This Bitfinex Credit Bubble cannot end well - page 33.

FattyMcButterpants

sr. member

Activity: 448

Merit: 250

Quote from: Keyara on July 08, 2014, 04:58:29 PM

Quote from: FattyMcButterpants on July 08, 2014, 04:54:35 PM

Quote from: theonewhowaskazu on July 08, 2014, 04:32:23 PM

Quote from: FattyMcButterpants on July 08, 2014, 04:15:32 PM

Quote from: theonewhowaskazu on July 08, 2014, 04:08:06 PM

Its possible to take swap but never pay for it. That's the pb.

Also, since a year ago, we've increased by about 600%. It would be very possible to leverage long on that with a 200% interest rate.

would it be wise, considering weeks and months of sideways price action? that's a lot of interest to pay for sideways, and through times of down trending. it's one thing to hold, it's another to baghold margin.

Well, its just the buy and hodl strategy except leveraged.

I know quite a few people basically in that exact situation who aren't complaining or sweating it much right now.

Not saying its the best strategy but you can't deny people are doing it, and I don't think its going to end any time soon .

i just dont really get it, though. if you are going to baghold for months anyway, then liquidity really is no issue. so why not leverage on MT4 and pay no interest?

What MT4? Which country is the company located?

MetaTrader 4 is a trading platform. to trade BTC on it (with leverage) you trade through BTCE which is based in Bulgaria. obviously, then you want to look at the reputability of BTCE.

BTCE --> finance tab > Meta Trader

Keyara

full member

Activity: 174

Merit: 100

Quote from: FattyMcButterpants on July 08, 2014, 04:54:35 PM

Quote from: theonewhowaskazu on July 08, 2014, 04:32:23 PM

Quote from: FattyMcButterpants on July 08, 2014, 04:15:32 PM

Quote from: theonewhowaskazu on July 08, 2014, 04:08:06 PM

Its possible to take swap but never pay for it. That's the pb.

Also, since a year ago, we've increased by about 600%. It would be very possible to leverage long on that with a 200% interest rate.

would it be wise, considering weeks and months of sideways price action? that's a lot of interest to pay for sideways, and through times of down trending. it's one thing to hold, it's another to baghold margin.

Well, its just the buy and hodl strategy except leveraged.

I know quite a few people basically in that exact situation who aren't complaining or sweating it much right now.

Not saying its the best strategy but you can't deny people are doing it, and I don't think its going to end any time soon .

i just dont really get it, though. if you are going to baghold for months anyway, then liquidity really is no issue. so why not leverage on MT4 and pay no interest?

What MT4? Which country is the company located?

FattyMcButterpants

sr. member

Activity: 448

Merit: 250

Quote from: theonewhowaskazu on July 08, 2014, 04:32:23 PM

Quote from: FattyMcButterpants on July 08, 2014, 04:15:32 PM

Quote from: theonewhowaskazu on July 08, 2014, 04:08:06 PM

Its possible to take swap but never pay for it. That's the pb.

Also, since a year ago, we've increased by about 600%. It would be very possible to leverage long on that with a 200% interest rate.

would it be wise, considering weeks and months of sideways price action? that's a lot of interest to pay for sideways, and through times of down trending. it's one thing to hold, it's another to baghold margin.

Well, its just the buy and hodl strategy except leveraged.

I know quite a few people basically in that exact situation who aren't complaining or sweating it much right now.

Not saying its the best strategy but you can't deny people are doing it, and I don't think its going to end any time soon .

i just dont really get it, though. if you are going to baghold for months anyway, then liquidity really is no issue. so why not leverage on MT4 and pay no interest?

theonewhowaskazu

sr. member

Activity: 448

Merit: 250

Quote from: FattyMcButterpants on July 08, 2014, 04:15:32 PM

Quote from: theonewhowaskazu on July 08, 2014, 04:08:06 PM

Its possible to take swap but never pay for it. That's the pb.

Also, since a year ago, we've increased by about 600%. It would be very possible to leverage long on that with a 200% interest rate.

would it be wise, considering weeks and months of sideways price action? that's a lot of interest to pay for sideways, and through times of down trending. it's one thing to hold, it's another to baghold margin.

Well, its just the buy and hodl strategy except leveraged.

I know quite a few people basically in that exact situation who aren't complaining or sweating it much right now.

Not saying its the best strategy but you can't deny people are doing it, and I don't think its going to end any time soon .

FattyMcButterpants

sr. member

Activity: 448

Merit: 250

Quote from: theonewhowaskazu on July 08, 2014, 04:08:06 PM

Its possible to take swap but never pay for it. That's the pb.

