they're planning to roll them out in the near future.
Topic: How many of you have been Zhoutonged? - page 8. (Read 26392 times)
they're planning to roll them out in the near future.
It's important to know that currently we always have a chain of forced liquidations, because forced liquidations will push the price to trigger more forced liquidations. We will just make sure that they are fully hedged in the market and the prices are reasonable.
so how do you define "reasonable"?
no offense but your business model is doomed. especially since mtgox, the major exchange, is going to be offering similar hedging options. you will always be one step behind them in reacting to volatility as they will be the HFT and you will be the retail equivalent.
not to be mean but i think you're offering to reverse trades for those customers wiped out in the last ramp b/c if you don't your client base will never return and you need to keep them alive and in the game.
this is going to keep happening over and over again.
The point is "going to". I'm going to build breakthroughs too, and you forgot this. Bitcoinica is already using Redis to track prices, and we already have the back-end engine to process 10,000 trades per second. Who will be the first to do HFT?
The business model may be doomed in the future but definitely not now. Bitcoinica has always been changing more quickly than our competitors.
Also, I didn't reverse any trades that happens under $4.55. Sorry but the "reasonable" price range is only the obvious personal feeling. $4.55 is reasonable, and $4.89 is not. I'm the guy coding and I know the price is wrong, that's why I'm reversing. I don't claim profits that shouldn't be mine.
then why do HFT companies pay millions of USD's every year to co-locate their computers in a room next to the NYSE? mtgox IS the exchange and will be competing with you in the option business. you will never be able to measure up to their service.
It's important to know that currently we always have a chain of forced liquidations, because forced liquidations will push the price to trigger more forced liquidations. We will just make sure that they are fully hedged in the market and the prices are reasonable.
so how do you define "reasonable"?
no offense but your business model is doomed. especially since mtgox, the major exchange, is going to be offering similar hedging options. you will always be one step behind them in reacting to volatility as they will be the HFT and you will be the retail equivalent.
not to be mean but i think you're offering to reverse trades for those customers wiped out in the last ramp b/c if you don't your client base will never return and you need to keep them alive and in the game.
this is going to keep happening over and over again.
The point is "going to". I'm going to build breakthroughs too, and you forgot this. Bitcoinica is already using Redis to track prices, and we already have the back-end engine to process 10,000 trades per second. Who will be the first to do HFT?
The business model may be doomed in the future but definitely not now. Bitcoinica has always been changing more quickly than our competitors.
Also, I didn't reverse any trades that happens under $4.55. Sorry but the "reasonable" price range is only the obvious personal feeling. $4.55 is reasonable, and $4.89 is not. I'm the guy coding and I know the price is wrong, that's why I'm reversing. I don't claim profits that shouldn't be mine.
This is why trading options is better than shorting. With option trading, your loss is limited and you don't get margin calls.
Bitcoin is so volatile that some random spike is likely to wipe out a leveraged short position. With an option, you only care what the price is when the option matures.
Bitcoin doesn't have options, of course.
Bitcoin is so volatile that some random spike is likely to wipe out a leveraged short position. With an option, you only care what the price is when the option matures.
Bitcoin doesn't have options, of course.
Options recently came out on vircurex.
It's important to know that currently we always have a chain of forced liquidations, because forced liquidations will push the price to trigger more forced liquidations. We will just make sure that they are fully hedged in the market and the prices are reasonable.
so how do you define "reasonable"?
no offense but your business model is doomed. especially since mtgox, the major exchange, is going to be offering similar hedging options. you will always be one step behind them in reacting to volatility as they will be the HFT and you will be the retail equivalent.
not to be mean but i think you're offering to reverse trades for those customers wiped out in the last ramp b/c if you don't your client base will never return and you need to keep them alive and in the game.
this is going to keep happening over and over again.
This is why trading options is better than shorting. With option trading, your loss is limited and you don't get margin calls.
Bitcoin is so volatile that some random spike is likely to wipe out a leveraged short position. With an option, you only care what the price is when the option matures.
Bitcoin doesn't have options, of course.
Bitcoin is so volatile that some random spike is likely to wipe out a leveraged short position. With an option, you only care what the price is when the option matures.
Bitcoin doesn't have options, of course.
Options recently came out on vircurex.
Let me get this correct... So when the price spiked up and people were trading on Mt.Gox at $4.5, Zhoutong's genius matching algorithm put the buy price at a $1 spread and force liquidate people's position at $4.9 
?? 
So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
?? So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
Can you send an email to [email protected] about this? We'd like to compensate you on this.
While it's true that our algorithm sets the price by balancing and predicting the benefit and the risk, after all the trading, there's no point of predicting, and we can clearly see that the prediction was wrong. So we are perfectly okay to refund you the "unexpected profit" we made from you.
