Price volatility is a measure of how liquid an instrument is... the more liquid the less volatile especially with a decentralized system, which is the goal here. The idea is less collusion and partnering up of whales to corner markets to create dips...
To me reading charts over the years, the volatility of bitcoin is very bullish as it means that we are very early of a large bull run and that near the end you would see more liquidity coming in and less volatility which would mute the critics who say they can't use btc because of volatility. By that time obviously its too late from an investors standpoint but it may be a perfectly obvious choice as a currency to transact for goods and services. At the start of every major bull run you always see volatility... like how it went from $50 back to $2.. but now the swings in % aren't quite as much.. telling me we have a long way to go up before it settles at which point I would say I'm happy to sell there or that there is no need to sell at that point because everything you need is denominated in btc.
Topic: Gold collapsing. Bitcoin UP. - page 1170. (Read 2032266 times)
yeah, i saw that and is the source of all my objections:
"The extensive plans represent a drastic shift in how bitcoins have been traditionally bought and sold through exchanges, with the company adopting a “hub-and-spoke” model that will find the exchange only interacting with formal members. Non-members will not be allowed to facilitate transactions on the exchange, however."
this is the definition of centralization. the inner spokes could conceivably control the price while the outsiders at the periphery would be mere spectators.
Well, no shit. Welcome to the future of Bitcoin.
Actually, as long as individuals can trade amongst themselves it will be difficult to control. But as soon as tainting (a-la coin validation) is ready and fully rolled in, people who transact in an opaque manner, or without the proper licensing as though Bitcoin were cash can be controlled (by simply tainting the coins associated with such transactions.)
lets hope tainting never happens.
“We’re going to attempt to slow things down a bit and create a true indication of bitcoin value, once or twice a day."
why? i like 24/7 fast price action. price fixes like this are artificial by the sheer nature of lag itself and the cherry picked prices. who is he to say we need to slow things down and what we have now is artificial?
News flash: What cypherdoc likes or does not like has just about exactly zero impact on that will happen.
well duh.
passive aggressive much?
yeah, i saw that and is the source of all my objections:
"The extensive plans represent a drastic shift in how bitcoins have been traditionally bought and sold through exchanges, with the company adopting a “hub-and-spoke” model that will find the exchange only interacting with formal members. Non-members will not be allowed to facilitate transactions on the exchange, however."
this is the definition of centralization. the inner spokes could conceivably control the price while the outsiders at the periphery would be mere spectators.
“We’re going to attempt to slow things down a bit and create a true indication of bitcoin value, once or twice a day."
why? i like 24/7 fast price action. price fixes like this are artificial by the sheer nature of lag itself and the cherry picked prices. who is he to say we need to slow things down and what we have now is artificial?
Agreed. Though assuming normal 24/7 liquid exchanges still exist (outside the hub/spoke deal), arbitrage would be doable. Sounds like the level of price-manipulation possible comes down to the degree to which the mega-exchange interior is willing to naked short.
yeah, i saw that and is the source of all my objections:
"The extensive plans represent a drastic shift in how bitcoins have been traditionally bought and sold through exchanges, with the company adopting a “hub-and-spoke” model that will find the exchange only interacting with formal members. Non-members will not be allowed to facilitate transactions on the exchange, however."
this is the definition of centralization. the inner spokes could conceivably control the price while the outsiders at the periphery would be mere spectators.
Well, no shit. Welcome to the future of Bitcoin.
Actually, as long as individuals can trade amongst themselves it will be difficult to control. But as soon as tainting (a-la coin validation) is ready and fully rolled in, people who transact in an opaque manner, or without the proper licensing as though Bitcoin were cash can be controlled (by simply tainting the coins associated with such transactions.)
“We’re going to attempt to slow things down a bit and create a true indication of bitcoin value, once or twice a day."
why? i like 24/7 fast price action. price fixes like this are artificial by the sheer nature of lag itself and the cherry picked prices. who is he to say we need to slow things down and what we have now is artificial?
News flash: What cypherdoc likes or does not like has just about exactly zero impact on that will happen.
The claim that the volatility in bitcoin is "too much" is bullshit.
this is exactly right.
volatility serves the purpose of shaking out the weak hands who don't or won't understand what we're dealing with here. and that being the first of its kind global digital currency that is totally transparent and open. in fact, many ppl do recognize this, and THIS is what accounts for the parabolic rises of over-exuberance that we've witnessed so many times. w/o the volatility everybody and their mother would be able to climb on board and everyone would be rich. that's impossible. bull markets don't work that way; there's going to be winners and losers and only a few of us will make it to the end. and so we have crashes to balance out the parabolas.
this is how it has to be.
I think I was implicitly assuming that the member banks would be operating their own retail-exchanges, similar to NYSE.
do you have a source for this?