Also, since a year ago, we've increased by about 600%. It would be very possible to leverage long on that with a 200% interest rate.

would it be wise, considering weeks and months of sideways price action? that's a lot of interest to pay for sideways, and through times of down trending. it's one thing to hold, it's another to baghold margin.

theonewhowaskazu

sr. member

Activity: 448

Merit: 250

Its possible to take swap but never pay for it. That's the pb.

Also, since a year ago, we've increased by about 600%. It would be very possible to leverage long on that with a 200% interest rate.

wachtwoord

legendary

Activity: 2324

Merit: 1125

Quote from: Marbit on July 08, 2014, 01:14:30 PM

Quote from: nrd525 on July 07, 2014, 08:29:13 PM

Apparently the people going long have already maxed out their existing credit. There are some uber-bulls.

Another note on sustainability - the amount of swaps has been growing since Bitfinex started. I've been watching since January 2013. So far it's proven relatively sustainable. It is very possible that some of the speculators are sitting on massive profits from having gone long in 2013.

So they just stay put holding leveraged positions, and constantly renewing swap? Sometimes interest rates get up over 200% annual...

Yes, that cannot be profitable. How are people not going out of business?

Marbit

hero member

Activity: 686

Merit: 500

Quote from: nrd525 on July 07, 2014, 08:29:13 PM

Apparently the people going long have already maxed out their existing credit. There are some uber-bulls.

Another note on sustainability - the amount of swaps has been growing since Bitfinex started. I've been watching since January 2013. So far it's proven relatively sustainable. It is very possible that some of the speculators are sitting on massive profits from having gone long in 2013.

So they just stay put holding leveraged positions, and constantly renewing swap? Sometimes interest rates get up over 200% annual...

dadugan

full member

Activity: 179

Merit: 100

Quote from: Dalmar on July 08, 2014, 07:02:40 AM

Quote from: Gargulan on July 07, 2014, 11:48:29 PM

Which Chinese exchange let user lend?

OKCoin and Huobi (through BitVC).

I thought okcoin and houbi only let users borrow and not lend.

Dalmar

hero member

Activity: 1106

Merit: 500

Life is short, practice empathy in your life

Quote from: Gargulan on July 07, 2014, 11:48:29 PM

Which Chinese exchange let user lend?

OKCoin and Huobi (through BitVC).

myself

legendary

Activity: 938

Merit: 1000

chaos is fun...…damental :)

Quote from: Sukrim on July 08, 2014, 03:07:29 AM

Quote from: myself on July 07, 2014, 09:49:24 PM

Quote from: Dalmar on July 07, 2014, 09:44:31 PM

Quote from: wachtwoord on July 07, 2014, 09:36:52 PM

And that makes up this incredible difference? Well apparently the market thinks so. If the market as reflected by Bitfinex actually is a real and free market that is ...

The Chinese exchanges recently have been copying BFX's swap model and their rates are fairly similar. The high interest rates are basically bitcoin exchange risk premiums.

yo mean my model

Hi Zhou Tong... Wink

ha he had a bucket shop with inverse swaps I took that "shit" to leverage/debt market level that today is called swaps .......

Sukrim

legendary

Activity: 2618

Merit: 1007

Quote from: myself on July 07, 2014, 09:49:24 PM

Quote from: Dalmar on July 07, 2014, 09:44:31 PM

Quote from: wachtwoord on July 07, 2014, 09:36:52 PM

And that makes up this incredible difference? Well apparently the market thinks so. If the market as reflected by Bitfinex actually is a real and free market that is ...

The Chinese exchanges recently have been copying BFX's swap model and their rates are fairly similar. The high interest rates are basically bitcoin exchange risk premiums.

yo mean my model

Hi Zhou Tong... Wink

Gargulan

full member

Activity: 231

Merit: 100

Quote from: Dalmar on July 07, 2014, 09:44:31 PM

Quote from: wachtwoord on July 07, 2014, 09:36:52 PM

And that makes up this incredible difference? Well apparently the market thinks so. If the market as reflected by Bitfinex actually is a real and free market that is ...

The Chinese exchanges recently have been copying BFX's swap model and their rates are fairly similar. The high interest rates are basically bitcoin exchange risk premiums.

Which Chinese exchange let user lend?

myself

legendary

Activity: 938

Merit: 1000

chaos is fun...…damental :)

Quote from: Dalmar on July 07, 2014, 09:44:31 PM

Quote from: wachtwoord on July 07, 2014, 09:36:52 PM

And that makes up this incredible difference? Well apparently the market thinks so. If the market as reflected by Bitfinex actually is a real and free market that is ...

