Bitcoin Forum

well i deposited 6 bitcoins into my bitcoinica account as well as got ONE free dollar from bitcoinica for openning an account. With bigger transaction fees and crap it will stop the massive sell/trade bots that plague Mt.Gox. Well I was wrong.. 2 days later i can't even get my money out or trade it for cash... proof is below... I tried mulitple times to get my bitcoins out or trade them for usd AT THE MARKET PRICE!

http://s3.postimage.org/wwyjqiy0q/bitcoinica.png
http://s3.postimage.org/wwyjqiy0q/bitcoinica.png

Oh btw I wasted 5 bucks trying to get it my damn money out, lol.. +1 USD to -4 USD! cmon WTF is wrong with this exchange?


my 1 USD proof: https://bitcointalk.org/index.php?topic=44454.msg538049#msg538049

If bitcoinica do me justice I might rename this to "Get my Money out B**&^%%$*! thread"

I don't get it where is the proof? Oh i see you added the prrof.

r u blind? it's a screenshot?

Maybe i'm a bit blind, but also there's no screenshot for me in Firefox.

I don't see a screenshot either.

2 vistion impaired people on the same day - we should form a club  8)

just realized that too.... firefox doesn't like the image tag "[img]" nor does the button work to post one up.

I think its not a problem with ff actually but the image url you posted does a redirect to HTML format so it isn't compatible with directly putting it in [img]

Maybe withdrawals have to be verified by an actual person? That still doesn't explain why you were apparently able to go into a negative balance, with just withdrawals, though.

Yes it is quite strange that any trading account would be allowed to have a negative balance.

Maybe it's only allowed because of the 6 bitcoins in there?

http://s3.postimage.org/f6wv5hkgt/bitcoinica.png

That'd make sense. The pic does show a "net worth" of $28.

6BTC x $5.50 per BTC - $5 in withdrawls = $28.

Am I reading this correctly?

You were trying to withdraw BTC by placing market orders?

Why didn't you go to the 'Withdraw' page?

Or am I missing something?

I don't understand it either. Anyway, hmongotaku, if you don't understand what bitcoinica is then don't use it. Bitcoinica is for users with background in Forex trading. It has advanced (and dangerous!) trading options.

Besides, they are not an exchange per se. Bitcoinica trades at MtGox. If you want to run away from them, use CampBX or TradeHill.

I'm the founder of Bitcoinica.

The confusion is simple: Bitcoinica is not (yet) a place for you to change your Bitcoins to USD. It's a trading platform for investors and speculators to gain profits from the trade. Bitcoinica is a professional tool.

You can't go to a forex broker and change your dollar to euro because you want to travel.

Bitcoinica uses net accounting system, all the profits and losses will only affect your USD account, but you can use both currencies as margin to trade. You're not trading BTC at Bitcoinica, instead, you're trading BTCUSD, which is a contract based on the ratio of values of these two currencies.

Since your USD account is negative, you can't withdraw. But I have settled your account, by using part of your BTC balance to fill the gap in your USD. Now you can withdraw BTC to your wallet!

I'm sorry that Bitcoinica is not for you at this moment, but we're developing features for people who just want to exchange Bitcoins too.

Currently we have more than 800 registered users, and most of them like Bitcoinica very much. (Most likely because they know what they're doing.)

We will keep you updated.

I'd ask the OP or a mod to change the title, seeing as how it was a misunderstanding.

Actually I have done the code and testing for account settlement for a while. It seems that now it's a good time to introduce.

Whenever you have a negative balance, Bitcoinica will display this message:

http://farm7.static.flickr.com/6156/6176613857_bc08a90276_b.jpg

And then you have the option of either settling with BTC or depositing more USD.

The system will automatically handle the currency conversion process. Then you will be able to withdraw BTC.

I hope this feature can help people who unfortunately made a loss.

I just want my 6 btc back! close my account pls.. take that shitty 1 btc if u want bro.. i never wanted that free 1 dollar! It's pretty gay site if I can't exchange it at the allotted/marketted price. of 5.5 usd/btc. I'm solely losing money due to 0 trades or w/e u call it. FAIL!

But you need 2/3 of a btc to cover the -$4

So you might get 5.3 btc back.

yes give me my 4.3 btc back!

I know how the OP feels. Ive been buying oil futures on NYMEX and my gas tank is still empty and now all my money is gone. Scammers!

Please log in to your account and withdraw yourself, I don't have access to your money.

I would risk on saying you are a fuckin douchebag that jumps on shit without understanding it and later complaint and throw unfounded accusations.

If you can't withdraw your money(because you are too stupid), too bad, Bitcoinica should just keep it as payment for all the trash mouthing you've done to them.

