This Bitfinex Credit Bubble cannot end well - page 18.

trashman43

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Quote from: efreeti on August 12, 2014, 10:39:41 PM

Quote from: scarsbergholden on August 12, 2014, 02:50:46 AM

Quote from: ?? on ??

Bitfinex give us a lot of nice numbers to work with. The rest of the exchanges don't and it is hard to make a good guess.

That's my main trouble with putting too much into Bitfinex's numbers. I don't see them as a driver of this market at all. They follow China to the tee pretty much, so I'd be much more interested to see numbers on Okcoin and BitVC/Huobi. Bitfinex calls may make us wick down, but I doubt they would drive the rest of the market down.

China is a huge market despite government banning the bank from servicing bitcoin related business. You can still gauge the sentiment of bitcoin in China using the price on bitfinex.

the price on bitfinex, sure, but how about the swaps? that is what this thread is about.

efreeti

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Quote from: scarsbergholden on August 12, 2014, 02:50:46 AM

Quote from: ?? on ??

Bitfinex give us a lot of nice numbers to work with. The rest of the exchanges don't and it is hard to make a good guess.

That's my main trouble with putting too much into Bitfinex's numbers. I don't see them as a driver of this market at all. They follow China to the tee pretty much, so I'd be much more interested to see numbers on Okcoin and BitVC/Huobi. Bitfinex calls may make us wick down, but I doubt they would drive the rest of the market down.

China is a huge market despite government banning the bank from servicing bitcoin related business. You can still gauge the sentiment of bitcoin in China using the price on bitfinex.

scarsbergholden

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Quote from: ?? on ??

Bitfinex give us a lot of nice numbers to work with. The rest of the exchanges don't and it is hard to make a good guess.

That's my main trouble with putting too much into Bitfinex's numbers. I don't see them as a driver of this market at all. They follow China to the tee pretty much, so I'd be much more interested to see numbers on Okcoin and BitVC/Huobi. Bitfinex calls may make us wick down, but I doubt they would drive the rest of the market down.

DavidHume

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Quote from: Newbie1022 on August 11, 2014, 02:56:38 PM

And the credit bubble lives!!! Nice bleeder during the last rout. And yet, we sit over $30 million on Finex with other purveyors of leverage entering the game... and we are still falling anyways. =S Spooky!

This is irrational behavior also. The risk of putting money on the exchange is high but lenders are willing to lose it all to lend at around 30% rate.

Newbie1022

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And the credit bubble lives!!! Nice bleeder during the last rout. And yet, we sit over $30 million on Finex with other purveyors of leverage entering the game... and we are still falling anyways. =S Spooky!

DannyElfman

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Quote from: wachtwoord on August 06, 2014, 06:03:56 AM

I agree relative changes reflect sentiment, but I'm a long term investor anyway.

On a related note I have held shares of companies with huge short interest. In stocks this in only a good thing as shorts need to borrow the shares and the rate for this increases based on demand. This way you make a nice little extra on the side and are able to buy more at depressed prices. I like short sellers

Short selling is very good for the market, naked short selling is not. So What bitfinex offers is actually very good for the market Wink

wachtwoord

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I agree relative changes reflect sentiment, but I'm a long term investor anyway.

On a related note I have held shares of companies with huge short interest. In stocks this in only a good thing as shorts need to borrow the shares and the rate for this increases based on demand. This way you make a nice little extra on the side and are able to buy more at depressed prices. I like short sellers

N12

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Not large for the overall market? Yes, I agree. Although arguably you could take it as a sentiment indicator for the broader market, but it is hard to say how representative it is. Large for the exchange market, perhaps a little. Large for the Bitfinex market? Definitely.

There's no question that this has anything to do with any exchange other than Bitfinex and perhaps BTC-E, really. Why would it, when the last margin induced flash crash on Bitfinex didn't?

wachtwoord

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Quote from: N12 on August 06, 2014, 05:44:39 AM

Quote from: wachtwoord on August 06, 2014, 05:42:34 AM

Does anyone have data on the percentage of shorts and the percentage of leveraged longs? (percentage to the market cap so 21M BTC)

Sure we do. Just check out https://www.bitfinex.com/pages/stats or http://www.bfxdata.com.

Right now it's near 30 million USD vs. 5.3k BTC.

Thanks!

So the short is completely negligible and the leveraged long isn't that large either at roughly 50k BTC (a quarter percent of the market cap). Can we all relax now?

For reference even a huge stable and respected company such as MSFT has 1% of it's float sold short (sorry I don't have data on leveraged longs as that's not even collected centrally I would guess).

N12

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Quote from: wachtwoord on August 06, 2014, 05:42:34 AM

Does anyone have data on the percentage of shorts and the percentage of leveraged longs? (percentage to the market cap so 21M BTC)

Sure we do. Just check out https://www.bitfinex.com/pages/stats or http://www.bfxdata.com.

Right now it's near 30 million USD vs. 5.3k BTC.

wachtwoord

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Quote from: N12 on August 06, 2014, 04:53:49 AM

Quote from: Essex343 on August 06, 2014, 04:40:08 AM

So....long squeeze still incoming? Cuz I been hearing that tale for a loooooong time now. Just sayin. Tongue

Maybe because the overall condition has persisted for a long time? It's just that few spoke about it before. A few weeks or months isn't much compared when this has been going on since either March 2014 or even winter 2013, depending on how you view it.

I'm not sure it's particularly probable per se that a flash crash has to happen. It's conceivable to deleverage in a more orderly fashion, or that this pattern holds out long enough and the saviour rally actually comes. Also, the longs on Bitfinex is just one particular aspect of that exchange, and Bitfinex is one particular aspect of the overall market (a flash crash on Bitfinex is unlikely to significantly affect Bitstamp), and the exchanges are just one aspect of the overall market too.

