Bitcoin Forum

Just a simple thread with a few questions for btfinex users.

What do users have to say about the USD swap facility? Other than btfinex going bust or running with the cash what are the risks to capital in extreme market movements? Bitfinex says traders losses don't cause swap lending losses but is this really the case?

Having a look at swap rates they are currently about 0.16% per day which is very tempting. I have read of rates up to 0.44% per day.

A high risk strategy might be to move a % of ones btc holdings there, exchange for dollars and swap on short term swap loans. With the idea of buying back when btc reaches a certain threshold.

Another option is to wait for the next peak (should it come) and sell out an agreed % at an agreed target price (1900, 2500, 2900) and leave it compounding lent out as swap through the next few months.

It's common knowledge that trading is unprofitable for most participants, whilst carrying risk of holding btc on an exchange. This seems similar in terms of institutional risk but a more straightforward way to generate consistent profit.

Comments?

http://www.reddit.com/r/BitcoinMarkets/comments/29isbb/eli5_why_cant_i_just_park_some_money_on_bitfinex/cilk4vf

Very helpful. The degenerate gambler in me will park a few k there for fun and see what happens.

I have even less trust in bitfinex after mtgox incident seeing as it's also a french endeavor. No racism, just a pattern I noticed - french = not reliable practices.

I've parked 10% of my 'btc money' into bitfinex. I've been making 8-10%/mo which is ~3x per year.

How I see it in 1 year:

if btc rises above 1800 (3x when i sold at 600): I would have made more holding all BTCs, but BTC is now 1800 so who cares!!!
btc from 600-1800; I made more than just holding
btc drops to 300; I lost 50% of my 90%. My 10% is now worth 3x as much and can buy 2x as much so 6x. So in $$ my NW would be 45%+30% = 75% in total BTC it would be 90 % + 60% = 150%. (THIS IS KEY, if btc drops to 1/2 the price, my nw in usd is still 75% but i increased my btc stash by 50%)
btc drops to 100; I lost 80% of my 90%. My 10% is 3x higher with 6x buying power = i own alnost 3x my initial coin.

but there are risks, aka bitfinex closes shop.

Current swap prices are closer to 50% per year, and you are assuming this won't drop, which it probably will unless the BTC price keeps skyrocketing.  Current swap prices are a lot better than during the last calm period, and long-term the swap rates go down over time  (last year I had like 7% a day for one loan, unfortunately only had 10 dollars or so on the website to test the waters).
I still like the rates there are today, but don't expect them to last unless there is another bubble.  And though I believe the bitfinex team wants to establish a long-lasting profitable business, it could still all go horribly wrong.

Also a similar pattern: hiding out in East Asia... like Karpeles.  :D

There are a lot of post on Bitfinex lately.

They have an audit feature, anyone with accounting background care to comment?

That's not the reason for finance to shift, though.  Finance is shifting because they have a reasonable legal environment.  HK and Singapore, that is.  Not Tokyo, Shanghai, Seoul -- they are regulatory scammers.  There is hope for Shanghai, however.

Hmm, a pattern with a length of 1.
Well, not worse than the TA charts here at least.

no, not one, have a long trail from a non-bitcoin businesses i dealt with. not saying that there can't be a reliable french business, just many of them are based on emotion rather than thought.

Who is the CEO of bitfinex? Didn't know he is a French.

Giancarlo.  Seems like a straightforward guy imo.  Doesn't handle things the way a lot of shady people handle things.

Bitfinex fucking rocks.

Most (99.999999999999999999999%) of the people that complain about it or post conspiracy theories about it (ie MatWearsAHat)  either haven't used it or were too dumb to understand how to use it (because Bitfinex really provides no good resource materials to understand all their functions).

But Finex still rocks and its the best exchange out their right now.

i don't understand why anyone would leverage long on Bitfinex. short, sure, that's cheap. why pay so much for swaps, especially when sideways action will kill your position? you pay no swap when trading on MT4 (BTCE) and FX Open.

BTCE is the best exchange, hands down, if only for their trade engine/API, and reputable past.

No one trading decent volume (500BTC +) can trade on BTC-E. Hell its hard enough on Finex and Stamp. But easiest on Finex.

depends on your trading plan. there's plenty of liquidity for whales on BTCE, but you can't play every little move and you pay a premium to get in a heavy position at any given level. i would think a smart whale would be making moves on all 3 exchanges, if not Chinese exchanges as well.

all of the western exchanges are thin, but Stamp regularly has more liquidity than Bitfinex.

