M❄

[M❄ @marcusmarcus_]

@thegoosedao HONK

[GOOSE DAO 🪿 @thegoosedao]

Goose DAO 🤝 gud fee tek

[M❄ @marcusmarcus_]

@thegoosedao @met_lparmy @MeteoraAG Honk!

[Backpack 🎒 @Backpack]

Real stocks. On Solana.

Backpack will be the first CEX to list SEC-registered equities on chain.

Coming soon 🎒

[Armani Ferrante @armaniferrante]

Waking up to see this post, I'm a exhausted, disappointed, and heart broken to see it go viral and to see the responses.

No one cares about our users more than our team, and if you take the time to actually read our Discord and my tweets over the past day, I hope you'll see that. The team has spent the past 24 hours all hands on deck to make sure every single user story has been accounted for.

I don't have a crisis management team for this post. I honestly am shocked by it, given how much of a disconnect there is between how we actually feel, our actions, and the sentiment of the tweet. All I can do here is to give as much information as I can and to let the reader infer the truth.

As most of our long time users know, we often make mistakes, but we always do the right thing. This post appears to have taken a reply to a question out of context, where I'm explaining why something happened at a technical level. It doesn't mention our policy, our response, or what we're actually doing after yesterday's massive liquidation cascade.

The truth is that

- We paid out each and every trader *yesterday* immediately and automatically without issue. This has never been an issue.
- If you read our Discord announcements, you'll see that there has been zero clawbacks and zero socialized losses.
- We published our daily proof of reserves yesterday and the exchange has been operating uninterrupted since yesterday (although certainly with plenty of hiccups along the way)
- However, liquidity dropped off significantly when the market collapsed, causing a cascade of liquidations and ADLs on Backpack and every other exchange.
- As you can imagine, due to the massive liquidations, there are a lot of questions about what happened, e.g., what's auto deleveraging?
- This quoted screenshot and the associated tweet is completely taken out of context and doesn't communicate what is actually happening.

The screenshot, in truth, is a somewhat technical reply illustrating *how* futures profits and losses work. It is *not* a policy choice in response to any incident. It's explaining *why* something happened.

For those that don't have the context, here are the details:

- Firstly, Backpack is a completely neutral party. The exchange doesn't take on positions for users. We don't provide liquidity ourselves. The whole system works without reliance on any priviledged trader, vault, or any other party. In essence, it's infrastructure acting as a peer to peer match making service/exchange between longs and shorts, winners and loser.
- Every long has a short. This is a fundamental invariant of any perpetual futures system.
- When positions are closed, there is a settlement process, where profits and losses are exchanged between longs and shorts, winners and losers. Profits for perps are not printed out of thin air. It is not taken directly from our wallets either. Settlement is an intermediate step to realize the PnL.
- Winners on perps earn profits from losers. It's zero sum. That PnL is always conserved between the two parties on any given trade. Your counter party is the person on the other side of the exchange. When you profit on a perp, the losses are paid out directly from losers. If the losers run out of money, e.g., due to going bankrupt, then there's no money for the winners to realize their profits.

What happened yesterday, and what this quoted post is referring to, is that some of the losers went bankrupt and as a result their accounts were stuck in this "settlement" step. As a result, when those losing positions deposited into the exchange, the settlement process was able to automatically complete and the winners were automatically paid.

The issue: a small amount of these bankrupt users deposited into the exchange *before* we settled all accounts on the exchange on behalf of user. What the quoted post fails to mention is that we did this already, yesterday, before we published our daily proof of reserves, and we did this without question because it's simply the right thing to do.

Make no mistake: all positions have been settled without question across the board. We did not touch a single penny of unrealized PnL from our users and will never do so.

Going back to the topic of settlement mechanics. Settlement is not some horrible decision we made where we decided that we would take money from users after yesterday's event. It's a fundamental part of how the peer to peer system works: Loser pay winners directly. The exchange itself is not the counter party for a trade. The counter party is the person on the other side of the trade when you open a long or a short.

As a result, there's never a run on the bank risk. That's one of the many reasons why we are so comfortable publishing proof of reserves every single day, even on a historic liquidation day like yesterday. Even if the whole system were to blow up, the losses, contagion, and risk is isolated between all the longs/shorts, winners/losers. Anyone holding spot with no leverage is unaffected. This is a relatively technical point but it's an important one. We put an enormous amount of work into designing a system robust to these types of situations. Risk isn't an after thought, it's a core part of how the whole system is built.

