Topic: Where are those Bitshares' Shills? - page 2. (Read 3824 times)

Correct and BTS faces the same challenges as other blockchains in order to support or grow its own value.

so BitUSD is pegged to 300% collateral BTS, not the USD.

Don't mislead the people, BitUSD is pegged to USD, by 300% collateral in BTS.
About "What if BTS go useless" read here: http://bytemaster.bitshares.org/article/2015/01/27/BitAssets-and-Black-Swan-Events/

Thing is Stan if your BTS go useless, so does my bitUSD. So, don't mislead people. BitUSD is pegged to BTS, not the USD.

More than full support.  Every single one of them is backed by over twice their pegged value in BTS collateral, held incorruptibly by the block chain.

is there actually full support for that price. As in if half the bitUSD were sold today, we would all walk away with their full value based on that rate?

I'm sure when the public asked "So how is it safer than a swiss bank, Stan?"

You, being the straight-as-an-arrow-wouldn't-dream-of-embellishment-my-word-is-my-bond Stan Larimer, replied

"It's not, really. That was just a hook to lure you in but at least the government won't be able to seize your money with BTS. Just like they can't in every other blockchain based crypto..."  

 


Ok, I'll leave you guys to it.

We aren't talking about the same things. $1 = 1 bitUSD has nothing to do with systemic risk and safety. It's the difference between not spilling your drink when walking on the deck of a boat and trying to keep your drink when the boat capsizes.

Again.  The tag line "safer than a Swiss bank" is a way to reach users of fiat banks who have not heard of crypto.  


Every crypto lists the benefits of cryto when explaining what they do to non-crypto noobs.

Inside the crypto community we talk about the characteristics that set BitShares apart from other cryptos, like 10 second transactions times and the ability to afford a growing robust community of supporting developers, marketers, and service providers because we aren't wasting all profits and new issuances on global warming.

... and (as I know) CoinoUSD, but Nubits and CoinoUSD it's IOU's.

The inability to be seized is common among crypto.  The ability to remain at $1 per bitUSD is not, only Nubits has the same functionality, with some differences in methods.

The assets stop existing, and the asset holders are given the correct value of BTS, enforced by margin calls.

You might read the statement "the assets stop existing" and think that a terrible failure has occurred, but this is incorrect.   This actually prevents the system from going out of control, and stops the holder of the asset from having their asset go to zero.  

Instead of the system collapsing when the value of BTS drops too much, and the BTS that people have in collateral cannot support the amount of bitAssets that they are on the hook for, the blockchain issues a margin call.  The blockchain takes $1 worth of BTS away from the person who created and sold the bitAsset, and gives it to the person who owns the bitAsset.    Essentially, the blockchain unwinds the derivative automatically if the person who created it starts to get in any danger of not being able to cover the value.

How this works is that when the blockchain issues a margin call, it puts out an order to 'buy to cover' the bitAsset of the person who shorted (created) it.  Anyone who owns that asset can then sell into that order, receiving the correct value of BTS in return, and then the bitAsset ceases to exist, and the obligation to provide collateral for it also ceases to exist.

Essentially, the system uses a combination of free market forces, plus blockchain issued margin calls, to enforce the peg.  


Yes, this is all extremely complicated, and confusing to anyone not extremely familiar with things like shorting, derivatives, etc.


Because of this system, a large decline in BTS over time simply results in trades being unwound.  You can see this has occurred to some extent, because the supply of bitUSD is now only $472,000.  In the past it has been over 1 million.  The people who had bitUSD sold and got $1 worth of BTS (at the time).  The people who had 'sold short' the bitUSD, either were forced to buy back due to margin call, or they voluntarily bought back before reaching that point.

BTS has dropped over 80% from its high, and the system remains intact.


Now, if BTS dropped 80% in an instant, things could break.  This is a black swan of a level that Bytemaster discussed in a blog post as a danger.  However, there are a couple safeguards.   First of all, price feeds don't update instantly, so if it was a flash crash but then recovered quickly afterwards, the price feeds wouldn't all update the incorrect horribly low price, and things wouldn't break.   There are a couple other safeguards as well.  

The system has held up for 8 months, during a bear market in which the overall value of BTS dropped 80%, and the price had several bad crashes.   I think that's a pretty good indication that it is resilient.   Note that a huge decline of this size in a short period of time is a black swan that breaks other systems as well.  The fiat banking system would definitely break under those conditions, as we were seeing in 2008 before the bailouts.  Bitshares is actually much higher collateral than the world's normal banking systems, which makes it have a much greater margin of error (which it needs at this time because of the great volatility inherent in cryptocurrencies).


