Wall Observer BTC/USD - Bitcoin price movement tracking & discussion

[adamstgBit]

Hey how do we know that GOX price is the real price of Bitcoin and the other exchanges are actually the ones that are fucked up?

[1714689448]

1714689448

[1714689448]

1714689448

[jatajuta]

Great talk by Andreas Antonopoulos regarding the mess on Gox.

http://letstalkbitcoin.com/e85-mtgox-and-malleability/

[JorgeStolfi]

Daily volumes of BTC trade to/from USD and other national currencies (in kBTC):


             !    Mon !    Tue !    Wed !    Thu !    Fri !    Sat !    Sun !    Mon !    Tue !
  EXCHANGE   !  02/10 !  02/11 !  02/12 !  02/13 !  02/14 !  02/15 !  02/16 !  02/17 !  02/18 ! Currencies considered

  Bitstamp   |  71.86 |  40.06 |  15.51 |  28.15 |  63.38 |  20.76 |  26.40 |  19.90 |  14.83 | USD
  BitFinEx   |  41.98 |  39.54 |  12.85 |  17.17 |  53.68 |  10.83 |  16.75 |  15.69 |   8.47 | USD
  BTC-e      |  47.04 |  28.64 |   9.97 |  18.53 |  52.18 |   9.16 |  21.75 |  15.07 |   8.08 | USD,EUR,RUR
  Kraken     |   1.45 |   1.11 |   0.58 |   0.93 |   1.79 |   0.41 |   0.91 |   0.89 |   0.51 | EUR
  Bitcoin.DE |   1.54 |   0.67 |   0.51 |   0.78 |   1.63 |   0.22 |   0.57 |   0.57 |   0.38 | EUR
  CaVirtEx   |   0.77 |   0.53 |   0.29 |   0.41 |   1.16 |   0.15 |   0.15 |   0.15 |   0.21 | CAD
  CampBX     |   0.37 |   0.11 |   0.10 |   0.21 |   0.41 |   0.05 |   0.07 |   0.28 |   0.10 | USD

  SUBTOTAL   | 165.01 | 110.66 |  39.81 |  66.18 | 174.23 |  41.58 |  66.60 |  52.55 |  32.58 |

  Huobi      | 134.09 | 120.08 | 131.86 |  82.39 | 236.27 | 122.80 | 110.57 | 130.41 |  74.04 | CNY
  OKCoin     |  70.49 |  64.22 |  60.79 |  62.49 | 147.26 |  51.45 |  63.63 |  63.05 |  51.46 | CNY
  BTC-China  |  18.23 |  11.17 |  11.01 |   8.02 |  24.87 |   7.55 |   9.08 |   7.86 |   3.86 | CNY
  Bter       |   0.85 |   0.76 |   0.69 |   0.65 |   1.54 |   0.74 |   0.56 |   0.48 |   0.35 | CNY

  SUBTOTAL   | 223.66 | 196.23 | 204.35 | 153.55 | 409.94 | 182.54 | 183.84 | 201.80 | 129.71 |

  MtGOX      |  50.07 |  18.70 |  25.21 |  33.85 |  79.56 |  60.15 | 104.46 |  65.69 |  63.50 | USD,EUR,GBP,AUD,JPY

  TOTAL      | 438.74 | 325.59 | 269.37 | 253.58 | 663.73 | 284.27 | 354.90 | 320.04 | 225.79 |



All numbers were collected by hand from the site http://bitcoinwisdom.com. Beware of possible errors.

For each exchange, the numbers include only the trade volume to/from the currencies listed in the rightmost column. Trade between BTC and other cryptocoins, such as LiteCoin, is NOT included.

The exchange Bter was added to Bitcoinwisdom's menu on 2014-02-15; its volumes for 02/07 to 02/14 have been added
retroactively to the table.

Coinbase is said to use Bitstamp for currency conversion.

