BAIP5: Set force_settlement_offset of Bitasset to 5%

[shulthz]

Everyone can use it

BAIP:005 
Title: Set force_settlement_offset of Bitasset to 5 %
Author:shulthz, 
Status: Committee vote
Type: Committee Proposal
Created: 2020-02-28

Abstract

Set force_settlement_offset of Bitasset to 5 %

Motivation

• No motivation to create bitAssets
• bitAssets are not used to trade in the market
• Force_settlement_offset didn't have help for bitasset discount
• Force settlement is another form of planned economy
• Force settlement is a suicidal behavior for a bitasset market
• A low offset is kind of theory of financial repression
• Mild inflation will promote the economic development.

Rational

Why we should set force_settlement_offset of Bitasset to 5%?

We must all know what is theory of financial repression！

1. force_settlement_offset didn't have help for bitasset discount;
   When a person finished a force settlement, he will make a market order which is a little higher than the market price, he will not chose to dump in the market directly, this is a very simple trade Logic.

2. A market can't maintain high discount under a normal conditon, the price will fall back into the normal price point by the self-regulation of market, currency arbitrage, these will lock the liquidity of bitasset, force the the discount into a normal level.

3. Force settlement is another form of planned economy.
   A lower force_settlement_offset is disrupting the market directly, this is a performance of planned economy.
   Force settlement = Exchange Rate Manipulation
   Most of the fund is taking the advantage of the market loopholes to kill the new and normal users, didn't flow into the normal transaction, this is not healthy.
   Big holder of bitasset can destroy the market and debtor easily with a fixed and lower force_settlement_offset.
   We can check biteur and bitcny.

4. DAI and USDE can "anchor" healthy without force settlement, all we should think about these.
   https://oasis.app/trade/market/WETH/DAI
   https://www.pizzadex.io/?pair=usdt2usde

5. 5% offset will maintain until some new mechanism of force settlement is available.

6. Why it is 5% not other "parameters", as we have 5% offset for a long time(about 11/01/2017-08/08/2019) , didn't have any big problem.

Specifications

Set force_settlement_offset of Bitasset to 5 %

Summary for holders

Discussion

https://bitsharestalk.org/index.php?topic=32176.msg341331#msg341331

See also

Inflation Index:
https://www.imf.org/external/pubs/ft/spn/2010/spn1003.pdf
Inflation, Unemployment, and Monetary Policy by Robert M. Solow, John B. Taylor, Benjamin M. Friedman
Inflation, Saving and Growth in Developing Economies by Anthony Thirlwall
Financial Deepening in Economic Development by Edward S. Shaw
Money and capital in economic development by Ronald I.Mckinnon

Copyright

This document is placed in the public domain.

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