Imagine you held some cryptocurrency. Someone tells you that there is a way to increase the value of your coin and simultaneously accumulate more of it. An easy way. You can just stake your coins and get a passive income. Like you can have your own masternode with as little as $1. You might earn 0.01% per day, or 10%. Depends on the day. And you don't even take the value from someone else. No, you increase the value of the whole.
It sounds good doesn't it? That's the appeal of passive income. It's incredibly powerful. That's what we intend to do for Bitshares.
We will make a Worker Proposal about making liquidity bot software. There already are some alternatives, but we will provide:
User Friendly, Appealing Liquidity Bot software Free for Anyone to Use on BitShares.
When our work is done, people will find an easy to use liquidity bot with several liquidity providing strategies optimized for BitShares. The software will be especially tailored for the average user, for who anything complicated is an insurmountable obstacle. The goal is that every single user can benefit from the bot, and hence, benefit Bitshares.
Solve the Chicken-Egg Problem of Liquidity and Volume
Most people simply hold their coins in a wallet. When they need to exchange for something else, they look for a liquid market. On the other hand, when liquidity providers choose a market, they look for an active one. This is a chicken-egg problem.
Once our work is done, people who would otherwise just hold their coins, will have the road paved for them to provide liquidity in any market. Once people start trading in the new markets, the liquidity providers will earn the spreads. This will help bootstrap lots of new markets.
Improve the Liquidity of Existing Markets
All the markets on Bitshares are incredibly shallow compared to many centralized exchanges. This situation will gradually improve, but with lots of new liquidity providers things will speed up. Time is money.
Better than Letting Your Coins Rust - Passive Income
With most coins out there you can't do anything. They just lie idle in peoples wallets. With a way to make your money work for you, would you not do just that? With user friendly software anyone can put any currency to work. Compounding profits is an incredibly powerful force. We think this possibility will make Bitshares as an exchange very appealing first of all to BTS holders, but also to holders of other coins. Finally Bitshares will have what DASH and many other blockchains have; a way to stake your assets and get a passive income. Even a small income has proven to be a powerful incentive for "staking". People also don't even have to touch BTS, BTC or Fiat. They can earn a passive income of their currency of choice!
Many will wonder if providing liquidity actually yields any profit. Of course this is a very complex subject, but in general you can think of liquidity providing as the opposite of paying a premium. If you want to buy now for whatever price is available, you pay for the privilege. The ones who benefit are the ones providing liquidity. They buy low and sell high. Constantly. Many community members in Bitshares are providing liquidity to the markets, and making some nice profit. Check out the Bitshares Liquidity Group in Telegram.
Lots and Lots of Benefits to the Community
- There will be a greater demand for Lifetime Memberships - and referral income
- The extra excitement about BitShares
- Proponents of other cryptocurrencies will be incentivized to provide liquidity on BitShares, while benefiting all three; BitShares, the other cryptocurrency, and the person himself
- Market Depth Charts will look much better, improving the user experience and encouraging trading on BitShares
- Simply more transactions - activity
- Holders will have the incentive to migrate to BitShares from other centralized exchanges
- More people will be exposed to the actual Bitshares, not just BTS. This could result in more voting activity, more word-of-mouth, a more positive sentiment about Bitshares.
- More people will put their BTS on the markets or short MPA's; effectively reducing the BTS supply
- We will have attracted new developers who have become familiar with Bitshares and able to contribute more in the future
- We will better support businesses building on Bitshares, like Bitspark
- The combined effect of all the above might start a snowball-effect, providing the final push over the tipping point.
We intend to start working in January.
Please Contribute and Give Your Opinions
This will be a Worker Proposal, and we want community input in order to get it right. After all, the community as a whole should benefit from this more than any individual.
The WP draft is on Google Docs. Feel free to comment and make changes. We will review them.
There is also a Telegram group dedicated to this WP.
Otherwise, just comment below and let us hear your thoughts.
Please contact [email protected]!
Why?