Yeah: http://www.coindesk.com/secondmarket-barry-silbert-launch-regulated-us-exchange-this-summer/
Quote
Silbert explained:
“If you want to buy and sell bitcoin you have to go through one of the members, and the members are all going to be regulated businesses. They’ll be banks, they’ll be MSBs, they’ll be bitcoin companies, they’ll be broker dealers. The idea is the other exchanges of the world could actually become members of the exchange.”
The result, Silbert said, would be an environment similar to the New York Stock Exchange (NYSE), where individual customers go through brokers such as Fidelity or TD Ameritrade in order to complete transactions. The idea for the market itself is based on the IntercontinentalExchange (ICE) Group.
“If you want to buy and sell bitcoin you have to go through one of the members, and the members are all going to be regulated businesses. They’ll be banks, they’ll be MSBs, they’ll be bitcoin companies, they’ll be broker dealers. The idea is the other exchanges of the world could actually become members of the exchange.”
The result, Silbert said, would be an environment similar to the New York Stock Exchange (NYSE), where individual customers go through brokers such as Fidelity or TD Ameritrade in order to complete transactions. The idea for the market itself is based on the IntercontinentalExchange (ICE) Group.
yeah, i saw that and is the source of all my objections:
"The extensive plans represent a drastic shift in how bitcoins have been traditionally bought and sold through exchanges, with the company adopting a “hub-and-spoke” model that will find the exchange only interacting with formal members. Non-members will not be allowed to facilitate transactions on the exchange, however."
this is the definition of centralization. the inner spokes could conceivably control the price while the outsiders at the periphery would be mere spectators.
“We’re going to attempt to slow things down a bit and create a true indication of bitcoin value, once or twice a day."
why? i like 24/7 fast price action. price fixes like this are artificial by the sheer nature of lag itself and the cherry picked prices. who is he to say we need to slow things down and what we have now is artificial?
The claim that the volatility in bitcoin is "too much" is bullshit.
Bitcoin operates with the current exchanges in a free manner.
Price fixing is bullshit. Just another way to manipulate the price to allow shenanigans to go on behind the scenes with new whales who are in fiat but want in on the Bitcoin train.
Bitcoin operates with the current exchanges in a free manner.
Price fixing is bullshit. Just another way to manipulate the price to allow shenanigans to go on behind the scenes with new whales who are in fiat but want in on the Bitcoin train.
I think I was implicitly assuming that the member banks would be operating their own retail-exchanges, similar to NYSE.
do you have a source for this?
Yeah: http://www.coindesk.com/secondmarket-barry-silbert-launch-regulated-us-exchange-this-summer/
Quote
Silbert explained:
“If you want to buy and sell bitcoin you have to go through one of the members, and the members are all going to be regulated businesses. They’ll be banks, they’ll be MSBs, they’ll be bitcoin companies, they’ll be broker dealers. The idea is the other exchanges of the world could actually become members of the exchange.”
The result, Silbert said, would be an environment similar to the New York Stock Exchange (NYSE), where individual customers go through brokers such as Fidelity or TD Ameritrade in order to complete transactions. The idea for the market itself is based on the IntercontinentalExchange (ICE) Group.
“If you want to buy and sell bitcoin you have to go through one of the members, and the members are all going to be regulated businesses. They’ll be banks, they’ll be MSBs, they’ll be bitcoin companies, they’ll be broker dealers. The idea is the other exchanges of the world could actually become members of the exchange.”
The result, Silbert said, would be an environment similar to the New York Stock Exchange (NYSE), where individual customers go through brokers such as Fidelity or TD Ameritrade in order to complete transactions. The idea for the market itself is based on the IntercontinentalExchange (ICE) Group.
...and his desperation to accept regulation at his level sounds to me like he lost Yen to the gox bk.
If he was stupid enough to keep non-trivial funds in Gox, then I just lost a lot of respect for him.
Second Market never used GOX prices. He even told he is not buying at GOX.
i think ppl are just panicking after gox's failure. watch the Bloomberg interview of Silbert. even he comes across as desperate to me. he even says they prematurely came forward with this idea to counteract the gox news. and his desperation to accept regulation at his level sounds to me like he lost Yen to the gox bk.
Isn't he just using the gox news to get extra publicity for his own exchange? Put it on the map as "the next big thing".
I think I was implicitly assuming that the member banks would be operating their own retail-exchanges, similar to NYSE.
do you have a source for this?
...and his desperation to accept regulation at his level sounds to me like he lost Yen to the gox bk.
If he was stupid enough to keep non-trivial funds in Gox, then I just lost a lot of respect for him.
in the same way they "set" interests too low, they can set a Bitcoin price too low. how do they do that with interest rates? with an avalanche of digital money typed into a computer screen and artificial buying of UST's via pomo's. in Bitcoin's case, a too low fix would act like a naked short that tv above alluded to. and if they start losing money when they stray too far from the real price, they just go cry to mommy, the Fed, to cover their losses. in the meantime, the real Bitcoin will take a hit.
my concern is it's a matter of size; the banks bring billions/trillions of artificial USD's to the table while Bitcoin is still in a nascent phase and potentially manipulable.