Also, why is Bitcoinica probably a ponzi scheme, care to enlighten me? Or you just spew garbage as you think of it without giving it proper thought and without even knowing what words mean?

While the OP's baseless slander of Bitcoinica is definitely beyond the pale, the general concern he raises is valid.  Services like Bitcoinica, MtGox, etc. are completely unregulated and unaudited, which would make any serious financial commitment to them fairly irresponsible.  I think a service like Bitcoinca could allay a lot of fears and get a lot more business (my business, perhaps, anyway) if it submitted to voluntary regular audits from an independent audit service following the Sarbanes-Oxley (http://en.wikipedia.org/wiki/Sarbanes-Oxley_Act#Implementation_of_key_provisions) requirements.  (I know Bitcoinica etc. are not subject to Sarbanes-Oxley by law, I just think it might good for their reputation.)

I agree: as there's no such thing as a regulated bank for storing your bitcoins, the first rule I applied when starting to move BTC from my wallet to exchanges is that I used as many as possible. My bitcoins are currently stored in 5 different locations (wallets and exchanges) and no location has automatic access to another.

Ok So i learn the hard way the exchange is poop, now i just want what's left back? is that too hard mr. chinese person. It shouldn't be too hard since your the creator right?  Or are u a retard like that douchebag in  bitcoinexchange.cc ???

Why don't you go to your account and hit 'withdraw'?

The exchange is not 'poop'. It would certainly work better if you were to READ. Go hit 'withdraw'. It works. Really. It does. I've even tried it.

like
 that guy that replied for me it was in negative somehow when i put up the first hold til 6.50 to sell order... I was in negative... I ask for the free 1 dollar from the thread. But then i put  up 2 market sells for the "buy/sell" price of that time... none went thru.. and i burned thru like 6 of them. Losing .5 BTC in the process. Luckly the stupid creator auto-tradded for my balance. It doesn't show nowhere in the log, but I'm glad the balance is back to 0.0 so i can withdraw my 5.4 BTC. Thank you mr. chinese guy! I hope you're not related to that guy in the bitcoin show.  



All in all Mtgox owns this exchange...

1) faster trades at the "exchange rate".
2) Lower fees
3) Independent exchange. (bitcoinica is doggie linked to mtgox)

I don't know what your problem is, but I've used Bitcoinica just fine for the past several days. I don't know what you did exactly, but it's fairly clear that you're having difficulty grasping how certain things work.

hmongotaku,

Bitcoinica is not an exchange, just as MtGox is not a market maker. When you enter a position at Bitcoinica, you are either going Long or Short. When you go long, you are betting (purchasing on leverage) that the price will go up. When you go short, you are betting (selling on leverage) that the price will go down.

1:5 leverage means that you can deposit $100 or the Bitcoin equivalent, and enter a position of up to $500 or 5x the Bitcoin equivalent on deposit.

Your maintenance is the amount of Net Value you must preserve x2, of what you must keep in your balance, or else you may be met with a margin call and get wiped out.

I think you've misunderstood what Bitcoinica is, hmongotaku. I see a number of buy and sell orders in your order history screenshot. When you sell '8 bitcoins' you've actually only depleted your available Bitcoin balance by 1.6 Bitcoins, as there is 1:5 leverage, and 1.6 * 5 = 8 Bitcoins. Where you may be even more confused is in the spread. During market volatility, and based on opposing trades by Bitcoinica users, there are times when the ask may be 20 cents above mtgox ask, and the bid may be 20 cents below mtgox bid. There are good and bad times to get into and out of positions, and it's based on your level of tolerance.

I have felt the way you do at times in my past, and because I did not understand something, I got angry and upset at it. We are, after all, just hairless apes. We do have the ability to learn however, and move past our self limiting assumptions about the world. I encourage you to read up on the highly available articles and how-to's for Forex trading, and once you've given it about 1-2 hours of reading, come back to Bitcoinica and make your comparisons so that you can fully understand the implications of the various features in the platform.

Good luck to you. I know that mr. chinese man means you no harm, and I'm certain that once you take a deep breath and consider the true nature of Bitcoinica as contrasted with the true nature of MtGox, that it will become much more clear as to their distinctions, and how they may be of use of use to you in the future.

Good luck!

-Jonathan

Thank you. Can the creator like add that to the FAQ... it's very misleading if he touts it as a bitcoin exchange like mtgox. then it's a trading scheme. I mean forex bullcrap thingymagig.

It is in the FAQ. Second question:

He doesn't tout it as an exchange, in fact he told you that yesterday:

he just changed the faq... still very mis-informing... miners beware! lol I got my BTC back, never doing business with this again.

i am a miner and i like his site.
and yes: i made money with it...

