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RE: The Power of +5%

in #bitshares8 years ago

All the other market pegged smartcoin assets there do not correspond well enough to the current FX rates, in some cases the difference exceeds 5 %.
But low liquidity and high spread makes the arbitrage impossible - Sumo will need a market maker, so the investors see the profits in real life, not only on the paper.
I think there are no mathematic tricks which could solely guarantee the peg, to say nothing of any growth :-)
As a collateral the dream coin will need a working business with ROI not less than 5% in terms of USD

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Correct. No mathematical tricks. The double collateral for the smart contract guaranteed growth are placed in escrow by the hypothetical whale who takes the only risk. The whale is betting that her ongoing investment will increase the value of the ecosystem enough to give her a lucrative profit by offering a useful product insured by escrow locked up on the BitShares blockchain.

This is the same principle used by Disney World when they bought up tracts of swamp land in Orlando and then drove up its value by decades of investment in that ecosystem.

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