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Use 90 days average BSQ price for compensation requests #114

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chimp1984 opened this issue Sep 6, 2019 · 8 comments

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@chimp1984
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commented Sep 6, 2019

This is a Bisq Network proposal. Please familiarize yourself with the submission and review process.

We use still 1 USD as orientation price for compensation requests. The BSQ price has been surprisingly stable around that value, probably because of that orientation. We should move to the real market price and use either the average or median price for the last 90 days. Thought median is not considering trade amount, so might be off in some cases.

This PR implements it so it is now easy to look up the average price.
We could use the start date of the proposal phase for a consensus for the BSQ price used in that cycle. The maintainer of the compensation repository could upload a screenshot at that day and all contributors use that price for calculating their requests.

I would suggest that we start using the real price with Cycle 6.

I will add a DAO proposal for voting. Before voting starts we still can adjust and discuss details...

@chimp1984 chimp1984 changed the title Use 90 days average BQ price for compensation requests Use 90 days average BSQ price for compensation requests Sep 6, 2019

@huey735

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commented Sep 6, 2019

@chimp1984 what are the pros of using the 90 day average? I'm sill leaning towards using USD as a unit of account.

Here's a chart of:

  • blue - BSQ/BTC price
  • red - USD/BTC price
  • orange BSQ/BTC price 90d average
    bsqprice
@chimp1984

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commented Sep 6, 2019

BSQ price is not bound to 1 USD. That was onlye used before BSQ trading was possible to have a consensus about the conversion. Now the free market decides the price and we need to adopt compensation amounts. If BSQ is 5 USD a 10 000BSQ request would not be 10 000 USD as now but 50 000 USD. Quite a bit of a difference ;-)

@mrosseel

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commented Sep 6, 2019

a contributor could ask e.g. 5000 USD in the compensation request, which is then translated in the corresponding BSQ amount. This exchange rate will then indeed have to be determined using some average/median calculation by the dao code. The 'guess the exchange rate' burden should not be put on the contributor. Only possible downside to this is the gaming of the exchange rate if the period is too short, and an 'unfair' exchange rate if the period is too long.

@chimp1984

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commented Sep 6, 2019

The timing of the request could be then used to game it. You wait for a low price (or self trade to move the price)... Not a big risk but seems easier the manual way. But if anyone wants to implement that and build some safeguards against gaming, why not...

@sqrrm

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commented Sep 6, 2019

@mrosseel it's not an easy task to get an oracle to work properly. For now it would have to be fed to the system, presumably by contributors so we might as well agree before the filing of compensation requests and use that exchange rate.

I also think, like @chimp1984 mentions, that it invites market manipulation. I don't think it's a good idea to incentivize market manipulation further.

@chimp1984 chimp1984 referenced this issue Sep 6, 2019
@chimp1984

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commented Sep 10, 2019

I think that proposal can be considered accpeted. 8 upvotes on 10.9.2019.
I would suggest that we start with beginning of Cycle 6 to take the 90 days average (visible in UI in the 1.1.6 release). The proposal repo maintainer should add a screenshot so that all contributors use that rate for new requests.

@chimp1984

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commented Sep 16, 2019

This proposal got accepted in DAO voting. So lets use the 90 days average BSQ price when proposal phase of Cycle 6 starts as conversion rate for requesting BSQ.

@mpolavieja

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commented Sep 16, 2019

Approved on Cycle 5 DAO voting

@mpolavieja mpolavieja reopened this Sep 16, 2019

@mpolavieja mpolavieja closed this Sep 16, 2019

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