I think an apology would be in order for falsely accusing bitcoinica.

To say it is a sham or ponzi is kinda libel.  Though I must say that bitcoinica is definitely not regulated by Monetary Authority of Singapore.  Having said this, most forex sites choose to be situated in countries where the financial laws are extremely lax. 

I didn't change the FAQ since last week.

You didn't read it.

Apology demanded.

The accuser has the burden of proof on him, do a wayback machine or whatever and retrieve the alleged original FAQ and prove your allegations.

http://webcache.googleusercontent.com/search?q=cache:eYz_H6yQVmgJ:https://www.bitcoinica.com/pages/faq+bitcoinica+FAQ&cd=1&hl=en&ct=clnk&gl=sg (http://webcache.googleusercontent.com/search?q=cache:eYz_H6yQVmgJ:https://www.bitcoinica.com/pages/faq+bitcoinica+FAQ&cd=1&hl=en&ct=clnk&gl=sg)

Google Cache: It is a snapshot of the page as it appeared on 22 Sep 2011 12:26:51 GMT.

Nothing has changed.

Thank you for the idea about the proof.

So, to OP: False accusation detected. Possible attempt of defamation. Apology is demanded.

zhoutong,

Don't worry about an apology from the OP. Anyone who matters, or anyone that has used your site and has some knowledge of trading accounts, we all know that the allegations were based on a lack of objectivity on OPs part. I'm sure that those 8 Bitcoins are his only treasure. He's just a 'lowly miner' trying to put another 8 Bitcoins into circulation. Certainly he doesn't have a lot of money, and is probably lower middle class. His libelous claims are obviously without merit, and we all know that. Everyone knows. You don't need an apology from him. I'm certain that he's too prideful and ashamed of his own ignorance to stand up and admit that he was wrong. You know what? That's ok. We've all done it, though perhaps not in such a public and google indexed forum.

It's clear that this miner was simply looking for the highest price he could get for his mined coins. He didn't understand what Bitcoinica is, and also clearly had no understanding of bid/ask and how those correlate to his actual price. I'm sure he tried to sell at Bitcoinica because he believed that the higher ask would yield him a higher USD sale price. I can see how someone who has no experience trading could get it wrong.

Perhaps the best thing to do is to consider the lack of regulation and oversight at the moment as an opportunity to self govern, and with an 800 member count at Bitcoinica, I do believe that it's safe for you to impose a basic questionnaire that asks new members a series of questions to verify that they have an understanding of what service Bitcoinica provides.

Example Questions:

1. Bitcoinica is an exchange where individuals can buy or sell bitcoins directly [true / false]
//If answer is 'true', give a descriptive text identifying the key differences between an exchange and a market maker. If answer is false, go to Question 2.

2. When you buy or sell BTCUSD at Bitcoinica, you are engaging in a direct purchase or sale of Bitcoin to a counter party. [true / false]
//If answer is 'true', give a descriptive text identifying the key difference between the BTCUSD trading pair and BTC. If answer is false, go to Question 3.

3. I have experience trading stocks, commodities and / or forex using leverage [true / false]
//If answer is 'false', provide a link to a video and written 1 page tutorial about how Bitcoinica works, including simple explanations of the order types, spreads and margin calls. If answer is true, go to Question 4.

4. etc..

I also think it would be good for you to start a 'Newbies' thread for Bitcoinica, with a living FAQ as #1 post, where you and others in this community can answer newbies questions about how they can use Bitcoinica, with use case examples.

I think Bitcoinica is great, and will be even greater one the lowly miners have a better understanding of its uses and limitations. So no, don't bother with an apology. Just work towards giving everyone an opportunity to understand and use Bitcoinica properly!

Regards,
Jonathan

Wow Jonathan,

while there is no defending the OP, Id find your post even harder to defend.

http://3.bp.blogspot.com/_XhfsQ7ELTCw/TRbw3UUqJmI/AAAAAAAAABw/OKyXCetvk4o/s1600/get-off-your-high-horse.jpg

That's a funny picture!

Thanks for your feedback.

-Jonathan

 Sorry if I offended you guys, this was just a troll thread for attention, I got my money back but learned a valuable lesson. Anyways I still think we website needs a better FAQ for noobs like me. All your elite jibberish is hogwash to me... Your website is like selling a race horse ticket and then never disclosing that the viewing seats cost 1,000 dollars.

No spending limits, no transaction time limit, no guarenteed processing time for transaction (in case i want to know how fast u can wire transfer) no liability at all. Only specs i can see on website is the 15 minute delayed ticker off mt.gox. Like going to walmart only to discover 50 people in 2 lines.

