Topic: MtGox fee to high? (0.65%) (Read 8005 times)

MtGox has done a stand up job considering. They have the ability to manipulate prices, charge higher fees, and crash the market if they wanted to. They haven't done any such thing (that we're aware of). 0.65% is far below most broker fees and exchange fees that you will be charged for other currencies as an average consumer. For the risk they incur, I'd say 0.65% is too low. They're putting their lives at risk because a government may potentially imprison them unjustly out of fear of what BTC could mean for the balance of economic and political power.

http://en.wikipedia.org/wiki/Natural_monopoly

Natural monopolies aren't necessarily bad. MtGox isn't really one in my eyes, either, just first to the game at the top. There are competitors to MtGox at this point. Keep in mind that MtGox is only roughly around 14% of the total BTC transactions in the market. I would say, though, that they provide the barometer for BTC->USD above all other exchanges; their BTC->USD price is stared at by all.

http://coinbits.com/mtgox-is-14-of-the-current-transaction-volume/

The barriers for another exchange to enter the market aren't terribly high. I've worked at a currency exchange before in the US. There's annoying paperwork, the occasional audit, and general fear that the government is going to find something wrong, but overall it's not bad. For what MtGox is doing to be legal in the US would require an MSB registration and a broker's license. MSB registration is fairly easy to obtain. A broker's license can be obtained by a willing individual, or a broker can be brought on for a cut.

People are fearing MtGox's demise, but a US based competitor that's legal can appear as a competitor very easily in my eyes. Tradehill already is bounds easier than MtGox. I'm not sure if they're legal by being registered and brokered, but they are accepting domestic US wire transfers, which tells me they're operating in the open, so I hope for their sake they're legal. Wire transfers are much easier than the Dwolla->MtGox fiasco that happens, and many magnitudes easier than LibertyReserve. A legitimate exchange in the US could also potentially accept ACH transfers, making it even easier. If you're lucky, you could negotiate a PayPal agreement. Pipe dreams perhaps on that one.

The only major worry I have is the government seeing BTC as a threat and outlawing currency trading for it as a whole. It's so radically different than any other currency out there that it's likely to scare many simple minded politicians trying to retain power and wealth. But I guarantee you many will secretly have BTC for their own wealth if it maintains

Spamming your referral link in all related threads now eh?

Fine, I will too. 

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Yep, mtgox is really too high. I think BCM is a better choice.

Please don't nest so many quote tags.

Based on my own opinion solely.

Based on what? MtGox alread ywent down to DDoS sometime last month for extended period of time. There was no crash (admittedly there was a price bump when it came back up).

Sadly the best post in this thread was about the difficulty in setting up an exchange, not due to technical reasons (this is easy as pie) but due to the legality of such an exchange. A huge portion of bitcoin users exist in a country where legally they would be at huge risk if they set up an exchange.

So you know better than MtGox how to run an exchange? Or are you just saying life would be "fairer" if the exchange had less fees? 'cos guess what: Life isn't fair!

Right now MtGox downtime, even briefly, could cause havoc (wild fluctuations or a crash) to the exchange rate. We need it to be as reliable as possible, and if that takes a 0.65% fee, so be it.

Also free to start your own competing exchange and set the fees you think are right!

There are already competing exchanges up. Look at the Bitcoin Watch Markets page: http://bitcoincharts.com/markets/

Mt. Gox is at the top, but all the other listings are other markets, and there's a reasonable number for BTC/USD. Bitcoin Market seems to have a reasonable volume going at the moment, too.

The thing about Bitcoin is, if you think the people running Mt. Gox are too rich, and you'd be down with, say, government-mandated redistribution of wealth to reduce income inequality, then tough luck. You're the one who wanted the cryptographically secure cyber-currency, and you have to deal with the consequences.

MtGox is good for what it is, but it's unhealthy to have one dominant player. The Statists can temporarily disrupt the BTC economy if it got shut down. I really don't like paying 0.65%, but I can't build a competing exchange without diverting resources from more profitable ventures. When the incentives change, so will my behavior. Right now, nothing bitcoin-related is more profitable than buying and holding bitcoins.

the price is what the market will bear. 0.65% is not too high to buy a currency appreciating at a 200,000% annual rate.

There's a pretty big incentive to make a competitor to Mt. Gox.  The trouble is getting one set up in a country that won't shut you down.  And then you get one running and start taking business from Mt. Gox, they lower their prices and run you out of business.  Good for the consumer, but it's enough to prevent someone from entering the market.  The other thing is, if you just start out, and you have lower fees, you will barely be able to make any money until you get significant volume.

I definitely would welcome a competitor to Mt. Gox.  One idea to get bootstapped would be to have a mix of Mt. Gox and your own market.  You keep a reserve of currency and Bitcoins at Mt. Gox.  If someone sets an order on your exchange, they get the option of filling it only at your site, or at both yours and Mt. Gox.  That way if the coins become available at Mt. Gox, they can get them, but they pay the higher fee.  If they become available at your site, you pay a lower fee.  The owner of the new site would just need to move money and Bitcoins around to Mt. Gox to be able to purchase at any point in time.

Just get a bank account with an API, start an exchange with lower fees and you'll surely attract a lot of users. Automated transfers are the key feature.

Actually I think it's twice that (1252BTC) because afaik 0.65% is taken from both sides (and for some kind of withdrawals possibly some % too). But I don't have any problem with that because:

• you can easily code another market, convince people to use it and profit
• you need to be aware however that one day, some goverment may ask you if you have and paid for doing
• not only gov, but any kind hacker can win quite a bit of a bounty if he gets on that server full of private keys, and that's a lot of risk
• even though MagicalTux got Mt.Gox when it was already functional he still is an early adopter, I would like to own it now, but I would never thought of getting all these problems for myself, so it was like bitcoin - high risk and much to win
• and he was in right place and right time with well earned knowledge and experience that were needed here

One thing I have mixed feelings about are dark pools. Knowing them gives one opportunity to earn a lot on trading bitcoins, especially that mtgox pretty much dictates current price.

i would like too, but i don't have the time.
I am still in school.

i can't see me trying to force MtGox to set a lower fee, im only suggesting that they should set a lower fee.

and im also suspecting that the last qoute you has takeing from me, you must have misread.

If you all don't want to see an MtGox, put your bitcoins where your mouth is!  Or, at least give me opinions on whether you'd be interested in collaborating to start up a competitor.
http://forum.bitcoin.org/index.php?topic=11385

Some of your quotes in this topic:

it might not be so high that it is a problem for you.
but i think MtGox should not take so much for it.

i dont like that! i think the fee should be around 0.05% its more fair. (it gives them a ~48.25btc/2day)

good point. but still 626btc/2day is way to much.

i think they should have many coins, but not as much as they have now.

oh. yes but then there is file recovery... its easier just to burn the whole computer.

Cheaper way exist, put your wallet on a cheap 64mb usb stick and burn it.

it should be eazy:
get some gasoline.
put it on your pc.
take a ligther.
watch the stuff burn.