BTCST market manipulation

[nrb]

There was an interesting discussion taking place on #bitcoin about the recent market movements and I'm curious what people make of it.

I think what we're going to see this weekend (which has already begun) is a calculated effort by pirateat40 to execute a bear raid on the exchanges in order to make his investors whole. He has the volume capable of making this happen and panic sellers will hand him the deals he needs to become solvent. I predict a few more major sell-offs over the course of the evening/weekend to induce panic and build up the asks on the order books. From there, panic sales will lead him to victory.

If I'm in the ballpark of correct, there are two ways this ends:

1) Pirate succeeds and pirate payday becomes one of the biggest days in the history of bitcoin. Panic sellers lose their shirts.

2) People hold their coins or prop up the price so he can't buy the discount coins needed to become solvent. BTCST investors lose their shirts.

How far off am I?

[fcmatt]

Seems like that is a good guess based on the log of #bitcon irc chat

[ruski]

[byronbb]

Doing it over the weekend would be optimal for such an operation as it would keep big buyers from wiring cash to the exchanges.

[nrb]

Seems like that is a good guess based on the log of #bitcon irc chat

To anyone curious, this is the log he's referring to: http://pastebin.com/PthgrzDS
*Edit* The log is from last month when pirateat40 was moving the market over the course of a few hours. I consider this a precursor to the actions of today.

Relevant quotes:

[2012-07-17 04:31:21] <t3a> so, just to be clear; it was pirateat40 that caused the crash correct?
[2012-07-17 04:31:36] <EmanuelDeOrtego> Probably
[2012-07-17 04:31:45] <Lepton> anyone here sold at 9.49?
[2012-07-17 04:31:49] <pirateat40> t3a, i take full responsibility.

[2012-07-17 04:33:50] <ErebusBat> pirateat40 why this move?  Need more capital?
[2012-07-17 04:33:51] <t3a> and the price is around 6.50
[2012-07-17 04:33:55] <Blitzboom> t3a: lol
[2012-07-17 04:34:23] <t3a> Blitzboom, my predictions are 1/1 tonight, I'm kindof on a streak
[2012-07-17 04:34:30] <Joric> let's try it again
[2012-07-17 04:34:36] <Karmaon> bitcointalk.org down?
 
[2012-07-17 04:34:37] <gmaxwell> Lepton: thats what the machine learning said. ::shrugs:: I dunno. I don't trade, I think it's silly.  But I figured it would be fun to try being the daily high. Didn't quite make it.
[2012-07-17 04:34:37] <EmanuelDeOrtego> https://glbse.com/asset/view/USD
 
[2012-07-17 04:34:46] <pirateat40> ErebusBat, this was kind of like a training simulation.
[2012-07-17 04:35:05] <pirateat40> ErebusBat, it will all make sense soon enough.
 

[2012-07-17 04:55:08] <proudhon> pirateat40, could you stop another "rally" if one were to ignite right now and buy up above $10?
[2012-07-17 04:55:30] <sabari> EmanuelDeOrtego, very nice
[2012-07-17 04:55:55] <sabari> btw
[2012-07-17 04:56:03] <sabari> the $8.0 wall is down to 690btc
[2012-07-17 04:56:05] <pirateat40> proudhon, i could take use to 1.80 if i needed to.

[2012-07-17 04:58:48] <pirateat40> There is no point in the last 7 months that I've not been in control of the market.

[2012-07-17 05:00:13] <proudhon> Pirateat40 is really our creation - that is, the creation of everyone who gave him bitcoins.
[2012-07-17 05:00:13] <nanotube> gmaxwell: 900
[2012-07-17 05:00:28] <sabari> !ticker
[2012-07-17 05:00:30] <zab_> well you're doing a great job inspiring confidence.. small time
[2012-07-17 05:00:44] <gribble> Error: Failure to retrieve ticker. Try again later.
[2012-07-17 05:00:45] <pirateat40> proudhon, exactly, I couldn't do this without my lenders.

The list goes on and on, plenty of evidence that he's willing and capable of manipulating the market for his needs.
 

