This and other comments in line with this make sense, but may I suggest that we take into account the fact that BFX is in beta testing and this means that things are being tried out, added, removed and modified in a relatively fast fashion. We do not want the testing mode to go on with 2 weeks notices for every minor change, do we?

I've traded places and I personally find Bitfinex, technically and overall by design, to be by far superior to anybody else out there. So, perhaps we should just try to let the team do their work and of course keep suggesting things, but in some more friendly and a bit more supportive manner. With that said, I am NOT implying that anybody in this thread is threatening Bitfinex in any way (I hope not) and "warnings" about various potential regulatory issues should keep coming, but again, let's try to keep those comments in a more "suggestive" mode.

Regarding "insured lending" critiques and concerns, first of all, people should not forget that in reality, lender's money come SECOND after trader's own money, when/IF things come to forced position liquidations. It technically, absolutely, does mean that lender's money are first of all fully covered by every trader's own funds and it is only AFTER the trader's own account is fully drawn, lenders' funds are at stake. Secondly, there are technical things that I believe are in place at Bitfinex, such as trading halting in extreme situations. I do NOT want to say however that there is "effectively"   no risk to lending and I THEREFORE would propose the team (again) to think about placing caps on lowest (and perhaps highest) lending percentages.

I also think that right about now is a very good time to introduce such capping, simply because if one looks at historical lending rates, one would easily see that market pretty much already found that the lowest rate is at some 0.1% levels, which would be my suggestion for capping on the lower end. The same in fact goes for highest rates, per historical data and which suggest that the high end "cap" is in the 1% range.

By the way, if such "capping" is implemented, I do not see the need for having flash rate function at all. Just imagine the advantage of potentially greater flexibility in lending rates discovery and how much will this process ADD to everyone's ability to "sense" the current market trends.