We had crazy Christmas with a huge Bitcoin rally.
No one stopped a transaction because of volatility? I haven’t calculated how much should BTC prize change before cheating becomes a rational decision.
We had crazy Christmas with a huge Bitcoin rally.
Yes there have been cases where the buyer did not pay bc of volatility. Unfortunately I cannot change easily the security deposit due (bad) implementation reasons. But in the next (big) release there will be custom security deposit, so the offerer can set it. This should help to adjust better to such situations.
What benefits do we get from the security deposit? Volatility, spam offer prevention… others?
for volatility the current deposit seems to protect well enough (i think).
for spam prevention it seems not, in my experience from last week, even though it prices out spammers in the mid term.
for hackers it’s irrelevant, since they will just complete the trade and reverse the transfer after. Unless they are caught before the seller releases their coins, it’s still profitable even if they get several 3% losses in a row.
on the other hand, it makes it harder for new users to use the exchange so it should be kept as low as possible… most of the new users that would like to be introduced to bitcoin through bitsquare are probably buying small amounts.
taking this into account my opinion is that when you implement a custom security deposit, you should leave 0.03 btc (or maybe 3%?) as default, and allow lower security deposits, maybe down to 0.001 btc.
Why not 0.0001 BTC like proposed minimum for the fees… Just to not get close to the dust level, otherwise it can be up to the user if he wants to make it as small as he wants.
Most of the time, but not always.
I don’t feel spam prevention as an issue right now, but that’s because I’m not a programmer. If you put spam orders and for any reason your order is accepted, then you’ll have to deliver that order or loose your deposit. Placing offers that could be accepted by someone are not a great thing due only to security deposit. Irrealistic offers are stopped by maker/taker fees.
It could be otherwise. Security deposit works in both ways. Maybe a new user will feel more comfortable knowing that in case something goes wrong, the other part will loose 30 mBTC.
Anyway, it seems that next version will let us decide which security deposit we prefer, and for me that’s a very good option.
being a programmer doesn’t say much about spam prevention as much as being a trader. the deposit helps to see mostly legitimate traders, but like happened to me this week, there will still be people who don’t care about spending some bitcoin to spam a network/service. the maker/taker fee isn’t enough to stop those people.
That is exactly how it will be used.
Default is 0.03 BTC
Min is: 0.001 BTC
Max is 0.2 BTC (I want to avoid that hunting for the deposit from the peer becomes a game, making arbitration much harder)
Seller deposit is fix: 0.01 BTC
% based might be an option but makes it a bit more complicate for users to follow. The trade fee will become already more complicate with amount and market price based. So prefer to keep it simple with deposit. the maker can edit it anyway.
The deposit is only a protection against protocol violations (not paying, not confirming, not replying in dispute,…). It does not help against charge back scam (never happened luckily) and is not a spam protection (that is the offer fee).
From my experience the 0.01 worked most of the time but not when there was high volatility. That was mostly a case in altcoins. In btc only in the last months price rally.
Beside that there are a few cases where the peers seem to be just ignoring the loss (not replying,…). So it seems it did not hurt enough.
The dispute will mid term also change to a 2 phase model:
There is a mediator. He has no signing key of the MS so there is no security risk. He only helps and when the case can get solved the peers are doing the payout (completing the trade). 90% of the disputes could be done like that.
If one peer is not available or not cooperative or a real dispute happens (was never the case so far) then the arbitrator as 3rd key holder steps in and does the payout like now.
To become a mediator will be easy and requires only a low amount of locked up deposit of BSQ tokens (DAO tokens). There will be reputation also (prob. out of system). It will be similar like at OpenBazaar or Bitrated.
To become an arbitrator requires much higher locked up deposit. The deposit requirements will be defined in the DAO by voting.
Both get paid by the DOA by nr. of cases.
Both will have confirmed availability commitments (e.g. has to be react at lease in 2 days).
To make it less stressful (like it is for me atm) we need to relax the availability requirements.
I just got a dispute in AirBnB and it took 3 weeks until they reacted… Not saying I want that we become that slow, but it will not be like now that the arbitrator checks twice a day the cases.
More on all that in the upcoming DOA paper… just wanted to give a bit preliminary info…