Face it man, you don't get how it works and you lost money trying to figure it out.  Take your loss and go play somewhere else.

I still don't understand how bitcoinica is supposed to work. How can you trade on a platform that isn't holding any of your money? Do you give them access to your account at MtGox? Or do they let you trade with their funds? If they let you leverage, then they probly don't understand the risks involved.

People have been asking that since its inception.  Zhoutong's answer is that Bitcoinica's bitcoin/USD position, summed over its users, is relatively small.  I.e., there is a relatively symmetric distribution of positions among its users, and bitcoinica can effectively arrange trades between its users which roughly cancel out.  This is a decorrelation argument, so I find it fairly unsatisfactory, because in a crisis all correlations tend to go to one.  (E.g., "What if every bitcoinica user decides it's time to sell short?")  Relying on this kind of cancellation will probably work for day to day usage, but for trading on a volatile commodity like bitcoin, you really care about how your counterparty will handle a crisis.

The problem is, the crisis can't happen without a change in price.

Here's my reply to a customer's similar questions:

"We have this circuit breaker in place. Execution will stop at one direction if the available funds are not enough for us to hedge. However, it has never been triggered since we launch our site.

What really makes sense is, if everyone wants to buy, the price would already have been risen. Every instant, we are trading at market equilibrium prices. It's highly unlikely that everyone on Bitcoinica wants to buy while everyone on Mt. Gox wants to sell. The best thing we can do is to have a large pool of traders to prevent sampling error. The higher volume we have, the more balanced our position is."

The real danger here is modeling error, not sampling error.  You are already big enough that if the pool of traders have balanced positions, you will, too.  My concern is what do you do when the pool itself is skewed.  "We'll stop trading if we're moving to a position we can't hedge" is a good start, but also unsatisfactory, since most people want to shift their position quickly in response to a crisis. 

Anyway, we've covered this before.  I know there are no simple solutions to these questions.

If the pool is large, it's almost impossible to have them create same positions at the same time without affecting the price.

We are always trading at (market equilibrium prices + spreads). It's more likely to cause the price to spike than to use up the reserve. Also, there's virtually no reason for Bitcoinica customers to place orders at the same time while other exchanges don't move at all. Bitcoinica will buy up very quickly if this happens. (Based on available reserve, we can influence the price of Bitcoin by about $0.5 in any direction.)

That's why the circuit breaker has never been triggered. We have launched the service for a month, and we have seen so many spikes and crashes.

So how do you ensure that anyone ever pays? Lets say I make a losing trade, what makes me pay? You are never holding the funds, so you cannot control the funds and thus ensure the transaction. Correct?

Why we never hold the funds?

We always require some margin from customers. If they lose too much to a warning level, we will issue margin calls. Soon after that, their positions will be liquidated automatically.

But what if even after liquidation, the account is negative?  You have to absorb the losses or do you ask the customer to top up?

I will ask. But if not, we will absorb the losses.

It's generally okay because forced liquidation usually happens at extreme prices with large spreads. So most likely we have already made enough profits to offset such losses.

Admitted troll, report user and ban?   I have not seen such douchbaggery on these forums in quite a while for no reason but ignorance.

It is so bad I am having a side theory that he is just zhoutong under a different name using some form of ultimate viral promotion for Bitconica.  I have never desired to use the service until now, but I'm being motivated by spite lol

But how can you liquidate when you are not actually holding any funds. Please explain how you ensure the user pays you? It seems that you don't quite understand that if you are not actually in control of the users funds then you have no power. Sure you can make their account go to 0 on your platform, but this doesn't actually mean anything for their real money.

I don't understand what do you mean by "holding the funds". Of course we are holding customers' funds when they deposit into their margin account. We are just not holding the full amount of funds required for trading.

For example when you buy at 5 using full leverage, when the price drops to 4, your whole position gets wiped out, and that's it. We force you to sell at 4 no matter what, just because you don't have enough money to back your losing trade.

I hope this makes sense to you.

It is like forex, for instance those with leverage of 200x, you put in $5000, you can buy up to a million dollars, but should the losses exceed the $5000, margin calls, you have to top up or be liquidated.

(let me first admit that I too have no idea how this kind of trading works)

I think everyone needs to have the same mentality you might of had your first time in a casino, or the stock market... Prepared to learn a few hard lessons!


But this isn't just OP being a troll; as bitcoin gets more and more mainstream, there will be an exponential FLOOD of people, just like OP, coming in with the same blind expectations (*this is my money! I don't understand what I'm doing with it*).

I'd say OP has been pretty nice compared to all the confused people to come...people with no computer knowledge at all...no financial knowledge... Get ready