What prevents one large player from buying up most coins?

[btcusury]

Say an interested party has 10 times Bitcoin's market cap to spend. He buys up the entire order book on the largest exchanges. Once he holds a significant percentage of all bitcoins, he waits for some kind of negative news, then dumps, causing panic sells, which he buys up at the bottom. He repeats this pattern until he owns as many bitcoins as HODLers allow.

How would this affect adoption and confidence in the market? Is there anything that would or could prevent this from happening, aside from the amount of fiat money required?

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[poptok1]

Say an interested party has 10 times Bitcoin's market cap to spend. He buys up the entire order book on the largest exchanges. Once he holds a significant percentage of all bitcoins, he waits for some kind of negative news, then dumps, causing panic sells, which he buys up at the bottom. He repeats this pattern until he owns as many bitcoins as HODLers allow.

How would this affect adoption and confidence in the market? Is there anything that would or could prevent this from happening, aside from the amount of fiat money required?

First there are limited money transfers. Without notice 15Keuro limit. So this would slowdown the process you are talking about, significantly.
Second, exchanger would probably suspend huge account, under suspicion, big movement, big risk of fraud or account takeover etc.

[btcusury]

You really think that would be a problem for someone will $100 billion to spend?

Assume such limitations of the legacy banking system are not an obstacle.

And yes, it would be a slow process, say over several months, so that it can go quite unnoticed.

[cloverme]

This goes back to a game theory, someone did a presentation a couple years ago at one of the conferences.  I think it was called brower theorem.  What happened is that the buyer gained no benefit. Consider this, you're playing the game of monopoly and the paper slips of money have value because the other players need it. If you have all the money, it's not as valuable because the other players can't use it. At some point, the value of what you hold loses value as a commodity. A bank could buy all the bitcoins available to destroy it, but then everyone could just use Bitcoin2, etc.  A similar situation happened on testnet, some a-hole started supermining all the testnet coins to sell them, so testnet was reset.    Truth in numbers goes both ways.

[DannyHamilton]

Say an interested party has 10 times Bitcoin's market cap to spend. He buys up the entire order book on the largest exchanges. Once he holds a significant percentage of all bitcoins, he waits for some kind of negative news, then dumps, causing panic sells, which he buys up at the bottom. He repeats this pattern until he owns as many bitcoins as HODLers allow.

How would this affect adoption and confidence in the market? Is there anything that would or could prevent this from happening, aside from the amount of fiat money required?

Say an interested party has 10 times Harley Davidson's market cap to spend. He buys up the entire order book on the NYSE. Once he holds a significant percentage of all Harley Davidson's stock, he waits for some kind of negative news, then dumps, causing panic sells, which he buys up at the bottom. He repeats this pattern until he owns as many shares of Harley Davidson as "hold"ers allow.

You can say the same about any thing else that is traded on an open market.

[btcusury]

So even if he could get 50% of all coins, or even 80%, he wouldn't be able to influence the price to the point of causing permanent/long-term market confidence loss?

[DannyHamilton]

So even if he could get 50% of all coins, or even 80%, he wouldn't be able to influence the price to the point of causing permanent/long-term market confidence loss?

Don't know.  You'll have to find someone willing to try it in order to find out.

My guess is that he'd loose some percentage of his purchasing power to the speculators each cycle until eventually he didn't have enough left to significantly influence the price.

Buying that much bitcoin would put a huge demand pressure on the exchange rate, meaning that as he completed his last few buys, he'd be buying at a very inflated price.  Then if he waits for bad news, the price will have already dropped by the time he starts to sell, meaning that he could be selling some of his bitcoins for a price less than he bought for.  If the bottom fell out and the price completely collapsed, he could be left selling his entire holdings for much less than he spent to buy it all.

Then as the market recovers, he starts buying and driving the price back up.  Before long, he is buying at the new peak price (only he has less bitcoins this time since he has less fiat available to buy the bitcoins with.  Then with bad news and a price collapse, he is stuck once again selling for less than he spent to buy the bitcoins, leaving him with even less buying power.