I hope this explanation makes sense.
to be honest, i don't see any explanation as to why or how you determined "unexpected profits".
If we liquidated the customer's assets at $4.50 but we charged the customer $4.90 for it, I would say $0.35-$0.39 should be the unexpected profit.
On the other hand, if the customer's assets shouldn't be liquidated at the price of $4.50 instead of $4.90, the better solution is to reverse it.
how did your algorithm make this mistake?
At the point of $4.50, there were a lot of forced liquidations, stop orders and market buy orders, and there's almost no depth beyond the price until $4.90. So the algorithm decided that the price should be set at $4.90 to minimize the risk for Bitcoinica based on the actual situations.
Then there are sell orders and price decreased, so the algorithm relaxed and lowered the spread. And the previous high were proven wrong.
It's important to know that currently we always have a chain of forced liquidations, because forced liquidations will push the price to trigger more forced liquidations. We will just make sure that they are fully hedged in the market and the prices are reasonable.
Let me get this correct... So when the price spiked up and people were trading on Mt.Gox at $4.5, Zhoutong's genius matching algorithm put the buy price at a $1 spread and force liquidate people's position at $4.9 ??
So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
?? So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
Can you send an email to [email protected] about this? We'd like to compensate you on this.
While it's true that our algorithm sets the price by balancing and predicting the benefit and the risk, after all the trading, there's no point of predicting, and we can clearly see that the prediction was wrong. So we are perfectly okay to refund you the "unexpected profit" we made from you.
I hope this explanation makes sense.
to be honest, i don't see any explanation as to why or how you determined "unexpected profits".
If we liquidated the customer's assets at $4.50 but we charged the customer $4.90 for it, I would say $0.35-$0.39 should be the unexpected profit.
On the other hand, if the customer's assets shouldn't be liquidated at the price of $4.50 instead of $4.90, the better solution is to reverse it.
how did your algorithm make this mistake?
Let me get this correct... So when the price spiked up and people were trading on Mt.Gox at $4.5, Zhoutong's genius matching algorithm put the buy price at a $1 spread and force liquidate people's position at $4.9 ??
So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
?? So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
Can you send an email to [email protected] about this? We'd like to compensate you on this.
While it's true that our algorithm sets the price by balancing and predicting the benefit and the risk, after all the trading, there's no point of predicting, and we can clearly see that the prediction was wrong. So we are perfectly okay to refund you the "unexpected profit" we made from you.
I hope this explanation makes sense.
to be honest, i don't see any explanation as to why or how you determined "unexpected profits".
If we liquidated the customer's assets at $4.50 but we charged the customer $4.90 for it, I would say $0.35-$0.39 should be the unexpected profit.
On the other hand, if the customer's assets shouldn't be liquidated at the price of $4.50 instead of $4.90, the better solution is to reverse it.
Let me get this correct... So when the price spiked up and people were trading on Mt.Gox at $4.5, Zhoutong's genius matching algorithm put the buy price at a $1 spread and force liquidate people's position at $4.9 ??
So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
?? So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
Can you send an email to [email protected] about this? We'd like to compensate you on this.
While it's true that our algorithm sets the price by balancing and predicting the benefit and the risk, after all the trading, there's no point of predicting, and we can clearly see that the prediction was wrong. So we are perfectly okay to refund you the "unexpected profit" we made from you.
I hope this explanation makes sense.
to be honest, i don't see any explanation as to why or how you determined "unexpected profits".
Let me get this correct... So when the price spiked up and people were trading on Mt.Gox at $4.5, Zhoutong's genius matching algorithm put the buy price at a $1 spread and force liquidate people's position at $4.9 ??
So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
?? So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
Can you send an email to [email protected] about this? We'd like to compensate you on this.
While it's true that our algorithm sets the price by balancing and predicting the benefit and the risk, after all the trading, there's no point of predicting, and we can clearly see that the prediction was wrong. So we are perfectly okay to refund you the "unexpected profit" we made from you.
I hope this explanation makes sense.
come one come all, Zhoutong proposes to refund you all?
Actually I did reverse/refund those obviously inaccurate forced liquidations. But it just happens that some were missing (excuse me hundreds of orders come at once).
Let me get this correct... So when the price spiked up and people were trading on Mt.Gox at $4.5, Zhoutong's genius matching algorithm put the buy price at a $1 spread and force liquidate people's position at $4.9 ??
So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
?? So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
Can you send an email to [email protected] about this? We'd like to compensate you on this.
While it's true that our algorithm sets the price by balancing and predicting the benefit and the risk, after all the trading, there's no point of predicting, and we can clearly see that the prediction was wrong. So we are perfectly okay to refund you the "unexpected profit" we made from you.
