Topic: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading - page 165. (Read 723861 times)

Right now providing some clarity and transparency on the entire swap system is my number one priority, and I am currently working on a detailed explanation. Expect it within the next few days.

I will look into the wiki, I was not aware that it was down.

There are a lot of different solutions out there, I will look into GetSatisfaction as well. I am curious as to how people feel most comfortable being contacted, and contacting us. This is probably my least favorite way of being contacted, as I have to read through all these posts, many of which are people chatting amongst themselves.

I like using IRC, and I am not sure if people use that, but it usually is a much quicker method of talking. I think we need to move away from this forum as a means of bug reporting and I think we are definitely looking for a replacement solution. We also use email a lot. There is a subreddit as well, and some people have used twitter in the past. So...its a little all over the place right now. A one stop shop for support would probably be a nice improvement from a customer perspective.

As I said before, bear with me as I try to absorb the tons of information that people have posted here in the past, as well as come up with some new systems that help us all have a better time. Keep up the comments though, I am really enjoying the feedback and finding out what you guys want.

I agree, and we are discussing options for fiat audits, but unfortunately, the big 4 that were mentioned in another post do not have experience with bitcoin firms. We have looked into it, and so far, given the complications of our swap/lending side, none of them were feasible at the moment. We are working on a way to prove it, in a way that will actually assure people, as opposed to simply having a person whose face people recognize say something in front of a camera. We have some possible ways to do this and are still fleshing them out. We definitely have this as one of our priorities for the next few months.

I think that a quarterly audit of at least the crypto side seems reasonable, but I honestly don't know the details and expenses associated with that service.

As far as support tools, that is one of the top items on my plate right now (besides getting caught up with these forums, etc). I have used JIRA in the past, as well as Kayako (JIRA is more for software bug tracking). I will take a look at UserVoice. We are basically trying to upgrade all of those parts of Bitfinex, to provide the best customer service. I was brought on board specifically to find the areas we can improve and hopefully improve them.

I do ask that you be patient, we are a small, but dedicated team, and there are a LOT of things that we can improve. I think that right now we are the best bitcoin exchange in the world, but we can always do better. I honestly don't even hold us to the standard of other bitcoin exchanges, because I think that they have a long way to go. I look at Wall Street, and although they have their fair share of flaws, they have done some things right. So please monitor our site, and this thread if you like, to keep an eye for upcoming changes. We should have a lot of cool features and improvements to show you soon.

-Josh

P.S. By the way, I was doing development at another bitcoin company, and I had to integrate with the API's from all of the major exchanges, Bitfinex is by far the best, and offers the most advanced and useful orders and information. So, I only took this job because I really believe in this company, and yes, I have been on the other side of it too. So hopefully, I can relate to where a lot of you guys are coming from.

Let's get a FIAT audit as well as what is in the "reserves" to cover lender losses.

I noticed that you also took down the BFX forum, including the Wiki. The forum was barely used so I can understand that decision, but the wiki had lots of useful info that was not replicated anywhere else!

There are loads of existing solutions, many cloud based, for providing support and Q&A - are you considering using some of these? Even something like GetSatisfaction would be a massive improvement, and solve many problems at once (support, feature requests, bugs, with voting, feedback and persistence/sharing of answers!)

About the other questions/responses:

- I presume you meant to say 'trader' not 'lender' here: "lender should not be able to lose more than his collateral"

- The audit was neat-o, but only included BTC so it is inaccurate to describe it as a 'solvency' audit as there are USD liabilities as well.

- To everyone, regarding speculation on the 'insurance' of loans, please stop saying the loans are insured. It is pretty clear: without a contract, what you have is not insurance. Until BFX offer an actual insurance contract, we cannot say that any loans are insured.

Thats not actually true. What you have shown is that back in April you had 100% of the funds required to cover your Bitcoin liabilities.

I don't believe you've ever proved that you also have 100% of the funds required to cover your fiat liabilities (of which you have at least 30m USD).

Btw, are you planning on setting up a better support tool? I've had good experiences with offering support via UserVoice, though there are other options. That would allow you to better track questions, manage FAQ, allow customers to vote on features etc.

/Steve

Yeah, the BTC solvency stuff is neat (though I hoped you'd do that maybe quarterly, the last and only one was in April - when there were still funds at Bitstamp too), however most people seem more concerned with your fiat balances - so an audit statement from one of the big 4 (http://en.wikipedia.org/wiki/Big_Four_%28audit_firms%29) and not just some random company/person would be really great.

That is a good idea. As I said, I am collecting suggestions and relaying them to the other people at Bitfinex. So far, we have shown that we have more than 100% of the funds required to meet our liabilities. We are committed to an ongoing audit process, so that there is never a question as to our solvency. Unfortunately, it requires even more trust when it comes to fiat, but those are the problems of legacy finance.

Hope to have more to report on this soon.

...how about publishing audits of your fiat (USD) amounts, as well as LTC and DRK?

Hi climbguy,

These are all very good questions. I can provide some information, but I am working on a comprehensive answer that will serve as a definitive stance on this subject.

