Bitcoin Forum

The title is something I've been wondering about for a while now. I'll take Forkcoin Bitcoin Diamond (https://coinmarketcap.com/currencies/bitcoin-diamond/#markets) as an example, and then take Binance and Gate.io as examples.

At Binance, Bitcoin Diamond trades around $43. At Gate.io, it trades at $6.
Binance doesn't allow deposits and withdrawals, Gate.io allows it.

I understand why people would want to sell their Forkcoin at Binance: if they do, they can instantly buy 7 times more back at Gate.io! I can even imagine the exchange owner can buy Bitcoin Diamond at the other exchange, to sell it at his own exchange for a 7 times higher price.

What I don't get, is why anybody would buy it at Binance. You can't even withdraw them! It's like you can go to a shoe store, you can buy shoes for 100$, and you can take them home. But instead of doing that, you buy the same shoes for 700$, at a different store, that doesn't allow you to take them home! Why would anyone do that? Is it really just speculation ignoring arbitrage?

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I opened this thread in Altcoin Discussion (https://bitcointalk.org/index.php?board=67.0) 2 days ago, where it only lasted about 20 minutes on the first page. It was read 6 times, including my own views. That board is spammed too much for any serious discussion, so I moved it here.

I'm not following Bitcoin Diamond, but same scenario is happening with PosToken. CoinExchange disable deposits/withdrawals and price pumps hard in there sometimes while stable in Mercatox. I don't have an idea what other reasons they have either but for sure they are gaining from it since it would be nonsense if not.

Can't say I can immediately see the logic of this either. What I have seen from experience is from Yobit, which is usually among the very first to offer markets on Bitcoin forks (they were, as I recall first to offer BCH and BTG). What they did was open the markets early, crediting users with BTC on a 1:1 amount of forkcoins and deposits/withdrawals would be locked for several days until the actual fork happened. In essence, a form of futures market.

You'd see wild variants in the early days, where people would sell off their forkcoins for prices far beyond what the market average eventually settled on. My take: yobit exchange owners had long-term plans with forkcoin devs and knew that they'd instantly own a lot of fork coins - thereby making them somewhat big whales in the process, better able to manipulate prices on other exchanges later on. And since they were first to offer markets, it encouraged more BTC depositors...

Of course, it would seem far easier to just withold all the fork coins like other exchanges did, but the benefit of creating those markets was also to create that trading volume as a foundation.

people don't care about these things! they buy in hopes of profit, they hope the price goes higher no matter what it started at. and with pumps and dumps it does go up and down and they sometimes make profit.

the thing is they don't care if they can withdraw it or not. they don't even care of it is an actual coin or even if it has a blockchain!

i am on a forum in my language where i try to share what little bitcoin knowledge i have, back in May 2017 someone contacted me begging me to help with with a transaction of a coin that weren't even being mined for over 6 months. and it was getting pumped at the time with a huge volume!

the only reason i can think of for the lower price is that Gate has opened the "flood gates" (aka deposits)! specially since the constant drop started right as they opened deposits on 28th https://gate.io/article/16323

https://i.imgur.com/qAhaZ5s.jpg
https://i.imgur.com/qAhaZ5s.jpg

I'm willing to bet that a significant amount of traders don't even know it's possible to withdraw any coins from any exchange.

They see a pump. They ride it. They run away. They don't care what its situation is. It's just another number to play with.

And the inability to deposit or withdraw turns it into a separate market rather like South Korea vs the rest of the world. It doesn't matter what goes on in the rest of the world. It can't touch that market.

I understand BCD is fully functional. I wonder whether Binance will forewarn their users when transactions in and out are possible. I wouldn't want to be caught on the wrong side of that.

Its pure selfishness and this is a further manipulation of price which wouldn't happen in a sane or regulated system and my grouse is with both Binance and Gate.io based on your analogy and I equally smell some amount of collision between the two.

For Binance, how do they even determine the price when there is no movement in ways to either deposit or withdraw? Because that is what determine the price of any coin but without this and they are having such high amount as trade value then its price fixing not backed up by demand and supply.

For Gate.io, there is also an element of price fixing because on a good day the price of a particular coin on a particular exchange should be relative close to others but with over 700% margin then human factor have been involved beyond demand and supply.

For those trading on the two platforms, a lot of people are ruled by the greed that since its a form of free money, let me dump at whatever price couple with 1:10 amount that its being claimed. They are then less bother about the unholy practice in the system.

This makes me (once again) think the whole cryptomarket is very immature.

I understand the price drops, no question there. It's the wreckless buying at much higher prices that has me flabbergasted.

So true. Could this be caused by the fact that people are completely used to having their broker hold on to the stocks they buy?

I really wonder what would be left of almost all altcoins and forks if people start looking at them rationally. Most of them have no rational reason to even exist.

Good point. I've seen before that arbitrage with South Korean exchanges is very difficult, leading to large price differences.

I'm not sure what you mean here: the price is simply the point where supply and demand meet.

I understand the ones who are dumping, it's the buyers I don't understand.

Any constructive mind-boggling posts are not the appreciated on the forum.Within a few minutes they're sent 7 feet under the shit load of useless threads.Roughly the ratio of smart thinkers to shit posters on the forum would be around 1: 50.

Coming back to your question,
 -Most of the traders who trade on Binance are newbie crypto fans who heard about crypto the day before they made an account on Binance.I was added in one of such telegram groups where no one knew about Core Wallets or Nodes.So Bianace was their only source for everything.Lack of knowledge could be one of the reasons.

 -Are there are country specific restrictions that you came across ? Maybe either of the exchanges don't accept people from a certain country and one of them is the only source of trades ? Doesn't sound logical but could be a possibility.