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Question: What was the cause of bitcoin crash today?
Massive sell-off / correction - 138 (43.9%)
Massive DoS - 81 (25.8%)
Bubble burst - 61 (19.4%)
Other - 34 (10.8%)
Total Voters: 314

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Author Topic: Why did bitcoin go down?  (Read 8917 times)
Operatr
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April 11, 2013, 02:29:55 AM
 #21

It didn't crash to what it was before the rise started, it is inevitable it would start to plateau following Cyprus cashouts, we're seeing who was just using Bitcoin to transfer their money to another fiat currency, or who decided it was better to stay as the value kept increasing, and there are more and more merchants starting to accept BTC following the new media hype and speculation.

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zef
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April 11, 2013, 02:46:53 AM
 #22

ill put in my 2 cents here. I was watching the depth chart very carefully from the time bitcoin hit 200 all through the drop to 100. I believe there was a massive dark pool sell order, combined with the ddos, made it impossible for people to withdraw their buy orders, and for other sellers to get in and sell. meaning whoever it was chewed through all the buy orders from 250 down to 105. i don't know how many coins that was, but it was a lot.

the reason i think this was a dark pool sell was that there was a huge spread once bitcoin hit below 200. sellers were selling still around 180-190, while all buy orders were being  sold down to 120 or so. Buyers would creep back up, but anytime they did they would just get eaten up by an invisible sell. This kept going on until around buys were at 105, while all non dark sell orders were at about 140. I presume whoever was selling did not want the price to completely tank, as they stopped before it broke below 100, which would of probably caused a panic.

now who knows whats gonna happen, but i think this is a very bearish sign.
Tonko
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April 11, 2013, 03:11:07 AM
Last edit: April 11, 2013, 03:38:44 AM by Tonko
 #23

now who knows whats gonna happen, but i think this is a very bearish sign.

Not necessarily.

The existence of the "dark pool" was well known. Anybody who read Ron/Shamir paper and choose not to ignore it (or actually had attention span to read it and ability to understand it) knew that is very probable.

It doesn't even take that much analysis: everybody who has been following BTC closely knew that there are 'entities' out here with a huge stash of coins, min 500,000 that they got for pennies.

Ron/Shamir also documented some curious patterns. For example a pattern where a single address would sell hundred of thousands of BTCs to multiple destinations, and, through Mt.Gox, they would all return back to the same address.

I called that market-making in one post. You can say it was testing and preparation for today.

That is really nothing unusual for stocks and is often very easily visible on pumped-dumped poorly liquid penny stocks.

zef
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April 11, 2013, 03:55:52 AM
 #24

can you link to that paper/article? I never heard of it. I don't think its bearish because of the existence of dark pools, but because a huge down swing like that will scare people into thinking twice about getting into btc at this price.

just an update though, gox says that they were not ddosed today, but that genuine volume of traders overloaded servers. https://www.facebook.com/MtGox
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April 11, 2013, 04:02:04 AM
 #25

it was market manipulation, plain and simple. see the thread in the newbie section.
Tonko
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April 11, 2013, 04:08:32 AM
 #26

can you link to that paper/article?

eprint.iacr.org/2012/584.pdf

MatTheCat
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April 11, 2013, 04:10:49 AM
 #27

it was market manipulation, plain and simple. see the thread in the newbie section.

link?

Kraken Account, Robbed/Emptied. Kraken say "Fuck you, its your loss": https://bitcointalk.org/index.php?topic=1559553.msg15656643#msg15656643

Bitfinex victims. DO NOT TOUCH THE BFX TOKEN! Start moving it around, or trading it, and you will be construed as having accepted it as an alternative means of payment to your USD, BTC, etc.
Chucksta
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April 11, 2013, 11:06:10 AM
 #28

Geez, this reminds me of 2011.

Dammit!
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April 11, 2013, 11:23:57 AM
 #29

I think its because it grew way to fast in two days it went from 130 to 240 there is nothing that can grow this much in price.
Except for food and water when there is nothing to eat and drink.
I think this was a correction big time but when you look at the charts you can see the bitcoin is stabilizing and even growing in price again.
It just went up to quick but it will go up again eventually, it isn't a total bubble burst its just because people came to their sense.
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April 11, 2013, 11:56:47 AM
 #30

When you have an asset who soars +1500% in a few months you sell it. Bitcoin is not an investment and you shouldn't put all your savings on it.
Galt
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April 11, 2013, 01:12:26 PM
 #31

Seems pretty straight forward, bitcoin is blowing up and MTGox can't keep up with demand. Thus it lags and people think the sky is falling. Thanks for the cheap coins last night though.

https://mtgox.com/press_release_20130411.html
jorov
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April 11, 2013, 01:21:47 PM
 #32

This is the second time Mt. Gox crashes Bitcoin.

