The Nxt community knows the Nxt blockchain doesn't have much to do with APEX.
Let's have it...

I haven't read the whole thread, and I have a question that may already be answered before:
Has cynicSOB, the creator of this thread, been able to prove a PoS currency can be attacked by actually doing so, or is this whole thread another joke from a wannabe hacker?

I doubt that. Bitstamp would be arbitraged.
For example, yesterday, Bitstamp had about 10% of the world's volume of exchange.
If it had done that, its set prices would have been swept by the volume of the other exchanges.

Yep, that's why usually it is asked from people like you to prove that what they say is true rather than asking people like me to prove it's false

You are a good example of why there is such a volatility with bitcoin: You don't understand the first thing about finance but you want to play with the big guys.
You have real nice and easy explanations to simplify a world too complex for your undrestanding, and then you'll blame it on the finance guys when you realize, a bit too late, that it doesn't work like that.

I'm sorry, but that just doesn't explain anything.

Firstly, you're accusing Mt Gox to be doing stuff that they were not doing. The still ongoing investigation shows something quite different.
http://www.zdnet.com/article/police-suspect-mt-gox-bitcoin-theft-was-an-inside-job/
--> Bitcoin theft, not bitcoin scam.

Secondly, you suggest that there would be such a fake exchange today, which I bet you cannot prove.
What you describe is actually extremely hard to pull off.
People come and go, unlike what you say. In the example you give, it would required only 1 out of 33 bitcoins to be withdrawn from that exchange for it to start running on fractional reserves.
Such an exchange couldn't run a month before being discovered.

Thridly, to get this done the way you say, the volatility needs to be low. In periods like today, the volatility within an exchange can be higher that 30% a day. That would kill your idea of a scam in a minute. (Today, I saw the price on Bitstamp go from $159 to $195 in less than 10 minutes).
The 3 little percents you were mentioning would be swept out of the way real fast. And making more of a difference would draw attention.

Fourthly, 3% isn't enough for manipulating the prices on a market with such a volatility. And wouldn't explain what is happening now.


So... Still waiting for something more believable, sorry.

Actually, I don't.
If an explanation makes sense to you, you should be able to understand it and explain it yourself, which you admitted you can't.

At least, that's how I work: Understand first, then talk about it...

Care to develop?

Certainly not.
The market works both on global and local incentives. Let me take a couple of examples:

1. If an exchange has high entry and exit fees but low trading fees. There is an incentive, once you're in, to stay in and do your trading there. If the price moves on other platforms, arbitrage should happen, unless the arbitrage itself costs more in entry and exit fees than the amount of profit it can generate. That's called spread.

2. If people on an exchange lose faith in it, for example because it takes a long time to handle withdrawals, then people will tend to sell their bitcoins on that exchange and try to cash out. That would drive the price down locally, without affecting the global price. That's actually what happened with Mt. Gox, and many people not understanding this phenomenon actually went there in the hope of buying cheap bitcoins -which they did- only to find out they could not withdraw them.

Could someone explain to me how, technically, and exchange coud manipulate the prices by putting fake orders?
I can see how to fake the volume, but the price...


Even if Bitstamp finds a way to manipulate the price on their exchnage, how would they manipulate it elsewhere?

That's impolite of you. Moreover, you disagreeing with me doesn't necessarily make me an idiot, but behaving like that tells a lot about you. You may want to think of the implications of that.

And what to say about your argument "I don't know how this works, but I know it's being manipulated" ?  What adjective would best fit that?

Whatever. Just ask your friend to explain how this works to you.

Well, a common mistake that I can see underlying in your question is the fallacy of the single cause
See here for details: http://en.wikipedia.org/wiki/Fallacy_of_the_single_cause

What has been happening is that we are in a bearish market for quite some time now.
This trend has been quickening its pace since January 3rd.
Why? I don't know. People get tired of the price decreasing and decide to cut their losses I suppose.
At some point, market pshychology has to be taken into account.
Check this here: http://www.investopedia.com/articles/trading/02/121602.asp

So, after such a long time in a bearish market, people still with bitcoins are holding, expecting the price to bounce up.
And then, something happens. What? I don't know. Maybe that news I posted before about the Russians, maybe some big holders decide this is enough, maybe something else (I checked the Bitstamp btc to see if they had hit the market and coud have caused this, but they're still being mixed.)
Whatever it is, it forces the trend down even more.

Then panic rises. people start selling, stop orders are triggered, etc.
But in the mean time, people are buying a lot. Never saw a volume like yesterday, and today's volume will be even bigger, seeing how it started the day.

So, basically, this is panic time. No manipulation here. And, I would add: if some had managed to manipulate the price, that someone lost a lot of money those last 2 days (that's the risk, and that's why pros wouldn't manipulate this market.)

Where will it stop? Noone knows.

We at CryptoCoins hedge fund have decided to keep holding the little bitcoins we still have, and wait for a rebound to step in with the cash.

One step at a time.
Right now, the hacker is mixing the coins.
Next step will probably to be forgotten.
Next, he should be mixing them again just before exchanging them for cash.
At that last step, he takes a risk.


Thanks. I PMed him.

