An Open Letter to Bitfinex & Raphael...

[Sage]

Dear Bitfinex & Raphael,

I appreciate the service you offer & you've always been upstanding, transparent, & fair in the past.  But there are some unanswered questions regarding this recent glitch.

Your partner, Giancarlo, is claiming that the reason for the crash was not because of leveraged traders margin calls executing market orders one after the other, but in fact the crash was caused by a "glitch".  And that there were no counter party sells to these buy orders.

Please help me out by addressing a few salient questions regarding this glitch...

- Can you explain this glitch in more detail?

- Can you explain why this glitch happened concurrently with a market crash across all the exchanges?

- At what price point were there no more matching sell offers for the Litecoin buys?

- Can you offer us some public trade history showing that there were no matching offers below that specific price point?

- Can you explain how my friend's trade -- trading right next to me, on the same internet connection -- was honored at $0.56 while my trade at $2.50 entered several minutes prior was reversed?

You've always been transparent & straight up with me in the past Raphael.  Please help clear up these unanswered questions.

[unclescrooge]

Hello,

The glitch was related to the margin trading feature. Basically, during
this crash happening on all exchanges and markets, a lot of forced
liquidations happened. When a forced liquidation happen, the system uses
traders balance in currencies other than USD to cover for USD losses, by
selling those balances on the market (settlement).
In this case, a miscalculation of the balances to settle, due to a
numbers of factors (in particular related to price of LTC), caused the
system to sell more LTC than what was really corresponding to balances
to settle.

There is no really a "point" at which there was no corresponding selling
offers, as some "legitimate" selling orders were still happening
concurrently to the glitch. Which is why some users could get LTC at
this very interesting price, and not you. Because in some case, there
WERE real counterparties, and in other case, not.

Unfortunately we cannot disclose counterparties of trades for privacy
reason, but I hope the explanation clears out the doubt of what happened.

In any case, we can discuss more personally in emails, like you began to
do earlier today.

The miscalculation bug has been fixed right away.

This post will also serve as a public explanation for other people that were asking themselves the same questions.

Have a good day
Raphael
Bitfinex team

[MPOE-PR]

We appreciate the service you offer & you've always been upstanding, transparent, & fair in the past.  But there are some unanswered questions regarding this recent glitch.

Lol. Taking this "we" nonsense to even greater heights.

You're using a service that's been repeatedly criticized for its shady practices and the general incompetence of its operators. If you're too lazy to do your own due diligence before you use a service, that's your loss, but it's another thing entirely to represent yourself as "we" in doing so.

[Sukrim]

Maybe Sage is e.g. the Queen of England or a Sultan?

http://en.wikipedia.org/wiki/Royal_we

[Sage]

Maybe Sage is e.g. the Queen of England or a Sultan?

http://en.wikipedia.org/wiki/Royal_we

Fair enough... I was speaking for myself and my partner.  But I do take your point.  I'll remove the we.

Cheers.