Hi all,
Ok, First, I am going to (again) talk about the FRR...if you read my other points, basically the same thing I usually say (tl;dr markets set rates, sorry if you don't like what is currently available, thats how markets work). If that bores you, please feel free to skip to the bottom where I will discuss our new plans for the upcoming year.
I still don't understand the debate about this. If the rate is low, you express that opinion by either leaving an offer at a higher rate, or simply not offering at all. The rate wouldn't be, and in fact COULD NOT be this low, if people weren't clicking buttons and entering a lower rate than you would prefer. People are CHOOSING to offer funds at these rates, so the fact that these rates EXIST means that they aren't too low.
Again, whenever we discuss this, people take the opinion that we should have a rate in mind. We shouldn't. If it is too low, then you are free to not take it. What you are seeing is the greater supply chasing the limited demand. This is classic, texbook even, supply and demand. You can blame the FRR all you want, but honestly, I have always felt that the rates people had seen in the past were really great...in other words, you were taking advantage of a market inefficiency. As people discovered it, it goes away. I currently have a LOT of people who are specifically interested in offering out millions, they find the rates very acceptable, and are curious how they can proceed as a business.
If you, today, got rid of the FRR, the rate would not change at all...because the FRR is not the rate that you are currently competing with.
Total Number of Swap Contracts Number of Swap Contracts Rate Time Offer Count
427.79 427.79 0.0253% 2 1
It was whichever random user decided that for HIM, 0.0253% was a good enough return for his $427.79. Without the FRR, this would be EXACTLY the same situation you currently face. I find it funny though, we are in a HUGE bear market, and people are wondering why the demand for going long (and with it the subsequent rate for a USD swap) are dropping, while, for the first time in a LONG time, the demand for BTC is up...its almost as if there is some sort of correlation between the demand for a certain position, and the rates that people are willing to give...
In a previous post, I specifically said that I thought it was very strange that the BTC rate was so low. I thought it was an inefficiency, in that if I had to choose to short or long over the next 30 days, I would specifically look for shorting opportunities, because they cost a lot less. I honestly wish we could get rid of the FRR, just to prove that it wouldn't make any difference at all...is it an ideal tool for calculating a "going rate" for swaps, NO. Could it be better, yes! But you will see that the rates are just reacting to the market. There is a finite, but unknown, demand for going long, whoever is willing to offer a swap for the lowest rate gets to be first in line to fill that demand. For a lot of people, something > nothing.
One last point, I find it funny that people think that for us this is some sort of financial move or something, but then point out that we could make more by raising rates. That is mathematically correct. Our rates are 15% of the returns generated, if we increase your returns, we would get 15% of a larger number. This is math, and we are aware of this. We have no interest in raising rates, in order to pad our cut. We would rather that supply and demand lead to whatever rate it leads to. In other words, a market.
Now that I have responded (again) to the FRR discussion. I want to wish you all a Happy New Year.
We have a live, working version of our new backend, and are currently testing it. It looks fast...REALLY fast. This is going to open up a lot of doors for us, in this new year.
We are going to be able to offer a FIX gateway, for institutional players who have been patiently waiting for one.
We will also have an official websockets API.
We are currently looking into other pairs that we may offer, including other fiat currencies.
We will finally be able to divert some resources into the growing list of suggestions and requests, specifically better reports and more user customization in the interface.
We are moving cautiously, we definitely don't take risks when it comes to our users funds and we appreciate the trust you place in us. I am SO excited about this, it is going to be a real game changer (sorry if I was grumpy in the first part, I am just really bored and annoyed by FRR talk, and the new backend is WAY more exciting and interesting).
I am looking into perhaps setting up a simulation/testnet environment, where perhaps some people could test it out, etc. No promises yet, but it is an idea I am throwing around. I know that a lot of people here have been with us since the beginning, and I really want to hopefully reward your patience, and show you guys what we have been working on. I know that things aren't perfect, I know that there are a lot of people who don't have things just the way they would prefer. I am sorry about that. We are working really hard, doing our best, to make the best exchange for bitcoin in the world. 2015 is going to be a great year, I hope. If you have more questions, feel free...
By the way...what are your opinions on the current prices? I am kind of shocked to see sub $300 bitcoins again. Any theories?