Should we race for the third wave now ?

$140 is not low ... it was lower 3 days ago...

Until people understand what is happening there will be a lot more cheap coins Smiley

Waiting for the bottom to BUY !
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April 11, 2013, 01:24:25 PM
 #33

there is nothing that can grow this much in price.
Except for food and water when there is nothing to eat and drink.

...and real value where there is just fiat paper monies and IOUs  Grin
Geddi
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April 11, 2013, 02:27:41 PM
 #34

there is nothing that can grow this much in price.
Except for food and water when there is nothing to eat and drink.

...and real value where there is just fiat paper monies and IOUs  Grin

real value  Cool
onealfa
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April 11, 2013, 05:07:03 PM
 #35

I am astonished.   What a crap  all over around  (all forums, portals, FB, twitter etc) ?  A "massive crash"  ?!

What Huh!   A crash Huh   
But we are simply where we all been only ONE (1!) week ago.  Just think of it !  ONE week ago.
How many days has passed since we all were  sreaming   "look !  BTC is already $100+  today !

I deeply believe that all these events has nothing to do with trust/believe in BTC, with the fundamentals of BTC

From the other side - WHAT can you expect, when MtGox, the largest exchange (70-80% market share) has an operation  time lag of 4600-4800 seconds ! 
Grab you calculator and think again of what you got - that is a HUGE 1.2 - 1.5 hours  LAG  !!!

What king of trade (logical?) can you expect on such a crap system???
And compare this to a advanced FOREX, NYSE automatic trading systems, where   serious contenders would not even try their chances, unless their access delay (ping, lag, what ever you call it) is less then 1-2 ms ( mili-seconds, that is)

Think of it. 
While you can ( $ while MtGox is stopped for a cool-ff)

bcpokey
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April 11, 2013, 05:41:40 PM
 #36

Most people probably did not buy in at that time, which is why it's a big shocker to people.

Those who know the history are probably not surprised, those who burned their assets in the fire of bitcoin craze probably are.

This reminds me greatly of July 2011, almost to a tee. The only difference is it's so much more massive that I missed the boat on raking in some arbitrage (I didn't expect a jump to > $250). But just as then, huge run up in relatively short period of time, for no reason, while everyone jumping for joy. Then big drop, then medium recovery, then big drop, small recovery, medium drop, etc. until eventually bitcoin was almost worthless. Hopefully the fundamentals are there to support bitcoin at a reasonable value this time, otherwise it might forever solidify bitcoin as just a pump and dump scheme for those with the capital and know how.
alexh
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April 11, 2013, 05:48:08 PM
 #37

Pretty sure because of all the price dumping on mtgox. However, there can always be something more behind that.
szita2000
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April 11, 2013, 05:52:49 PM
 #38

Some big fishes cashed out I think. Wink

Knowledge speaks, but wisdom listens...
MatTheCat
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April 11, 2013, 10:03:54 PM
 #39

I thought about it for a while before separating those concepts. A bubble and a correction are different in my book. I think in my opinion when a bubble burst the. Price should go back to the beginning of the bubble. This was not the case. A correction is whe. There's a spike that is not justified and the. A profit taking takes place and the price is adjusted to real values. This is just my opinion and conceptually I could be wrong though.
To me, what happened today was a huge DoS not only against mtgox, but also other exchanges and even bitcointalk! Every site related to bitcoins was somewhat slow.
I think DoS is the bug cause. We need to start isolating the exchanges and the use of brokers could be an alternative.

Hey deathcode old pal!

Just wondering how your exit strategy fared amongst these multiple DoD attacks?

Did you get yourself that motorbike you were looking at?

Kraken Account, Robbed/Emptied. Kraken say "Fuck you, its your loss": https://bitcointalk.org/index.php?topic=1559553.msg15656643#msg15656643

Bitfinex victims. DO NOT TOUCH THE BFX TOKEN! Start moving it around, or trading it, and you will be construed as having accepted it as an alternative means of payment to your USD, BTC, etc.
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April 11, 2013, 10:49:13 PM
 #40

Because a butterfly flapped it's wings in Hawaii.

Send me your Bitcoin and I will make sure to HODL it safe for you!
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