Topic: Mt. Gox, Reverse Analysis (Read 741 times)
It makes no sense to kill the goose that lays the golden egg. So it must be liquidity and not Gox arbitraging itself.
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During the last weeks we were hearing bad rumours, news and horror stories about Mt. Gox withdrawal delays.
In the other hand we see a price higher in Mt Gox than any other exchange, in fact the exchange rate of Mt. Gox is not a reference for Bitcoin price at all.
Most of us think that Mt Gox is facing a severe liquidity problem.
But is taking weeks and when a financial institution has liquidity issues it collapse fast, is not a long process, lest say you have u$s 100.000 at Mt Gox and you think they just don't have the cash... the instinct move is to move out of there as fast as you can, if you loose 20% is better than loosing 100%, so everybody will move from Fiat to BTC their BTC price will skyrocket several times in a couple of hours.
I believe that a liquidity problem is the most probable scenario but some situations does not describe the events I will expect from the evolution of a liquidity crisis.
Lets think bad for 5 minutes what if... there is not liquidity issue and Mt Gox intentionally delay the wires, what if the feed the rumours to force this artificial overprice in his exchange? They can send the cash to Bitstamp buy Bitcoins at $800 and sell them for $930 at his exchange, at least a 10% profit in dollars.
Again I am not saying they are doing that trick but it might be?
TML
In the other hand we see a price higher in Mt Gox than any other exchange, in fact the exchange rate of Mt. Gox is not a reference for Bitcoin price at all.
Most of us think that Mt Gox is facing a severe liquidity problem.
But is taking weeks and when a financial institution has liquidity issues it collapse fast, is not a long process, lest say you have u$s 100.000 at Mt Gox and you think they just don't have the cash... the instinct move is to move out of there as fast as you can, if you loose 20% is better than loosing 100%, so everybody will move from Fiat to BTC their BTC price will skyrocket several times in a couple of hours.
I believe that a liquidity problem is the most probable scenario but some situations does not describe the events I will expect from the evolution of a liquidity crisis.
Lets think bad for 5 minutes what if... there is not liquidity issue and Mt Gox intentionally delay the wires, what if the feed the rumours to force this artificial overprice in his exchange? They can send the cash to Bitstamp buy Bitcoins at $800 and sell them for $930 at his exchange, at least a 10% profit in dollars.
Again I am not saying they are doing that trick but it might be?
TML
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