As you suspect, it's necessary to prop it up as bitcoin rises, otherwise what you gain on a dip, you lose on a climb. That's what I call babysitting or nursing. One good way to go about it is the 2J-ladder, which in a nutshell means to sell on the way up (make your short larger) and buy on the way down (make it smaller, profiting a bit).

The alternative is to just set up a largish insurance as a one-off expense and forget about it until it's worth redeeming. This is much easier on the nerves and doesn't require that much labor. However, there are issues with this brutal approach: you need to close it (on a loss) as soon as bitcoin rises too much, and reopen it higher (so a bit of monitoring and labor is required after all); it doesn't pay off with small profits when decreasing the size; and finally, it should be done near a maximum to start with. If we were that good at spotting maxima, life would be easier, wouldn't it? But then, the very point of such a hedge would be moot.

I am using this small margin short as a hedge against an ugly crash.
I'm already long with all my stash. No leveraged margin. Actual btc. Long to the moon.

She keeps going down. Hard dump this weekend. Wish my short was bigger.

This could get ugly for sure. It's already not too pretty as it is right now.

However, the trustee is subject to Japanese - not USA - regulations. I know absolutely nothing about these legal intricacies, but as we've seen in the Gox case, Gox's (I mean the ripped off customers') holdings were accounted in fiat value. If there's any coherence in Japanese bankruptcy laws, giving the corn away too cheap might get the trustee into a hornet's nest of legal retaliation/prosecution.

EDIT - more substance to my thesis from bitserve (nice detective job)

Hm, it's on a Tuesday. Maybe we'll see a pump on the weekend, April 20-22? I'm counting the Friday in the weekend, as it's apparently been for a long time, bitcoin-wise.

EDIT - Jojo69 also answered my question. Thanks.

We may be solving the tx fee issue soonish. Signs are promising. However, one problem I see with bitcoin as a currency is price volatility. It's unbearable. I think that's what Anon136 meant when mentioning gold.

OK, 1 btc = 1 btc - so the price in echo-chamber terms is stable, but

How many apples for 1 btc?
How much bread, gasoline?
How many lambos?

Until these questions get an answer that drifts as slowly as gold (or better yet, slower), general adoption as a currency isn't reasonable to expect.

Which is... when's the last deadline?

This can't be the trustee selling. On Saturday? Puh-leeze!

This is manipulation, plain and simple. Somebody wants to have our coins for cheap.

Don't let them.

Hodl.

Margin trading and derivatives are double-edged swords. They can be used to get rekt, much too easily.

However, the original function of futures was that of guaranteeing certainty of price to sellers or buyers of the underlying commodity (e.g., wheat).

When used in moderation, with ample safety bands on either side, these instruments can be useful to hedge against unfavorable conditions - that's what I'm trying to do here. Nothing new under the sun, I guess.

By having my safety short on leveraged margin, I am risking just a small fraction of my stash (that is, part of my play money) to get insurance against a price drop. E.g., to short 1 btc, you can spend as little as 0.1 btc (on 10x leverage). Of course, any price movement gets amplified 10x, so careful! Safety bands around your position!

Now the technical question is: how do I decide where, how much to short? The answer comes in the form of a working method: use the 2J-ladder to build the position starting small, small, small, and try to bring it higher and smaller.

Well, smaller - within reason. If the position (and the underlying "wheat", which is actually corn in our case) goes UP, it can and should grow little by little, as long as it doesn't get so large that a sudden move UP blows you off or becomes too much of a weight on your "insurance costs".

So it seems. My hunch was off. Again.
But this time the dump's starting from a lower point.
Who knows where it's headed to.
Low 7k's?
HODL.

My dick was small at 8400, yesterday.

It has been shrinking and growing, shrinking and growing since.

I hope it becomes a baby squid soonish.

STUPID me. I thought I was meriting a newbie for diligent wall observing. The numbers didn't add up, and I thought 130 was actually 8130 (which would have been spot on). I'm embarrassed. I can't demerit the newbie, but I can merit the patrol.

Funny birthday.

And worse than the IRS, possibly. It will be a meetup of very rich peeps, remember: one million dollars will be just 10 BTC.

I think the details (place, time, reservations) should only be discussed in a private board. Invitation-only private. And yes, it would be appropriate to have some state of the art crypto verification at the door - like signing a message with the right key. No joke.

That's when a short on the side turns into a valuable asset.

Woops, can't even read anymore. Thanks for setting me straight.

The way I read it, the loan is denominated in USD. If so, it's impossible to claim the same BTC amount. Or did I get it wrong? I'm stressed out by my safe trading binge.

I used the last dip to lighten my safety short and profit a bit. The dip was welcome, because my short entry point was drifting towards unprofitability as the price raised.

Now I'm waiting to rebuild the missing part a bit at a time, scalping the small waves as we get back to where we were, around 8.5-8.6k. When will it be? I don't know, of course. That's the unnerving nursing/babysitting part.

My ultimate goal is having a short that tracks the current price, ideally an inch higher up from it (wishful thinking, and impossible on maxima. I know).

When I'm set or near-set, let them moon it - I'll drop it when the pain exceeds my threshold. Let them swamp it - I'll get richer than I would have been without my safety short.

A 200-250$ dip down, almost instant. We won't see BMB/Rosewater for some time, I'm afraid.

Exactly my hunch. I got it while following the price more closely than usual, scalping my short up. I'm gonna have a hard weekend for sure :-)


This sounds like bullshit. It can't be true. Such a business model leaks too much profit if the underlying cryptocurrency appreciates.