I didn't make a a website. I hired people to do so.
In the team, we also have someone with 2 master degrees: finance and trading, someone else with 2 master degrees also: finance and risk management, someone else with a master degree in economics, etc.
So yes, that makes us freaking experts.

You're right. My experience is all in Bitcointalk. You got it all here. 
Check this out here: https://nxtforum.org/index.php?action=profile;u=554
Or here: http://cointelegraph.com/news/112356/exclusive-key-negotiator-in-bter-nxt-hack-speaks-out
Or here: http://bitcoinist.net/cryptocoins-hedge-fund-nxtinside-gives-birth-to-a-new-partnership/
Or here: http://www.contrepoints.org/author/dom-p
...


Since you adminitedly don't understand how this works, why exactly are you trolling here?
If you're so sure this is a price manipulation case, just explain how this is done. Or just leave it to pros.

Thinly traded? Bitcoin had never seen this kind of volumes. Never!


People like me are in the finance business. I am actually comanager of a hedge fund in Bitcoins, been working in the banking and finance business for over 10 years now, and am the CEO of Crypto Finance Analysis Consulting.

So, unlike you, I do undersand how these things work, and I can actually explain how prices can be manipulated.
It's been done with gold, for example:

A few banks agree on a strategy (the equivalent here would be the top 5 to 10 exchanges agreeing on such a plan)
During certains periods of the day, when the volume is known to be much lower than at some other times, they put sell orders to push the price downward. They lose money at that point, but since they can predict the volumes from years of experience on that specific market, they know the volume with rise within a couple of hours.
Anyway... Since they push the price downward, stop orders are automatically triggered, pushing the price further down.
Then, the volume starts rising again, but at a low price. The banks buy the gold and the price slowly recovers.
Ready for the next operation.

http://www.bloomberg.com/news/2014-02-28/gold-fix-study-shows-signs-of-decade-of-bank-manipulation.html

Why doesn't it work for Bitcoin?
- The history isn't long enough
- The price volatility is too high
- The volume volatility itself is too high, so there's no way to predict it
- The volume is not big enough for such players, who are playing of much larger ones, several dozens billion dollars per day.

I don't buy that.
There aren't two ways to make the prices fall: Sell a lot at a low price.
That means you need to own a lot of bitcoins to start with, and dump them at a low price.

Now what's the interest of doing that? Hoping that the price will crash much much lower than the selling price so buy rebuy low. It's a hell of a bet.
If the market swallows the orders (and it did swallow $200,000,000 worth of orders yesterday) without starting a crash, the plan fails. To succeed, such a plan needs to not find a resistance in the market. Usually, there are some. So that's extremely risky. And since all of this cannot be forseeable in details, people doing that would need to keep many Bitcoins in reverve in case the pump needs to be restarted again. That means they need to be losing money with the rest of us.

Like this?

http://multigateway.org/

Hello,

Following the recent Bitstamp hack, I would like to find a way (tool, web site?) to follow the stolen bitcoins around.

They ended up here: https://blockchain.info/address/1L2JsXHPMYuAa9ugvHGLwkdstCPUDemNCf

And then the mixing started, coins are suffled around.

It goes on and on and the hacker's goal is achieved: I get lost.

Does any of you know of such a tool?

Never seen that anywhere, anytime. Crashing so quickly!

Does anyone know of something that could explain this apart from pure panic?

I found this: https://www.cryptocoinsnews.com/russia-blocked-several-bitcoin-sites-preperation-russian-bitcoin-ban/

But that is clearly not scary enough for such a crash...

Yes.

And still a bit more I didn't include: deposit and withdrawal fees.

But again, they pay for servers, employees, electicity, taxes, etc.

Usually, it doesn't work that way.
There's a difference between personal wealth and corporate wealth. Fortunately, would I add...

But I take that argument: Since they are so rich (but then, why asking for VC to invest in Bitstamp? I don't understand the need. But that's another story...), they may want to save their company.

Looks like I had my numbers wrong. Thanks for pointing that out.
at 0.3% average fees, they got over $7M of fees in a year.

That, you don't know.
There are plenty of improvement that are not immediately visible.
Dare I say: Security improvements (!), data centers, procédures, documentation, regulatory compliance, development, partnerships negociations, etc.

Yep, that's the big risk.
But, looking back at BTer, they finally got out of the storm OK, volume globally maintained.

Yeah, well... This was before the hack, huh...

Now, there are not a million options here:
1. Bitstamp pays $5M with the fees they charged. That's tough, because they had about $1.5M worth of trading each day. At a 0.3% average, that gives $4500 per day. It would take them 1111 days of such fees to pay for those $5M, running costs non accounted for. Impossible.
2. They get $5M from their insurance. I've been working with insurers for such matters myself. Can't find one that would do that, so I'd bet they weren't insured for such a hack.
3. They get $5M from investors. That's tricky. New investors won't be stepping into this mess, so that leaves the previous VC that brought $10M. But this money was probably spent. If not, why bringing it in in the first place? Maybe they'd add $5M to protect the $10M they invested prior to the hack, but that's a dangerous move. Not impossible, but doubtful...
4. They run on fractional reserves. Easy, as long as 88% of the funds remain there.

On which option would you bet?