Repeat the cycle a few times and he's left with so little buying power that he isn't going to make a difference anyhow.

[BlackPanda]

no one can be detained. the big players have a lot of money. they can do anything with their money. with strong financial strength and superb trading capabilities they can be the strongest.

[Lauda]

Exactly where would he be able to buy such a significant amount of coins? What order book has so many coins within the ask side? Examples:

Bitstamp:

Bitstamp | There are currently 10916.529 bitcoins offered at or under 100000.0 USD, worth 14528917.7987 USD in total

Bitfinex:

Bitfinex | There are currently 23686.651 bitcoins offered at or under 100000.0 USD, worth 19809660.8929 USD in total

BTCChina:

BTCChina | There are currently 6820.5865 bitcoins offered at or under 100000.0 USD, worth 6766202.24775 USD in total.

If we assume that the person would use USD (solely) they'd only be able to take ~41 423 Bitcoin (draining 3 major exchanges in the process) before the cost per Bitcoin would grow exponentially (assuming a instant buy-out). I don't think that this represents a significant amount. I don't think that anyone could correctly predict that would happen. Maybe someone who excels in economics and investing?

[DannyHamilton]

If we assume that the person would use USD (solely) they'd only be able to take ~41 423 Bitcoin (draining 3 major exchanges in the process) before the cost per Bitcoin would grow exponentially (assuming a instant buy-out). I don't think that this represents a significant amount. I don't think that anyone could correctly predict that would happen. Maybe someone who excels in economics and investing?

Of course as the price headed upwards, there'd likely be more bitcoins joining the market (both buyers and sellers).  Profit taking sellers would jump in selling more bitcoins for this theoretical attacker to buy, but speculators would also come in and buy up some before the "attacker" could get them (potentially selling to the "attacker" later at an even higher price).

[franky1]

lauda making logical sense on this topic, good

to add to his comment.
the exchanges themselves know a general direction a price will go before an order is made. simply by knowing if more dollars or bitcoins are being deposited.
its not an exact science, but they can see changes in supply and demand at the time of deposit. long before the customer gets to place an order

as soon as bitstamp sees a whale deposit $14m. bitstamp would raise its own "ghost" orders to higher prices. so the whale wont even be able to buy all of them 10,916btc, as the prices would change before the dollars have "cleared" to be able to allow the whale to make an order

as soon as bitfinex sees a whale deposit $20m. bitfinex would raise its own "ghost" orders to higher prices. so the whale wont even be able to buy all of them 23,686btc, as the prices would change before the dollars have "cleared" to be able to allow the whale to make an order

as soon as btcc sees a whale deposit $7m. bitfinex would raise its own "ghost" orders to higher prices. so the whale wont even be able to buy all of them 6820btc, as the prices would change before the dollars have "cleared" to be able to allow the whale to make an order

[amacar2]

With seeing current volatility nobody will be willing to invest more than 100billion $ as it is not a small amount usual trader can risk and can hold for longer term. TO make atleast some return he have to again sell them but after seeing price pump many will try to short just like how price goes down from 800$ to 600$ or even lower within 2 days. This will never gonna happen.....Never.

[Luterwish]

Say an interested party has 10 times Bitcoin's market cap to spend. He buys up the entire order book on the largest exchanges. Once he holds a significant percentage of all bitcoins, he waits for some kind of negative news, then dumps, causing panic sells, which he buys up at the bottom. He repeats this pattern until he owns as many bitcoins as HODLers allow.

How would this affect adoption and confidence in the market? Is there anything that would or could prevent this from happening, aside from the amount of fiat money required?

First there are limited money transfers. Without notice 15Keuro limit. So this would slowdown the process you are talking about, significantly.
Second, exchanger would probably suspend huge account, under suspicion, big movement, big risk of fraud or account takeover etc.

