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1  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: February 23, 2015, 01:09:02 PM
How is that possible?
Anyone to explain?


Hello TheXpert,

I will write you a PM for more details on whats next, but for everyone here is what happened. We are currently testing a new trading engine on DRKUSD and DRKBTC pairs only. Initially this engine used a feedback loop to confirm new balances after exchange execution. Problem was when you inserted the same type of orders for the same account in between this loop, like your bot was doing by sending the same marketable orders over and over, the exchange balance checking would be screwed and allow for a negative balance before catching up with your actual balance.
This wasn't such a serious problem anyway as there was a circuit breaker in place that would limit any possible negative loss to a maximum of 1,000 usd.

Anyways this has now been corrected (this was the purpose of testing on very small volume pairs like DRK). Your bot has been very useful in this regard.

Have a good day
Raphael
Bitfinex team
2  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: September 29, 2014, 09:39:56 AM
Quote
Some reports say the bug is a read only cache leak related to the CDN they use to serve your region, and that the other accounts you see when the bug is triggered are from people using your same CDN server (same region). Still no official confirmation/response.

Hello,

This is correct. The cache has now been totally deactivated and you should not get the wrong balances displayed on this page.

We will monitor the situation closely but no account could be compromised because of this.

Please accept our sincere apologies for the inconvenience.

Have a good day
Raphael
3  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: September 26, 2014, 05:33:49 PM
Hello everyone,

Some of you may have noticed on the mining stats page that the last block had a reward of -200.71XXXX (block height 322671). And everyone holding TH1 got charged BTC instead of earning it.

Unfortunately Bitfinex got the wrong information about the last block reward. This block was not mined by TH1 and as a result, you will all be credited back the dividends shortly.

Please allow us a few hours to proceed, and please accept our apologies for the inconvenience

Have a good day
Raphael
Bitfinex team
4  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: September 22, 2014, 08:59:17 AM
Hello guys,

As many have noticed, nobody received swaps interests on time tonight. They are just been credited as I wrote this post now.

No interests are lost, the interests credited now include the last few hours of today, and tonight you will receive your daily interests minus those few hours already credited.

My apologies for this delay. For the curious, let's just say the server on which these interests payments are launched is a bit overloaded and missed his "time window" for interests payment. A new server is already ordered and due for the end of the week Smiley

Have a good day
Raphael
Bitfinex team
5  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: September 17, 2014, 11:04:02 AM
I've encountered yet another bug in the BFX swap system regarding wrong durations. A swap in my "provided list" has just popped up showing 27 days when this was never issued by me and wasn't in the book just 5 hours ago while showing it has been taken nearly 2 days ago. I've written to the BFX support. No idea what is happening at the moment but they should better get their lending system cleaned up. There are quite a few bugs popping up at the moment.

I think there is a glitch as I've found the same. There is a 'swap provided' in my account for BTC at the FRR rate/30-days issued just a couple hours ago ... I never set at FRR and all my BTC was lent yesterday for only 4-5 days. I would never lend for 30 days. This is a serious glitch ... now my BTC is tied up for 30 days ?!?
Thanks for the confirmation. Write to BFX support to get that fixed as soon as possible. I've already notified them and they have also answered but haven't closed the swap yet. Something similar has happened before and they have cleared that up but it has taken a few hours.

Hello guys,

I replied to such a request by email although I am not sure which one it is.

We are working on it

Have a good day
Raphael
6  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: August 19, 2014, 12:22:46 PM
Not sure if this was addressed before, but why is the max LTC order size 2000 now!? It's a pretty annoying feature that was implemented. Can we go back to at least 5000 please?

anyone?

This doesnt make sense... LTC price is going lower and the lower it is people would probably have a higher lot size

Why would bfx restrict it to 2k per order

That makes it incredibly annoying for someone who wants to do a 10k or 20k LTC order

Probably to prevent "manipulation" trying to farm the stops, But with this low price 2k LTC is way too capped.

We'll update this very shortly to a more sensitive limit.

Raphael
7  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: August 19, 2014, 12:20:42 PM
Hello
When I withdraw via wire transfer It says "Invalid account name, please put the real account name"
But "Beneficiary Name" was grey so I can not write any thing in it. I don't know why. I had withdrawal successfully many times before.
Best regard.

Hello Romoantic,

Please contact us at support@bitfinex.com to confirm your verification details, this happen because your details ar enot up to date on our platform


have a good day
Raphael
8  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: August 14, 2014, 04:29:32 PM
I would say lenders benefit from this, as going forward it provides BFX with more granular control over leverage ratios - in particular, them being able to manage separate max leverage per currency is great. For traders it is probably a small negative or neutral.

