- This service is officially launched. We currently accept customer service by email. We reply most emails in a few hours.

- Total trading volume has exceeded 10,000 BTC. We will disclose the exact data via our API after 1-2 weeks.

- Bitcoinica is under xWaylab Inc., a registered corporation in United States. While I'm living in Singapore, xWaylab Inc. currently provides e-commerce solutions to some of our clients, and I'm not the sole shareholder. I'm responsible for Bitcoinica product development, with the help of two adults graduated with Finance / Accountancy degrees and several years of Forex brokering experience.

- We are applying for SSL Certificate with Extended Validation (our current certificate is secure only at the domain level), which means that the corporate information will be validated by a major CA. This may take a few weeks while they gather our corporate documents. We will announce the results soon.

- Bitcoinica is closed source. We will arrange for security auditing soon. I have a few contacts who are security professionals and I'm in the process of negotiating the details.

- Bitcoinica is hosted by Heroku, a Platform-as-a-Service provider. Servers are located in Amazon Web Services datacenters. Both Amazon AWS and Heroku have passed PCI Level 1 Compliance and they host thousands of popular websites.

I hope you have at least read Bitcoinica's About and FAQ or have tried out the service.

I'm personally a Libertarian Anarchist (free-market advocate) and I take Economics courses. Bitcoinica gives everyone more power to trade, while helping miners to hedge against their losses when Bitcoin is dropping. Majority of the trades will be directed to the spot market and to increase liquidity.

I believe that Bitcoinica should have added value to the community.

Thanks for the explanation. However,

1. Bitcoinica is not a bucket shop, it's a brokerage. All the hedging will take place if our clients place orders in a particular direction. The spread seems high now, but will be eventually lower.

2. We don't bet against our clients. We never want them to lose. There's no incentive to do that.

3. There are large scale transactions coming in Bitcoinica. First day we got 3700+ BTC, ranked number 3 among all trading platforms. Bitcoinica has more than 5% of total Bitcoin/USD trades. A bucket shop can't survive this amount of volume.

4. Because of stop orders and margin calls, we are partly responsible for the crash. Our orders are already influencing the market.

5. I'm not a Singapore citizen. I just live here. Thank you for teaching me the culture.

That's not really true. We hedge most of the transactions in Mt. Gox. However, I do have to use a bit of smartness to write an algorithm to manage the hedging. I can see the actual trading data of Bitcoinica - way too many people are transacting at different directions nearlyat the same time. I also checked my Mt Gox account history, even with the algorithm, I'm still selling to myself most of the time.

I would rather save these commissions and offer lower spreads by taking a little bit of risk. I'm okay with losing money on some transactions while making them back on others. In the long run, we may  offer better rates than any other exchange. This will be a competitive edge for Bitcoinica.

I understand your point. But I target different customers.

I don't want to grab market share from Mt. Gox or TradeHill. They are, instead, my partners.

The only way to build a new Bitcoin trading platform today is to get investors from elsewhere. Our aim is forex traders (especially day traders).

Mt. Gox and TradeHill are like stock markets, which are okay for a relatively small market like Bitcoin. But what if we want to make it larger? This is how abstraction comes in.

My design approach is to take out the noise: If Bitcoin is really a currency, why should we care so much about BTCUSD's volume? Why should we even see the order book? I know these are two important components for every market, but it's not important to everyone. Here, Bitcoinica guarantees liquidity, gives people the opportunities to use margin and do short selling, and giving quotes with acceptable spreads.

It saves people's time, money and creates a lot more opportunities for various kinds of investments.

I built Bitcoinica because I wanted a completely revolutionary platform. I have always been trading on Mt. Gox, if I don't need it, I won't start from scratch and build it. Now I trade on Bitcoinica myself. I think it's a good thing and I should share with people, while at the same time I can make small profits to fund my future projects.

That will be a good try. It seems that Bitcoinica will get competitors soon. (Haha, joking.)

I think yours is like a web-based API wrapper. That will be useful for traders who are not comfortable with other exchanges' interfaces or want more features that can be done via API.

Actually being a brokerage is just the very beginning for Bitcoinica. We have future plans too. We will keep everyone updated.

Taking this strategy makes Bitcoinica the third largest trading platform right now (3,724 BTC traded in first 24 hours). We have successfully avoided the network effect associated with every exchange. (Positive feedback loop: Thin order book -> No volume -> No traders -> Thin order book -> No volume ...)

Thank you so much for your active support!

Enjoy your trading!

Alright, I came to Singapore 3 years ago. Didn't know this stuff.

But I decide what kind of person I want to be. I know many people are doubting my abilities in terms of security auditing and the financial concepts because of my age. But what I want to say is, Bitcoinica has added value into the Bitcoin market.

As a member of Bitcoin community, I really hope that everyone can judge this matter correctly. Will everyone be better off if I shut down Bitcoinica now? I don't think so.

If there's something I can't prove now, I will prove with time.

Yeah, indeed. I'm working on that.

FAQ is meant for FAQs. If some questions are frequently asked, I will definitely put in FAQ. Because we just launched the platform less than 2 days ago, I haven't collected that many questions. I apologize for that.