But, with the current amount of longs versus shorts, IF a deep spike downwards happens, it's going to be hard to not have a liquidation cascade.

Does anyone have data on the percentage of shorts and the percentage of leveraged longs? (percentage to the market cap so 21M BTC)

N12

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Quote from: Essex343 on August 06, 2014, 04:40:08 AM

So....long squeeze still incoming? Cuz I been hearing that tale for a loooooong time now. Just sayin. Tongue

Maybe because the overall condition has persisted for a long time? It's just that few spoke about it before. A few weeks or months isn't much compared when this has been going on since either March 2014 or even winter 2013, depending on how you view it.

I'm not sure it's particularly probable per se that a flash crash has to happen. It's conceivable to deleverage in a more orderly fashion, or that this pattern holds out long enough and the saviour rally actually comes. Also, the longs on Bitfinex is just one particular aspect of that exchange, and Bitfinex is one particular aspect of the overall market (a flash crash on Bitfinex is unlikely to significantly affect Bitstamp), and the exchanges are just one aspect of the overall market too.

But, with the current amount of longs versus shorts, IF a deep spike downwards happens, it's going to be hard to not have a liquidation cascade.

fonzie

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Right now there is a huge amount of USD swap offers that far exceed the demand. Question is how many of them will buy into BTC if we should go upwards?
This could fuel up the next rise and might help to close old levereaged long positions without tragedy.

Essex343

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So....long squeeze still incoming? Cuz I been hearing that tale for a loooooong time now. Just sayin. Tongue

Nrcewker

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LuckyDiamond.io - FLAT 50% Deposit Bonus!

At least now Bitfinex is very good, enjoy the process, they do not care what the end

DannyElfman

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Quote from: Marbit on August 05, 2014, 05:55:49 PM

Quote from: DannyElfman on August 05, 2014, 05:42:02 PM

Quote from: Marbit on August 05, 2014, 05:37:18 PM

Quote from: DannyElfman on August 05, 2014, 05:10:33 PM

I think it is funny that people use highly leveraged positions and let them go near forced liquidation, then due to market movements and illiquidity, get stopped and try to blame all on bitfinex.

Ever wondered why no serious trader using bitfinex ever complained?

Do you really think that? Have a good long read in the service discussion thread. Their market freeze + locking shorts in position during a rally left many traders with a very sour taste in their mouth.

Yes I remember that well, but that was a business decision. In no way did the traders implied that Bitfinex was entering positions and being a bucket shop. (That is what most people here accuse BFX of).

Their business and success is hugely depended on a healthy swap market and freezing the market in chain-liquidation scenarios is a bad but apparently neccessary step.

Saying "it's a business decision" doesn't mean that no serious trader every complained.... plenty of traders had legitimate complaints in that fiasco.

I wouldn't make any assumptions about their business model.

You are right.

Atleast in the bucket shop accusation I am pretty positive that they act honest.

I prolly should leave now to not get branded a shill :p

Marbit

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Quote from: DannyElfman on August 05, 2014, 05:42:02 PM

Quote from: Marbit on August 05, 2014, 05:37:18 PM

Quote from: DannyElfman on August 05, 2014, 05:10:33 PM

I think it is funny that people use highly leveraged positions and let them go near forced liquidation, then due to market movements and illiquidity, get stopped and try to blame all on bitfinex.

Ever wondered why no serious trader using bitfinex ever complained?

Do you really think that? Have a good long read in the service discussion thread. Their market freeze + locking shorts in position during a rally left many traders with a very sour taste in their mouth.

Yes I remember that well, but that was a business decision. In no way did the traders implied that Bitfinex was entering positions and being a bucket shop. (That is what most people here accuse BFX of).

Their business and success is hugely depended on a healthy swap market and freezing the market in chain-liquidation scenarios is a bad but apparently neccessary step.

Saying "it's a business decision" doesn't mean that no serious trader every complained.... plenty of traders had legitimate complaints in that fiasco.

I wouldn't make any assumptions about their business model.

DannyElfman

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Quote from: nrd525 on August 05, 2014, 05:43:21 PM

The bubble might be alleviated (or at least decentralized) by http://www.coindesk.com/huobis-bitvc-opens-new-bitcoin-interest-accounts-all-international-customers/

Their system is a joke compared to BFX. They have no true market price for swap but just distribute it evenly to lenders and let borrowers pay way too much for it.

Maybe they change it though.

nrd525

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The bubble might be alleviated (or at least decentralized) by http://www.coindesk.com/huobis-bitvc-opens-new-bitcoin-interest-accounts-all-international-customers/

DannyElfman

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Quote from: Marbit on August 05, 2014, 05:37:18 PM

Quote from: DannyElfman on August 05, 2014, 05:10:33 PM

I think it is funny that people use highly leveraged positions and let them go near forced liquidation, then due to market movements and illiquidity, get stopped and try to blame all on bitfinex.

Ever wondered why no serious trader using bitfinex ever complained?

Do you really think that? Have a good long read in the service discussion thread. Their market freeze + locking shorts in position during a rally left many traders with a very sour taste in their mouth.

Yes I remember that well, but that was a business decision. In no way did the traders implied that Bitfinex was entering positions and being a bucket shop. (That is what most people here accuse BFX of).

Their business and success is hugely depended on a healthy swap market and freezing the market in chain-liquidation scenarios is a bad but apparently neccessary step.

Topic: This Bitfinex Credit Bubble cannot end well - page 18. (Read 62097 times)