It is also a slight reduction in the max effective leverage - 3.33 vs 3.5, though I doubt that this is an active constraint or BFX wouldn't have chosen that number. Going forward they may choose to reduce that number further, especially eg for LTC. That would be bad for traders that like a lot of leverage, and good for lenders. Also good for the ecosystem / reducing systemic risk.

Indeed the idea of moving toward per pair/leverage is done on purpose, and you'll soon discover why.

Other than that we tried to be neutral for traders, with a positive effect for people who are USD only and want to short (more effective leverage). Nobody short anyway so it doesnt change much.

Also today was a good test for the new trading engine to handle liquidations, and while I give you that it lagged a bit, it behaved as it should (ie no loss for lenders, or Bitfinex).

Steve, I dont see any issue on my side, if it persists could you contact us to support to see where it can come from?


Have a good day all, and good luck for your trades
Raphael
Bitfinex team
9  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 19, 2014, 09:59:20 AM
I have a problem, my offered swap was taken for a few minutes, then closed. Now I am stuck witht the 30 days time frame and cannot close my offered swap anymore. My money is neither offered, nor taken nor closed, it is kind of frozen, listed under "Swaps currently provided". Anybody has a solution for this?



Yep looks like the site is having issues. Offers are not posted on the swap book unclescrooge to the rescue!!!!!!!!

Is it? How long did it last? (assuming everything is fine now)
10  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 19, 2014, 09:58:50 AM
I have a problem, my offered swap was taken for a few minutes, then closed. Now I am stuck witht the 30 days time frame and cannot close my offered swap anymore. My money is neither offered, nor taken nor closed, it is kind of frozen, listed under "Swaps currently provided". Anybody has a solution for this?



Hello,

If I understand it correctly, the swap is closed, but still listed on the "Swaps currently provided" table right?

If that happens, you can refresh the page (F5) and it should get all back in order. It may happens that the connexions to the server is broken for some reason.

Let me know if it helps

Raphael
11  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 17, 2014, 05:06:16 PM
It is surprising that the USD swap rates keep constantly at around 0.16% for more than a week.

I think this has to do with the depth of the swap demands (very high). Unless there is a big change in either demand or open swap it will likely stay stuck there for some time.

WHo doesnt love stability Smiley

Raphael
12  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 17, 2014, 04:38:14 PM
It's far cheaper to run their current model, but at the same time they might lose a lot of customers to regulated US exchanges if they come to fruition

That sums it up perfectly.

I can't comment on it though Smiley
13  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 17, 2014, 04:35:11 PM
It looks like Raphael hasn't logged into bitcointalk for about two days. Is this unusual?

Hello guys,

I was just reading this and it actually made me smile Smiley But I'd like to address some of the speculation here: I am not very active on forums and reddit (its been quite some months like this actually), because I love working 24/7 as much as the next guy but I also need some time off and enjoy a bit of free time with my wife (nothing extraordinary Smiley). So there is not much room left for reading forum and stuffs.
Furthermore as Giancarlo said we now have a new PR person that will be the person to talk to now.


Regarding the "repeated litecoin withdrawal problem", it is simply false. Let me explain (again) how it works: we store litecoins and bitcoins in a hot wallet, for no more than 0.5% of our total assets. When the hot wallet is empty, we will have to replenish it MANUALLY (do I need to explain why?). When this happens, withdrawals are delayed in "processing" state, up to 12 hours generally.
It is not a problem, we even state on the withdrawal email that withdrawals processing is subject to hot wallet availability.

While 0.5% of our BTC assets is big enough to allow us to rarely have to replenish the hot wallet, 0.5% of our litecoin assets is, lets say, a smaller number and as such we have to this operation quite often.





TL;DR - The change to not needing swap until you exceed your trading wallet USD balance will actually reduce risk for lenders, but only if the calculation for liquidation prices remains unchanged (and if lenders are paid before traders in case of liquidation). It will however do this at the cost of reducing the demand for swaps by anywhere between 40% to 100%.

BFX, can you also please clarify what effect the changes will have on liquidation prices? I'm going to run through an example to clarify my understanding of all the changes, please correct.

Let's say we have a trader, with the 1000USD and 1BTC in their trading account. BTC is trading for 600 say, so their margin balance is $1600.
They have 2.5:1 leverage switched on, so their liquidation price is when their effective margin reaches 13% of their margin.

