We've just launched a cool new feature called loans that give you back 5% of your bet amounts each Monday. An awesome consequence of loans is they increase the incentive to bet in long term markets.
What changes will we make to the design or implementation of loans in the next 60 days?
If there are multiple right answers, I will resolve to all of them, in proportion to how important I think they are.
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@MartinRandall I think a specific suggestion of which bug should get fixed might have been more likely to have been chosen.
@Gigacasting people trade what they know best, with very limited capital
Providing a small loan for any single-click bet would be almost risk-free (~100 coin flips against them not likely at ~200-300 loans) and give liquidity to 'less trusted' / illiquid markets where no one has any interest in using their own capital
@JamesGrugett "Your argument sounds like a reason everything should be a loan!"
I mean, I wouldn't say no....
@JamesGrugett I find it exciting to get daily income rather than weekly. The annoyance thing isn't really a factor for daily loans because I get far more notification spam from other sources of daily income.
One could use the same logic for daily streak income. Clearly y'all think those are a positive experience on net (though I still disagree - not due to the daily thing, due to the coercive and punitive element), so I'm not sure why the same argument wouldn't apply to loans.
@MattP Hmm, yeah. I think there should be something we can do about those perverse incentives. Jack's suggestion was that you get your loan back immediately if you buy back in after selling out. That seems like a good idea.
Your argument sounds like a reason everything should be a loan!
@JamesGrugett also, if it closes tomorrow, or next week, what's the harm in Manifold giving the loan? I get what you're saying about this being an odd idea, but I suspect the more you think about it the more you'll realize it has most of the upsides of the current system, removes some downsides, and the things that you might think are downsides aren't actually problems. (Who cares if someone gets a big loan for a market that closes next week? It'll close next week and they'll be proven right or wrong anyway)
@FutureOwl Haha, yup. You have to pay them back, but you might be getting a payout for the market resolving at the same time. You could come out ahead then!
@JamesGrugett yeah, basing it off of close date requires too many safeguards to prevent abuse. Basing it off of market length is a hack to get around some of the perverse incentives users like @MartinRandall have brought up that can discourage traders with existing loans from correcting markets upon new information, since they lose their loans. Eg:
@MattP I don't really see how this makes sense. Really, we want to know how much longer the market will be open for. If it closes tomorrow, or next week, there's not much reason to get any loan. It doesn't matter whether the market for 2024 president has been open for a year already or not. It only matters how much time is left.
But there's no surefire way to know how long a market will be open, so that's why we have the current approach where the longer after your bet, the more money returns as a loan.
@LivInTheLookingGlass I feel like it's less meaningful if it's every day. The amounts would be small and there's nothing to look forward to. Plus it's more annoying to get an income notification every day?
@MattP I think the odds of this being implemented in the next 60 days are low. Also, arguably this is a special case of margin calls.
A more likely hypothetical: portfolio balance is m2000, mana balance is m1000, cap is portfolio value + balance = m3000, loans are at the cap = m3000. Probably I should not be able to cash out my balance such that my loan is over my cap.
Dr P has a portfolio value of m11,000 and m1,000 loan/week. Spindle has a portfolio value of m46,000 and m5,000 loan/week. Still, these amounts are small compared to other startup costs.
@MartinRandall with the current implementation, you'd have had to have a really terrible investment crash for this to happen as loans will cease disbersing once they hit portfolio value, yeah? (or portfolio value plus balance, not quite sure which)