loaned asset from "myself" [effectively the loaner] (on leverage, if possible and required), thus effectively closing my old position without a loss (except the fee and interest + possible loss from a preset price gap) while smoothly switching sides from long to short around a fixed price (or with a preset gap in-between if I am willing to take some temporal loss)?
Or do I end up with coexisting, simultaneously opened long and short positions (with neither closing automatically until I run out of the credit limit on either ends)?



Not all of these are significant and/or apply to me right now (and it's improbable if all of these affect you at the same time) but these come to my mind:
- exchange/trade fee
- possibly higher leverage interest rate
- possibly worst market liquidity (with a slight chance that someone starts a mini-pump/dump right there, so price gets worse)

It would be more precise if they had "stop limit" orders as an option. Any idea why this option isn't yet available?

Can't really think of anything that could possibly prevent you from closing your old order and creating a new one. It doesn't cost anything.
So yes, there is a way - you just cancel existing order and create new one.

You're confused about how those things work - they're not parameters to an order, but separate order types that you can enter at any time.

A stop's mechanism is "When the price gets this high, trigger a market buy" (for a stop buy) or "When the price gets this low, trigger a market sell" (for a stop sell). It's a happy coincidence that you can use that order type as a way to add some safety to a prior trade by, for example, selling off your position automatically if the market turns downward.

And a 'take profit', unless I'm mistaken, is just a limit order set somewhere off in the 'favourable' direction, waiting to cash you out when the market gets there.

No responses from BFX all day. I have lost over 3.4k because of this glitch today, and now I cant get my buy in as low as it was.  BFX really screwed me here, I hope something can be done to make it right, or I will move most my coins out.

Bummer I really like trading here.

and bitfinex let this happen, and not answer for any mails

Is there a way to update a simple margin trade position with stop loss and/or take profit options (without closing the active order and reopening a new order with one or more of these parameters included)?

There is enough swap, as when the contracts run out - it frees up a lot of swap (unless the lender refuses to renew).  The question is whether they'll try a short squeeze, or a swap squeeze. I'm thinking a swap squeeze is more profitable and we'll see 1% interest rates.

I don't think they are going to take action.  There isn't enough swap or asks to support all the contracts running out on Wednesday.  The smart thing to do is to use this knowledge to your advantage.  Even if you don't, it seems someone has planned this for a couple weeks now and the short squeeze will happen anyway.

Should I manipulate the price of the TH1 contract and increase its price to 2 BTC and the suck dry the people stupid enough to short it (by offering them swap at one interest rate for the next 30 days, and then doubling or tripling it for the last 30 days)?  Or is Bitfinex going to take action and reverse trades on this badly constructed contract.

Username: Herojuana

Thanks for quick reply, I sent support an email already, if you could get me ahead of the line, that would be great.

All lenders do share the same preference for returns: We want them to be as high as possible.

Where we differ is on risk tolerance and need for funds availability. For FRR swaps, these are are partly addressed by the ability to set the term length of a swap offer. They could be further addressed by adding a minimum interest rate option, where if the FRR drops below the lender's specified minimum, their offer will be suspended until the FRR rises.

The FRR±delta option doesn't give us anything that we didn't already have with fixed rate swaps. It creates a variable that we have to proactively manage if we want to avoid suboptimal interest rates or idle funds, just like when manually specifying rates on fixed-rate swaps. The whole reason that lenders use FRR is so that we don't have to proactively manage our interest rates. You may as well just remove the FRR option instead of introducing another layer of complexity.

In order to still cater to set-it-and-forget-it lenders (of which I am one), you'd have to add an option to offer swaps which track the (volume-weighted) average delta value of all current FRR loans. That just reintroduces the problem that we currently have with FRR. Perhaps then someone will propose to allow lenders to offer swaps at FRR±averagedelta, plus or minus another manually-specified parameter. And so on, ad infinitum.


In case it isn't obvious, I've changed my mind as a result of thinking through this, and am definitely opposed to FRR±delta.

Have you emailed [email protected]? That would be the quickest way to get this investigated, but if you give me your username or email, I can forward it along to support.

You are saying the exact same thing as I am. The fact that there is only one variable rate means that everyone picks that one variable rate. So, it seems to me that the simplest way to fix that is to offer multiple variable rates, which you could do by using a delta from the FRR. Remember, the FRR is the average rate, so it is just a number like any other.