I don't think so that exchanger would probably suspend huge account, i mean to say that why he/she would do such a thing, the whale doesn't harm his exchange as the exchanger is getting the cut from the amount the whale is trading as the trading fee.

[7788bitcoin]

With Satoshi holding so many coins, people will start panicking when they know he is selling... Likewise, knowing someone (if he is successful in acquiring the bitcoins) is holding large amount of bitcoins will create fear in all users, worrying about his next moves. People will dump bitcoin and leave, causing huge harm to the network.

[franky1]

With Satoshi holding so many coins, people will start panicking when they know he is selling... Likewise, knowing someone (if he is successful in acquiring the bitcoins) is holding large amount of bitcoins will create fear in all users, worrying about his next moves. People will dump bitcoin and leave, causing huge harm to the network.

price drama is temporary..
but lets delve into the slimmest chance that the real satoshi returns..

once his coins are sold. thats it.. other people have them.. then the satoshi "hoard" is no longer in question.

during the short term price drama of that event people will not think of it as doomsday.. but instead DISCOUNT DAY as the price will tank. and losts of people will buy cheap coins..

then the price will recover.. drama over and everyone can finally stop asking about the satoshi hoard

[InternationalBankAlliance]

This goes back to a game theory, someone did a presentation a couple years ago at one of the conferences.  I think it was called brower theorem.  What happened is that the buyer gained no benefit. Consider this, you're playing the game of monopoly and the paper slips of money have value because the other players need it. If you have all the money, it's not as valuable because the other players can't use it. At some point, the value of what you hold loses value as a commodity.

Bankster McEvol is not trying to become fabulously wealthy from BTC. If he sees it as a threat, he destroys it, at a nominal cost to himself.
Think of it as our immune system attacking our own cells to get rid of a virus.

A bank could buy all the bitcoins available to destroy it, but then everyone could just use Bitcoin2, etc.  A similar situation happened on testnet, some a-hole started supermining all the testnet coins to sell them, so testnet was reset.    Truth in numbers goes both ways.

So if you just lost a fortune because Bitcoin 1 became worthless, you'll magically get more fiat & invest that in Bitcoin 2 (which will also become worthless)?
By the time we get to Bitcoin 3, even the True Believers would learn to stop throwing away their money.

[Divinespark]

There is just no way to accumulate that kind of size off exchanges without moving the price significantly, and that's going to get even more pronounced after the halving kicks in.

[BitcoinHodler]

i think the issue here is not about whether or not someone can do this. the biggest part is WHY ?

if the reason is for profit then i have to say that there are so much easier methods of making money with that much money and not do this.

one of the easiest methods is to start a new coin yourself and advertise the shit out of it with 1/100 money that you need to do what OP is saying then premine almost all of it then start hype > pump > dump for profit > rinse and repeat (if process sounds familiar because it is the process used in ethereum)

[InternationalBankAlliance]

There is just no way to accumulate that kind of size off exchanges without moving the price significantly, and that's going to get even more pronounced after the halving kicks in.

Why would this need to happen off-exchange? And what makes you think it hasn't happened/is not happening now?
Daily exchange volume is ~$300mil.

i think the issue here is not about whether or not someone can do this. the biggest part is WHY ?

Well, if we're to take some people here seriously, Bitcoin aims to make legacy finance (& even governments) obsolete.

[Kprawn]

Well at the rate some of these reserve banks are printing "toilet paper" money, it could just be likely that enough fiat will be available to try things like this. Only problem is, the more they print, the less

it's worth on the open market. I have to say, some people have enough money to make a decent dent on most of the coins available on these exchanges. In November 2015, this was the situation with

gold : " The top ten largest owners of gold in the world are reported to control nearly 24,000 tonnes -- or over 768 million troy ounces. With gold spot prices at $1,100 an ounce, this metal would be

worth approximately $845 billion and represents about 14% of all the gold ever mined. "