Oh, I see the domain is marginsoftware. This worker proposal is about providing free and incredibly easy to use bots built for providing liquidity on Bitshares, so advanced trading software that requires a licence doesn't really fit in. That said, I expect some trading software to integrate Bitshares sooner or later. I just want to do one thing at a time, so I will concentrate on this liquidity bot thing first. Once I'm done with this, I might try to get some advanced trading software for Bitshares also - unless someone beats me to it :-)
This is going to be very good for all of us! I will be encouraging all my contacts to vote for such a Worker Proposal.
Thanks for your support!
Thanks for all you are doing on this Marko.
awesome idea!
just make a super noob friendly mode (highlight the risks), make it 2 click setup, and we're on something big.
Super noob friendly. Yes! I'll collect your thoughts for the future.
Thanks for your support!
This is great for the bitshares community. Can't wait to tell my guys about this. I already have a lifetime account
Fellow LTM here as well. Cheers.
Nice to meet you sir. @john-robert
I actually didn't think twice to register for LTM because of the study I did in Bitshares. We just need volume
And volume requires liquidity :-)
upvoted followed and resteemed....
awesome proposal...hope the bot is simple...cant wait
If you need any noobs to test it out, let me know!
Just follow me.I will post progress reports
I like this idea. Given the short life of the centralized exchanges, a decentralized exchange is great and automating the market making is a way for lots of people to make a little extra. You could set up a bot buy low sell high. Suddenly, the market could bring stability to the bitcoin price.
Upvoted 100%. Sounds like a good idea.
As soon as this is working, I will provide all the liquidity!
Okay, if I had the capital for that, I could develop my own programs. But I will provide what liquidity I can. (:
Upvoted. This sounds like a very interesting project. I will look into the WP, especially interested in how the staking will work in practice.
There's little details yet, but the essence is that we will provide an easy way to put your money to work. There are market making strategies that create some profit with very small risk, while adding value to the market. The result of this proposal will pave the way for the user so it's really easy to put your money to work. It's not staking, but the incentive and the results are similar.
It would also be beneficial to in future introduce ability to place orders on several pairs at same time with same money (has to be HF probably). When an order gets filled on one, it disappears from others. The reason is that each coin, lets say bitUSD has a pair against ALL other coins, and it would make it easier to provide liquidity for all the coins you want to provide it for paired with bitUSD instead of just having to pick one.
Yes I get the idea, and have been thinking about the same. Such a feature would have to be in the consensus algorithm in order to avoid two of the orders to be filled simultaneously. Another possibility would be to go fractional reserve on some UIA, but then you would need to be the issuer.
One more possibility for adding liquidity would be to visually combine orderbooks in the GUI. For instance if you want to exchange MAID to STORJ, the software would calculate routes over different pairs, like MAID->USD->STORJ, and include that virtual order in the available orders. Then, when excecuted, the software would secretly make two orders in the separate markets, and the user would get his STORJ.
These, however, aren't a part of this Worker Proposal. This WP is about liquidity bot software.
What an amazing initiative you are bringing our way by sharing this idea with us all, here, on Steemit.com!
That'll surely be incentivizing an extra slice of the trading population as well as the general public interested in passive incomes, wicked!
Thanks again! All for one and one for all! Namaste :)
This sounds awesome. Bitshares just keeps getting better and better!
I know new users tend to get overwhelmed and find the DEX complicated so anything that makes it easier on the noobs will be welcome.
Nice post
@markopaasila Very interesting post .. And I really like his ...
Good post, I am a photographer, it passes for my blog and sees my content, I hope that it should be of your taste :D greetings
Good stuff! Asutko Suomessa?
Jep. Juodaanko kahvit joskus?
No ilman muuta! Taitaa vaan olla Atlantti välissä.
This is a great idea, looking forward to progress reports.
Definitely interested :)
We are looking for Bot Builders
http://shaivitetemple.org/Forum/topic/blockchain-bots-that-benefit-people/