You don't keep any money in a bank, do you tera? It's gotta be all paper, right? After all, anything you can't hold in your hand is at risk of hacking from hackers.
Bank transactions are reversible. If anything every goes wrong I will have human beings to speak with, resolving the situation and even hunting down the thief. It's likely that the bank itself would be legally liable for the losses, and not me. Also you can create bank accounts with restrictions and limits on the amount of and way funds can be transferred. Nobody would be able to just instantly transfer my entire account balance to some other account, even if they had access. |
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Because there's nothing he could say in English to convince me that we're just suddenly going to break out right now and have a single rally all the way to ATH and beyond in less than a month. "godmode trader" has spoken.
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Poor guy, he's going to have to move, get bodyguards, and maybe change his name. What a vicious journalist.
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From article: Even so, Bitcoin is vulnerable to massive theft, fraud and scandal, which has seen the price of Bitcoins whipsaw from more than $1,200 each last year to as little as $130 in late February. I hate reporters!! |
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I have permabearish thoughts about bitcoin sometimes, but they're not about the exchanges like you described. They're about a bitcoin being a beta software which will eventually become obselete, outclassed, or broken. A quantum computer or a genious mathematician might break EC, etc.
I wouldn't worry too much about ECDSA being broken. If that happens in a reliable and fast way bitcoin is probably the least of your worries. You could always introduce a protocol update that supports even stronger encryption aswell. All you'd need to do is transfer the coins from old addresses to new ones. If all cryptography becomes useless well then goodbye freedom, hello Orwellian state. Can you explain the process by which all the coins would be transferred from old addresses to new addresses with the new encryption algorithm? Who is doing the transfer, and how did they get the private keys? After that, how do you go about distributing new public and private keys to each and every bitcoin user? You introduce a new address format accepted by the protocol next to the old one. Anyone wishing to obtain the stronger encryption sends their own bitcoin to such a new address Those that don't move their coins risk being attacked. We could then argue what will happen to those coins that are now lost but then become available through brute forcing. In a sense it would be like mining bitcoins. [edit] think of how you are now using change addresses. all that really is required is that the protocol accepts such a stronger address as a valid output It would not be like mining bitcoins because the difficulty would not increase. When the hackers get efficient enough at decrypting or brute forcing the address, all the coins will start to be compromised at once. They will be free bitcoins, instantly forfeited by anyone who did not switch over. If enough people did not switch, the supply side will be thrown into chaos. Think about the 1,000,000 coins that haven't been touched in years. Think about all the presently lost coins. |
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I have permabearish thoughts about bitcoin sometimes, but they're not about the exchanges like you described. They're about a bitcoin being a beta software which will eventually become obselete, outclassed, or broken. A quantum computer or a genious mathematician might break EC, etc.
I wouldn't worry too much about ECDSA being broken. If that happens in a reliable and fast way bitcoin is probably the least of your worries. You could always introduce a protocol update that supports even stronger encryption aswell. All you'd need to do is transfer the coins from old addresses to new ones. If all cryptography becomes useless well then goodbye freedom, hello Orwellian state. Can you explain the process by which all the coins would be transferred from old addresses to new addresses with the new encryption algorithm? Who is doing the transfer, and how did they get the private keys? After that, how do you go about distributing new public and private keys to each and every bitcoin user? |
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I really miss those 100K-200K B on gox days. It was like all the cards were on the table and I felt really bullish because we were able to push through regardless. Now the most important exchange has... less than 20K B most of the time, and I have to trust the bulls that 'it's ok because the coins are being distributed, traded, and hoardled elsewhere'. But what if it's wrong, and these bulls are just leading an elaborate pump and dump, with these hoardled coins ready to be dumped at any time. I would feel much better with 100K B on bitstamp's order book. Lets see it.
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I have permabearish thoughts about bitcoin sometimes, but they're not about the exchanges like you described. They're about a bitcoin being a beta software which will eventually become obselete, outclassed, or broken. A quantum computer or a genious mathematician might break EC, etc.
