How to turn BEARISH situation into a BULLISH suituation - Bitshares Edition
Hello guys, as promised, I will be teaching you how to properly use Bitshares Borrowing System in a losing situation. We all know that Bitshares shows great progress during this past few days. Breaking every walls that comes around it. Most of us doesn't wawnt to get left behind by Bitshares fast growth. Me too, I'm afraid to convert my Bitshares to bitUSD, that's why I will teach you guys how to use Bitshares Borrowing System.
FEED PRICE - this is the current price of Bitshares in the Bitshares DEX. BTS/bitUSD
CALL PRICE - this is the limit where if the price of BTS/bitUSD exceed the call price, the collateral you've set will be all taken by Bitshares Network.
DEBT - this is where you set the amount you want to borrow within Bitshares Network.
COLLATERAL - this shows how many Bitshares was used as collateral. When adjusting the RATIO.
RATIO - this bar must be atleast at 1.75 ratio. This is to ensure that when the price goes down the bitUSD that we borrowed are well collaterized even when Bitshares price goes down.
As you can see guys, we can adjust the ratio up to six. As we set the ratio the call price will increase meaning that we can safely assume that even when the price goes up to 50% if we set the collateral to 6 our Bitshares will not be called by the Bitshares Network.
Why use this is a bearish situation?
In a bearish situation, the price of the asset will go down. This is the perfect time we can use the Bitshares Borrowing System. Why? When the price goes down to 30-50% we can safely assume that Bitshares will return into it's original price in no time. Right? If that happens we can start borrowing from the system.
To compute how you can safely sure that you have the amount of Bitshares to collateral the amount you will borrow.
You must compute the total amount of your Bitshares in bitUSD in the current price.
Divide the amount of bitUSD in 6
The answer is the safest value that you can borrow to the system.
For example. Let's say Bitshares price is at $1 so 1 is to 1. If I have 600 Bitshares. The safest total of bitUSD I can borrow is 1. So I can collaterized it with 599 Bitshares. Remember to atleast save 1 Bitshares in order to make transactions.
Once you have borrow you can now buy Bitshares in the Bitshares DEX. If in the current price you buy Bitshares and the price goes up to let's say 10% you will gain a 10% increase based in the amount you borrowed in the system.
If the price goes up to 100% the total Bitshares that you've bought with bitUSD is now at 110 bitUSD. This is because the Bitshares price increased in 10%. Meaning you will have 10 more Bitshares in your wallet. Then we can now bought back the bitUSD using the Bitshares that we've bought with the bitUSD we borrowed from the system.
In order to get the Bitshares that we use in order to borrow. We will pay our debt with the same amount of bitUSD that we have borrowed from the system. If we borrow 100 bitUSD, we need 100 bitUSD in order to get back the Bitshares the we use as collateral. Don't worry about the fee. It's as low as 0.1 something if you can gain 10 Bitshares it's small compared to the Bitshares you gain using this guide.
This is my Christmas Gift to all my readers out there. Have a Merry Merry Christmas Everyone!
Your Bitshares Enthusiast,
Nem Dayao
Cool. I also made a video on it.
Like your video too!! Thnx
Great article Nem. I'm pleased to have found your steemit. I believe in steem and bitshares and appreciate you writing these instructional resources. Everyday we bring more people into these platforms is better for us all and humanity.
Thank you @john-robert, I'm committed to help those who wanted answers about Bitshares here on Steemit. Steemit is also a great platform. Now that Steemit is focusing it's goal to reach millions of people through advertisement, I believe it won't take long till we see new ATH's. Same goes for Bitshares, we have so many updates coming this new year.
I borrowed bitUSD last week at 0.28$ and I plan to sell soon at 1$, right now my ratio is 4.31 but I started as low as 1.88 being confident we where in rocket mode.
Lucky youuuu!
I don't really understand the first thing about Bitshares
It's a lending platform?
Bitshares is many things.
It's a platform where you can develop your own blockchain. Same as ethereum, qtum and NEO.
It's a currency and storage of value like Bitcoin. But unlike Bitcoin, Bitshares can be converted to smart assets like bitUSD that holds exactly the value of a dollar. It's not limited tobitUSD though, there's bitCNY currency of Chinese Yen, bitKRW currency of Korean Won and list goes on.
It's a token for Bitshares Exchange. In order to use Bitshares DEX, we use Bitshares as fee to make order books.
Soon Bitshares can be used as a payment for merchandises using bitAssets with the use of OCASH.
Great explanation here. Bitshares is mutifaceted and a very capable platform for helping connect people everywhere. Steem for social media and Bitshares for economies.
you borrow to yourself... you are the collateral provider...
Heeyy you do it ... ;) ... My sister thankss .. autenthic machine
Thank you so much sister! I made a lot of Bitshares using this technique. Be sure to safely save some collateral you can always add more Bitshares for collateral if it's about to reach your margin call.
Heyyy youu! I am not your sister ... Becouse i am a boy ... And then i can be your brother ...
Jajaaa
Sorry!!!!! How rude of me. Okay brother @orelmely