Quote from: oyvinds on September 02, 2014, 12:23:49 PM

Quote from: LOADING.READY.RUN on September 02, 2014, 11:42:34 AM

Quote from: bbbbbb2014 on September 02, 2014, 11:35:36 AM

That's 12.41% interest rate. For USD. Do you guys find that acceptable - as it seems the level of liquidity is also very low.

It doesn't matter who finds it acceptable or not -- loan rates are determined by a market, and there's very little demand for opening new longs. Apparently there are enough people who prefer to offer their USD at these low rates over pulling the USD out of BFX.

BFX has historically offered great interest rates on USD. If you have a lot of USD there and you expect rates to rise at some point in the near future then it makes sense to leave the money at BFX - and 0.02%/day (which people fill on the demand side now) is more than 0%/day, right?

As you say, interest rates are set by demand and supply. Right now it's the bearmarket and the swap demand has clearly shifted towards BTC.

BTC loans are at record highs http://www.bfxdata.com/combined/btc.php

What that guy who decided to sell 1600 BTC short at $469/$470 today was thinking is a rather interesting question - but I guess it's great risk/reward if you see the $200 in the cards..

I know it appears a bit sad and depressing that USD rates are this low right now. We who have been using BFX for quite a while remember the good-old-days of 0.99%/day and miss them. However.. we won't be seeing those rates again. Back when 5 people were using BFX it was possible to get those rates like that but the user-base at BFX has grown a whole lot and there are a whole lot of people who think 0.2% or just 0.1%/day is GREAT (and it is, when you think about it, pretty darn good compared to many alternatives).

Very accurate! Don't forget that we were already at these rates in the past (it's now even a bit lower though) and the only reason we went back to nearly 1% for some short time was blatant manipulation which seems impossible or at least fixed for now. We need very significant sums of money borrowed to get us anywhere near 0.2% again. The amount of short positions is quite daring at the moment. I agree that we might be in for a large short squeeze like we had in the past but I'm also bearish towards bitcon at the moment in general and will refrain from entering a long position. It would be devastating for the bitcoin economy if these shorts were liquidated without pushing up the price signficantly. At the moment these shorts are directly buffering any potential further downfall.
What they sadly won't do though is increasing the dollar swap rate. Hopefully we have bottomed out by now. Anything below 10 % pa will give me some serious headache.