Their tradeable balance is (note that swap interest is a negative value):

Pre-July 21 calc:
Code:
leverage * margin balance (in USD) + unrealized profit + unrealized swap - balance spent on any open trading position(s)
2.5 * 1600 + 0 + 0 - 0 = 4000

Post-July 21 calc:
Code:
leverage * margin balance (in USD) + unrealized profit + unrealized swap - balance spent on any open trading position(s) - value of BTC component of margin balance*
2.5 * 1600 + 0 + 0 - 0 - 600 = 3400
(The BTC value of the margin balance is subtracted from tradable balance because this is treated essentially like taking a BTC 'position' with some of your tradeable balance)

What I call 'effective margin' is margin balance plus unrealized profit plus unrealized swap. At the moment a position is opened it is always = margin balance as there is not yet any profit or swap. When the margin ratio = effective margin/margin balance hits the trigger, (in this case 13%) the trader is liquidated. This is how we calculate liquidation price.

If we assume a simple position of n bitcoins bought at price Pbuy and CUSD USD plus CBTC BTC in the trading account, then Margin ratio equals:
( n*P - n*Pbuy + Iswap + CUSD + P*CBTC) / (CUSD + P*CBTC)

Liquidation price is when this equals 0.13, so
Pliq = (n*Pbuy - 0.87*CUSD - Iswap) / (n + 0.87*CBTC)

Lets say the trader opens a position by buying 5BTC at $600. Their tradeable balance and liquidation prices at the moment the position is opened look like the following:

Pre-July 21 calculation:
Code:
Tradeable balance = 2.5 * 1600 = 4000
Active swaps = 5 * 600 = 3000
Liquidation price = ( 5*600 - 0.87*1000 - 0 )/( 5 + 0.87*1 ) = $362.86

Post-July 21 calculation:
Code:
Tradeable balance = 2.5 * 1600 - 600 = 3400
Active swaps = 5 * 600 - 1000 = 2000
Liquidation price = ( 5*600 - 0.87*1000 - 0 )/( 5 + 0.87*1 ) = $362.86

(BFX - Is this new liquidation price calc correct ie it remains the same? Does anything change?)

OK, that's all good, but if the liquidation prices are the same, where does the reduced risk come from? The answer is that this change probably doesn't reduce the risk of a cascading liquidation by much, (assuming that I'm right and the liq. price calc doesn't change) but if it works the way I am assuming then lenders will be more protected because even in the case of a forced liquidation, it will be the trader's money that is put at risk first. Let's see what I mean.

Under the pre July-21 system, a liquidation causing a loss to lenders will occur when the effective margin drops below zero. This is when the loss is equal to the total margin balance, so when

Plosing = (n*Pbuy - (CUSD - Iswap) / (n + CBTC)

This will occur at (5*600 - 1000 - 0)/(5+1) = $333.33.
We can see that liquidating the position by selling the 5 bitcoins, plus the 1 bitcoin collateral, will yield 6 * 333.33 = 2000. This plus the 1000 in the trader's wallet will be just enough to pay back the lender their $3000 swap.

OK, what about after July 21? Say price goes to $333.33 and we liquidate. We get the same $2000, and the trader also has the $1000 in his wallet. The lender gets paid back the $2000, and the trader at least still has his $1000 USD collateral too. There's an 'extra' $1000 USD of margin in play here!

In the case that the liquidation price is below this amount, I would assume that the lender takes priority (again BFX need to clarify here!). So this means that the actual price that will cause a loss to lenders post July 21 is when effective margin = negative USD collateral, so:
Plosing = (n*Pbuy - (2*CUSD - Iswap) / (n + CBTC)

So yes this change will result in reduced risk for lenders, but it will also mean that demand for swaps to cover the portion of the position that otherwise would be bought with the trading wallet USD balance will vanish. Given that for each individual, their current leverage is bounded between 1 (they are borrowing less than their margin balance) and 2.5, this drop in demand is bounded between 100% and 40%. Obviously most people using the margin trading feature have leverage above 1, so it's unlikely that the drop will be near to 100, but it's also unlikely to be near to 40% either. I would guess between 50 - 60%.

It's also worth noting that this part of the change doesn't affect the likelihood of a cascading flash crash very much. However the change in the treatment of BTC/LTC collateral will have an effect there, by reducing the effective leverage possible for these traders.

I think this change by BFX is as much a PR move as it is a move truly intended to avert systemic risk. The headline 'swaps active' number is going to drop by a huge amount; this is all BFX management really want, cos they hope that then people will stop whinging about it in the forums and making them look bad. Given Giancarlo's response to the completely reasonable thread about there being a BFX credit bubble (he called it FUD and was childishly abusive) I think the real motivations here are clear.

