82 lines
3.6 KiB
Markdown
82 lines
3.6 KiB
Markdown
BSIP: 0002
|
|
Title: Refund Create Order Fees on Cancel
|
|
Authors: Daniel Larimer <dan@cryptonomex.com>
|
|
Fabian Schuh <Fabian@BitShares.eu>
|
|
Status: Installed
|
|
Type: Protocol
|
|
Created: 2015-12-16
|
|
Discussion: <https://github.com/cryptonomex/graphene/issues/445>
|
|
<https://bitsharestalk.org/index.php/topic,20107.0.html>
|
|
Worker: 1.14.7
|
|
|
|
# Abstract
|
|
|
|
To make the BitShares decentralized exchanges more similar to other exchanges
|
|
there should be no fee for creating orders that do not get filled.
|
|
Unfortunately, to prevent abuse, a minimum fee is still necessary.
|
|
|
|
# Specifications
|
|
|
|
This proposal will charge the minimum order fee at the time the order is
|
|
created. It will be refunded if the order is canceled before any part of the
|
|
order is filled. A small fee will be charged to cancel orders. This order
|
|
cancellation fee will be just enough to prevent spam (equivalent of a fraction
|
|
of a Dollar cent).
|
|
|
|
If the fee is paid in something other than BTS, it will be converted to BTS via
|
|
the fee pool at the time the order is placed. If the order is canceled, BTS will
|
|
be refunded to the user's account.
|
|
|
|
Recommended Order Creation Fee: $0.20 for normal users $0.04 for LTM Recommended
|
|
Order Cancelation Fee: $0.01 for normal users, $0.002 for LTM
|
|
|
|
As a result, the minimum market fees for normal users will be less than those of
|
|
centralized exchanges for orders greater than $100. For lifetime members, orders
|
|
above $20 will be cheaper than the 0.2% fee charged by normal exchanges.
|
|
|
|
# Discussion
|
|
|
|
## Fees payed in BTS
|
|
|
|
Paying fees in BTS is the cheapest way to pay fees because the
|
|
core-exchange-rate for UIA usually charge a slight premium to handle market
|
|
risk. This means that the next order you place will use the BTS to pay the fee
|
|
rather than the user asset. Think about it as getting a refund in "store
|
|
credit". If you place an order, cancel an order and then decide you don't want
|
|
to do any more business with BitShares then you will have to sell the BTS (which
|
|
will require placing an order) or "transferring".
|
|
|
|
Stated another way, for trading bots it doesn't matter that the refund is in a
|
|
different asset. For users it doesn't matter either. It will only impact those
|
|
who attempt to flood with a lot of orders, then cancel all of them. They will
|
|
end up converting their UIA to BTS at poor exchange rates and then having to
|
|
sell the BTS.
|
|
|
|
Bottom line, we presume someone placing an order will eventually want it filled.
|
|
By refunding them in BTS they can eventually get it filled and end up with 0
|
|
BTS.
|
|
|
|
## Discouraging of Makers when not Refunding Partially Filled Orders
|
|
|
|
A concern is that the rule may encourage taker but discourage maker, as if an
|
|
order is partly filled, the creation fee will not be refunded, and obviously
|
|
taker can be more easily to make sure his order is fully, not partly filled.
|
|
|
|
## Anti-Spam considerations
|
|
|
|
Furthermore, a fee has to be charged for anti-spam. Orders create objects which
|
|
must be kept in memory which imposes a resource cost on every node on the
|
|
network (plus more cost for storage / bandwidth for the transaction). Cancelling
|
|
an order frees up memory, which can be viewed as a negative resource cost,
|
|
represented by the refunded fee.
|
|
|
|
Ultimately, this reflects a tension between the economic value of liquidity
|
|
(market makers should be encouraged because a bigger book is better) and its
|
|
cost (every order consumes memory). If we make the fee equal to cost, someone
|
|
deciding whether to place an order can determine whether the cost exceeds the
|
|
value, and the tension is resolved in a decentralized market-based way.
|
|
|
|
# Copyright
|
|
|
|
This document is placed in the public domain.
|