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Author Topic: Trading Houses - The Lowdown  (Read 535 times)
datz
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June 13, 2011, 03:56:09 AM
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What is going to happen with the trading houses? They are the only semblances of central authority that can prevent market manipulation. What are their philosophies on openness of the market? We need a council of representatives from the trading houses to trace blocks and prevent or at least detect arbitrage and manipulation. Otherwise, the currency will appear unsound and manipulatable, and will never reach its potential value.
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June 19, 2011, 01:59:30 AM
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What is going to happen with the trading houses? They are the only semblances of central authority that can prevent market manipulation. What are their philosophies on openness of the market? We need a council of representatives from the trading houses to trace blocks and prevent or at least detect arbitrage and manipulation. Otherwise, the currency will appear unsound and manipulatable, and will never reach its potential value.

Isn't arbitrage generally a good thing, particularly high frequency and automated? It would encourage stability in the market, in fact, and the BTC prices would even out across the markets.

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spooge
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June 21, 2011, 05:14:37 AM
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There's a lot of misunderstanding about currency markets (obviously BTC/USD in this context). Arbitrage ensures stable prices across competing markets/exchanges. Automated trading adds liquidity, reducing volatility. All of this is good for market functionality.

As for market manipulation, if someone crashes the market with a large sale, ce'st la vie! If it goes too low (in your opinion) it will quickly resume to a stable price but now including the increase in supply (at the previous high price). If you don't like short-term movements in the market, don't trade in them - or better still, consider them buying opportunities. Vice versa.

This really isn't an issue IMO.
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June 21, 2011, 05:18:24 AM
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Have a look at http://forum.bitcoin.org/index.php?topic=20425.0 for a post about Open-Transactions. Could very well be the next generation trading platform.
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June 21, 2011, 05:18:44 AM
 #5

Isn't part of the point of having a free-market that everyone is responsible for their own actions? I personally am investing with the same philosophy I use for poker... I bring what I can afford to lose, and no more.

A major part of the reason Bitcoin caught my fancy is that it is unregulated by the same criminals who've been manipulating the rest of the economy in my country.

I want the chance to participate in a free market before I die...
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