Topic: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading - page 172. (Read 723903 times)

I have a question too.

Assume I hold a LONG BTC position with the swap set to TERM.


How will this work, in case the position is full leveraged but still above the margin call level,
i.e. the Tradable Balance is equal or less than 0  and the Margin Balance is above the Required Margin ?

Thank you

Other than lowering risk, do you have stuff in the pipeline for lenders too? Eg switching loans for ones on the market that are the same rate or better so it is easier to lend out for longer periods and still get some money out quickly in case of an emergency.

Another nice feature for lenders would be the ability to offer higher leverage and not just longer duration. If someone wants 10k USD at 1% a day for 10:1 trading for a week, I'd do that in the current market. This might be subject to limits of course to not increase your global leverage too much but would be something where lenders could charge more and traders probably also would pay more.

Thanks for the updates by the way, much appreciated.

Upcoming changes in our margin trading feature


Dear customers,

In an ongoing effort to provide our customers with the best possible trading experience, we are pleased to announce several enhancements to our swaps system. As the swaps market continues to grow, we continue to be extremely focused on ensuring that it operates as fairly and efficiently as possible, while mitigating systematic risks to the greatest extent possible.

Self Funding: To the extent that a trading wallet’s collateral is the correct currency, it will now be automatically used to offset the position’s swap requirements. For example, if a trading wallet contains USD, and the position is long BTCUSD, the USD borrowing requirement will be reduced by the amount of USD collateral. We believe that this change will result in significant cost savings to traders and help make the closely watched aggregate swap statistics more meaningful. This new feature essentially allows traders to pay no swap interest when the positions size is less than their collateral, i.e., “unlevered” (provided, of course that the collateral is held in the correct currency), and avoids the clumsy process of claiming unlevered position as this feature effectively enables traders to perform the economic equivalent of a “partial claim” when the position is reduced in size of more of the correct collateral is deposited in the trading wallet.

Daily Settlement: Up until now, swap interest to liquidity providers has always been paid daily, but swap interest from traders is only collected when the positions is closed. While this makes sense from a certain perspective, it has the unintended consequence of effectively putting Bitfinex in the position of making 0% loans to cover the payments imbalance created by large “unrealized swap” balances, which really should be serviced by the P2P facility that we already have in place. Moreover, from a balance sheet perspective, we feel that it simply makes more sense to match the frequency of the collection and payment process. In order to implement this change, traders will need to select how they wish these daily payment to be made. The system will support a new variable for each position, “Swap Type”, which can have one of two values:

Daily (default): Swap interest will be automatically deducted from the collateral in trading wallet of a daily basis. If the correct currency is not present, an appropriate conversion will be performed to satisfy the payment.
Term: Swap interest will be capitalized in to position every night by automatically accessing swap offers to cover the required payment.
Existing positions will be phased into this process, with daily “catch-up” payments of no more than 10,000 USD.

These first two changes will be active on the 21st of July, 2014.

Real-time Autorenew: In the past, the “autorenew” feature for offering swap liquidity was only processed once every 15 minutes, which could sometimes create an offer “vacuum” if large positions were being opened and closed quickly during periods of heightened volatility. We have reduced that interval to less than one minute as we approach a true real-time solution to this important feature.

Swap “Bot”: We will soon be offering traders the ability to automatically replace the swaps that fund their positions with cheaper ones should they be available at the same or better terms, eliminating the rather laborious manual process that is available today. There are many nuances to making this work efficiently and it will be offered on an “opt in” basis, but we anticipate that this feature will make the swap market much more efficient and reduce volatility in the average swap rates. We will provide further updates on the specific functionality by the end of July.

Once again, we wish to thank all of our customers for their continued loyalty, which, in recent months, has made Bitfinex the number one platform for BTCUSD liquidity as measure by trailing 30 day volume. We look forward to serving the community’s ongoing trading needs as we continue to update and improve our trading platform.

As always, we welcome your feedback.

Best regards,
The Bitfinex team

@Ente: BFX is not responsible for your trading failure lol
Edit: you might not want to do a fullquote when the user you're referring to is just right above you..

@all: The tradable balance bug has been fixed now.
contradicting the announcement, the new swap system seems to be live already.


@BFX: Really, before you change a live system test it. And for gods sake work on your communication skills.
Also, please clarify on how the new "term" swap option works. Are you basically piling up daily compound interest by paying for swaps with new swaps? I liked to see how much swap I got on a position. This would get complicated if it was paid daily and therefore set to 0. Not keen on having to log this daily.

As a trader I would like to know exactly how the changes affect my profits beforehand to make an educated decision.

edit2: @BFX:
-A good idea to help your communication would be to change the OP of this thread. People don't want to read through the last pages just to find out what happened if they didn't get it straight away. The OP even still says you don't have your own orderbook.
-A newsticker with a yellow background or whatever on top of every BFX page you open would def help. I for one rarely look at bitcointalk if I'm busy and I don't have to. On the other hand every trader will see the BFX page.

My position is all in the red as well!!!1!

