From f22084690073f8631803be2d5c93ff30c9f5b71e Mon Sep 17 00:00:00 2001 From: abitmore Date: Sun, 18 Feb 2018 21:56:55 +0000 Subject: [PATCH] bsip34: wording change and text reorganization --- bsip-0034.md | 25 ++++++++++++++++--------- 1 file changed, 16 insertions(+), 9 deletions(-) diff --git a/bsip-0034.md b/bsip-0034.md index 444a381..1635b38 100644 --- a/bsip-0034.md +++ b/bsip-0034.md @@ -10,6 +10,19 @@ # Abstract +Currently, in BitShares, a short position may be margin called only when both +two requirements are met: +* call price is above or equal to median price feed +* no limit order on the book is buying collateral with price higher than the + short position's call price + +This behavior has led to certain confusion and anger among market participants. + +This BSIP proposes a new behavior to improve the situation: drop the second +requirement, trigger margin call when the first requirement is met. + +# Motivation + To avoid ambiguity, in this article, all prices are in terms of `debt asset / collateral asset`, aka how much debt asset per collateral asset. A bid is an order to buy collateral asset with debt asset. @@ -41,21 +54,15 @@ This mechanism has led to certain confusion and anger among market participants. * market manipulators / arbitrage traders have more chances to force borrowers to sell collaterals at lower price -This BSIP proposes a new behavior to improve the situation: derive the fair -collateral price only from price feeds. - -# Motivation - -Make the exchange system easier to understand and more user-friendly. +This BSIP effectively proposes a new behavior: derive the fair collateral price +only from price feeds. # Rationale Since price feeds are provided by a set of chosen producers, the median price feed is usually considered trustworthy. On the other hand, instant market price is not as reliable, especially for the markets with poor depth, so it's -a rather limited supplement for calculating collateral price. Depth of internal -markets could be greatly improved in the future, however price feed producers -can always adjust their algorithm to include internal market data. +a rather limited supplement for calculating collateral price. At this moment, changing the rule to only use median price feed will clear away the confusion the end users may have, while still keeping the derived collateral