The Chinese exchanges recently have been copying BFX's swap model and their rates are fairly similar. The high interest rates are basically bitcoin exchange risk premiums.

yo mean my model

Dalmar

hero member

Activity: 1106

Merit: 500

Life is short, practice empathy in your life

Quote from: wachtwoord on July 07, 2014, 09:36:52 PM

And that makes up this incredible difference? Well apparently the market thinks so. If the market as reflected by Bitfinex actually is a real and free market that is ...

The Chinese exchanges recently have been copying BFX's swap model and their rates are fairly similar. The high interest rates are basically bitcoin exchange risk premiums.

wachtwoord

legendary

Activity: 2324

Merit: 1125

Quote from: Sukrim on July 07, 2014, 08:46:31 PM

Quote from: wachtwoord on July 07, 2014, 08:15:00 PM

Quote from: Sukrim on July 07, 2014, 07:28:01 PM

Quote from: wachtwoord on July 07, 2014, 07:14:07 PM

Anyway, how on Earth are these leveraged longs holding on for these periods of time while paying these sky-high interest rates? Especially considering interest rates for USD are at record lows in the real world ... It just makes zero chance. I would not be surprised if something shady is going on.

Just look at the charts - as long as there are swings like this, 0.2%/day interest is pocket change. Also consider that other exchanges charge more for a single trade (often from both sides), not just per day. If you trade one single time less you already have saved the swap fees...

But you can borrow USD way cheaper ...

With a lot more effort maybe, also you either will NOT be able to borrow a few 100k USD with BTC as collateral or you might at least have to answer some quite nasty questions. Also USD are not transferred as fast as BTC - depending on your lender it would take several days until you actually have the USD you borrowed on an exchange to trade with.

And that makes up this incredible difference? Well apparently the market thinks so. If the market as reflected by Bitfinex actually is a real and free market that is ...

Sukrim

legendary

Activity: 2618

Merit: 1007

Quote from: wachtwoord on July 07, 2014, 08:15:00 PM

Quote from: Sukrim on July 07, 2014, 07:28:01 PM

Quote from: wachtwoord on July 07, 2014, 07:14:07 PM

Anyway, how on Earth are these leveraged longs holding on for these periods of time while paying these sky-high interest rates? Especially considering interest rates for USD are at record lows in the real world ... It just makes zero chance. I would not be surprised if something shady is going on.

Just look at the charts - as long as there are swings like this, 0.2%/day interest is pocket change. Also consider that other exchanges charge more for a single trade (often from both sides), not just per day. If you trade one single time less you already have saved the swap fees...

But you can borrow USD way cheaper ...

With a lot more effort maybe, also you either will NOT be able to borrow a few 100k USD with BTC as collateral or you might at least have to answer some quite nasty questions. Also USD are not transferred as fast as BTC - depending on your lender it would take several days until you actually have the USD you borrowed on an exchange to trade with.

wachtwoord

legendary

Activity: 2324

Merit: 1125

Quote from: nrd525 on July 07, 2014, 08:29:13 PM

Apparently the people going long have already maxed out their existing credit. There are some uber-bulls.

Another note on sustainability - the amount of swaps has been growing since Bitfinex started. I've been watching since January 2013. So far it's proven relatively sustainable. It is very possible that some of the speculators are sitting on massive profits from having gone long in 2013.

Well then the rates will go way down when the ETF is released as I can borrow USD at Interactive Brokers for 1.59% APR https://www.interactivebrokers.com/en/index.php?f=interest&p=schedule2

nrd525

legendary

Activity: 1868

Merit: 1023

Apparently the people going long have already maxed out their existing credit. There are some uber-bulls.

Another note on sustainability - the amount of swaps has been growing since Bitfinex started. I've been watching since January 2013. So far it's proven relatively sustainable. It is very possible that some of the speculators are sitting on massive profits from having gone long in 2013.

wachtwoord

legendary

Activity: 2324

Merit: 1125

Quote from: Sukrim on July 07, 2014, 07:28:01 PM

Quote from: wachtwoord on July 07, 2014, 07:14:07 PM

Anyway, how on Earth are these leveraged longs holding on for these periods of time while paying these sky-high interest rates? Especially considering interest rates for USD are at record lows in the real world ... It just makes zero chance. I would not be surprised if something shady is going on.

Just look at the charts - as long as there are swings like this, 0.2%/day interest is pocket change. Also consider that other exchanges charge more for a single trade (often from both sides), not just per day. If you trade one single time less you already have saved the swap fees...

But you can borrow USD way cheaper ...

Topic: This Bitfinex Credit Bubble cannot end well - page 33. (Read 62099 times)