In general though, one person wrote about how typically a broker will just give you margin with your account, and you don't have to deal with margin, but you also can't provide liquidity and get a return on your funds. No one has to participate in the swaps market, but for those who like doing it, it is a pretty awesome feature. Furthermore, as in most things in life, the more effort you put in, the more you get out. So, of course, the more time and energy you spend managing your positions, the better your results should be.

Hi, I had an open margin long with 363 coins from 482, and I had one sell order for 50 coins at 394.  My order got hit and it closed most of my margin long coins down to 192, and only lowered my base for the 50 coins that were hit.  There are reported errors all across the board, BFX please help, wth happened?

I'm not saying the swap-market *is* a fund, all I'm saying is that it *resembles* a fund, yes, because of the swap-walls and swapper's "me first" mentality, I get that and we're on the same page there. I also agree with you that I'm pretty much restating "what it is" but that's only because we haven't seen this market in any other form than ineffective in the past but I think we won't agree anytime soon when I don't see why this market would need to be anything but just that: ineffective and slow, like a savings account on a bank, ahem... It doesn't really make any sense for maker or taker alike to put up or take 0.2% for 30 days when they both can have 0.1% for less days as this market is basically a coma-patient most of the time and you can lend or borrow for 0.1% again and again like 98% of the time. Just look at the current "USD swap offers": about 40 lines of text ranging from 0.0936 to 0.1948% - nobody's interested in keeping this a market, everybody loves FRR.

As a maker you can't cancel swaps you have lent out for too low and as a taker you ruin it for any maker by returning expensive swaps as soon as cheaper ones become available and on the charts that produces just see-saw nonsense with an FRR-magnet on a pretty constant line. I'd love to leave my trades running for months without having to check every other day if I didn't accidentally catch a slightly too expensive swap-rate. Taking swaps for 30 days is no option either bacause of the 98% thing above, it's costly and especially time-consuming to catch good ones, they disappear as fast as they come. Now what if the swaps were a variable/liquid rate for everyone involved equally for as long as any party wants? Wouldn't that be so much more relaxed, both for traders and the backend servers alike? As a sidenote: In any other forex market the leverage is just a feature you receive by signing up for their service, you as a customer aren't involved in managing swaps for them.

I don't think anyone is currently is arguing that the swap market is currently a fund, more that it is morphing into something fund like due to the influence of the FRR and passive lenders.  You say that there is nothing wrong with everyone choosing the same value, and you are correct, but when Bitfinex provides, and to a point, encourages a majority to select the same value, there is a problem and that is what the FRR does. 

Take what Sukrim said: "Well, if you can't predict how the rates will be in the future AND you can't predict how long your offers will be used, using the only available variable rate is not a bad move imho."  He is correct and that logic encourages lenders to use the FRR.

It is the existence of the FRR that is the problem.  If it were to be removed, would a majority make offers a the same rate?  How would they know what that rate would be?  Do you think there would (as there was at one point) be 3m in offers at the same rate?  They would have to look at the order book, make whatever calculations they has decided upon and then make an offer.  I would be hard pressed to come up with a scenario where 3m be offered at a single value. 

The FRR influences the market to where it doesn't behave like a market.  I hate to state it this way due to the negative connotations, but when you combine the FRR and passive lenders, Bitfinex starts to look a awful lot like a bank.  You put your money in Bitfinex's fund (the FRR) and Bitfinex will take care of lending it out (adjusting the FRR).  In return Bitfinex will give the lender a average return after they take a 15% cut.  The only time this fails is when when the market is dead and no loans are being made or when the FRR fund runs out of money. 

The FRR also has an tremendous advantage over the fixed rate lender - Bitfinex can change the rate during the life of the swap.  If a fixed rate lender makes a swap for 10 day at .05 the get their money in play and the rate go to .5, they are out of luck for 10 days. Not so with the FRR, Bitfinex will just increase the rate to take advantage of the improved market.  That's an advantage that fixed rate lenders do not have and it something they have to compete against.  On the other side, if the rate drops, the FRR goes down thus increase the odds that the borrower will keep the swap.  The fixed rate lender's swap will most likely be closed a replaced by a lower rate swap which is now (ironically) automatically done by Bitfinex via a bot.

Yes, the swap market is a market, but it is not a free market.  It is greatly influenced by the FRR which comes with institutionalize advantages.  So, as a fixed rate lender how do you fight the system that's rigged against you? You don't.  You put your money in the FRR like everyone else.  When the majority do so, the "market" is no longer a market, it is a fund - brought to you by the FRR.