I don't think market makers are a solution to the problem you see. Market making might reduce some liquidity spikes, but it wont stop the big price swings. First of all, the function of a market maker is to provide liquidity and reduce the bid/ask spread. Second, a market maker has to be nimble. A market maker that tries to block price swings by putting up big walls is just going to lose a lot of money.
A market maker with a lot of bitcoins can MAKE a lot of money by putting up walls to prevent the price from changing too fast. Consider what I'm doing with my meager stash of bitcoins, then imagine what would happen if someone with 1000 times as many bitcoins did similar. The price around $145 as I write this. I currently have buy orders for 0.5 bitcoins at every $1 increment from $100 to $141. I have sell orders for 0.5 bitcoins at every $1 increment from $145 to $200. Whenever one of my buy orders executes, I immediately place a sell order $3 higher. Whenever a sell order executes, I immediately place a buy order $3 lower. As long as the trading range stays between $100 and $200, I make $1.50 (after commissions) on every buy/sell pair. If it goes outside of this range, I wait for it to return. History says it will return. I haven't been trading this method for long, but it looks like I could average at least $5 per day, or $1825 per year, on an investment currently worth about $7200. That's 25% return on investment per year. Might turn out to be more. Now imagine the effect someone with 10,000 times as many bitcoins, putting 100 BTC buy and sell walls at every $1 increment from $10 to $1000. They would probably not make nearly the same return, because their action would dramatically reduce the volatility. That would ruin things for us day traders, but would make Bitcoin a viable alternative for housewives in Argentina, which is awesome because it makes my "buy and hold" stash MUCH more valuable! No, with 10k as many bitcoins, their actions would add enough liquidity that a whale would eat them and they would be royally fucked. What you are doing is not without risk, as you acknowledge by restricting the range you are willing to trade. |
|
|
|
So since every coin I hold can be considered profit, by not cashing out I'm continuously making someone else lose, and will continue to do so until I do cash out? How can that be?
I'll tell you... the real losers are going to be those who stick with fiat until it is too late.
only if you are the exchanger or mining bitcoins your self.... if you are holding bitcoins their number is not increasing, if you have 100 bitcoins now, you will have 100 after 10 years, where will be your profit then? the only profit you can make is to take money away from other people at the right time... It doesn't matter. You are not looking at a closed system. It will only be a zero sum game if the exchange rate returns to its original value: 0. Until that point (if it ever comes) we will have more winners than losers within bitcoin, and more losers than winnners in the fiat world. |
|
|
|
|
So since every coin I hold can be considered profit, by not cashing out I'm continuously making someone else lose, and will continue to do so until I do cash out? How can that be?
I'll tell you... the real losers are going to be those who stick with fiat until it is too late.
|
|
|
|
I just loaded some rocket fuel, we're about to blast off to the moon!
Paul Buchheit: "Bitcoin may be the TCP/IP of money."Paul Buchheit is an American computer programmer and entrepreneur. He was the creator and lead developer of Gmail.
He developed the original prototype of Google AdSense as part of his work on Gmail.
He also suggested the company's now-famous motto "Don't be evil" in a 2000 meeting on company values. The main problem I see is that Bitcoin is so dependant on the banking system. The exchanges fall apart without bank accounts, without wires, without ach deposits. Bitcoin works great as a "secondary" or "transaction" currency. Which means you use it when you want the privacy (buying bongs/dildos) or to avoid fees (sending to people in different countries). So you still use USD, you're paid in USD, you just use Bitcoin when the situation warrants it (and the advantages it brings). When an exchange can be crippled because one american bank account gets closed, that sorta points to the fact this "de-centralized" currency really needs the "centralized" banks to operate. Bitcoin is doing well because Govts/Banks are letting it exist. Sure they can't destroy it, but they sure could make it a lot harder to use. Most sellers wouldn't want BTC if they couldn't convert it to their native currency. But Banks are greedy, they launder money for drug cartels, so I doubt they care about Bitcoin as long as they get a share (which they do, wires are expensive). Yeah, we "Bears" have been preaching this all along, yet we were pointed at by the "true believers" and accused of "FUD". I do most of my trades for cash. I run a bot, but I only ever deposit and withdraw bitcoin. |
|
|
|
Just run this: http://guthub.com/yrral86/rubybotgem install bundle bundle install edit settings.rb bundle exec ruby bot.rb It does what you want, without the risk of emotion inherent in manual control of trading. I'm having trouble finding the documentation, and the code doesn't seem to contain any comments. Where is the documentation? Pending.... 2 weeks left in the semester then I'll put some time into cleaning it up and documenting it. Pull requests are always welcome if you want to do some reading and add a few comments. The code is pretty straightforward if you can read ruby. |
|
|
|
I think it's just zombie pcs "refreshing". I read somewhere that the thing that supposedly would make DDOS agains the Tor network has not been implemented, because it would require a fair amount of resources. With a sizeable botnet, the zombies could just send legitimate requests over and over, making sites like silk road and such, with stone age servers, be almost unusable.