Ok, I get it if it comes down to naked shorting as the manipulation tool. There'd have to be a lot of ability for the exchange/system to operate without transparency regarding accounts balancing, etc. Is Barry cool with that?
how can you or i arbitrage when we're not allowed to go into their artificial exchange and buy low to sell high on a real exchange?
I think I was implicitly assuming that the member banks would be operating their own retail-exchanges, similar to NYSE.
the real question is why do the banks want to make it a closed, exclusive exchange?
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
I don't think the motive is sinister, I think it is a matter of political expedience. Bitcoin's image is not pristine; if this new exchange is open exclusively to big highly-visible and regulated players, there will be less objections from above and below. In other words, this has better optics.
A foot in the door...
who cares about better optics or political expediency? Bitcoin is doing just fine, thank you very much. i don't care that we're at half the high; what matters to me is that we're at 19.13x the price of one year ago exactly.
i think ppl are just panicking after gox's failure. watch the Bloomberg interview of Silbert. even he comes across as desperate to me. he even says they prematurely came forward with this idea to counteract the gox news. and his desperation to accept regulation at his level sounds to me like he lost Yen to the gox bk.
the real question is why do the banks want to make it a closed, exclusive exchange?
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
I get how that can happen for interest rates, where member banks and CBs set the rates anyways, and can support some tacitly-colluded target. Can see it somewhat with the gold market too, since people aren't actually moving metal, and therefore there's lots of opportunity for obscurity with regard to who has what, etc.
in the same way they "set" interests too low, they can set a Bitcoin price too low. how do they do that with interest rates? with an avalanche of digital money typed into a computer screen and artificial buying of UST's via pomo's. in Bitcoin's case, a too low fix would act like a naked short that tv above alluded to. and if they start losing money when they stray too far from the real price, they just go cry to mommy, the Fed, to cover their losses. in the meantime, the real Bitcoin will take a hit.
my concern is it's a matter of size; the banks bring billions/trillions of artificial USD's to the table while Bitcoin is still in a nascent phase and potentially manipulable.
Quote
But with bitcoin, where the underlying asset can move instantly with zero friction, doesn't arbitrage take care of any gross price discrepancies rather quickly? What am I missing?
how can you or i arbitrage when we're not allowed to go into their artificial exchange and buy low to sell high on a real exchange?
the real question is why do the banks want to make it a closed, exclusive exchange?
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
I get how that can happen for interest rates, where member banks and CBs set the rates anyways, and can support some tacitly-colluded target. Can see it somewhat with the gold market too, since people aren't actually moving metal, and therefore there's lots of opportunity for obscurity with regard to who has what, etc.
But with bitcoin, where the underlying asset can move instantly with zero friction, doesn't arbitrage take care of any gross price discrepancies rather quickly? What am I missing?
the real question is why do the banks want to make it a closed, exclusive exchange?
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
If you take the point that some kind of daily fix is administratively desirable for an ETF, then how would you do it?
You can’t take any Exchange price because the tape will be painted. You can’t take a time average because it’s too historical. Asking a group of major buyers and sellers to tip their little flags at consensus isn’t that bad. As I said, if they’re consistently miles off the market they’ll soon be forced to change.
Retail investment, in the sense that buyers trust someone else to manage their coins, is coming and will operate in some ways we may think absurd. But that’s where the new money after next will come from.
the real question is why do the banks want to make it a closed, exclusive exchange?
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
I don't think the motive is sinister, I think it is a matter of political expedience. Bitcoin's image is not pristine; if this new exchange is open exclusively to big highly-visible and regulated players, there will be less objections from above and below. In other words, this has better optics.
A foot in the door...
the real question is why do the banks want to make it a closed, exclusive exchange?
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
i can think of only one reason; manipulation. remember that all they do for Libor is conduct phone calls that ask what interest rate participating banks can borrow money at. that's been definitively shown to be a scam.
a real exchange that includes all participants in a market would squelch that.
...
What I'm becoming more interested in is whether or not (and/or how) this new exchange could allow or prevent naked shorting. Can someone school me in how this works?
What I'm becoming more interested in is whether or not (and/or how) this new exchange could allow or prevent naked shorting. Can someone school me in how this works?
Here is what the exchanges can do to discourage naked shorting: They can keep folding and losing everyone's BTC. In this way people will eventually be trained to not retain a significant BTC balance under the care of the exchange.
In order to naked short, one needs to give someone something they don't have (and the other person needs to accept it.) This is relatively easy with stocks since the DTCC looks the other way and the receiver only sees what their brokerage account shows on the UI (that is, phantom shares.) BTC is different in that I don't have to rely on the broker's UI. I can rely on my own wallet as a source of truth. Of course if I'm using my exchange account as a bank account, all bets are off.
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