I will make a tour or even a documentation to explain these terms.


You can refer to this FAQ:

What's your Margin Call Policy?
After you've logged in, you can immediately see your real-time account Net Value (total assets) and Maintenance (minimum net value). When your Net Value falls below twice the amount of Maintenance, we will issue a margin call. If you don't take actions before your Net Value falls below Maintenance, all your positions will be liquidated automatically.

There are no fees.

We may implement margin interest for non-active traders. But currently there are zero fees in any kind of trading.

The spread is inclusive of everything. All trading, deposit and withdraw transactions (excluding wire) are free.

What's so special about the country I'm living in? And what? "financial fraud"?

While I don't really understand what you mean, I have to say that the Bitcoin market is open for all, and new ideas are coming out every day. I urge you to look at the product itself instead of judging by other factors.

I'm not interested in unethically making other Bitcoin fans' money in this united community. What we want is to enlarge and enrich the Bitcoin market and Bitcoinica does the job of bringing in Forex traders.

We will release a Tour page soon. So that everyone can learn how to start trading.

Thanks for the feedback!

Thank you for your support!

We have a long list of new features that we're going to launch in (probably) one month:

- Trading API
- Real-time Front-end
- Phone/SMS Trading (in US)
- TradeHill Support

We recommend you to give Bitcoinica a try. Any feedback will be welcomed and greatly appreciated!

Thank you for your wishes! We will definitely do a good job to expand the Bitcoin community.

The spreads have reduced by 13% during the last few hours despite the crash. Generally it will be even smaller when the prices are stable. But you can't simply compare with Forex brokerages who can trade millions of dollars without affecting the market. Bitcoin fluctuates 5% - 20% everyday, and our spreads are only about 0.5% - 2% for single side. There are a lot of opportunities to make profits.

Plus, you have margin trading and short selling, which are not yet available in other exchanges. We believed that we should build a platform that every wants to sign up. And we did.

Yes, you're right! We exactly want to do that.

We will never manipulate the prices like what some evil Forex brokers do. All our pricing algorithms are absolutely independent of our clients' positions. (We would suffer some losses from some transactions rather than hurting our dear investors.)

I think the margin level is not really a problem, because we want to give traders some control over their own finances. Some people may just want to try the platform out and they invest only $1 to have a some taste. For those who trade a large amount, we may subsequently increase their margin requirement instead.

We're pretty transparent about margin calls and our prices. After we launch our APIs (coming soon), everyone will be able to see our historical prices and compare that with Mt. Gox or other exchanges.

We have clients who buy and sell. Generally our portfolio is quite balanced. We invested our own money into our Mt. Gox account to allow investors to trade with margin. Now 24 hours have passed, and it seems that our cash flow is very smooth now.

We don't hedge all transactions at 100%. We have a specially designed algorithm to selectively hedge transactions above a certain threshold (undisclosed) to save on commissions. We currently trade at Mt. Gox only, but we will extend our partnership to TradeHill soon.

Bitcoinica has traded 3,724.12 BTC in the past 24 hours, our of which, a bit more than 2,000 BTC is hedged in Mt. Gox.

We're partly responsible for the crash a few hours ago, because some of our clients received margin calls for their long positions (at $6.9 - $7) and following that, forced liquidation.

1) Depositing Bitcoins is equivalent to opening a long position of BTCUSD. Actually you do get some more trading power, but you won't get the full 1:5 leverage. Your position's value is floating, so we can't allow you to trade using full leverage unless you convert them to USD, which is our accounting currency.

2) I'm sorry for the unclear specification of margin calls. Actually we have a very systematic approach: You can see your Net Value and Maintenance in your Account Overview, when NV < 2 * M, you will receive a margin call. Forced liquidation will occur when NV < M. When the market condition is extremely harsh (almost no liquidity), the losses may be bigger than initial deposit. You will have to deposit it back to resume trading using that account.  (We won't/can't take legal actions anyway, because we don't aim to make profits on every single transaction.)

3) Everyone in Bitcoin community is watching the crash just now. Nothing unexpected has happened at Bitcoinica. We liquidated our clients' positions (by their Stop orders or Force) within 2 seconds of the start of the massive sell-off at Mt. Gox. (We're partly responsible for the drop.) We will use what we have earned to compensate all the customers if this unlikely event happened.

Bitcoinica has traded 3,724.12 BTC in the past 24 hours, this makes us the third largest trading platform right now (following Mt. Gox and TradeHill).

Thanks for the good advice!

We will offer RESTful APIs!

I can't really prove to you how we're different from any other market maker who steal your money. I didn't write the algorithm for human invention on prices, and all our algorithms are absolutely independent of our customers' positions.

Time will prove that Bitcoinica's midpoint prices are more than 90% correlated to Mt. Gox's.

1. We offer 1 : 5 margin for long and short positions. Anyone can sign up for a margin account. You can try it out with a few dollars first. Everything, including margin calls, is transparent. (It's not yet well documented though.)

2. We will try to release in a week. But can't guarantee anything yet.

3. We use Ruby on Rails. So the answer should be easy to guess. :-)