Current Liquidity

[masterOfDisaster]

@masterOfDisaster please send BTC proceeds to FLOT.

That’s the standard procedure for deposits to my Poloniex gateways - whatever gets deposited to the gateways and converted (or not), gets transferred to a FLOT address;)

[cryptog]

Poloniex BTC/NBT
1438.1709 sell
19636.135 buy.

Polo needs 15k NBT additional to the sell side. @FSRT ? @masterOfDisaster ?

[dysconnect]

It appears that @masterofdisaster is placing 1000 NBT every time out of his 15k.

@assistant liquidity

[willy]

It appears that @masterofdisaster is placing 1000 NBT every time out of his 15k.

Parametric order books. NuBot places numerous orders. One with 1000 NBT with the lowest spread and reports this liquidity as T1.
The rest is placed as T2.OnOrders with a larger spread. NuBot submits this liquidity as T2. ALix also doesn’t consider it T1, because it’s > 1.5% away from our 1 USD peg.

It’s a tricky situation. If you see 1000 NBT figures somewhere on ALix, be sure to check the exchange order book for T2.OnOrders.

[cryptog]

ALix also doesn’t consider it T1

Would it be possible to also display T2 in Alix?

[dysconnect]

It appears that he’s trying something different this time, in order to reduce arbitrage risk due to a faulty or slow NuBot. Personally I think 1000 NBT is a bit too small, not large enough for people to want to send funds into Poloniex for a quick trade.

[Passed] NBT entry gateway on Poloniex provided by @masterOfDisaster

Round four 15,000 NBT credited at 2015-12-27 21:28: Currency Amount Address Date Status NBT 15000.00000000 BNCaRW9ZjSLeGkwCfMb48izHy2tXLAVR2i 2015-12-27 21:28:08 COMPLETE No NBT have been traded so far. 1,000 NBT on orders. Status at 2015-12-28 15,000 NBT have been traded for 35.3 BTC. Withdrawing the BTC needs to wait until the NBT from the “NBT exit gateway” have been withdrawn as both gateways share the withdrawal limit. Status at 2015-12-29 4 BTC have been withdrawn to 3QDWJ2yq…

[willy]

It’s hard to tell what’s T2 from a LP and what’s an order lurking for a profit by a third party.
Just looking at order books, you won’t see the difference.

I’m playing with a liquidity info verifier at the moment.
The idea is to verify the liquidity information on T1 and T2 with every block.

@dysconnect, mh. maybe.
Hope moD enlightens us

[masterOfDisaster]

It appears that he’s trying something different this time, in order to reduce arbitrage risk due to a faulty or slow NuBot.

Indeed I effectively disabled the parametric order book. But that’s the case since I started the NuBot gateways.
Single orders sized 1,000 USD value are placed (same for both gateways) close to the feed price.

It would be easy to remove that limit or enable parametric order book functions.
But that would pose some risks (which you already identified) I wouldn’t want to take on behalf of Nu.

[willy]

Single orders sized 1,000 USD value are placed (same for both gateways) close to the feed price.

Is the rest of the 14k submitted as T2 liq (on exchange)?

[masterOfDisaster]

It is. You can check the broadcast liquidity of the custodian address.

[cryptog]

It’s hard to tell what’s T2 from a LP and what’s an order lurking for a profit by a third party

So the most robust way for Alix in order to get T2 liquidity for each exchange would be to ask each provider to submit its liquidity and the id of the exchange on which it operates…

enable parametric order book function

What is the issue with enabling parametric order book?

[cryptog]

@assistant liquidity

[assistant]

Hi @cryptog

The current total liquidity in the Nu network is:

Bid: 51356.2149 NBT (39.18%)
Ask: 79737.2964 NBT (60.82%)

It is broken down in the following manner:

Tier 1:
    Bid: 13366.9561 NBT
    Ask: 22299.2472 NBT

Tier 2:
    Bid: 14020.43 NBT
    Ask: 28424.0492 NBT

Tier 3:
    Bid: 23967.3288 NBT
    Ask: 29014.0 NBT

[cryptog]

Apparently Nu needs at least 10k on Tier1 and 10k on Tier 2 buy side in order to get rebalanced.

