Topic: Warning: How many of you Bears have ever been a victim of a Short Squeeze? - page 27. (Read 43772 times)

LOL!  coming from you, who's normally quite conservative and measured, this is hilarious!

I think $20-30 from a short squeeze is highly unlikely. Perhaps the $10 range, but even that's just a wild guess. A significant rise like that due to short covering might garner fresh interest from Bitcoin neophytes and trigger more buying support.

Back to selling pressure: it's more likely that either mined BTC or existing BTC that had been purchased post-mining have been sold. How much of the total decline in price has been from short-selling versus normal inflationary debasement attributable to block generation, relative USD (or other currency) strength or other factors? Where other than Bitcoinica is short selling possible?

Without that information, it is virtually impossible to do much more than make an educated guess.

Now that I've got that out of the way: let's kill some shorts, I want to make a profit!

welcome back Vladimir. I missed you

The real short squeeze in bitcoin world will push bitcoin price to 20-30$ or higher even if for short time. Some tiny move from 2.5 to 3 is not a short squeeze at all, even if someone got a margin call. Wait for massive amount of margin calls one causing another and as result a violent parabolic move up. That would be the squeeze. The market is fairly shallow and the squeeze can be huge.

Potentially interesting strategy is to place some sell orders now in 20-30-50 range even if just to ease short's pain. lol.

I'm watching the show.

I don't consider it to be a short squeeze, just a normal fluctuation.

Some short sellers were liquidated, unfortunately.

Late afternoon here.  Been watching it and enjoying the show. 

And a nice midnight snack at $3. Refreshing after all the weekend declines.

Waiting for momentum to kick in...

liquidate their asses Zhoutong.

there's nothing like a midnight Squeeze 

This is not trading against my clients. Zero net position is still maintained because there are always leftovers in our reserves, i.e. we're risking part of our profits in an effort to reduce total transaction cost. There's no net profit from this kind of activity because everything is automated. And pricing algorithm is completely independent.

For example, you have a $1,000 deposit and want to short 200 BTC. In the spot market, we may sell 0% - 100% of the 200 BTC. (Average 40-60%). A small part is reserved for future internal matching. (A short period, depending on volatility.) It's impossible to have another 200 BTC buy order coming up at the same time. So all we can do is reserve a small part of this sell order in the pool. This is where risk comes from.

If there's another sell order coming up in this period, we will just give up and most likely lose a small amount of money on this trade. If a buy order coming up, we can absorb the spreads and make some profits.

We have a system to monitor the status of the pool. Our profits are roughly equal to our losses. There's no algorithm to maximize profit or whatsoever. This is just a way to save transaction cost and offer better spreads a typical exchange.

If we are trading against you, we will look at your stop orders and try to manipulate the price to exactly trigger your stop order and change the price back. This is definitely not we are doing.

But, if you believe that a price-agnostic bot holding unhedged positions for only a few seconds using independent algorithms using its own money is practically a brokerage trading against clients, I have nothing to explain. We're purely generating value for customers, and we don't make a single cent from doing this.

you said that


And you claim not to trade against your clients?




 

This is pretty like a show. I'm surprised that many people in this thread changed the topic from short selling to Bitcoinica.

I respect the value of this thread if it's talking about the possible effects of short squeeze on short sellers (or even USD holders) in general. But Bitcoinica is a bit irrelevant here because we don't really have many short sellers.

Just now I had a quick lookup on the positions. I'm very clear about what will happen. Let me leave something here:

If BTC/USD suddenly spikes to 10,000. Most Bitcoinica clients will be happy (two ways: making profits and limiting losses through stop orders). Bitcoinica will be happy because its BTC profits will increase in value. Not all positions can be hedged but zero net position can still be maintained.

Bitcoinica won't be wiped out. Instead, it will prove its robustness.

It's completely fine to stereotype about Bitcoinica's future, and I actually appreciate that. The community effort is much more useful than the risk assessments. However, one thing remains clear, I will be the one paying for everything if I'm lying about my risk now.

I have no incentive to cheat. From the day that I disclosed my age, I knew I would lose at least 50% of customers. Many people don't trust Bitcoinica. But Bitcoinica is not a money making machine. It's just a product that sets a high standard for the Bitcoin community. I feel that existing solutions are not good enough, and hardly anyone can really design an economically-feasible, financially-proven, technically-robust with an innovative business model, and intuitive and elegant design all at the same time. But I believe that Bitcoinica has done it.

