Bitcoin Forum

I'm not really a computer person but have been trading stocks/shares for years and I am slightly worried by the trading patterns at MtGox. Here is a graph of recent trades:

http://img159.imagevenue.com/loc223/th_766425367_marketmanipulation_122_223lo.jpg (http://img159.imagevenue.com/img.php?image=766425367_marketmanipulation_122_223lo.jpg)

Within a time frame of minutes prices have risen and fallen between $4 and $10, that is prices rose within minutes to +250% and then almost instantly fell -60%. With a market as liquid as that of MtGox and also with the wide market depth this makes no sense at all and raises questions of either:

1) Physical market manipulation by MtGox.
2) Erroneous trade reporting by MtGox in order to distort market sentiment.
3) Insider trading.

I for one have money in MtGox - that is I have transferred real money into their accounts and thus have a binding legal relationship with them within the UK.

In the Supply of Goods and Services Act 1982 it states that services must be 'carried out with reasonable care and skill'. Unless MtGox start to behave in a proper and controlled fashion I will be taking legal action against them to redeem my initial funds.

The problem is here that we have a group of cowboys trying to run a virtual commodity exchange who quite clearly have no grounding in the matters which should concern them. I can accept that most start ups such as MtGox may initially encounter problems and I accounted for this during my initial entrance into the market. However MtGox shows no sign of improving and as time passes appears to be reporting increased amounts of erroneous trading patterns. I am highly concerned and have sent a copy of my protest to MtGox.

There is a very good reason that the worlds stock exchanges have regulators.

I suggest the folks at MtGox wake upto the fact that this is no longer a game: they are taking real money from real people and putting themselves in a highly precarious position.

  

Its a game to me

are they hiring market makers?

I warn you now that when people start taking money from people it ceases to be a 'game'.

That might be market manipulation of sorts, but I wouldn't say any of it is from any mtgox malfeasance. The BTC market depth is not that great. If you have $100,000, you can do the same kind of trading and make wacky looking graphs on MtGox too.

Look at the 2010 stock market flash crash (http://en.wikipedia.org/wiki/2010_Flash_Crash), some $20 stocks hit a penny and others went to $100,000 within seconds from computerized trading.

Not quite sure what it was, but I had a sell order at $12 which wasn't executed even though the graph shows the price hitting $16 yesterday...  now it's still back to $7+ if I decide to sell my $4 bitcoins...

It was bugs in their software.

perhaps it has a little bit to do with the amount of bitcoins that are in circulation. say john doe makes a trade to buy bitcoins on Mt. Gox for .50 c less than he could have on tradehill. when he made that trade on mt gox, It drove the price up on that exchange, but he sold high on tradehill, making the price drop on that exchange. could be that someone made a larger than normal volume of trade on one site, to sell for a profit on another exchange. am i making any sense?

Yeah that day of market movement was wierd. Not sure what bot would have bought at $12.5 in the same 24 hours period as it was $5 earlier.

This problem was due to an password leak on bitcointalk.org and user that had the same information from this site had been compromised and caused these false

trading to pull the bitcoin price to an strange numbers.  That is why, I usually create an new name and a password for each website that I sign up with just to be on the

safer side.   ;D