To any user that deposited while their account was being settled--or to anyone that was unexpectedly affected for any reason--they should please email [email protected] and give us any and all information so that we can help. We are also present in Discord to answer questions. We do our absolute best to be available there all day every day, although in this case email is a lot easier for us to stay organized to move as quickly as possible.

In any case, I hope this clarifies the below quoted tweet, and what is actually happening. Honestly, we try to be some of the most approachable people we can. There's no question we don't answer. There's no PR crisis management team, here. We just do the right thing and hope that is good enough for the world.

We've put our heart and souls into our product, users, and community, and we will continue to do so.

Thank you for reading.

[M❄ @marcusmarcus_]

@doodles need

[doodles @doodles]

500K subs on Youtube over the weekend!

to celebrate, we're giving away 5x embroidered coaches jackets.

RT & comment 'need' to enter.

[M❄ @marcusmarcus_]

@MoneyTaura Your discord has been a godsend. Learnt so much, and being able to discuss with likeminded traders has upped my game significantly

[M❄ @marcusmarcus_]

@MeteoraAG Lfg Meteora

[Backpack 🎒 @Backpack]

Welcome to Season 1

[M❄ @marcusmarcus_]

I was responding exclusively to your comment about the unstaking period being an obstacle for leaving the project if you disagree with what is going down.

Don't really care about the drama around JUP.

If you feel that the ability to short a coin while you are unstaking, thus securing a delta neutral position and locking in the price you want to sell the coin at, is somehow "too risky for the average investor", then the problem at hand goes way beyond the industry.

[M❄ @marcusmarcus_]

@LandoBerando @armaniferrante 30 day unstaking is no longer a valid excuse in this day and age

You have every option at your disposal to short the token while you are unstaking

[Solana Legend 🎒💧 @SolanaLegend]

0/ With each new cycle comes a leading exchange, and @Backpack is building a next generation financial institution. Crypto and open finance allow anyone to trade any asset, borrow, earn yield, transact, and securely hold their assets without restrictions.

[M❄ @marcusmarcus_]

Hey Shai! Big Fan!

Been looking up on Quantum Computing now with all the recent unveilings made by big tech, and came across your post

Does your opinion of QC not being an immediate concern yet, especially for the likes of KAS, still stand? Or have recent advancements in the field changed that?

Thanks

[M❄ @marcusmarcus_]

@beefheartgoro @phantom Using @Backpack yup

[M❄ @marcusmarcus_]

I may not be the largest fan of OS, but this is honestly a step in the right direction.

While rewarding users for holding benefits projects more than the marketplace, it's step 1 in creating a healthier NFT environment.

Commendable move, hope others follow @_ilmoi @0xrwu

[dfinzer.eth | opensea @dfinzer]

we've heard the feedback on the current XP system, and we're putting a pause on XP given directly for listing and bidding

while we don’t think liquidity rewards are inherently bad (see more below), we understand that there are a lot of strong emotions towards point systems, and that the NFT market as a whole is in a unique spot right now. we’re building OS to support this space long term, so we’re pausing this part of the rewards program while we think through the best path forward

in the meantime, we'll focus the rewards program on XP shipments -- which were designed as a flexible way to reward broad participation in OS2, such as buying and holding

users that joined our beta early and gave feedback in Discord earned the first round of shipments because they helped us make the product better (thank you!)

our second round of shipments is going out now to a subset of the users that bought an NFT on OS2 -- with XP multipliers if you held an NFT from a top volume project for more than 3 months (the longer the time held, the bigger the boost). check your rewards tab on OS2 to see if you got one

if you didn’t get a shipment this time around, more are on their way. we’ll continue to reward buyers and holders that use OS2

regarding liquidity incentives, I want to be clear about our thinking here: we're operating a business in a competitive space, and liquidity is fundamental to any marketplace. we’re going to be thoughtful about adjustments / enhancements, but liquidity rewards in some form are important to offering a strong product in the market

lastly: I appreciate the feedback. we’ll continue to work closely with those who have helpful ideas. but some of the vitriol I saw on X this weekend appeared to be primarily motivated by extraction / attempts to bring OS down. we’re listening closely as we build, but we won’t be bullied. if you want to help us build the future constructively, we’re all ears.

[M❄ @marcusmarcus_]

@guccishark_ @ExoticRaccoon This is amazing dude

[M❄ @marcusmarcus_]

@daosdotworld @HypurrDao Couldn't have chosen a better blockchain to expand to

@thegoosedao is ready for you 🪿