Topic: Secondmarket with upcoming professional bitcoin exchange. (Read 1135 times)
Please hold it for a while with the good news, I need to scope more loan advances and wire money
will people stop hyping up secondmarkets stupid exchanges.
the main exchanges secondmarket is involved in (bitcoin trust, winklevoss and others) are all investment companies selling pretty much shares of their company. they wont have bitcoin wallet withdrawals. its is purely a betting game using the real bitcoin price.. but copying it over to their database and then people gamble on its rise and fall, without actual bitcoins changing hands.
winklevoss for instance they are using their business value (based on the bitcoins holding) as a price value of their shares. so if bitcoins drop. the holdings are worth less, which means the business value drops. and thus the share price of the company drops.
anyone investing in winklevoss and other markets like this are not purchasing actual bitcoins which they withdraw.
so please stop highlighting this stupid effort of FIAT lovers pretending to be involved with the bitcoin market. the day trading on these stupid exchanges will not affect actual buys and sells on bitcoin exchanges.
-rant over-
the main exchanges secondmarket is involved in (bitcoin trust, winklevoss and others) are all investment companies selling pretty much shares of their company. they wont have bitcoin wallet withdrawals. its is purely a betting game using the real bitcoin price.. but copying it over to their database and then people gamble on its rise and fall, without actual bitcoins changing hands.
winklevoss for instance they are using their business value (based on the bitcoins holding) as a price value of their shares. so if bitcoins drop. the holdings are worth less, which means the business value drops. and thus the share price of the company drops.
anyone investing in winklevoss and other markets like this are not purchasing actual bitcoins which they withdraw.
so please stop highlighting this stupid effort of FIAT lovers pretending to be involved with the bitcoin market. the day trading on these stupid exchanges will not affect actual buys and sells on bitcoin exchanges.
-rant over-
A Bitcoin ETF structured similarly to the GLD exchange traded fund would swap bitcoins for ETF-shares with its authorized participants, and thus influence the market price of bitcoin. For example, if the net-asset value of the fund is less than the BTC ETF price on (say) the NASDAQ, then an authorized participant will sell the ETF short while purchasing bitcoins in the open market. They will then swap the bitcoin for newly-issued shares in the ETF, cover their short position, and pocket the arbitrage profit.
To put it more simply:
Assume:
- BTC price on BitStamp = $1000
- 1 ETF share is equal to 1 BTC
- The ETF is trading for $1050 on NASDQ
I would simultaneously short the ETF (giving me $1050) and purchase 1 BTC from BitStamp (costing me $1000). I then take my bitcoin to the ETF Fund Manager and say "I want to swap this bitcoin for 1 share" and he is obligated to issue me a share in exchange for my bitcoin. I then take that share and return it to the person who I borrowed it from in order to short it. So now I'm up $50.
Of course, the fund doesn't want to deal with any old Joe-blow and a couple BTC here and there, so they only allow "authorized participants" to arbitrage like this, and only in "baskets" of say 100 BTC or so.
DrGregMalhauser's thread covers this in great details: https://bitcointalksearch.org/topic/winkelvoss-etp-could-become-the-pricing-mechanism-for-btc-252330
will people stop hyping up secondmarkets stupid exchanges.
the main exchanges secondmarket is involved in (bitcoin trust, winklevoss and others) are all investment companies selling pretty much shares of their company. they wont have bitcoin wallet withdrawals. its is purely a betting game using the real bitcoin price.. but copying it over to their database and then people gamble on its rise and fall, without actual bitcoins changing hands.
winklevoss for instance they are using their business value (based on the bitcoins holding) as a price value of their shares. so if bitcoins drop. the holdings are worth less, which means the business value drops. and thus the share price of the company drops.
anyone investing in winklevoss and other markets like this are not purchasing actual bitcoins which they withdraw.
so please stop highlighting this stupid effort of FIAT lovers pretending to be involved with the bitcoin market. the day trading on these stupid exchanges will not affect actual buys and sells on bitcoin exchanges.
-rant over-
the main exchanges secondmarket is involved in (bitcoin trust, winklevoss and others) are all investment companies selling pretty much shares of their company. they wont have bitcoin wallet withdrawals. its is purely a betting game using the real bitcoin price.. but copying it over to their database and then people gamble on its rise and fall, without actual bitcoins changing hands.
winklevoss for instance they are using their business value (based on the bitcoins holding) as a price value of their shares. so if bitcoins drop. the holdings are worth less, which means the business value drops. and thus the share price of the company drops.
anyone investing in winklevoss and other markets like this are not purchasing actual bitcoins which they withdraw.
so please stop highlighting this stupid effort of FIAT lovers pretending to be involved with the bitcoin market. the day trading on these stupid exchanges will not affect actual buys and sells on bitcoin exchanges.
-rant over-
Good news about SecondMarket's proposed exchange, however the CoinDesk article reveals some major stupidities.
"Firstly, it will focus on price discovery. Using the gold market as a model, the exchange will attempt to fix the value of bitcoin once or twice a day to allow trading to be pegged at certain values and create a true indicator for the derivatives and mining markets."
