I think using only 30% of the emergency fund like suggested by @arch is way too little in an emergency like this. And it favors the non-liquidated borrowers more than the liquidated borrowers, which is completely upside down imo.
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I may have missed it, but could you edit this proposal to specify how the 100k BALN would be distributed? For example, pull data on borrowers positions at block height xyz, then distribute pro-rata based on the amount of debt. Just an example
I like all the 3 other proposals. Proposal of @Collapseby2050 is no point because if it’s a no in the votes then that’s the result. @iconist proposal which is based on @particleX proposal is best for a compromise.
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I’m pro 100% refund but it’s isnt going to sit well with others and you want a vote to pass!
33% much better but also you have to take into consideration what others on here are saying and not cut your nose or to spite your face!
If you push for 100% back when you could have got 25% you’d be pretty mad with yourself!
I lost 250k in the collateral as well as money I moved in to rebalance off other coins.
Obviously 100% back would be lovely. But I will not be turning my nose up to 25% and get 0% back!
The @iconist proposal favors the non-liquidated borrowers as well so I see this have a high chance of succeeding
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I’m just going to hop in to point this out again real quick. Based on some recent comments it seems this hasn’t sunk in for some people so I just want to try again to make sure you (and others) understand.
A 33% return would be giving back 100% of the value to anybody liquidated. There would be absolutely no economic penalty whatsoever, outside of losing leverage, so please please try to think this through by referring to this post. I’m hoping as many people understand this as possible in order to have the best result of a vote as possible.
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Will do! Also a good idea to let the BALN come from the emergency reserve. What you describe here is indeed what I intended. One snapshot block somewhere between Jan 21 and Jan 24 and a distribution pro-rata the amount of debt.
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Exactly, 1/3 is perfect, then we can show goodwill to the non-liquidated borrowers as well as suggested before. I think this is the perfect option for everybody affected.
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The non-liquidated borrowers also got an advantage that the liquidated borrowers did not have, after the recent votes by bringing the liq price lower (LTV).
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And it’s important to give refunds based on the user’s collateral. A percentage calculation. Doesn’t make sense to split it evenly among all.
I left the specific block open for now and am open to suggestions. Otherwise also the distribution method that arch describes in his proposal could be used but that may overcomplicate things in my proposal
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If you go back to what I typed a few comments up, yes it’s 100% of value liquidated, but doesn’t account for the amount of ICx purchased in an attempt to stave off liquidation of a faulty rebalance system. My case is pennies compared to others, but it’s very similar to others but at a much smaller scale. Someone like ICxholder that pumped thousands of dollars worth of ICx to counteract the rebalance but still ultimately got liquidated. That is a second level of financial losses that isn’t addressed in any proprosal, but are a direct a result of a faulty rebalance system.
While that sentence is accurate 33% = 100% it doesn’t take into account the efforts that some of those liquidated took to counter the faulty rebalance system.
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In accordance with this I have altered the proposal from 5% of ~2mil DAO BALN holdings = ~100k units to 15% of Emergency fund (720k) Baln holdings = ~100k units.
This is to also note to anyone following along, the change in that term of my proposal.
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I want to state again: The UI doesnt state any penalty fee. Therefore no penalty can be imposed. Otherwise this would be just a scam.
It already has a bad taste since the user has no idea when he got liquidated at which price. Such a lack of transparecny is just shocking.
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Please stop repeating and yelling scam. We are trying to have a constructive conversation to come to a mutual agreement. Comments like these do not help.
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There are many people here who still misunderstand the two problems (overagressive rebalancing and the false UI). So this has to be repeated everytime someone falsly states that its the fault of the liquidated people.
So I am going to make some assumptions:
- You don’t think everyone agrees with you, hence needing to publicise it
- You would like everyone to agree with you.
Please in your words, if it is ‘not the fault of the liquidated people’ how the people that didn’t get liquidated avoided it.
I want to hear you describe how someone that sold a ton of other assets at a loss and propped up their loan is ‘just lucky’, or whatever other excuse.
I want to hear how all the people that did understand their product and managed to keep it up, are somehow special and didn’t instead stress and work hard at managing their position.
I want to see you turn away a far larger percentage of people that weren’t liquidated than were from supporting pretty much anything after this.
@Advocatus92 as Bot mentioned, everybody is trying to have a productive conversation. I will reply to your post here, but then it’s time to move on. Any more posts about this will be removed. I don’t want this highly productive thread to start digressing.
I’ll address your points below:
Liquidation has no formal definition like this that I’ve seen, especially not in this context. See the definition of liquidate on investopedia. It simply means to turn assets to cash. There is no formal liquidation definition that you keep referring to. I’ve seen definitions of partial liquidation and margin calls that could apply, but certainly not some broad-stroke definition of Liquidate that automatically means your debt is paid and you get back everything else.
Additionally, the specific definition in the context of Balanced is mentioned in the docs here. If you type in “liquidate” in the search bar of the docs, it’s mentioned quite a few places actually.
Additionally, the specific definition of liquidation in the context of Balanced is mentioned in the Disclaimer, which is forced in to be seen by every user at the time of signing in.
Screenshot from disclaimer
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Your definition is right. The collateral gets turned to cash to repay the loan. Thats it!
Partial liquidation didnt happen because unfortunately balanced doesnt support this. Margin call is also not supported by the platform.
If you expect of every user to read the documentation then at least have a disclaimer and a warning before using the platform. I doubt thats what balance is aiming for. Why even show any information on the platform if you leave out the important information of a unreasonable high penalty fee.
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Now I was reading the docs with the liquidation policy. Even here the penalty fee is not mentioned.
In the docs is rightly stated that this liquidation should encourage users to manage their position. Why you keep the unreasonable high penalty fee a secret I dont understand. This goes goes against it.
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