Dates on the header line are UTC. Specifically, "01/15" means "from 01/15 00:00:00 UTC to 01/15 23:59:59 UTC". (Beware that Bitcoinwisdom uses your local time, so the date may appear to be off by 1 day.  For example, if you are 2 hours west of Greenwich, it may show "01/14 22:00" when the UTC time is "01/15 00:00".)

NOTE: A few days ago, MtGOX has suspended withdrawals of Bitcoins and national currencies.  Therefore it is essentially isolated from other markets, and its price is completely out of the norm.  The exceptional trade volumes above may be meaningless.

[CoinDox]

I appreciate the thoughtful response. Your analysis of Houbi's trading activity is spot on. Do you happen to be able to read/write mandarin?

I would not call it "artificially inflated".  Since they charge no fees, we should expect that they have many more actively trading clients than other exchanges, and also that each client generates a lot more trade volume than a client would elsewhere.

I have seen many claims that their volume is "fake", but I have yet to see evidence of that.  Their volume data seems to be consistent with humans assisted by robots or scripts. The model above exploits some features specific to Huobi that hopefully will let us get around that limitation.  First, Huobi seems to have little trade by unsupervised robots (which have much more varied behavior than humans, and therefore should be less predictable). Their clients apparently have relatively well-defined demographic profile, and are relatively isolated from the rest of the world in terms of economic news.   And, those clients are trading a single item (Bitcoin) and have a relatively narrow channel for injecting money into the system (local banks)

There is most definitely no validity behind "fake" volume coming out of those exchanges. Yet, the conditions on the exchange that you mention, computer assisted trading, tightly control fiat entry portals, and being isolated from global financial media all lead to blur the real utility (value) of the asset in question its' market participants. Computer assisted trading, especially in a no fee environment, has created a market in which true exchanges of wealth get distorted by a thick layer of mathematical models and relationships. Tight control of money into the system gives banks, and by extension the ruling political party, an effective bargaining chip when innovation and regulation collide, which we see happening all across the globe right now, not just in China. Finally, with the people's consumption of digital information filtered on a daily basis, only a handful of individuals know the reality of the market in which they operate in. So, "fake" volume at Houbi? No, not quite, but distorted, bureaucratically controlled, and fundamentally skewed? Yes, very much so.

On the other hand, evidence fo fake volume at MtGOX and other sites are quite strong. For example, by the end of January MtGOX's volume was as low as 15 kBTC/day; some dumb robots, that worked steadily day and night, may have accounted for half of that.

It may not be a pleasant conclusion for non-Chinese bitcoiners, but it seems undeniable that bitcoin trading is now largely a Chinese thing; specifically, that the price of bitcoin is now largely determined by the Chinese traders at Huobi and OKCoin., and carried to other exchanges by arbitrage.

I do not even want to get into the issues with the other exchanges at the moment, for that is a whole other can of FUD/WORMS/DoGEs.

To me, the thought that BTC is growing to be largely a Chinese "thing" automatically raises concerns over future of innovation in the space and the underlying utility of the tech from a global perspective. Let's face it, China is not the world leader in open innovation policy.

Anyways, I digress - back to the real world I must

[pjviitas]

Hey how do we know that GOX price is the real price of Bitcoin and the other exchanges are actually the ones that are fucked up?

hell, for that matter how do we know the $2 I'm offering for a Bitcoin is not the real price and all the rest are F!#^g up?  

You make a great point.

I mean there are 2 choices here...either around $600 or $300.

By the looks of it $600 is turning out to be a solid valuation for Bitcoin.

GOX going down like this actually solidifies the true value of Bitcoin.

[FNG]

We're going parabolic..

[shmadz]

http://www.coindesk.com/canadas-finance-minister-regulate-bitcoin/

Thanks Adam, that seems to be the most complete story I've seen so far. Unfortunate that they are so quick and often to play the "funding terrorism" card.

