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Author Topic: Why is there a penny bot?  (Read 2593 times)
romerun
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February 08, 2013, 01:08:56 PM
 #21

it would still be possibly or even easier to make fake depth

There is a robot that executes very small trades apparently to astroturf the mtgox last trade price.  My question is why would someone spend perfectly good money to do that?

...
I was thinking there would be a service by now that one could pay and it would attempt to raise the best bid.   Maybe someone has done this and that's what you are seeing.

I get your point, but this penny bot looks to me like it's making the last trade look as low as possible.  I just can't think of a situation where this would be good for someone. After some thought, maybe this is Satoshi Dice keeping their BTC exposure to a minimum in real time.  If so, pretty cool demonstration of the technology.
The lesson is - don't use last price. It is a bad indicator of the current value for several reasons, this being one of them.

Much better is to take some value (e.g. 100 BTC), see how much it costs to buy 100 BTC with the current depth table, how much is obtained by selling 100 BTC, and take the average.
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February 26, 2013, 11:30:48 AM
 #22

I guess the penny bot is run by some merchant that wants to increase the $$ he gets by devaluing the ɃɃ's last trade by a small amount. Maybe several people trying to front-run the very predictable penny bot can close the spread a bit. For sure these front-runners would have an incentive to do so. No need for regulations from MtGox.

There is a robot that executes very small trades apparently to astroturf the mtgox last trade price.  My question is why would someone spend perfectly good money to do that?

...
I was thinking there would be a service by now that one could pay and it would attempt to raise the best bid.   Maybe someone has done this and that's what you are seeing.

I get your point, but this penny bot looks to me like it's making the last trade look as low as possible.  I just can't think of a situation where this would be good for someone. After some thought, maybe this is Satoshi Dice keeping their BTC exposure to a minimum in real time.  If so, pretty cool demonstration of the technology.
The lesson is - don't use last price. It is a bad indicator of the current value for several reasons, this being one of them.

Much better is to take some value (e.g. 100 BTC), see how much it costs to buy 100 BTC with the current depth table, how much is obtained by selling 100 BTC, and take the average.

Oh, how I wish this was used more.

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March 04, 2013, 11:43:00 AM
 #23

Heres the behavior of the penny bot(s):


The "buy a penny" bot looks turned off


Am I right in reading that this bot made you 200Btc ? nice

I'm so tempted to try and write a bot but I know it will end in tears as im not great with the old programming and it would have to compete.



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