[dysconnect]

In the long term, if NuLagoon tube has enough volume it will need rebalancing to maximize profit. Moreover, without FLOT, I imagine that you could only sustain the balance between pools C and D by purchasing from the open market, which is costly. Further more, when balancing is needed and NBT is sold to NuLagoon, this NBT would likely change hands quickly and give you revenue.

Given this, in theory it is possible for Nu to sell NBT like this at a slight profit, especially when there are multiple services like yours competing for tier 4 liquidity. Though admittedly we haven’t yet reached that stage.

FLOT activities have been rather improvised but regular dealings like this require more discussion among FLOT members, and eventually it needs to be escalated to a motion vote.
It’s not very good use of our time to argue for the 60NBT extra cost in this potential transaction, but this is a precedent, and lines should be drawn.

Personally, in order to support the initiative and until tier 4 operates at a better consistency, NuLagoon can have a say in deciding a low-risk trading price, which may or may not be the 0.4% spread right now, but there should be a monthly or quarterly (possibly partial) refund of exchange fees.

[dysconnect]

@assistant liquidity

[assistant]

Hi @dysconnect

The current total liquidity in the Nu network is:

Bid: 58707.5966 NBT (43.14%)
Ask: 77372.8371 NBT (56.86%)

It is broken down in the following manner:

Tier 1:
    Bid: 15613.8678 NBT
    Ask: 24918.9799 NBT

Tier 2:
    Bid: 19124.9 NBT
    Ask: 23439.8572 NBT

Tier 3:
    Bid: 23967.3288 NBT
    Ask: 29014.0 NBT

[dysconnect]

@assistant liquidity

[assistant]

Hi @dysconnect

The current total liquidity in the Nu network is:

Bid: 59554.7164 NBT (46.06%)
Ask: 69756.6593 NBT (53.94%)

It is broken down in the following manner:

Tier 1:
    Bid: 14710.7143 NBT
    Ask: 24973.7687 NBT

Tier 2:
    Bid: 21061.19 NBT
    Ask: 15768.8906 NBT

Tier 3:
    Bid: 23781.3121 NBT
    Ask: 29014.0 NBT

[masterOfDisaster]

What is the issue with enabling parametric order book?

The issue is increased risk, because more funds are put into orders.
That’s pretty much the only thing I worry about and decided to limit the order size.

If more funds than 1,000 USD value are put in orders at the same time, they will be there in case NuBot crashes, gets unresponsive, loses the internet connection, has trouble with Poloniex’ API, etc.
The orders will stay placed until they are deleted.
If the BTC price moves while the orders can’t be deleted (and placed anew) for whatever reason, Nu might lose money.

I thought about it for some time and came to the conclusion that a broken peg (and low funds on Poloniex is the only reason to use one of the gateways) might be more harmful for Nu than some funds that are not sold at optimal prices.

Even if the orders were sold at a few percent below current market price, the economical damage would still be only a few percent of the funds on orders.

And in the best case they are sold at ALP clients running on the other side. That would still be a loss for Nu, but a gain for valuable service providers.

My experience so far with NuBot on a RaspberryPi2 has been overwehelming - it runs like a charm.
That was another reason to dare increasing the order sizes.

I adjusted the configuration of the sell side gateway to:

  "bookSellwall": 2000.0,
  "bookSellOffset": 0.005,
  "bookSellInterval": 0.002,
  "bookSellMaxVolumeCumulative" : 6000,
  "bookSellType": "lin",
  "bookSellSteepness": "low",

And the buy side gateway to:

  "bookBuywall": 2000.0,
  "bookBuyOffset": 0.005,
  "bookBuyInterval": 0.002,
  "bookBuyMaxVolumeCumulative" : 6000,
  "bookBuyType": "lin",
  "bookBuySteepness": "low"

This should place (up to) 3 orders (depending on available funds) sized 2,000 USD value.
The first one has an offset of 0.005 USD value.
The next order an offset of 0.005 + 0.002 = 0.007 USD value (linear order book).
And the last order an offset of 0.007 + 0.002 = 0.009 USD value.

This puts a total of 6,000 USD value at risk of losing some percent if something goes per-shaped.
If anybody has serious ojections, please tell me.

Documentation of NuBot settings is available here:
https://bitbucket.org/JordanLeePeershares/nubottrading/src/7dea551e0794f102b8bc904268e4c42e6e48b064/docs/SETUP.md?at=master