In this piece we look at the ten different chain split tokens that could exist on the Bitfinex platform in and some of the complexities and challenges involved.
There are circumstances in which the policies Bitfinex has chosen are unfair and place a burden on customers, however perhaps this could not be avoided. Bitcoin chain split tokens is not known if the Bitcoin Unlimited chain will exist as a different coin to Bitcoin at the time the contract is due to settle in December The above diagram illustrates the 10 chain split tokens which could exist on bitcoin chain split tokens Bitfinex platform in During the year various groups created spin-off coins of Bitcoin and Bitfinex provided its customers the opportunity to trade these tokens.
Typically each spin-off can result in three new tokens. For example SegWit2x resulted in:. However, avoiding any of these issues is difficult and perhaps potentially impossible, given the complexities involved. In many ways Bitfinex has bitcoin chain split tokens a service to the community by rising to the challenge and supporting these tokens. A full timeline of the events related to the 10 chain split tokens is provided in the table below. As we mentioned in our previous piece on the SegWit2x hardfork, the spin-off token distribution decision for financial platforms is not straight forward.
There are essentially four options:. Potential financial platform policies regarding the distribution of spin-off tokens. It is also possible to have a different policy with respect to Bitcoin lending and Bitcoin margin positions, which is not illustrated in the above chart. Supporting additional tokens can not only put additional burdens on the exchange, but also on customers, as the situation with Bitcoin Gold below illustrates.
Bitfinex clients who were short BTC on margin at the bitcoin chain split tokens of the fork had a BTG liability added to their account when the fork occurred. This needed to be done to balance out the impact of users who were long BTC on margin at the bitcoin chain split tokens of the fork and benefited by receiving BTG.
This places a burden on customers who were short, as they now have bitcoin chain split tokens go into the market and buy BTG to cover their positions, despite potentially having no interest or knowledge in BTG.
This may frustrate some customers bitcoin chain split tokens they were not given much notice in this particular case perhaps under 24 hours. Anyone with a negative balance resulting from being a BTC borrower at the time of the fork will need to buy back into BTG within 3 days or risk having the system do it for them. The issue may be of particular concern to Bitfinex customers, since the BTG token does not exist yet, nor is the client ready to be released, as further development work may be required.
The date Bitfinex enabled trading, 24th October, was only the date of the snapshot of Bitcoin balances, not when the token actually launched. Therefore Bitfinex customers who were short BTC at the time of the snapshot will not be able to deposit BTG to the platform to cover their short positions, as the token does not yet exist and instead they appear to be forced to buy it on the market at Bitfinex.
There may be insufficient liquidity, which could cause problems. The chain split tokens do not consider the impact of the other chain split tokens. The above contracts do not fairly reflect each other. This problem is illustrated by bitcoin chain split tokens overlapping nature of the contracts in the chart above. If Bitfinex wants to increase the complexity of the bitcoin chain split tokens even further, the following additional distributions could be conducted:.
Bitfinex may actually make adjustments for these events and even eluded to this possibility in a recent post. It would be interesting to see if any of their customers actually demand this. Skip to content Abstract: Chain split token overview Bitfinex chain split tokens — Source: For example SegWit2x resulted in: The BCH distribution had a coefficient of 0.
There are essentially four options: Anyone with a negative balance resulting from being a BTC borrower at the time of the fork will need to buy back into BTG within 3 days or risk having the system do it for them Source: The chain split tokens do not consider the impact of the other chain split tokens The above contracts do not fairly reflect each other.
If Bitcoin chain split tokens wants to increase the complexity of the above even further, the following additional distributions could be conducted:
Posted: 21 Mar 2018 08:08 PM PDT I feel like I understand how the stock market works, and I got lucky with crypto. Over the short term ( 1- 2 months), I expect ITC to easily reach 1 billion ( 5x) once it lands on Binance exchange.
Storing your API credentials at Coinlend does not contain any risk.