I’m going to copy a conversation between the FLOT members which I started 20 h ago as a private conversation.
I thought it might be good to discuss the matter to find a common ground within the FLOT first. But now I think (we had a friendly reminder from @mhps, thank you for that!) that this belongs in the forum and needs to be discussed openly.
I don’t know for what reason, but sometimes quotes within quotes don’t work properly. I’m sorry for the inconvenience.
Time stamps are UTC
approx. 15:00:00 2015-12-05 , @masterOfDisaster:
First, I come to a different number of BTC: 10, because the buy side has 10 BTC and the sell side 30 BTC (give or take). 10 BTC need to be moved from one side to the other on Poloniex.
Second: shouldn’t we require the trading partner to deposit the NBT (or in other cases the BTC) to a T4 multisig address first (and how many confirmations do we require?) before we send money?
Third - and just for the record: my buy side gateway on Poloniex (deposit address known to FLOT) is up and running (just in case we don’t find anybody willing to trade until the 10 BTC on buy side are consumed)
Thanks for this thread.
It seems that flot is not fast enough to handle T1 balance. Even if the time frame was less than 2 hours! Response should be fast since the markets are fast.
I propose for Jordan and/or fsrt to take the role of T3 custodian for now.
Some might have had other expectations but looking at the terms of the FLOT members it’s quite obvious that the FLOT is not designed to balance T1.
T1 needs to be balanced from T2, which in turn gets balanced from T3.
And if T3 starts to get imbalanced from balancing T1-2, T3 needs to be balanced from T4.
I often thought and wrote T1-3 would need to be imbalanced to activate T4 balancing.
Now I think that’s wrong. T3 needs to get imbalanced by balancing T1-2. In total T1-3 could still be balanced then.
The conditions to balance T3 with T4 funds should be:
T1-2 balanced (or in general: according to the compensation per side; with equal compensation 50:50 ratio of buy side to sell side is considered “balanced”)
We should give @zoro a credit line a la the T3 custodian thread. @zoro could promote funds T3>T1 himself (at a 0.3% spread in favor of T3) and put them on exchange. We can work on our ability to audit and report the liquidity. So when trying to bring BTC to exchange, if the Bitfinex price is $400/btc, @zoro could pay 401.2 NBT/BTC. Then, assuming the price doesn’t change, he could sell the BTC for something like 402 NBT/BTC on exchange, plus the ALP rewards.
@zoro could withdraw a portion of funds from T1, moving them to T3. @zoro can now give @henry T1 money to put directly on exchange at whatever price they agree on. Because they are independent actors and Nu only pays @zoro after each transaction with @henry for the total time the liquidity was provided, the deal has every incentive to go according to contract.