Oh, wait, that's not a bug.. oops

Ente

There's a weird bug happening right now (browser independent):
"close"/"claim" displaced


My tradable balance also shows an insane negative amount right now.
Devs, clear this up!!!

If you change stuff on your platform why don't you test it out first..

Edit: That weird displacement is gone now. My balance is still negative. If someone had to use his "tradable balance" right now, this could potentially cost real money!

Edit2: Just saw the announcement.. I don't quite get why that would change my tradable balance at all, but if it has something to do with it it would have been great to know beforehand

one additional remark:

I don´t really get how people can complain about the orderbook at bitfinex being too thin.

2 major reasons why I think this is seriously retarded:

1. hidden orders -> lots of the big whales use hidden orders... therefore no one of you knows the true amount of bids (except Raphael + Giancarlo)

2. many people who would pick up BTC all the way down in case of a price decline haven´t already put in their bids (why should they keep unnecessary funds in open bids?)
They will wire it to bitfinex as soon as buying opportunities arise.
Therefore I think the true amount of bids will increase substantially in case of a BTC price decline.

the crazy volatility from the last years is probably gone for good.
You won´t see another big BTC crash where BTC goes to something like 200 $.

BTC has matured and lots of big players entered (venture capital going into bitcoin infrastructure ...).

I will be buying at 550, 500, 450 ... all the way down.
And I guess many smart people + a few of the really big whales will realize this opportunity to pick up large amounts of BTC and do it like me.

Therefore I don´t really think BTC will fall below 500 $ at any single point in the future  

The only situation where you would get your heavy BTC crash is when a major bug in BTC is found.
But BTC has now been around for years and lots of very intelligent people haven´t found a major flaw in the bitcoin
transaction protocol therefore I also think this possibility is very unlikely.

The APR for offering swaps is still quite good and I completely trust Raphael + Giancarlo with my money.
Even if I wouldn´t trust them I think keeping the site running is way more profitable than running off with the user deposits.

(legit income from exchange + lending fees > short-term gains by thief)

No activity on his reddit account (where he is at least that active) as well. So many aspects that make me feel uneasy.

As it was written so many times they can only do this if this is a temporary flash crash. If we go to 200 (and I'm explicitely stating a value of 200, not something outrageous like 1 dollar) with a flash crash and stay there they are done for. What would they do?

this is the first time I´m reading about these alleged litecoin withdrawal problems 

Besides, I think their strategy isn´t to run off with the funds in the worst case scenario.
I rather expect them to handle it similar to the last flash crash where they simply freeze trading and
do a roll-back of trades.

This would also explain why they don´t respond to your concerns because obviously that would once
again show that lenders would get saved on the cost of the traders who won´t get their profits of
shorts (obviously these profits would be insane in case of a huge BTC crash).

It's weekend.. just wait a little bit until the next business day.

It looks like Raphael hasn't logged into bitcointalk for about two days. Is this unusual?

Because else at least I'm going to assume that their strategy for a flash crash is to run off.

I've trusted Bitfinex in the past but there have been some events in the near past that make me a bit suspicious and trust is the most important feat an exchange has to provide.

1. Silently cutting the link to Bitstamp AFTER TELLING ME they would tell us in such a case (look it up, it's in this thread).
2. Another silent company change
3. Showing some remarkable incompetence regarding the swap system, it was BitcoinIdiotDude who revealed these exploits after they have been going on for months and pecularities were repeatedly mentioned here and they didn't bother to investigate.
4. Giancarlo's massive pumping in the "Bitfinex Margin Bubble thread"
5. several reported litecoin withdrawal problems.

6. Most importantly that they haven't said a single word since three days.

Well, because the trust of us users in the worst-case-scenario strategy of a platform is a big factor in evaluating the risk of the platform. Which directly dictates how much funds to have stored there.

edit:
This doesn't mean they have to publish passwords and secret backup locations.
A strategy shouldn't rely on being secret, ever.

Ente

why should they outline their strategy for these worst case scenarios in a public forum?

Still not a single answer from BFX to all of this? What is that? Is there some long-ass holiday on the British Virgin Island or is there more to their secretivity. Ignoring this won't make it go away.

It is surprising that the USD swap rates keep constantly at around 0.16% for more than a week.

I guess Bitfinex had been relocated their company to BVI for some time.

Yea I was pertaining about how they took off the address that was there before. I know someone looked it up and knew it was a virtual office but at least it had an address, now they took that off

So can we get an answer about the HK issue- is this actually a company registered in HK with a real business/company number or is it just totally a BVI owned business and has nothing to do with Hong Kong?

In January there was still a "Bitfinex Limited" registered in Gloucester Road, HK with company number 1872039 - now Virgin Islands?! Sorry, but not communicating this stuff is definitely something that starts to sound very strange, especially after silently(!) cutting your liquidity in half (or worse) by dropping Bitstamp. This is now the 4th or 5th company operating Bitfinex...

@DoubleSwapper:
By now they should have 2, maybe 3 million USD, they never stated how many BTC the company owns afaik.