Currently the order book is non existent.  There are no bids.  Let's try to keep this thread on the topic of Bitfinex again here.

Interesting, I will take a looks at their site.  I can remember when bitfinex interest was much different.

Can you explain what is the problem with lending? I see people talk about it a lot but i didn't understand (i only trade, not lend).

Well low rates are good for traders. There is too much of supply atm so the rates are very low. But i guess when demand increases and rates shoot up there might be some shortage but it won't last long, market should stabilize it.

1) Put a USD Swaps demand offer for 30 days at the rate you want.
2) Buy all the Bitcoins
3) Enjoy the knowledge that you won't be paying more than 0.278% (like 10%/year) the next 30 days
4)
5) Take loss (or profit if this thing actually moves up)

See, the secret that is used so successfully by the trader elite is to reserve the USD at low rates for long periods before buying all the bitcoins. You may actually end up paying interest for USD you don't use for some hours or a day but that's life.

As for those who say "these rates are too low": People are, for some reason, willing to lend out at these rates. If you are a lender and you find these rates to low then go find something else to do with your digital american toilet-paper.

And there is generally no reason to worry about "Bitfinex running out of USD". If there is little USD available then rates go up and millions of fresh USD magically appears. It's supply and demand, it's that simple.

hi

how about amount I can deposit USD and exchange toBTC?
1000000USD OK ?
1000k USD a month?
too big amount need more  vertification?
my account aleady vertified

Hello bitfinex,

I have some suggestions to make regarding the lending service and FRR.

There is a limit on how high the interest rate is allowed to be, but not how low. Of course there are reasons to put a cap on how high one can set the interest rate. People may get into a position where the only available option is 10000% interest per year, either by someone manipulating it, or by the demand increasing too suddenly. This would obviously make the margin trading platform look bad as profits may get diminished by interest. But, if the platform recognizes this, then why does it not recognize that interest rates may go too low, either by manipulation, or suddenly decreased demand, or - an unfortunate truth - the FRR pushing the rate lower than the actual decrease in demand.

The last part regarding FRR pushing the interest rate is true and is evidently something many are complaining about. There are several reasons why there should be a lower limit, since we recognize limits are necessary (there is an upper limit). I will make a list below

• Lending is risky. If someone gets margin called but there is not enough liquidity on the orderbook, the lender loses out.
• Added risk: lending is done on the bitfinex platform. Considering MtGox lost 600k BTC and tens of millions of USD, one is wary about leaving their funds on an online exchange
• Lending has to compete with other investment vehicles, and risk has to be considered here.
• The profitability of lending vs borrowing has to be balanced. Too high interest rates cuts traders profits, but too low rates make it almost free to borrow (a $10,000 loan at 0.03% costs a measly $3 per day)

I think 0.1% per day is a reasonable lower limit.

The second suggestion is my vote on how the FRR algorithm should work. Here is what is exactly happening now. If there are an equal amount of USD being lent and borrowed each day, say $20m, and $3m waiting to be lent, some people will by default try to get under the $3m FRR wall to get things going, and the FRR algorithm will see this as a signal to lower the rate - despite the fact that the demand or supply never changed. Once the rate drops a little, the FRR adjusts existing loans, making those who want to lend their USD quickly go even lower. Then this cycle repeats. There are charts showing that the demand and supply hasn't changed yet the rate drops consistently.

My suggestion is that the FRR algorithm should not be based on the average rates of previously lent money. Instead it should be based on the demand and supply of USD for margin trading. I mean this type of logic:
Let X be supply (available USD), Y be demand (new swaps per day and/or sum of swaps), Z be the lending rate

• If X increases while Y increases less, remains unchanged, or decreases, then the rate decreases proportionally
• If Y increases while X increases less, remains unchanged, or decreases, then the rate increases proportionally
• If both remain unchanged, the rate remains unchanged

Surely both lenders and borrowers would agree on a system which says "I'll loan to you at a rate depending on how much demand there is for my money". Having the ability to adjust the variables for this would be a plus, as some people would like their money lent as fast as possible while others want the highest rate.

Regarding limits, I am either on the side of having no limits at all, or having both upper and lower. If the lending platform proves to offer stable rates without upward or downward spikes, as a result of manipulation or the inability to balance itself during times with high volume, then obviously there is no need for limits.

Which funds get lent out when bids and ask meet, if they are at the same price? Obviously, the moment there is an offer and a demand placed at the same rate, it gets executed.

Didn't know upper limits weren't enforced! Then I change position on this. No limits at all.

Wow, we've gone full swing to traders wanting outright manipulation and market fixing to protect their rates. The solution is quite simple, first, remove FRR. With the number of autolending bots, there's no need for it.

Second, put lend durations on their own books. Have, say, four lend books total, 2 day, 7 day, 14 day, and 30 day. This more accurately reflects how true fixed interest markets work. It would also prevent bid/ask from crossing. Additionally, because the lends are callable (the borrower can end the loan and return the funds at any time) borrowers can automatically take the best rate from any book they want. All the time duration risk lies on the lender and can be reflected in yield curve.