Disclaimer, I'm fairly new to the Larimer side of crypto - although I've been using and following Bitcoin for a while, the issue of price fluctuations got me investigating Bitshares recently.
And I'm very impressed with both the concepts behind it, and how it works in practice. So impressed that I signed up for SteemIt just for the Larimer name. Still early days, this is my first post, and I don't really know how it works yet, so I'll just use it for blogging and getting responses to my thoughts for now.
Which brings me back to Bitshares. I like the way BitUSD and the other stable tokens work - the concept is clever - speculators go long/short usd/bts and these positions keep the BitUSD token stable.
But then I heard that when crypto in general goes down a lot, people flock to BitUSD, drying up the liquidity, and liquidations happen. And then the stability suffers.
When I got my bitshares account started and was able to explore the DEX , I see there are hundreds of tokens there.
Which is great in one sense - but isn't dilution of funds a big problem? If the money is spread thin on hundreds of tokens, it's hard to keep liquidity up on BitUSD (which I would argue is a rather important one. Not to ignore BitCNY, but since the Chinese currency is supposedly pegged to USD, is it really necessary to spread the liquidiy out between the two?).
And the same thing goes for the blockchain space in general - there are so many coins and tokens and ICOs and whatnot, that it's getting hard to keep track of them all, never mind keep the liquidity high enough to make them tradable and stable. Even just the number of exchanges in Bitcoin's case - the liquidity is low because of the number of exchanges.
I'm not saying I have a solution (yet), but I'm curious to hear your thoughts on this.