If I'm cheating myself, then I'm simply destroying my hard work, my reputation and my future. I'm interested in generating long-term value for everyone, and we all are, that's why we are here. From day one, Bitcoinica is never just another going-to-close exchange.

If you're still in doubt, just know that Bitcoinica is not having as many short positions as you think at this price and point of time. The recent fluctuations have already driven some short sellers (who use leverage excessively) away. The rest of the short sellers are mostly backed with large amounts of margin and long-term trading history at Bitcoinica.

Perhaps he should look into registering Bitcoinica.bit...

There's no need to target garage sales, especially when that's a marginal impact. This is aimed at businesses that deal in cash transactions; relatively low-hanging fruit. Craigslist does not facilitate the actual transactions; it only provides a way of connecting two parties. Keeping that in mind, the contact information is valuable and could conceivably be used by law enforcement to then monitor for potentially large transactions (such as automobile trading... at first).

So no court battle is necessary because CL does not participate in the actual transaction, although US supreme courts cases have an overwhelming record of winning in favor of gov't against any opposition. Government can and will take more drastic action if it feels that revenue is escaping its purview. This has arisen during the decline of every empire for over 2,000 years and there is no reason to expect anything different this time. If the US gov't wants Craigslist data, it can exert pressure on the site operators in many ways.

This is exactly like the attempted, and nearly-attained, reporting requirement for any transaction over $600. Now that it's been pushed through at a state level, it won't be long before the floodgates open and this becomes a standard practice punishable by fines and/or jail time.

Denial won't stop these things from happening. Bitcoin-like systems provide a way to fly under the radar for both individuals and businesses. It doesn't matter how many times they're knocked down; the value they offer is immense, but currently unrecognized. It only takes time for this to change.


Indeed, aside from technical clarifications. Less talk, more work!

basically, you just said that if someone gets scammed, they deserve it.



and then you backpedaled....but yeah, keep pretending that you are posting to help people.



for the record, there are entire threads here warning of the dangers of margin and over-leveraging (and even the potential dangers of using bitcoinica), so cut the bs.  helping people make informed decisions is great....just do it without being a pompous disingenuous asshole

The US authorities could shut your business down in 30 seconds for money laundering and seize your domain.


Settle the legal issues before you start offering services to the public if you are a serious company.

Being in business for 45 days means absolutely nothing, a good scam would wait months to extract maximum value before pulling a runner.

You can say this as many times as you like, but unless we can actually see your exchange behavior, there is no way to tell if you're being honest.


Oh, passion. I guess that's good enough for me. (It's not.)

Don't get me wrong, I've been impressed with your service, and I want to trust everything you're saying. But your words are not enough for many who have a lot invested. You provide zero transparency except for your word. My experience with bitcoinica has been exemplary. But nothing stops you from turning on a dime and run for the money.

If I were you, I would probably give up trying to defend Bitcoinica here. It's a waste of your time. Enjoy your current business, and if you feel like trust is a problem for attracting new business, become more transparent with your operations.

You're right. But this brings no value to us.

I have been honest about these stuff all the time, since launch. My age is never a secret in this forum.

Legally, I would say Bitcoinica is operating in the graceful period of unregulated operation. My advisor has arranged consultations with two lawyers in Singapore and we're going to settle the legal stuff soon.

Bitcoinica has been up and running for about 45 days. If I really wanted to scam money, I wouldn't put in so much effort to innovate and try to be different. I know this may not prove anything so you definitely have to right to choose not to trust Bitcoinica, or basically anything in the world.

oh I am sorry for doing due diligence about anonymous internet bucketshops offering 5:1 leverage.


If my posts SAVE some money from being thrown into a black hole then good.



This bitcoinica operation is screaming red flags everywhere but by all means continue to trust a US illegally operated business run by a 17 year old  

If I had any money in there I would personally report them to the SEC and NFA but since I do not I will leave it to any members of these sites that wish to do so.




And I am being the douchbag? Those encouraging people to use this site are the douchbags.




And this zhoutong replies to comments about his shop are showing such extreme limited knowledge of how to run a broker that even if it was a licensed business I would run the fk away.

It's not. We have our own order book as well. There are people placing limit sell orders at 3, 3.1, 3.2, 3.3, etc. When there's a short squeeze they will sell at these prices. The buy orders will still be matched.

There will be large hedge, but not that large after all.

According to our historical hedging records, this kind of hedging size can be handled comfortably.