Amendment
I misread something in the Finex statement (I updated my blog) but want to clarify it now because it's a little tricky.
Unlike Kraken, Finex is not requiring those borrowing BTC on the platform to pay back the BCH owed. Bitfinex is instead weighting the longs and shorts of BTC and distributing the according number of BCH.
So as of yesterday when the announcement was posted, there were more BTC longs than shorts, so Finex would have issued ~1.091 BCH for each BTC someone had on the exchange. But if instead there are more shorts than longs, Finex will issue less BCH per BTC.
Consider the following example to illustrate why:
Imagine if person A loans out 100 coins to person B.
person B then sells them to person C cause person B is shorting the coin.
Person C then withdraws those coins to a personal wallet where he owns the private keys.
Now Bitfinex doesn't even have the 100 BCH to match the borrowed 100 BTC! Thus, if there are more shorts than longs, they will pay out less BCH. So it's possible we could only receive something like .8 BCH for each BTC in our Finex account.
BUT
By having BCH on Bitfinex immediately after the fork, it's possible we could get a better price for selling those BCH by selling before the price drops when others deposit coins to sell them.
Also, by having BCH on finex, we could possibly loan those out to people trying to borrow them on margin to short them at outrageous rates. Give me 5% interest/day on something that is crashing and I don't really care if it's crashing.
Making the right decision is a really tough balancing act.
I have to consider:
- probably more shorts than longs on Bitfinex, since the loan rates go higher when people short, which means less BCH per BTC
- but I can sell or loan those BCH quicker than others can because theyre already on the site
- and I can have my BTC loaned out while this is happening and I can make large interest on those.
This is complete chaos and I FUCKING LOVE IT.