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RE: The tide seems to have changed
Hey, guys. I had a quick question for anybody! When the article says at the bottom to borrow some bitUSD, what does that exactly mean? He says"AND buy something you like with the same money." I'm really confused and really want to know lol. Thank yaa
That's a good question.
Congratulations, you have just created some USD out of thin air. You still have the same amount of BTS, but it is locked in to back the value of USD you created. It's insane, isn't it! Anyone can create USD without permission!
Now you can exchange that same USD for some more BTS or any other token on the network. If you buy more BTS, you are effectively shorting USD and long on BTS (you think BTS will rise in comparison to USD). However, beware that if BTS goes down compared to USD, you will need to lock in more collateral, otherwise you risk the system automatically "settling your position"; taking back your USD and returning you less BTS than you originally locked in. If you don't have enough BTS, you must buy more.
This is the way Market Pegged Assets are created in Bitshares. They can track the value of any non-digital or digital thing in the world, like oil, gold, wheat, Apple stock, or indexes. Gradually more and more of these will be created, and more BTS will be locked in, effectively reducing liquid supply, and thus increasing the price.
Thanks for the extremely detailed response! I was not expecting that lol.
And feel free to join the Telegram channel. You will receive help there.