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Author Topic: How To Capitalize On The Bitcoin Frenzy WITHOUT The Risk  (Read 4435 times)
Sage
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April 08, 2013, 02:00:28 AM
 #1

We've entered the first phase of public interest in Bitcoin...

It will eventually become public frenzy.  That will lead to Bitcoin eventually becoming overbought... and then it will correct.  And I predict it will correct hard, fast, and unexpected.  The big question is WHEN?

Bitcoin will then establish another base, and the cycle will repeat several times on its way to mass adoption.

If the thought of that correction scares you, and you're afraid to jump in at the wrong time, here's how to profit without the risk...

Lend your fiat to Bitcoin traders at Bitfinex.com

Because of the demand you could easily get 300%-500% with little risk.   Bitcoin goes up, you make money.  Bitcoin crashes, you still make money. 

A real no-brainer right now if you have some fiat laying around.

Sage

P.S.  I'm not affilaied with Bitfinex.com in anyway, other then a happy user, and trader, and want to see the platform succeed.

P.P.S. Also I post this for self-interest.  It's freakin frustrating to not be able to establish the position I want to simply because all the loans have been gobbled up.



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Elwar
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April 08, 2013, 02:16:19 AM
 #2

I have a buddy who was trying to buy at $93 and Coinbase only allowed him to buy 1BTC.

He feels like he missed the boat so he is planning on moving money to BitFinex to loan.

He is frustrated with the difficulty of trying to get his dollars to any of these places.

http://www.bitpools.com
Pool your bitcoins with others. Vote on solutions using the Bitcoin blockchain. Keep your bitcoins in your cold storage until you find a solution you like.
Links and Reviews of useful every day places to spend bitcoins: https://bitcointalk.org/index.php?topic=943143.0
simonk83
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April 08, 2013, 02:21:59 AM
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Ok, so if I lend $1000 for example, and the trader doesn't have enough to repay, then Bitfinex will repay me on his behalf?   

So I guess my question is, who runs this site, how trustworthy are they, and what's stopping a trader from taking a huge loan and then just defaulting on purpose?
Sage
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April 08, 2013, 02:32:33 AM
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Ok, so if I lend $1000 for example, and the trader doesn't have enough to repay, then Bitfinex will repay me on his behalf?   

So I guess my question is, who runs this site, how trustworthy are they, and what's stopping a trader from taking a huge loan and then just defaulting on purpose?

The trader doesn't have direct access to your loan.  They can only use your loan to do leveraged trading within the Bitfinex.com platform.

With every trade is a margin requirement.  If the margin is hit, and the trader doesn't deposit more, then their position is liquidated.

Your loan is paid back either way.

Your risk isn't the market or trader risk, your risk is a possible hack.  But because you're holding fiat in the system, and not Bitcoins it would be very hard for the hacker to move that fiat out of the system. 

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April 08, 2013, 02:41:04 AM
 #5

I like bitfinex, but to claim that there is no risk in case of a sudden btc drop is not correct. 
If the margin positions fail to be liquidated properly, this leads to a loss which could be transfered to lenders if it becomes too big.
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April 08, 2013, 02:42:00 AM
 #6

There is no such thing as capitalizing without the risk.

If there were guaranteed profits of 300-500%, people would be doing it themselves and not giving the profits back to you.

Don't say people didn't warn you.
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April 08, 2013, 02:46:35 AM
 #7

If the margin positions fail to be liquidated properly, this leads to a loss which could be transfered to lenders if it becomes too big.

Of all of the risk I would never consider the software doing what it is supposed to do.

The biggest risk is the couple month old site closing up shop and taking everyone's money.

http://www.bitpools.com
Pool your bitcoins with others. Vote on solutions using the Bitcoin blockchain. Keep your bitcoins in your cold storage until you find a solution you like.
Links and Reviews of useful every day places to spend bitcoins: https://bitcointalk.org/index.php?topic=943143.0
Sage
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April 08, 2013, 02:50:54 AM
 #8

If there were guaranteed profits of 300-500%, people would be doing it themselves and not giving the profits back to you.

Don't say people didn't warn you.

While nothing is guaranteed, this is a very shortsighted view and plain ignorant way to look at things.

"doing it themselves"

...Is not an option period.  Traders need speed and liquidity.  And lenders need a intermediary to protect their loan with margin requirements and position liquidations if necessary.

