BAIP: 0010
Title:Set Margin Call Fee Ratio
Authors: bitcrab
Status: Draft
Type: Consensus
Created: 2020-9-1
Abstract
This BAIP propose to set the Margin Call Fee Ratio of the 3 main bitAssets bitCNY, bitUSD, bitEUR based on the implementation of BSIP74 in BTS4.0.
Motivation
As described in BSIP74, margin call tradings are potential to contribute a big part of the income to the system, and the fee can be regarded as the cost for stabilization of bitAssets.
Rational
This fee ratio will modulate the Maximum Short Squeeze Ratio (MSSR) when determining the Margin Call Order Price (MCOP):
margin_call_order_price = median_feed_price / (MSSR - MCFR).
Specifications
Set Margin Call Fee Ratio as below:
bitCNY: set MCFR = 1%, MSSR = 1.02
bitUSD: set MCFR = 1%, MSSR = 1.02
bitEUR: set MCFR = 1% (MSSR is already 1.02)
Explanation
While MSSR = 1.01 and MCFR = 1%，
margin_call_order_price = median_feed_price / (MSSR - MCFR) = median_feed_price
this is not suitable for a margin call order as margin call order price should always be obviously lower than the median feed price, that's why here set the MSSR = 1.02
To set MCFR to 1% is based on the consideration to "make obvious effect and little pain", surely the value can be adjusted based on the practice in the future.
Copyright
This document is placed in the public domain.
Abstract
This BAIP propose to set the Margin Call Fee Ratio of the 3 main bitAssets bitCNY, bitUSD, bitEUR based on the implementation of BSIP74 in BTS4.0.
Motivation
As described in BSIP74, margin call tradings are potential to contribute a big part of the income to the system, and the fee can be regarded as the cost for stabilization of bitAssets.
Rational
This fee ratio will modulate the Maximum Short Squeeze Ratio (MSSR) when determining the Margin Call Order Price (MCOP):
margin_call_order_price = median_feed_price / (MSSR - MCFR).Specifications
Set Margin Call Fee Ratio as below:
bitCNY: set MCFR = 1%, MSSR = 1.02
bitUSD: set MCFR = 1%, MSSR = 1.02
bitEUR: set MCFR = 1% (MSSR is already 1.02)
Explanation
While MSSR = 1.01 and MCFR = 1%，
margin_call_order_price = median_feed_price / (MSSR - MCFR) = median_feed_pricethis is not suitable for a margin call order as margin call order price should always be obviously lower than the median feed price, that's why here set the MSSR = 1.02
To set MCFR to 1% is based on the consideration to "make obvious effect and little pain", surely the value can be adjusted based on the practice in the future.
Copyright
This document is placed in the public domain.