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Author Topic: MtGox should consider National Market System Plan (Limit Up/Limit Down)  (Read 724 times)
johnyj
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April 11, 2013, 11:21:39 PM
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It's a trend in today's electronic trading world to limit the trading range during a reasonable time frame

http://cdn.batstrading.com/resources/membership/BATS_US_Equities_Limit_Up_Limit_Down_FAQ.pdf

"On May 31, 2012 the Securities and Exchange Commission (SEC) approved, on a pilot basis, a National Market System Plan, also known as Limit Up/Limit Down (LULD), to address extraordinary market volatility. As LULD is phased in, Single Stock Circuit Breakers (SSCBs) will be phased out. Upper and Lower Price Bands will be calculated based on a continually updated Reference Price and disseminated marketwide by the consolidated feeds (SIPs) with trading prohibited outside of the specified price bands."

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April 11, 2013, 11:25:51 PM
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When the price was going up up and away I bet you were perfectly happy.

Now that it's returning to reality, out of the woodwork come all the people who want regulation by central authorities. It would be funny if it wasn't so sad.
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April 11, 2013, 11:27:46 PM
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No they shouldn't.  The answer to manipulation isn't more manipulation.  Free & transparent markets period.

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April 11, 2013, 11:32:05 PM
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It's a trend in today's electronic trading world to limit the trading range during a reasonable time frame

http://cdn.batstrading.com/resources/membership/BATS_US_Equities_Limit_Up_Limit_Down_FAQ.pdf

"On May 31, 2012 the Securities and Exchange Commission (SEC) approved, on a pilot basis, a National Market System Plan, also known as Limit Up/Limit Down (LULD), to address extraordinary market volatility. As LULD is phased in, Single Stock Circuit Breakers (SSCBs) will be phased out. Upper and Lower Price Bands will be calculated based on a continually updated Reference Price and disseminated marketwide by the consolidated feeds (SIPs) with trading prohibited outside of the specified price bands."


This is not the answer.
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April 11, 2013, 11:52:31 PM
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They need to secure some professionals with the right set of skills, and additional funding if they need it, and build out their infrastructure as if they are going to be handling NYSE volumes next week and more the following week.
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April 11, 2013, 11:55:27 PM
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When the price was going up up and away I bet you were perfectly happy.

Now that it's returning to reality, out of the woodwork come all the people who want regulation by central authorities. It would be funny if it wasn't so sad.

I don't have an account at MtGox Wink

Notice that it also include "Limit UP". This rule is not targeted at exchage price itself. It is to avoid wrongly triggered incorrect trades and in case the exchange do not have enough liquidity or processing power. Give it 10 minutes, the liquidity will recover, but let it go, the liquidity will get worse and worse due to the panic sentiment change, although no fundamentals changed the price would still hit zero, and trigger a serials of other events


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April 12, 2013, 12:05:27 AM
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They need to secure some professionals with the right set of skills, and additional funding if they need it, and build out their infrastructure as if they are going to be handling NYSE volumes next week and more the following week.

That may be the right answer in the long term, but that takes time and money.

In the short term, Lu/ld would help stabilize btc and maybe even keep it from being hyper deflationary...
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April 12, 2013, 12:07:52 AM
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In the short term, Lu/ld would help stabilize btc and maybe even keep it from being hyper deflationary...
What you're calling "hyper deflation" is just rapid adoption. Trying to limit that is silly, like trying to prevent the number of people from buying TVs, telephones, or automobiles for the first time from rising "too quickly".
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April 12, 2013, 12:12:55 AM
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In the short term, Lu/ld would help stabilize btc and maybe even keep it from being hyper deflationary...
What you're calling "hyper deflation" is just rapid adoption. Trying to limit that is silly, like trying to prevent the number of people from buying TVs, telephones, or automobiles for the first time from rising "too quickly".

Based on the last couple of days, it looks more like pump and dump than adoption.
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April 12, 2013, 12:13:17 AM
 #10

A 10% Limit Up per day won't affect the latest rally, but can definitely help to avoid the sudden crash

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April 12, 2013, 12:23:20 AM
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Based on the last couple of days, it looks more like pump and dump than adoption.
Broaden the amount of data you're looking at. How quickly has merchant adoption been increasing as measured by BitPay's sales figures, compared to the rate of increase in the exchange rate?
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