Bitfinex simply provides the platform for doing that.

The reason for such high loan rates right now is because there is high demand and few loans.  As soon as more loans enter the system then the opportunity decreases.  

As with all investments, those who recognize value first get the biggest advantage.

There's no way this opportunity will continue forever.  

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April 08, 2013, 04:26:09 AM
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There is no such thing as capitalizing without the risk.

If there were guaranteed profits of 300-500%, people would be doing it themselves and not giving the profits back to you.

Don't say people didn't warn you.

I have to agree with others that theres no such thing has making profits that large without there also being a large risk involved.


I'm not saying to not trust the site but I also have to ask who owns the site.  Anytime you're going to hand over hundreds of thousands of dollars to somebody and trust them to keep it safe it's a good idea to know who they are.  I see far too many bitcoin related sites and services were the owners remain anonymous, that's never a good idea to give that much money when you have no idea whos looking out for you (or not looking out for you).

Hourly bitcoin faucet with a gambling twist !  http://freebitco.in/?r=106463
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April 08, 2013, 06:24:41 AM
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Little risk??? Do you remember what happened to bitcoinica, which by the way bitfinex stole the code from? NO THANK YOU
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April 08, 2013, 06:29:11 AM
 #11

Little risk??? Do you remember what happened to bitcoinica, which by the way bitfinex stole the code from? NO THANK YOU

+1 that; much larger risk than just hoarding. At least with hoarding, you can be sure you have the coins, whatever the price. With bitfinex, you one day may have exactly zero capital. No insurance whatsoever, this has to be the riskiest idea here. Selling your house and going all in bitcoin is not even half as risky.

i am satoshi
Faraday
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April 08, 2013, 06:38:55 AM
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P.P.S. Also I post this for self-interest.  It's freakin frustrating to not be able to establish the position I want to simply because all the loans have been gobbled up.


Do you realize that posting in here is probably going to attract more traders than lenders so the loans will be even more gobbled up?

Also, /vouch for bitfinex. I also use it Tongue
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April 08, 2013, 09:58:09 PM
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What do you mean you don't have enough money to buy Bitcoins? Bitcoin is much better than fiat because it is not backed by debt! BORROW BORROW BORROW

 Roll Eyes
Sage
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April 09, 2013, 03:15:23 AM
 #14

What do you mean you don't have enough money to buy Bitcoins? Bitcoin is much better than fiat because it is not backed by debt! BORROW BORROW BORROW

 Roll Eyes

Regardless of the Bitcoin position you have, to leverage trade LONG you need to borrow the fiat your leveraging against.

On the other side of this cycle I'll be eventually shorting Bitcoin too.  That means someone's gotta loan Bitcoins.  Who wants to make some extra return on their Bitcoin holding?  If you're in it for the long-haul it only makes sense to get your Bitcoins making a return somehow/somewhere.  Bitfinex so far is proving to be a great platform to do that.
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April 09, 2013, 07:03:32 AM
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Little risk??? Do you remember what happened to bitcoinica, which by the way bitfinex stole the code from? NO THANK YOU

+1 that; much larger risk than just hoarding. At least with hoarding, you can be sure you have the coins, whatever the price. With bitfinex, you one day may have exactly zero capital. No insurance whatsoever, this has to be the riskiest idea here. Selling your house and going all in bitcoin is not even half as risky.

It's a completely different kind of risk from Bitcoinica. Bitcoinica is one lazy-ass platform which doesn't even bother to use a cold wallet for reserve, that's how they got stolen over and over again, to secure your bitcoins, make sure most of your reserves is in the cold wallet and you only withdraw from it through offline transaction is enough, it's not too complex a thing, and that's what I am sure Raphael is doing.

The risky aspect of Bitfinex is, of course, that the site owners may just run away with your money, so I am still waiting for them to get fully registered with the Hong Kong finanical service regulators to move any significant amount of fiats into their site.

https://tlsnotary.org/ Fraud proofing decentralized fiat-Bitcoin trading.
piramida
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April 09, 2013, 07:12:21 AM
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that's what I am sure Raphael is doing.