"Oxymoron" means opposite senses combined together, usually illogically. You cannot have the oxymoron of price discovery while fixing value. Using the archaic model of the gold price fix is simply ridiculous. Volatility of the bitcoin price is a function of its newness and growth phase. Derivatives could be valued off 12 hour VWAP (ending GMT noon, midnight).
Slowing down price discovery only creates instability. Even gold has daily 10% dips and gains and that market is 5000 years old and worth 7 trillion dollars.
One thing MtGox got right was the principle of 24/7 continuous trading, which has been copied by all other exchanges since. Despite whale dumps and buys, the cryptocurrency markets have been the freest anywhere, and that is the correct model to maintain.
"Firstly, it will focus on price discovery. Using the gold market as a model, the exchange will attempt to fix the value of bitcoin once or twice a day to allow trading to be pegged at certain values and create a true indicator for the derivatives and mining markets."
"Oxymoron" means opposite senses combined together, usually illogically. You cannot have the oxymoron of price discovery while fixing value. Using the archaic model of the gold price fix is simply ridiculous. Volatility of the bitcoin price is a function of its newness and growth phase. Derivatives could be valued off 12 hour VWAP (ending GMT noon, midnight).
Slowing down price discovery only creates instability. Even gold has daily 10% dips and gains and that market is 5000 years old and worth 7 trillion dollars.
One thing MtGox got right was the principle of 24/7 continuous trading, which has been copied by all other exchanges since. Despite whale dumps and buys, the cryptocurrency markets have been the freest anywhere, and that is the correct model to maintain.
It's a good thing because it distributes the risk of Bitcoins failure among banks and large corporations who have leverage over the political structure of the United States...
This is a good thing, and there will also hopefully be a professional organization formed that vets these types of exchanges for their financials , outside audits and so on. This is just the beginning,,,
Secondmarket, they have some traditional financial experience and background, the risk will be better, but. the asset of digital currency industry is Bitcoin, how to keep and transfer it still is tough.
http://www.nytimes.com/2014/02/25/business/apparent-theft-at-mt-gox-shakes-bitcoin-world.html
Quote
SecondMarket’s plan is to create a platform more like the New York Stock Exchange, where only large institutions can join and trade.
Why do you guys think this is a good thing?
I guess we will be seeing a lot more exchanges opening up after the recent drama with mt gox.
think so too. in the next 1-2 years there will be alot better players. thats only the beginning.
http://www.coindesk.com/secondmarket-barry-silbert-launch-regulated-us-exchange-this-summer/
I guess we will be seeing a lot more exchanges opening up after the recent drama with mt gox.
Can't wait! We definitely need any bit of positive headlines to boost the Bitcoin community and price.
Quote
The new exchange is being put together by SecondMarket, which rose to fame a few years ago after creating a platform for buying and selling shares of companies like Twitter and Facebook before they went public.
Without the trouble at Mt. Gox, the SecondMarket plans would have been seen as a major boon for virtual currencies, providing a potential entry point into the Bitcoin market for large banks, which have so far avoided virtual currencies as their price has skyrocketed.
Until now, the major Bitcoin exchanges have all allowed anyone from the public to buy and sell virtual currency. SecondMarket’s plan is to create a platform more like the New York Stock Exchange, where only large institutions can join and trade.
[/quote]Without the trouble at Mt. Gox, the SecondMarket plans would have been seen as a major boon for virtual currencies, providing a potential entry point into the Bitcoin market for large banks, which have so far avoided virtual currencies as their price has skyrocketed.
Until now, the major Bitcoin exchanges have all allowed anyone from the public to buy and sell virtual currency. SecondMarket’s plan is to create a platform more like the New York Stock Exchange, where only large institutions can join and trade.
Thats is good news:) I hope they will develop some realy nice exchange!
http://www.nytimes.com/2014/02/25/business/apparent-theft-at-mt-gox-shakes-bitcoin-world.html
Quote
The new exchange is being put together by SecondMarket, which rose to fame a few years ago after creating a platform for buying and selling shares of companies like Twitter and Facebook before they went public.
Without the trouble at Mt. Gox, the SecondMarket plans would have been seen as a major boon for virtual currencies, providing a potential entry point into the Bitcoin market for large banks, which have so far avoided virtual currencies as their price has skyrocketed.
Until now, the major Bitcoin exchanges have all allowed anyone from the public to buy and sell virtual currency. SecondMarket’s plan is to create a platform more like the New York Stock Exchange, where only large institutions can join and trade.
Without the trouble at Mt. Gox, the SecondMarket plans would have been seen as a major boon for virtual currencies, providing a potential entry point into the Bitcoin market for large banks, which have so far avoided virtual currencies as their price has skyrocketed.
Until now, the major Bitcoin exchanges have all allowed anyone from the public to buy and sell virtual currency. SecondMarket’s plan is to create a platform more like the New York Stock Exchange, where only large institutions can join and trade.
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