Here are some things I can tell you about the lending market. We provide statistics about the total size of the swap market, and we monitor that number very carefully. Ideally, any lender should not be able to lose more than his collateral. We have some pretty cutting edge systems in place to try and liquidate positions that look like they will result in the loss of any money that is not theirs to lose. That could be looked at as the first line of defense. If the market moves too quickly, and we can't react to it in time, we have always so far, covered the losses of the lenders. I am getting more information on exactly what our customers can expect. So far, we have been able to absorb any market turbulence, and lenders have not lost money, to my knowledge. While, as far as I know, there are some doomsday scenarios, we have been working hard to do the best we can.

One thing that I have found interesting, is that since all people trading on margin have to have collateral, when their collateral is decreasing in value, it can be quite difficult to know exactly when to liquidate positions. There is a mix of bitcoins as collateral, as well as dollars. So in a "flash crash", bitcoins would decrease, while dollars stay the same. We are trying to make sure we keep a good ratio of those two assets, so we maintain our exposure at a reasonable level.

The most interesting question you have asked, and one that I am happy to be able to somewhat answer, is whether we have had any 3rd party audits.

From a security perspective, our FAQ says the following:
"Our platform is regularly tested by the company Arcui to detect and prevent any intrusion."

I would like to point out that we are paranoid when it comes to security. In the bitcoin world, it is far too common to hear of "hacks", etc. We take security seriously, and have never lost customer's funds.

We also have undergone a proof of solvency audit by Stephan Thomas. If you login to our platform, and click on the gear icon where your username is, you will see a drop down menu, you can click on "Audit" in order to view the information about our proof of having the funds.

If you would like more information about the audit process, feel free to read over this thread.
https://bitcointalksearch.org/topic/ann-bitfinex-passes-proof-of-solvency-audit-560457

I hope that I have been able to provide some answers, trust me, I am working on getting all of this information into one easy to find place.

Let me know if I can help with anything else.

We are working on providing a clear answer to this question. For now, let me say this. We do have systems in place to cover losses, and we have covered losses in the past. I can't, at this point, give you a complete comprehensive answer, but I am working on getting that answer for you.

One thing that should be clarified is that usually, return is correlated to risk. It is safe to say that any investment that offers 50%+ returns is not "risk-free". There is no such thing as a free lunch. That being said, I think that we at Bitfinex take a lot of steps to protect our lenders, and so far, we have done so in every case of severe market conditions. We have been through quite a few big changes, and have always made sure that our customers were protected. I hope that, as you wait for a more complete answer, you give us the benefit of the doubt.

Hi Ente, I am reading and listening to all these questions, and aggregating them and getting answers. This is my first week, so I am still trying to figure out the answers to all of the great questions that have been asked here.

We are working on getting you answers to those specific questions. I, of course, cannot make any statements without first getting the correct information.

Sorry for any delay, know that we are working behind the scenes to clarify all of the confusing aspects of our platform. I am working, right now, on a new FAQ, which should answer all these questions and more.

Regards,
Josh

P.S. Building a "sound system" as you described is also one of the projects I am working on. This medium, as a way to collect information, is less than ideal. This thread alone is over 200 pages long, so while I have been skimming through this thread, and others, I will probably not be able to know 100% of what has been said before.

That is not how it works. Borrowed funds can only be used to do margin trading. Lent funds are locked away and do not count as account balance!

thanks. I do not understand why i can't borrow funds. The borrowing would be backed by the loan..

You lent some funds?

Then there is no other way than waiting for it to expire, or the guy that took it to close it.

Hello guys, i have just one question. I have a loan stuck in the swap section. I tried to borrow money to close the swap but i have no sufficient funds. How can i close the swap earlier?

Yes, a lot of questions piled up in the meantime.

- what is the legal structure behind BitFinex?

- how does the 'insurance' work, for whom, to what degree, when? Who will fall through the cracks, when the insurance isn't sufficient?

Josh, feel free to chime in on this at any time :-)
Also, I would suggest every PR guy in such a situation to have a sound system so no questions get lost. The introduction is now six pages ago..

Ente

The answer to number 5 is incorrect.  There was an Audit done.
AUDITOR: Stefan Thomas
AUDITED ENTITY: iFinex, Inc., https://www.bitfinex.com
ROOT HASH: 37c49d606c61aab140726265099992c3dd0fba30e1ce1a8a04f0e56cec6dc19f
BLOCK HEIGHT: 294378
RESULT: >100% reserves

The audit is arguably dated now as it was completed on April 5th 2014.  It would be nice if this type of audit was carried out frequently.

1 By them. Of course we don't know the extent of the insurance, the only thing we know is that they increased the fee to cover defaults in case of a flash crash (or so they said), still they can't obviously cover everything if a shit storm big enough strikes, in this case lenders are probably fucked.

2 Again a matter of speculation since no real numbers or info are shared on this, probably they can cover a mild flash crash, but who really knows exactly.

3 bfxdata.com and their statistics page is all the market info available

4 Who knows, they don't and probably won't share any specifics

5 No

The high return for your money comes at a price, you'll have to decide if the return is worth taking the risk.

Is the platform down?

So what's up with your new PR-guy? So many questions piled up in here since his (admittedly, kind of promising) introduction about a week ago yet no "better PR" could be observed as of yet.

Call me crazy but I think I'm starting to miss Giancarlo. His rants were at least some PR which is still, most of the time, better than no PR at all