Seems absurd (ie suspicious) they have not borrowed a few million then lent it out for swaps for the greatest carry trade of all time.

yeah that interest on swaps is crazy. if i get the urge to use margin, i'll check out MT4.

The interests on swaps is around 60% annual. That is much lower than it was a year ago. What are you people even talking about?

much lower than a few weeks ago too -- so, this is the low end of that range. it goes much higher than the current 0.1655% per day...

my original point up thread was -- why pay that much interest in the first place? you can go 3:1 on BTCE and pay no interest. maybe it's just me -- i'm not a whale, but i'm not a guppy, either. and i also think most people here aren't whales either.

So who is covering the margin on Btc-E?  If BTC-E is covering the margin for free - THAT doesn't scare anyone?

hmm. well, theyve been in business for a long time now, collecting fees. rolling out PAMM now too. theyve got a long term business model.

and when they had a flash crash to $100, they didnt roll back trades. smart bidders and shorters kept their cheapp coins and btce took the hit on any liquidity not covered by the book.

bfx on the other hand, punished smart bidders, shorters by rolling back trades and locking open leveraged positionms.

so actually yeah, i prefer btce, who chooses their customers (traders) rather than bfx choosing one set of customers (lenders) over traders.

French is not a race, so it is not racism, but you certainly try to discredit people on the ground of nationality. I can not prove it is incorrect, only point out that the group of people that is french, consist of millions of very different individuals. With high degree of certainty, your comments are stupid.
 

Btc-E carry the risk for leverage position. For bitfinex, it is their customer who carry the risk while they only charges fee.

Found this on Bitfinex swaps:
http://www.bfxdata.com/swapstats/usd.php

Isn't it really a timing question?
With the swaps you get something, even if BTC goes up, down, or sideways?
Where as the margin trades (3:1 BTC e), you are bullish/bearish on the price - but when the strike price happens is anybody's guess.

Ok let me explain what I meant. A group of people that is french consist of millions of very different individuals, correct. yet most of them have much in common. For one, they all speak french. For another, they mostly live in France. Also, there are my favorite businesses such as hennessy and some beauty brands, so definitely they *can* run a business, but bitfinex, in particular, does have alot of other similarities with mtGox to raise flags for me. Nationality of the owners is just one of them, also that it runs as an unregistered company which basically has no responsibility, and that it did not employ any professionals in economics or accounting last I checked.

High interest rate on bitfinex and high premium on icbit are sign of bullish. People borrowing are expecting the rally will be higher than the interest rate.

That part is clear ;). What is unclear is whether they are right. And what happens if they are wrong - e.g. will lenders be paid by vague Bitfinex "insurance" when borrowers will default?

So what about bitfinex.

Added two new points, but kept the stupid one. Still stupid.

Nationality in Europe (France) is slowly losing its meaning.

Demography will look entire different 5-10 years down the road. Immigration issue need to be re-examined if they want to fix the problem.


This is suppose to be a bitfinex thread and not "french" discussion.

Ok whatever. I hope you move your money on to the next nigerian exchange that opens up, good luck :)

Are nigerians bad too?

No, they are great, and all their business ventures are completely trustworthy.

Award for one of the most embarassing threads this year, good work piramida & arbitrage001.

"Damn (black) frog eaters!, do nut trust them , they are evil , all of them!"

 ::)

Sure, and they might be right. Or they might be very wrong. My memory is a bit fuzzy, but I remember a massive short squeeze last November when Bitfinex traders were very wrong about the market. Can't happen in the other direction? :P

Thats my market moto: Go against the crowd.

Oh noes!  That means be a bear!   :o

But on this forum, people are always predominantly bullish. If you go to Tradingview right now, most people seem bearish. Take your pick. :D

Most people seem bearish on Trading View now?  :o Perhaps we are reading different Trading Views ;)

What trading view are you guys talking?

tradingview.com

It is a technical charting website aimed at a lot of forex/stock traders that also has charts for the major bitcoin exchanges (except Okcoin).

and using this direct link you can get historical mtgox data: https://www.tradingview.com/e/?symbol=MTGOX:BTCUSD#

Interesting that the TradingView analysts were bullish when it seemed that bitcoin was on the verge of breaking up, and they could draw you all kinds of wonderful TA graphs with lines showing you that it would likely do that.  But when the bitcoin market doesn't do what they expect, they get confused, then get bearish, and then suddenly can draw you all kinds of wonderful TA graphs with lines showing you that it will likely break down.   ::)

I think we are consolidating here and it is healthy. A slow move upwards.