Lender beware.

Thank you for your detailed analysis. This change will indeed not change the liquidation risk as we don't change the liquidation price calculation.

However it will not lower the swap demand by 40 to 100%. It would currently lower it by a very small % (because most of our long users don't hold any USD as collateral). But even this small decrease in demand is nothing compared to the increase of demand resulting from the other change: the need to backup unrealized swap or pay it every day. The amount of unrealized swap is really high enough to outweight the amount of USD in trading wallet by a fair amount. However this will be smoothed out over the first days after the change to avoid spike as much as possible.
So long story short: our changes will initially lower a bit the swap demand, then in 2 to 3 days increase it by more.
Then of course there is the normal fluctuation of margin longs and the options that traders will chose for their unrealized swap which makes predictions only approximate.


Thank you for the auto-lend bot, it is a very good idea. I think initially it will just be based on the current asks with maximum and/or minimum rate to lend to.


Best regards
Raphael
Bitfinex team
14  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 13, 2014, 03:37:54 PM
Just a side note:
Existing positions will not be touched/forced liquidated
It only impacts your tradable balance, not your liquidation price.

Raphael
15  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 13, 2014, 01:08:39 PM
Hello guys,

To answer some questions:

-You can already chose your swap type, daily or term, on your active positions. But the change will be active only after the 21st of July. We offer you this option now in order for long term position holders to make sure to set their preferences before the change is active


-Regarding the "term" option: yes we are compounding interests payment. WHich is why the default option is "daily", and which is why if you plan on holding a long term position be carefully with this. I hope you understand the reasoning here: paying lenders at the end of their swaps but charging traders at the term of their position meant we were lending money at 0%. Which poses legal problems, and increased our risk by using our capital for what it was not supposed to be used.


Quote
"How will this work, in case the position is full leveraged but still above the margin call level,
i.e. the Tradable Balance is equal or less than 0  and the Margin Balance is above the Required Margin ?"

We will still borrow additional swap to match your unrealized swap, no matter your tradable balance.

One last change that is upcoming on the 21st of July as well:

Leverage calculation: The currency that is used as collateral for your open position(s) does impact your risk of default in case of a forced liquidation. If you have 3 BTC and take a 6 BTC position, your true leverage, regarding exposure to BTCUSD price, is 3:1, not 2:1. We thus will include the collateral that is not in the last currency of a traded pair as part of the position cost (ie all non-USD collateral for BTCUSD and LTCUSD positions, and all non-BTC collateral for LTCBTC positions).

Your tradable balance is equal to:

( Your leverage * your margin balance (in USD) + your unrealized profit + your unrealized swap) - your position(s) cost (in USD)

Today, your position cost is equal to:

( your position base price * your position size )

After this change, your position cost will be equal to:

(your position base price * your position size + ((your position base price * your position size in USD) - your USD trading balance)
Ok, what does it means in simple term:

1st example

Current BTC price is 600 USD/BTC, and you have a leverage of 2.5:1

If you have 1 BTC, you can open a 1.5 max long or short BTCUSD position
If you have 600 USD, you can open a 2.5 max long or short BTCUSD position

Each dollar you add in your trading wallet will allow you to increase your tradable balance

2nd example

Current LTC price is 0.02 BTC/LTC, and you have a leverage of 2.5:1

If you have 1 LTC, you can open a 1.5 max long or short LTCBTC position
If you have 0.02 BTC, you can open a 2.5 max long or short LTCBTC position

Each bitcoin you add in your trading wallet will allow you to increase your tradable balance

Edit: Existing positions will not be touched/forced liquidated
It only impacts your tradable balance, not your liquidation price.

Let me know if you have any questions
Raphael
Bitfinex team
16  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 05, 2014, 11:31:24 AM
Hello guys,

I am here as well Smiley

So what happens is a lender borrowing up to his tradable balance (which was high enough to let him borrow all the orderbook or so), and paying interests due (or maybe it will be his evening surprise Smiley). In other words, playing by the rules.

Now from my point of view it was not profitable for him to do this, but as long as users are playing by the rules there is nothing we can do. After all if someone want to borrow as much as he can to spike the rates regardless of his costs, then there is nothing we should do from a free market perspective. Similarly if people want to go long at more than 0.1% per day, there is nothing we can do either...