[nrb]

Doing it over the weekend would be optimal for such an operation as it would keep big buyers from wiring cash to the exchanges.

Hadn't factored that in, nice way to prevent the bulls from cutting you off.

[nrb]

http://www.adamzyglis.com/images/cartoon775.jpg

Care to elaborate?

[matthewh3]

The list goes on and on, plenty of evidence that he's willing and capable of manipulating the market for his needs.
 

Well isn't it about time he was banned from the major exchanges.  This market manipulation bullsh*t is only possibly because bitcoins market capitalisation is so small.  For we all love bitcoin and >$10.00 coins sound expensive but with a market capitalisation of under $125,000,000 we should all admit we are all geeks, this is a hobby, love it too much and that it could still really collapse to sub $1.00 levels very easily for a long time.  Tho I'll still be a bitcoiner  

[misterbigg]

it could still really collapse to sub $1.00 levels very easily for a long time.

I don't see how that's possible. Miners wouldn't sell below cost, and there is a minimum demand because of Silk Road.

[fcmatt]

it could still really collapse to sub $1.00 levels very easily for a long time.

I don't see how that's possible. Miners wouldn't sell below cost, and there is a minimum demand because of Silk Road.

Some miners do not pay for electricity. Like me.

[smoothie]

Doing it over the weekend would be optimal for such an operation as it would keep big buyers from wiring cash to the exchanges.

bitinstant

[matthewh3]

it could still really collapse to sub $1.00 levels very easily for a long time.

I don't see how that's possible. Miners wouldn't sell below cost, and there is a minimum demand because of Silk Road.

Miners wouldn't mine and SR is through-put not input.  Yeah I do think $1.00 is a bit extreme but not a steady $7.00  

[notme]

Just so nobody gets confused, that irc log is a month old and not referring to today's events.

[nrb]

Just so nobody gets confused, that irc log is a month old and not referring to today's events.

Thanks, added some clarification there.

[ruski]

Care to elaborate?

MTG volume is not high enough to rebuy the amount of coins required, at any price. Beyond that, not really. Read up for yourself.

[misterbigg]

I don't see how that's possible. Miners wouldn't sell below cost, and there is a minimum demand because of Silk Road.

Some miners do not pay for electricity. Like me.

Then you wouldn't sell below $0. But since your costs are zero you wouldn't sell down at $2 anyway.

[adamstgBit]

Just so nobody gets confused, that irc log is a month old and not referring to today's events.

right alot has happened since then... 15$!

it should also be noted that this was RIGHT after he dumped the coins, and b4 it was quickly bought back up.

how many times to have has to say this, pirate40 is out, hes made deals people which will allow him to close up shop quickly.

please start Speculating as to what the deal is.

[misterbigg]

I don't see how that's possible. Miners wouldn't sell below cost, and there is a minimum demand because of Silk Road.

Miners wouldn't mine and SR is through-put not input.  Yeah I do think $1.00 is a bit extreme but not a steady $7.00  

But if you want to buy BTC to use on Silk Road then you would have to purchase through the Ask side of the order book, which we expect to be thin. Thus raising the price. So low prices like $1 would be inherently unstable and quickly correct (unless Bitcoin's true value was $1, which I doubt).

[nrb]

http://www.adamzyglis.com/images/cartoon775.jpg

Care to elaborate?

MTG volume is not high enough to rebuy the amount of coins required, at any price. Beyond that, not really. Read up for yourself.

We're not sure how insolvent BTCST is at this point so that's not a certainty, and the point of the bear raid is to get some volume from panic sellers.

[adamstgBit]

I don't see how that's possible. Miners wouldn't sell below cost, and there is a minimum demand because of Silk Road.

Miners wouldn't mine and SR is through-put not input.  Yeah I do think $1.00 is a bit extreme but not a steady $7.00  

But if you want to buy BTC to use on Silk Road then you would have to purchase through the Ask side of the order book, which we expect to be thin. Thus raising the price. So low prices like $1 would be inherently unstable and quickly correct (unless Bitcoin's true value was $1, which I doubt).

their is nothing stop SR users to place bids and wait a little ...

i would speculate that most people that use SR also do some minimal speculation