1. I doubt Silk Road is running on "stone age servers". 2. The speed of the server has pretty much nothing to do with DDOS resistance. DDOS is accomplished by saturating the network connection, not attempting to overload a machine that is simply piping data from disk to the network port. |
|
|
|
Not trying to hate or anything... but what is the bull counterpart to FUD? Lot of that going on around here.
Hope, false certainty, and overconfidence |
|
|
|
some fractal analysis suggests
Is there such a thing, or is it like astrological analysis? “Millionaires don't use Astrology, billionaires do.” ― J.P. Morgan |
|
|
|
volumes have been extremely LOW.
$2 purchases swing the market a million dollars either way. strange
False Buying Bitcoin Amount to spend in USD: $2 Estimated purchase: ฿0.01474313 Slippage: ฿0.0000000 in fact, a million USD would get you ฿7228.77413498 Slippage: ฿136.08077738 and would only take us up $5 |
|
|
|
Please shorten/break the topic. It's too long to fit in a small screen  bitcoinstore.com They have lots of larger screens  . |
|
|
|
HAHAHA i love how smoothie always has 255 dollars as the price barrier, smoothie we know you bought in at 255 dollars, stop trolling becouse of it
Maybe he's just restricted to 8 bit values? you noob bears werent around when your forebears were saying the same thing about those who bought at $32 before the 2011 crash. you kids probably werent even born then, so i can't expect you to pick up what i'm saying. all those suckers who bought at 32. i feel bad for them. losers |
|
|
|
I don't see what are the fees  Edit: And I don't know how to send bitcoins to my phone number There's not a lot of info on their website is - and I can't find any discussion on here about it either. Have they just come out of the blue? I sent an SMS to 'signup' about half an hour ago and am awaiting confirmation. I think the main thing I'd like to know is whether the users' in-the-cloud wallets are accessible by the company or whether they're more like blockchain.info's only accessible by the user. Not wanting to be a wet blanket but if the former then everybody signing up ought to familiarise themselves with the mybitcoin history! I don't see how it could be the latter. You are sending them an sms, they have no way to access a private key on your device. This is what I'm finding confusing. Going by the limited information on the site alone it says: To make a transaction simply text your request. ex. "send '555-phon' 10 for beer". Please bear in mind I may have got this totally wrong because I am not a techie. But my understanding of that is that you're sending your payment SMS to the service provider not the recipient - in which case isn't it just an on-line wallet service with SMS instruction for payments and SMS notification of receipts? If so then the private keys of the wallets associated with the phone numbers surely have to be kept on the service provider's side. In which case, my question is: Are they only accessible via instruction from the phone or does the service provider also have access to them. Unlike Blockchain.info wallets where the encryption/decryption can be done on the client side I can't see how that could be handled by an sms-only phone. I'm not saying the service provider is untrustworthy but if my understanding is correct one essential aspect of Bitcoins - i.e. not needing a bank - is absent. Maybe paywithbits.com is more trustworthy than Barclays or Mpesa? I don't know but it's a big step away from what in Bitcoin world we're used to and I'm reservedly excited about this as something I'd like to see go viral in developing nations until I understand more. The no bank aspect isn't what will win the masses. As long as they are competent with security, I don't see a problem unless they aren't upfront about their real identities. The need to be a registered business with the proper licenses. Bitcoin is great for those of use who know how to secure it ourselves, but the average person is scared they will get hacked and lose it all. |
|
|
|
No, you don't exist. Bitcoin is all speculators and drug dealers. |
|
|
|
I don't see what are the fees Edit: And I don't know how to send bitcoins to my phone number There's not a lot of info on their website is - and I can't find any discussion on here about it either. Have they just come out of the blue? I sent an SMS to 'signup' about half an hour ago and am awaiting confirmation. I think the main thing I'd like to know is whether the users' in-the-cloud wallets are accessible by the company or whether they're more like blockchain.info's only accessible by the user. Not wanting to be a wet blanket but if the former then everybody signing up ought to familiarise themselves with the mybitcoin history! I don't see how it could be the latter. You are sending them an sms, they have no way to access a private key on your device. |
|
|
|
How will you feel when a 2000 satoshis a week is a good wage?
Like I don't give a damn what a good wage is because I have way too many btc. |
|
|
|
boring is good.  No. It isn't if you like to do daytrading, or at least have some fun staring at bitcoinity. My bot has made over 100 trades the past couple days... It is this kind of stable market where daytrading profits come easiest. In more volatile markets, the risk is way higher. Sure the reward is too, but I prefer reliable profits and a liquid market. And I think most merchants and consumers would agree with that last point. |
|
|
|
Let me know if anyone is doing anything about the debt. I have a good amount owed to me and don't want to see it walk away.
Good luck. They owe me 14 BTC, but I doubt I'll ever see any of it again. |
|
|
|
So, this is like in 23 minutes now? Or has it already happened?
Time is 1pm GMT.
Reading is hard... 11 hours, 18ish minutes to go, not that I'm participating. |
|
|
|
Just run this: http://guthub.com/yrral86/rubybotgem install bundle bundle install edit settings.rb bundle exec ruby bot.rb It does what you want, without the risk of emotion inherent in manual control of trading. |
|
|
|
|
Show Posts
