What happens if the difficulty shoots up faster than everyone predicts?
best short ever ?i mean the 1th value drop allot because diff increase so shorts should make good money
Topic: the short of a lifetime - page 2. (Read 4595 times)
i mean the 1th value drop allot because diff increase so shorts should make good money
What happens if the difficulty shoots up faster than everyone predicts?
There are almost no swaps available to short this. Someone has to buy the thing before being able to offer it for lending.
Really? I'm having trouble with the numbers, but I think shorting will make you money at up to somewhere between 0.6%-1%/day. I'm assuming a 10% increase in difficulty.
The bold part, can someone ELI5 please?
shorts pay money to longs longs pay a premium so people actually short this
if the longs pay to much premium they lose money even after dividends
given the nature btc traders where they only know to buy i expect the premium to get huge
note: shorting makes money only if the daily interest is below 0,21%
The bold part, can someone ELI5 please?
You are buying 100 THS for 3 months. Let's say you think that you would get X BTC in that time. So today you might be willing to pay about X for this contract.
But in 1.5 months, you would only pay X/2 because there is only half the time left.
in 2 months X/3
in 3 months less 1 minute you'd be willing to pay nothing for it.
EDIT: it will be interesting to see what traders value these at...
The bold part, can someone ELI5 please?
I will give you $5 if you pay me $10.
The bold part, can someone ELI5 please?
https://www.bitfinex.com/pages/announcements/?id=23
Quote
Introducing mining contracts
Posted: about 4 hours ago
We are pleased to offer mining contracts as trading product on the Bitfinex platform. We have worked for some time to develop what we believe is a superior approach to “cloud mining” that is smartly packaged to offer simplicity and transparency. While we are very excited about this offering, please note that we consider this a “live beta” as we continue to tweak the product to meet the need of our traders. Because it is a beta phase product, the first “tranche” is purposely small and short-dated. As we gain experience in administering this product, assess demand, and incorporate feedback from our traders, we will introduced larger and longer dated tranches. The contract specifications follow:
Trading Pair: TH1BTC
Tranche Size: 100 THS (terahashes per second)
Expiration: 3 Months
Pool: TH1 is part of a larger pool (~3,500 THS total). Statistics regarding this pool will be posted regularly along with blockchain transaction id’s will be posted and frequently updated.
Pool Fee: 3%
Hosting: All hosting, power and maintenance cost for the duration of the contract is included in the price per TH.
Margin: TH1 can be borrowed and sold short. We will start out with a 25% Initial Margin Requirement, but we see that going as low as 12.5% in the near future.
Dividends: The blockchain time stamp on block rewards will be used to determine “holders of record” at the time that the block was mined. Positions will be aggregated between balances in the Exchange Wallet and trading position in the trading wallet to determine a “net position”. Dividends will be computed as the pro rata share of the block reward less the pool fee. Longs will get paid dividends in their default wallet. Shorts will pay dividends from the Trading Wallet only. Longs who provide TH1 swap liquidity will still receive dividends.
The product is designed as a “depleting asset”, whose value will continue to go down all the way to zero at expiration. Coupled with the fact that all hosting and maintenance is already included, we expect fair value analysis to be much easier for the average trader and cloud miner. TH1 will also be the first shortable mining contract (that we are aware of) further enhancing efficient price discovery. Trading will commence at 9 AM EDT on Monday September 15, 2014. We welcome your feedback and, as always, we thank you for your business and continued support.
Posted: about 4 hours ago
We are pleased to offer mining contracts as trading product on the Bitfinex platform. We have worked for some time to develop what we believe is a superior approach to “cloud mining” that is smartly packaged to offer simplicity and transparency. While we are very excited about this offering, please note that we consider this a “live beta” as we continue to tweak the product to meet the need of our traders. Because it is a beta phase product, the first “tranche” is purposely small and short-dated. As we gain experience in administering this product, assess demand, and incorporate feedback from our traders, we will introduced larger and longer dated tranches. The contract specifications follow:
Trading Pair: TH1BTC
Tranche Size: 100 THS (terahashes per second)
Expiration: 3 Months
Pool: TH1 is part of a larger pool (~3,500 THS total). Statistics regarding this pool will be posted regularly along with blockchain transaction id’s will be posted and frequently updated.
Pool Fee: 3%
Hosting: All hosting, power and maintenance cost for the duration of the contract is included in the price per TH.
Margin: TH1 can be borrowed and sold short. We will start out with a 25% Initial Margin Requirement, but we see that going as low as 12.5% in the near future.
Dividends: The blockchain time stamp on block rewards will be used to determine “holders of record” at the time that the block was mined. Positions will be aggregated between balances in the Exchange Wallet and trading position in the trading wallet to determine a “net position”. Dividends will be computed as the pro rata share of the block reward less the pool fee. Longs will get paid dividends in their default wallet. Shorts will pay dividends from the Trading Wallet only. Longs who provide TH1 swap liquidity will still receive dividends.
The product is designed as a “depleting asset”, whose value will continue to go down all the way to zero at expiration. Coupled with the fact that all hosting and maintenance is already included, we expect fair value analysis to be much easier for the average trader and cloud miner. TH1 will also be the first shortable mining contract (that we are aware of) further enhancing efficient price discovery. Trading will commence at 9 AM EDT on Monday September 15, 2014. We welcome your feedback and, as always, we thank you for your business and continued support.
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