Bitstamp now needs 18,000 bitcoins to get back to where they were - page 2.

NotLambchop

sr. member

Activity: 378

Merit: 254

Quote from: Elwar on January 06, 2015, 09:16:29 AM

... They will then need to convert that $5 million to bitcoins to get back to equilibrium of 180,000 and $10 million.

So, how do you believe they will do that?

They believe in Bitcoin, why would they be holding USD? Who does that?

ravenjt

full member

Activity: 215

Merit: 100

Quote from: Elwar on January 06, 2015, 09:35:36 AM

So, what would be the best approach to return to equilibrium?

Presumably to pray that (or engineer that) the BTC price crashes, so it only has to pay out a small amount of new USD to customers transferring the BTC to USD then withdrawing.
This suggests that it should discourage withdrawals of BTC, and instead encourage withdrawals of USD.

mike81

member

Activity: 62

Merit: 10

Quote from: Elwar on January 06, 2015, 09:35:36 AM

Yes, I would not expect it to be instant. BitStamp would need to have a strategy to transition back to equilibrium but in the meantime they would have a fractional reserve thing going on.

So, what would be the best approach to return to equilibrium?

I don't think they are unbalanced at this stage even. So only when everyone starts to withdraw their BTC and fiat there might be a slight problem. I don't see this happening. If they reopen quickly and restore customer confidence trading will continue and may even get back to normal levels. Business as usual.

ElectricMucus

legendary

Activity: 1666

Merit: 1057

Marketing manager - GO MP

They should ask Mark Karpeles to reimburse them.

Srsly if you believe this "hack" story you deserve everything that's coming.

Elwar

legendary

Activity: 3598

Merit: 2386

Viva Ut Vivas

Quote from: Jammalan the Prophet on January 06, 2015, 09:21:13 AM

They don't need those 18000.

This is the biggest mistake people make.
Those coins where deposited on bitstamp by users who either wish to use them trade or to sell and get the money.

It's highly unlikely that everybody who deposited those 18000 coins will ask for them next thing tomorrow.
I assume a lot of them will just sell their coins (credited to their accounts) and demand back the usd.
So for those bitstamp can simply pay in usd.

Yes, I would not expect it to be instant. BitStamp would need to have a strategy to transition back to equilibrium but in the meantime they would have a fractional reserve thing going on.

So, what would be the best approach to return to equilibrium?

celebreze32

sr. member

Activity: 296

Merit: 250

Quote from: Elwar on January 06, 2015, 09:16:29 AM

Bitstamp says they had 10-15% of their bitcoins in their hotwallet.

So, for easy math let's say they have 180,000 bitcoins and the last I checked they had over $10 million in orders.

They didn't have any of their fiat stolen, but they only have ~162,000 bitcoins.

They can probably add $5 million worth of fiat from their corporate account or investors or whichever. They will then need to convert that $5 million to bitcoins to get back to equilibrium of 180,000 and $10 million.

So, how do you believe they will do that?

Pantera Capital invested $10m in Bitstamp during 2013, which could cover double their $5m loss.

http://www.coindesk.com/paypal-bitstamp-chief-compliance-officer/

Bitstamp used to do business directly with Bitfinex.

This article says Bitfinex used to include the Bitstamp order book in their own order book for liquidity purposes. In other words, they were arbitraging between themselves and Bitstamp.

http://bitcoinvista.com/2014/06/12/the-bitcoin-trading-platform-bitfinex-is-distancing-themselves-from-bitstamp/

Bitstamp could probably do a deal directly with Bitfinex or other companies they have connections to.

Jammalan the Prophet

sr. member

Activity: 500

Merit: 250

They don't need those 18000.

This is the biggest mistake people make.
Those coins where deposited on bitstamp by users who either wish to use them trade or to sell and get the money.

It's highly unlikely that everybody who deposited those 18000 coins will ask for them next thing tomorrow.
I assume a lot of them will just sell their coins (credited to their accounts) and demand back the usd.
So for those bitstamp can simply pay in usd.

TrollinU

member

Activity: 152

Merit: 10

https://eloncity.io/

Market buy the whole thing in one go of course Roll Eyes

$10,000 here we come!!!!!! Cool

Elwar

legendary

Activity: 3598

Merit: 2386

Viva Ut Vivas

Bitstamp says they had 10-15% of their bitcoins in their hotwallet.

So, for easy math let's say they have 180,000 bitcoins and the last I checked they had over $10 million in orders.

They didn't have any of their fiat stolen, but they only have ~162,000 bitcoins.

They can probably add $5 million worth of fiat from their corporate account or investors or whichever. They will then need to convert that $5 million to bitcoins to get back to equilibrium of 180,000 and $10 million.

So, how do you believe they will do that?

Topic: Bitstamp now needs 18,000 bitcoins to get back to where they were - page 2. (Read 1881 times)