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That's the ichimoku cloud on the 1 day timeframe. However, it's just a passing thought and I'm not sure if it's actually significant. The indicator I'm actually using before I increase to max position is the 3 day MACD.
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Here's another way to analyze the resistance we need to break before the bear market is officially over - this purple shit.  |
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I wouldn't mind some May 2012-like stability. It's nice to not need to check the price every day in order to have a good estimate of how many bitcoins something is worth.
were at July, not may (we hope). may preceded the crash to 66 Bitcoin was nowhere near $66 in May 2012. "preceded" My bad. I still don't understand your statement. May had a period of "stability" before a crash in June. July had a period of "stability" before a rally in August. Which would you rather be in? |
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"stagnant trader day" = oxymoron
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I wouldn't mind some May 2012-like stability. It's nice to not need to check the price every day in order to have a good estimate of how many bitcoins something is worth.
were at July, not may (we hope). may preceded the crash to 66 Bitcoin was nowhere near $66 in May 2012. "preceded" |
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It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.
It already does look really awkward with the rise on 3/3 initiated by the whale that wanted 5k btc. The quick rise is due to the quick fall. I didn't like it at first but now I realize it was legit. Everything is symmetrical, and the rise out of the next downtrend should be symmetrical too. Since it was a longer fall, it will be a longer rise. |
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I wouldn't mind some May 2012-like stability. It's nice to not need to check the price every day in order to have a good estimate of how many bitcoins something is worth.
were at July, not may (we hope). may preceded the crash to 66 |
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To form a proper base for an upward breakout from the 3 month downtrend, it should do something like this, as it did last year.  (12 hour chart) We're talking about THE breakout of the 2014 consolidation into the rally for the next bubble. This doesn't just happen off the cuff with a 3 day retracement after a 75% rise from the bottom which was a mere week ago. |
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Probability of break out in the next 4 hours: 55.6%
What's with everyone calling for a breakout right now? We just met the 3 month downtrend a couple days ago, and it takes a couple weeks to break out of a 3 month downtrend. It would make no sense on the chart if it just went up right now without any consolidation. |
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$666 is the new $100.
One bitcoin = one benjamin one beast
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It's too early to go up though. It should take 2 weeks to break the 3 month downtrend. It would look REALLY akward on the chart if went up right now.
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what kind of a move, percentage wise, is needed to trigger margin call assuming you are fully leveraged?
It depends what your level of leverage is on Bitfinex, and whether you "cheat" the leverage by borrowing against bitcoin instead of usd. Most people have 2.5 to 1 to leverage, and you can cheat this by exchanging to bitcoins first and then borrowing against your bitcoins, so that your leverage is 3.5 to 1. I will assume the cheating case since you asked "fully leveraged". Also the margin requirement for someone using this leverage is 13%, meaning you need to maintain an account value equal to at least 13% of the USD that you borrowed. Let's say my account value was $600 and I bought a bitcoin for $600, then I leveraged an additional 2.5 bitcoins in a margin position on top of that. That means I borrowed $1500. In order to stay alive, I need to maintain an account balance (including unrealized gain/loss), of $1500 * 13/100 = $195. $195 is the neccessary net value collateral (or "margin") that bitfinex needs at all times to make sure they can quickly close my position if I start approaching the red on my account value. If it goes below $195, I am liquidated. For every dollar that bitcoin goes down, I lose $3.5 of my account value. That is because my 1 real bitcoin is losing $1 of value and my 2.5 of leveraged bitcoins are causing a $2.5 unrealized loss. I will do a calculation to find the amount of loss that I need to reach $195. $600 - $3.5*x = $195. 3.5x = $405 x = $115.714... The price needed to drop $115.714 for me to be liquidated. That makes my liquidation price $600-115.714 = $484.286 Bitfinex always shows this liquidation price next to your leveraged position, though I'm not sure if it's calculated properly in real time when you're "cheating". The percentage move is $115.714/$600 = 19.2% |
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