Where do Exchanges get BitCoins ? | Bitcointalksearch.org

lixer

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Quote from: apoorvlathey on April 22, 2016, 10:53:17 AM

Bitcoin users get Bitcoins by exchanging them for fiat at exchanges but where do the exchanges get bitcoins from ?

This question came to my mind after frequent cases of YoBit's Signature Campign wallet getting dry !

Very simple !! Do you know exchanges charge fees for every trade ?
Every exchanges have a fees for every trade. Just think how much trade happens in a single days. Also they earn from the transaction fees like sending btc in bulk free of transaction fees and get fees from individuals transaction. Hope you can understand now where do the exchanges get bitcoins.

wuvdoll

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Quote from: apoorvlathey on April 22, 2016, 10:53:17 AM

Bitcoin users get Bitcoins by exchanging them for fiat at exchanges but where do the exchanges get bitcoins from ?

This question came to my mind after frequent cases of YoBit's Signature Campign wallet getting dry !

Basically, exchangers get their coins from either miners, traders, contacts, etc. They can just ring up people and buy from them whenever they run low on bitcoin inventory. They have some sort of a wallet/s to check whether their bitcoins needs restocking or immediate selling.

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Quote from: GermanGiant on April 22, 2016, 11:40:27 AM

Quote from: apoorvlathey on April 22, 2016, 10:53:17 AM

Bitcoin users get Bitcoins by exchanging them for fiat at exchanges but where do the exchanges get bitcoins from ?

This question came to my mind after frequent cases of YoBit's Signature Campign wallet getting dry !

Exchanges that directly buy/sell from/to an user always buy low and sell high. Other exchanges just connect user's buy/sell call with that of another.

I think about it either. I even saw my friend sells the other's bitcoin and then the money is given by the third people who wants to buy bitcoin. so the second people send his bitcoin to the third people. exchanges just connects buyer and seller.

bitcoineverything

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Probably from bigtime miners who invest on bitcoin startups such as exchanges and also probably from owners of established btc startups who wanted ti extend their funds to other ventures.😄

pandalion98

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I think they get an initial amount from some private/public investors and some from their own pockets.

After that, they earn from transaction fees from the site. Some have fee-per-trade, some have withdrawal fees, etc. You know what I mean.

Hellacopter

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Most likely the exchanges buy their bitcoins and then they get some earning from the exchange transactions usually. I think the most part of the exchangers use this method nowadays.

dearbesz

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where do exchange get Bitcoins?
most of the exchanges get their bitcoin on every transaction who join in the
exchange flatform whether there gonna buy or sell Bitcoins. Wink

RodeoX

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Most exchanges just connect people who have coins for sale with buyers. They facilitate the trade and may not require many coins themselves.

maokoto

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I suppose they get Bitcoins from user fees and perhaps some altcoin selling to users too (if the exchange does mine). Probably some do mine too.

DimensionZ

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Exchanges are peer to peer platforms where users exchange fiat for Bitcoin and vice versa. I don't think the Bitcoin exchanges need a lot of backing up by investors and a big starting capital to operate because everything is being deposited and withdrawn by the users and the exchanges are only profiting from the withdrawal fees.

Whosdaddy

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Quote from: ljudotina on April 22, 2016, 10:56:30 AM

On exchange user1 trades bitcoin for money that user2 has. You do not trade WITH exchange....exchange is just a place where youers trade.

Yes, at there you buy a currency when someone sell it , it is not directly available at the exchange, but still there are some exchanges where you do exchange with the exchanger, at there the exchanger get bitcoin when someone sell it or they buy bitcoin to availthe service for their members.

erikalui

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Every exchange is different. While some have users placing a buy and sell order (example Localbitcoins), other individual exchange websites get bitcoins by trading themselves and other big exchange websites like virwox might be getting coins from big traders as they buy in bulk. Sometimes they too run out of coins and hence they delay the withdrawals (Eg: Payza).

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Quote from: apoorvlathey on April 22, 2016, 10:53:17 AM

Bitcoin users get Bitcoins by exchanging them for fiat at exchanges but where do the exchanges get bitcoins from ?

This question came to my mind after frequent cases of YoBit's Signature Campign wallet getting dry !

These are from exchange fees that are imposed on users. Yobit offer trades with a 0.2% both way fee.
Some sites like YObit also act basically as an escrow service as a iddle man of two transactions.

ricardobs

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Quote from: apoorvlathey on April 22, 2016, 10:53:17 AM

Bitcoin users get Bitcoins by exchanging them for fiat at exchanges but where do the exchanges get bitcoins from ?

This question came to my mind after frequent cases of YoBit's Signature Campign wallet getting dry !

At exchanges a lot of people are selling and buying bitcoins and other currencies for their businesses and other usage etc, and with this the exchanges have their fees and other cut up at there, so in this way they get some bitcoins by providing us the service.

The Sceptical Chymist

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I would imagine places like wesellcrypto and Circle buy their own, maybe on other exchanges. Not sure about coinbase. Other exchanges just get it from customer trades, as others have said.

MaxTax

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Quote from: Rude Boy on April 23, 2016, 11:59:11 AM

On the other hand while you buy some coins, somewhere someone else will sell his coins. OR they'll get some bitcoins by mining. OR they (may be the owner of that exchange website) might get some bitcoins by some local traders and he hold it until he open an exchange?

Nah most of the time the owners hold a small leverage for high withdrawals but overall they start with less capital and user deposits start to grow Until they got enough leverage to payout perhaps 80% of the funds in case of an emergeny.

Rude Boy

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On the other hand while you buy some coins, somewhere someone else will sell his coins. OR they'll get some bitcoins by mining. OR they (may be the owner of that exchange website) might get some bitcoins by some local traders and he hold it until he open an exchange?

tn211

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Quote from: mkc on April 23, 2016, 11:07:44 AM

Exchanges a good one only a places where customers do exchange. One customer has fiat, another one has Bitcoin, each has a exchange rate in mind, when they match, then there is a trade. It is exchzngd's job to bring these two persons together.
Exchange also act like a escrow, when a user says he has 5k Bitcoin for sale, the user has to transfer the Bitcoin to exchange's account. This way exchange make sure when price agree upon, always a trade. This is still user's bitcoin，but exchange can transfer the coins to personally account, and claim being hacked etc.like gox.

Exactly. Most of the coins they hold or not theirs. So what we have seen in the past exchanges getting hacked. Were just excuses to run away with investors money.
If you will use an exchange, double check if they can be trusted.

mkc

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Exchanges a good one only a places where customers do exchange. One customer has fiat, another one has Bitcoin, each has a exchange rate in mind, when they match, then there is a trade. It is exchzngd's job to bring these two persons together.
Exchange also act like a escrow, when a user says he has 5k Bitcoin for sale, the user has to transfer the Bitcoin to exchange's account. This way exchange make sure when price agree upon, always a trade. This is still user's bitcoin，but exchange can transfer the coins to personally account, and claim being hacked etc.like gox.

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Quote from: apoorvlathey on April 22, 2016, 10:53:17 AM

Bitcoin users get Bitcoins by exchanging them for fiat at exchanges but where do the exchanges get bitcoins from ?

This question came to my mind after frequent cases of YoBit's Signature Campign wallet getting dry !

Exchanger works in both way and called trading that mean one person will sell bitcoin for fiat and another buy that bitcoin for his fiat and exchanger take some of those coin as fee.

So quite confused about what is your actual question. Huh

Topic: Where do Exchanges get BitCoins ? (Read 2071 times)