I hope that made some sense.  It took me a lot to get my head around at first.  There is a reason everyone thinks Bitshares is way too confusing.  But cryptography and the concept of the blockchain are very confusing as well if you want to understand the technical details.  The experts have grokked these concepts, and the rest of us trust them when they say it works.  Bitshares just needs to get to that point as well.

So we are back to 'why would you market a feature that is common to all?' Unless Stan got his revisionist's cap on and is writing a new chapter for his history book.

If anything is malicious, it is using someone's own ignorance against them. Only someone who hadn't been around the block would accept what the "marketing department" peddled. You could argue it wasn't targeted but the effect would easily be foreseen.

I am not arguing Swiss banks are safe, you are otherwise you wouldn't have used them in the comparison (you would have used cypriot banks). Not only that but and that BTS is also safer. So why post links now trying to undermine the safety of swiss banks?

Your definition of safer seems to be 'can't be seized'. Fine. But a more useful definition would be 'more likely to be there in 1-50 years time'. What do you think the ratio of swiss bank failures (even haircuts) to cryptos failing (I.e. systemic risk) will be over the next year? Next 50 years?

Maybe it is another case of Bitshares small print? "Safer than a swiss bank*"

*assuming you agree with our definition of safer being 'unsiezable', like every crypto is, rather than a lower systemic risk so there is a higher chance of a market being there the next time you look.


Systemic risk isn't unique to BTS. But most point out these as risks (crypto is high risk, latent fatal flaw(s) possible 》 asset within a crypto, relies 100% on the crypto 》 very high risk, risk squared and much more dangerous) rather than going the opposite way and portraying the same as a virtue.

Sadly, its not just Cypriot banks any more.  Cyprus was just a test case.  Meanwhile banking laws in Europe and the US have been quietly changed to allow the same thing to happen there.

So bail outs are history.  Bail ins are the new government-sanctioned plan.  Coming to a bank near you.

This means that legitimate crypto assets can be much, much safer than the new, unbelievably corrupt banking system.

As always, pick your own risk mix.  As I said,


And yes, many (well designed) cryptos share this characteristic - but we are marketing to the users of the vilely corrupt and unbelievably dangerous fiat banking system.  Hence, it's important to mention that BitShares, being a very well designed crypto, is "safer than a Swiss bank".

Swiss banks are not what they used to be.  See: http://en.wikipedia.org/wiki/Foreign_Account_Tax_Compliance_Act

Trying to market something is not the same as trying to catch noobs, you are intentionally assigning malicious intent because of your biased opinions. While the safety may be available from most blockchains, the usefulness is not, but guessed you missed the part about pegged assets.

Swiss banks are no longer what they were either, just see Swiss-leaks. And before you try to twist my words again, no I'm not saying tax evasion is great nor that Bitshares should be used for it, but scandals like that one are eroding the confidence in Swiss banks and their ability to keep their client's money safe from outside influences.

No, marketers mean what 100 BitUSD equal 100$ USD in Swiss bank but "safer than a Swiss bank" because can't be seized, etc.

Ah, so BTS marketers were just trying to catch noobs who didn't understand that what they were investing in was available everywhere within crypto, rather than being a unique USP to BTS?

But you still appear to support that $100 in BTS is safer than $100 of CHF in a traditional swiss bank. Maybe you should have said "Safer than a Cypriot bank", but I guess that would have grabbed fewer people..

You're mixing apples and oranges here imo, that statement was made up by the Bitshares "marketing department" and does indeed refer to the safety of your funds compared to in a traditional bank, which is subject to government confiscations, bankruptcy, Cyprus style haircuts and other kinds of risk. Like you said in another post this is equally true for any blockchain based currency, although they of course do not offer the market pegged assets with interest payment that makes Bitshares more similar to a traditional bank.

Good dodge and misdirection (and I thought you had changed). I was talking about the systemic risk of BTS collapsing, I didn't ask if you were worried about banks. What you won't acknowledge and continue to draw attention from is that BTS isn't as secure as a bank from a systemic "collapse of market" failure as they have governments stood behind banks, ready to bail them out. If BTS goes down, there is no one there to pick them up again. It works, until it doesn't.


All cryptos have blockchains, so you must think that all cryptos are safer than a swiss bank account? So why say that at all, if this is what you truly meant at the time. Would you market a car using features that were commonplace across all cars?

"BitsharesCar has eye-level translucent windows, symmetrically positioned circular wheels and ergonomic posterior envelopment systems (seats)"     ...No? Maybe you would..