I hope this explanation makes sense.
come one come all, Zhoutong proposes to refund you all?
Let me get this correct... So when the price spiked up and people were trading on Mt.Gox at $4.5, Zhoutong's genius matching algorithm put the buy price at a $1 spread and force liquidate people's position at $4.9 ??
So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
?? So when all these forced buy bitcoins are actually bought in Mt.Gox market at any price around $4.1-4.5, the all difference goes into Bitcoinica's pocket?
I've been Zhoutonged good!!!
Can you send an email to [email protected] about this? We'd like to compensate you on this.
While it's true that our algorithm sets the price by balancing and predicting the benefit and the risk, after all the trading, there's no point of predicting, and we can clearly see that the prediction was wrong. So we are perfectly okay to refund you the "unexpected profit" we made from you.
I hope this explanation makes sense.
Quote
Because although it will work most of the time, sometimes when the prices moves too fast, they aren't able to liquidate on time, which would effectively cause the account of that person who was liquidated to have a negative balance. And they can't be sure that person is honest enough to deposit more funds to make the balance go to zero or positive again. And if they don't deposit more, Bitcoinica would have lost money themselves.
And it seems that doesn't always work either. After my position was liquidated, I still had a -$69 balance. I deposited some money to cover it, but I can't imagine that everyone would do that.
Yeah, spreads only reduce the risk. They don't completely eliminate the risks. That's why they must find a good balance between dampening their risk and providing smaller spreads to stay competitive. That's exactly why the spread is increased in situations when there's more risks (High volatility and/or shallow order book) because they need to protect themselves against those risks, and later reduced again once the dust settles down.
the Voice of Reason.
Quote
Because although it will work most of the time, sometimes when the prices moves too fast, they aren't able to liquidate on time, which would effectively cause the account of that person who was liquidated to have a negative balance. And they can't be sure that person is honest enough to deposit more funds to make the balance go to zero or positive again. And if they don't deposit more, Bitcoinica would have lost money themselves.
And it seems that doesn't always work either. After my position was liquidated, I still had a -$69 balance. I deposited some money to cover it, but I can't imagine that everyone would do that.
Yeah, spreads only reduce the risk. They don't completely eliminate the risks. That's why they must find a good balance between dampening their risk and providing smaller spreads to stay competitive. That's exactly why the spread is increased in situations when there's more risks (High volatility and/or shallow order book) because they need to protect themselves against those risks, and later reduced again once the dust settles down.
Quote
Because although it will work most of the time, sometimes when the prices moves too fast, they aren't able to liquidate on time, which would effectively cause the account of that person who was liquidated to have a negative balance. And they can't be sure that person is honest enough to deposit more funds to make the balance go to zero or positive again. And if they don't deposit more, Bitcoinica would have lost money themselves.
And it seems that doesn't always work either. After my position was liquidated, I still had a -$69 balance. I deposited some money to cover it, but I can't imagine that everyone would do that.
I have a lot of cash in my account. Is the only way I can get it out is by a wire or can I just use it to buy bitcoin?
If I have to use a wire... WTF.... If not, tell me how to do it:)
Thanks
If I have to use a wire... WTF.... If not, tell me how to do it:)
Thanks
Or withdraw to your Mtgox account via Mtgox codes, and withdraw your funds via Mtgox.
I have a lot of cash in my account. Is the only way I can get it out is by a wire or can I just use it to buy bitcoin?
If I have to use a wire... WTF.... If not, tell me how to do it:)
Thanks
If I have to use a wire... WTF.... If not, tell me how to do it:)
Thanks
Click "exchange" in top bar. Put in amount of USD to "sell" for BTC, click "Exchange". Poof, you have bitcoins.
With those fast movements and shallow order book they _have_ to have big spreads, or Bitcoinica risks losing a lot of money on spikes. They would effectively be Zhoutonging themselves! I agree that those big spreads suck as a trader, though 
Why not liquidate at Gox and give the customer whatever price they actually got?
Because although it will work most of the time, sometimes when the prices moves too fast, they aren't able to liquidate on time, which would effectively cause the account of that person who was liquidated to have a negative balance. And they can't be sure that person is honest enough to deposit more funds to make the balance go to zero or positive again. And if they don't deposit more, Bitcoinica would have lost money themselves.
Edit: Also, when a large position is liquidated, that in itself will push the price up or drive the price down. If that effect is big enough due to a shallow order book, that can also cause the liquidation not to be executed for the right price, which will leave a negative balance.
By calculating spreads, they are effectively calculating the risk and protecting themselves against it. This allows them to guarantee liquidity.
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