With that said, all ideas are welcome to ensure that unused swaps are not used for manipulation. We could double charge the closing of unused swaps without using them (but it would penalize legitimate use as well). We could prevent closing unused swaps manually (ie you can only use your swaps in a margin position or let it expires until the end of its period). What else?

Or we can just wait for people to realize costs/benefits of manipulation has become too high.

Anyway thank you for your analysis and have a good day
Raphael
17  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: July 04, 2014, 02:59:00 PM
Hey guys,

The orders can now be cancelled, they couldn't for a few moments because of a broken link with the trading engine.

Thank you
Raphael
Bitfinex team
18  Economy / Speculation / Re: This Bitfinex Credit Bubble cannot end well on: June 28, 2014, 12:09:01 PM
Perhaps you are looking for something more sinister here, but from that graph it seems to me that the likeliest explanation of the ballooning swaps on Finex is simply that they have gained a lot of users since December. I don't know for how long they have existed but I didn't actually try trading there until last winter, as part of me moving away from MtGox, and I suspect that may be true for a lot of other users as well. I think you would find that everything from Kraken to Huobi gained a lot of users during that time period.

I disagree that USD swaps balloons more than BTC swaps in general in your graph. If you cut out June the trend is not nearly as pronounced. In fact, both swap pairs follow an upwards trajectory with two major exceptions: people were in general very bearish in February (omg! look at those slopes!), and people are very bullish in June. You can also see the formation of a bullish trend in January which later falls apart spectacularly, and I think we all know why that was.
The BTC swaps are only one piece of evidence for what I believe to be the fact that Bitfinex hasn't grown by a factor of 9 since December. Here's something much better: http://data.bitcoinity.org/markets/volume/6m/USD?c=e&t=a&volume_unit=btc I would say it grew by a factor of 2-3, a moving average would visualize this better.

Hey,

I didnt want to participate in the discussion as I love reading analysis of economic metrics and don't have necessarily anything useful to add, but maybe want to correct some points.

You are right that the increase in USD swap is not necessarily reflecting an increase our active users. Actually, the distribution of long positions size is VERY variable (ie a lot of small positions, a few big positions, classical 80%-20% something).
However I do not think the trading volume is also a very good indicator, for the same reason, and also the fact that volume also depends on volatility.

As for will it end badly I don't think so. Our users are mostly bitcoiners, they are really long and ready to pay a high rate for this, especially because of some "information" circulating about the bubble spiking again for the 24th of July. But if you note, the spike of margin rates is getting lower over time than what it used to be, to a point where it is imho sustainable (less than 100% a year is not unreasonable for bitcoin)

Finally we have taken some steps in order to prevent flash crashes like february. Of course we cannot make bids appear magically, but the worse that could happen is a price significantly depressed on bitfinex compared to other exchanges, until arbitrage made its magic. I want to believe the orderbooks of exchanges do not reflect all the money there is to make the price, the price itself is a signal upon which actors act to buy and sell, send USD or BTC to exchanges,...

Well, an interesting topic, questions we did certainly discuss internally believe me Smiley

Raphael
19  Economy / Exchanges / Re: And we have another Bitfinex Hookey THIEVING Short Squeeze! on: June 22, 2014, 02:09:33 PM
Ok guys, enough bullshit.

We now have regularly the most volume on BTCUSD, we are earning a lot in fees (just do the math yourself), plus swap fees. We do not front run 6 btc orders, nor any orders for that matters, just to grab a few dollars more. My policy since I started Bitfinex has always been to allow users to make the best out of their money, because the more profit you earn the more likely you are to stick with us. I want to believe that this is because of this policy that we are where we are now.

Now for all wannabe traders out there, there is something that you should always know about: slippage. If someone makes a 300+ BTC market order like yesterday, it will spike the price, and if your stop is triggered at the time, you will get a worse price than expected. There is no manipulation, no tricks, just normal market functioning.

This happens on every markets and even more so on thin market like bitcoin.

Now if you don't believe this, just stop using Bitfinex and go on other exchanges where slippage doesn't exist.

Have a good day
Raphael
20  Economy / Exchanges / Re: [OFFICIAL]Bitfinex.com first Bitcoin P2P lending platform for leverage trading on: June 19, 2014, 10:42:53 AM
Hello guys,

api.bitfinex.com and www.bitfinex.com both suffered a DDOS attack this morning, which is why Incapsula challenged all visitors and blocked legitimate bots along with attackers. Really sorry about this side effect.

We will see in the future how to allow "good bots" if possible.

Thank you for your understanding
Raphael
Bitfinex team
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