Bitcoin Forum

anyone can place bid\asks on mtgox and then cancel... does not cost money to do this.

is this normal? can't this mess up the real market? if everyone had to pay 1c for bid\ask and they were manipulators.. they would dust away their $ in mtgox.

how to bidding and asks placing work in other markets in the world?

A Tobin tax to deter speculators? The only question is, would it be in the interest of Mt Gox?

How could an offer mess up a market? That's all a market is, a place where people make and accept offers.

The "Depth of Market" chart and listing on mtgox should be taken with a large rock of salt if not completely disregarded.

1. Large orders, (the most important ones if you're trying to gauge market sentiment), don't show up.
2. Orders may be placed and canceled at whim, as you just pointed out.
3. Trading bots exist which can instantly place orders at certain times without showing up on the Depth of Market list.

There is still meaning there. When you see a bid for 10 coins at $6.80 each you know that at this moment no one with access to Mtgox values having extra coins more than that many dollars. Maybe there is a dark order at $6.82 so there is some info that you don't have, but that doesn't change the info that you do have. And you get the info for free!

So you know the highest current valuation is 10 coins at $6.80, except it could be higher due to dark pools, and it could be lower because a trading bot could cancel that 10@6.80 order at any second.

So I maintain that you really don't know much / you shouldn't have much faith in what you 'know.'

I agree the information is not perfect.  Paying for orders may help a bit, but I'm not sure it will.  There are still bots, and I don't think they should be eliminated.  Uncertainty is how you make (or lose) money.

Why are there so many threads about what MtGox should or shouldn't do?
Maybe you should try to setup your own exchange?

Personally I'd like to see lower transaction fees, but would never demand anything.
0.65% makes market making and speculation very costly, even though the volatility is sometimes very high.
Compare that to, for example, EUR/USD where the bid ask spread from a typical MM is 0.01%.

Yes but you forget that in forex one can use leverage. On mtgox you can't. If they allowed margin trading them getting compensated via a traditional spread would be OK. As it stands if they implemented a spread type of setup they would not make a lot of money for sure because of the small size of the btc market.

Be patient I'm sure sooner or later we'll be able to speculate on BTC using leverage and pay a commission or pay spread - like in forex or stocks, etc.

yup

How do other world systems work with bid and ask spreads? ie stocks, currency spreads on world markets? Are there fees involved?

No, regardless of there being a higher offer to buy you still no that no one has been willing to fork over $6.80 to get that coin listed at $6.80. Yes, there is a piece of info you don't have. No, you are not entitled to it. No, it doesn't change the info you do have.

Yes. For example in the forex world (with which I am most familiar with) trading costs are incorporated either in the spread or the trader is charged a direct commission per trade. Either way there are ALWAYS fees and you cannot trade "for free"

If your concern is the fact that the depth of market view might not represent exactly how things are because orders can be placed/remove for free, you are probably expecting something from the depth view you shouldn't be expecting (well, things will change a bit soon).

Adding a fee to placing orders would be the same as adding a fee for posting on the forum.

In most markets, it is free to create a buy or sell order (and it's free to cancel the order).  There is usually a fee/commission only if the trade is actually executed.  This is the way it already is on Mt. Gox.  If there were a fee to create orders, this would reduce volume and liquidity in the market.  We want more volume!

I don't think there should be a fee to place or cancel orders.  There should only be a fee when a trade is executed (as it is now).

I agree that the orders and their volumes would go down if there is fee to even place orders. At current state, I would definitely not want the exchange to make such change. In fact, I think the MtGox fees are already way high as it is. 

I've often thought that a good way to reduce the spread would be to reduce or even waive the tx fee for any bid or ask that is inside the current spread. 

Edit: This would also make it such that anyone could act as a market maker without needing any kind of special arrangement with mtgox.  Also, a bid that is above the lowest ask (or a market order) would not be inside the spread and hence not eligible (and same for an ask that is at or below the highest bid).

AS i've already said in another thread, it is expensive the mtgox fee, i pay 0.15% with my bank if i buy stocks, 0.65% at mtgox, it's way too high.

Is there any margin set for trading for getting compensated via a traditional spread?

I would stop using mtgox if they started implementing this.

Placing "bait" orders as well as pulling them to exploit various things happens "for real" / in the normal marketplace all the time.

I don't see the point in asking an entrance fee when there is a provision cost on transaction already.
Also since it is all electronical there is no real "cost" to place an order other than needing to track it, and so far we're still in manageable dimensions.


As for spread/comission/cost - if you create competition, obviously spread/fees/comission will go down.

Don't like it as it is? Tough titty. Pseudomonopoly ftw.

Of course not, its a FREE market, everyone is free to place any orders they want to what extent they want.
And that's exactly as it should be.