I'm not even sure coinbase is doing it properly, let alone bitfinex. Can't be sure, just because something is simple to do, that the site owners are doing it and are not making little mistakes like keys in unencrypted backups etc - there has to be some kind of certification. So while I did use bitfinex, I also did some research and found it's just another ran-out-of-basement business yet, so withdrew most of the funds just to be safe. Not saying it's evil, most probably not, and wishing it all the best, but saying "Without risk" does not apply here in the slightest.

i am satoshi
oakpacific
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April 09, 2013, 07:21:54 AM
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that's what I am sure Raphael is doing.

I'm not even sure coinbase is doing it properly, let alone bitfinex. Can't be sure, just because something is simple to do, that the site owners are doing it and are not making little mistakes like keys in unencrypted backups etc - there has to be some kind of certification. So while I did use bitfinex, I also did some research and found it's just another ran-out-of-basement business yet, so withdrew most of the funds just to be safe. Not saying it's evil, most probably not, and wishing it all the best, but saying "Without risk" does not apply here in the slightest.

I know, but it's fair to say it's at least much more cautious and serious than the joke that was Bitcoinica, though still a long way from sufficient security.


I don't think you need any encrypted backup of keys by the way, you just do several paper backups then no more need for a digital backup.

https://tlsnotary.org/ Fraud proofing decentralized fiat-Bitcoin trading.
essem
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April 09, 2013, 07:34:38 AM
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If there were guaranteed profits of 300-500%, people would be doing it themselves and not giving the profits back to you.

Don't say people didn't warn you.

While nothing is guaranteed, this is a very shortsighted view and plain ignorant way to look at things.

"doing it themselves"

...Is not an option period.  Traders need speed and liquidity.  And lenders need a intermediary to protect their loan with margin requirements and position liquidations if necessary.

Bitfinex simply provides the platform for doing that.

The reason for such high loan rates right now is because there is high demand and few loans.  As soon as more loans enter the system then the opportunity decreases.  

As with all investments, those who recognize value first get the biggest advantage.

There's no way this opportunity will continue forever.  



So why not get a real loan in the real world and then lend it out on Bitfinex? You'd make a shedload of cash, especially if you kept quiet about it keeping the interest rate high since d > s?

Right? I mean that's what I would do if I didn't believe this site would eventuallt make off with your cash
Sage
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April 09, 2013, 07:39:28 AM
 #19

If there were guaranteed profits of 300-500%, people would be doing it themselves and not giving the profits back to you.

Don't say people didn't warn you.

While nothing is guaranteed, this is a very shortsighted view and plain ignorant way to look at things.

"doing it themselves"

...Is not an option period.  Traders need speed and liquidity.  And lenders need a intermediary to protect their loan with margin requirements and position liquidations if necessary.

Bitfinex simply provides the platform for doing that.

The reason for such high loan rates right now is because there is high demand and few loans.  As soon as more loans enter the system then the opportunity decreases.  

As with all investments, those who recognize value first get the biggest advantage.

There's no way this opportunity will continue forever.  



So why not get a real loan in the real world and then lend it out on Bitfinex? You'd make a shedload of cash, especially if you kept quiet about it keeping the interest rate high since d > s?

Right? I mean that's what I would do if I didn't believe this site would eventuallt make off with your cash

That is a very doable arbitrage play right now.  Do it.
essem
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April 09, 2013, 07:47:14 AM
 #20

If there were guaranteed profits of 300-500%, people would be doing it themselves and not giving the profits back to you.

Don't say people didn't warn you.

While nothing is guaranteed, this is a very shortsighted view and plain ignorant way to look at things.

"doing it themselves"

...Is not an option period.  Traders need speed and liquidity.  And lenders need a intermediary to protect their loan with margin requirements and position liquidations if necessary.

Bitfinex simply provides the platform for doing that.

The reason for such high loan rates right now is because there is high demand and few loans.  As soon as more loans enter the system then the opportunity decreases.  

As with all investments, those who recognize value first get the biggest advantage.

There's no way this opportunity will continue forever.  



So why not get a real loan in the real world and then lend it out on Bitfinex? You'd make a shedload of cash, especially if you kept quiet about it keeping the interest rate high since d > s?

Right? I mean that's what I would do if I didn't believe this site would eventuallt make off with your cash

That is a very doable arbitrage play right now.  Do it.


I've maxed out my father's credit card to buy my bitcoins. Hopefully I'll make enough money that he won't get mad when his bill comes at the end of the month
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