(speaking of which, and dragging my own reply off-topic.. but this gives the US the perfect play in terms of their bitcoin hoard. They simply auction off the bitcoin, and a CIA plant will win the bid. They will then use the bitcoin fund a false-flag op and then use this to justify further controls, not just for bitcoin, but for their fiat as well.)

back on topic, regarding this quote "One option FINTRAC listed in the document was to “choke bitcoins oxygen (sic)” by denying Canadians access to the foreign-exchange market, "

That right there makes me think CaVirtex might have the proper business plan moving forward. That statement is pretty much business as usual for Virtex. As far as I know they only offer accounts to Canadian citizens and require driver's license and utility bill as minimum.

Sadly, this also means business as usual for me. I'm pretty sure I will still be able to move bitcoins in and out of btc-e or crypsty for some alt-coin plays, but in terms of fiat exchange directly in and out of my bank, it seems I'll be stuck with Virtex. (That's not exactly a bad thing, I've always had excellent customer service from virtex...I'd love the lower fees other exchanges offer, but I still value the trust factor, moreso now with what's going on at gox. How many of you have spoken with the owner of your exchange over the phone while their kids are screaming playing in the background?)

[derpinheimer]

About 10k coins added to asks on MtGox >1000

[Arcas]

About 10k coins added to asks on MtGox >1000

I never understood why people park their money in ridiculous orders. If, for some reason, bitcoin suddenly jumped up to $1000, I probably wouldn't want a computer automatically filling my order.

[Arcas]

Google trends update

I've included the regional interest map because it seems like the folks in the Bahamas are taking an interest in either investing or seeing how their money is doing.

Considering the Bahamas is basically a beach resort/tax haven this isn't surprising.

[shmadz]

About 10k coins added to asks on MtGox >1000

I never understood why people park their money in ridiculous orders. If, for some reason, bitcoin suddenly jumped up to $1000, I probably wouldn't want a computer automatically filling my order.

Somebody has been leaching all those cheap coins. 10,000 X 1,000 = 10,000,000  That's a pretty nice payday, and probably only half their coins or less...

[adamstgBit]

Google trends update



I've included the regional interest map because it seems like the folks in the Bahamas are taking an interest in either investing or seeing how their money is doing.

omg BUY!!!!!!!

[RicePicker]

About 10k coins added to asks on MtGox >1000

I never understood why people park their money in ridiculous orders. If, for some reason, bitcoin suddenly jumped up to $1000, I probably wouldn't want a computer automatically filling my order.

It just shows a small percentage of the theoretical bitcoins that Mtgox has on their exchange. I am assuming what is appearing on the order book to be only probably less than 50% of what is sitting in peoples accounts.   

[ChartBuddy]

Explanation

[octaft]

About 10k coins added to asks on MtGox >1000

I never understood why people park their money in ridiculous orders. If, for some reason, bitcoin suddenly jumped up to $1000, I probably wouldn't want a computer automatically filling my order.

Manipulates the ask sum.

[ChrisML]

About 10k coins added to asks on MtGox >1000

Choo Choo!!

[JorgeStolfi]

Your analysis of Houbi's trading activity is spot on. Do you happen to be able to read/write mandarin?

No, what I know about Huobi is basically from sources in English, e.g.

http://forexmagnates.com/exclusive-interview-ceo-of-largest-bitcoin-exchange-in-the-world-huobi-responds-to-mt-gox-situation/

http://www.csmonitor.com/World/Asia-Pacific/2013/1206/Why-the-Chinese-can-t-get-enough-of-Bitcoin-despite-bank-ban

There is most definitely no validity behind "fake" volume coming out of those exchanges.

Well, it is hard to tell what the volume means, at any exchange.  The plots of BTC-China or Kraken Bitcoin.de, for example, are quite weird.

I would consider legitimate (i.e. not "fake") any transaction between competing people or organizations, whether it is done manually or with the help of scripts and robots.  Any such transaction contributes to define the true "market price" of the item.   To a first approximation, it should not matter if the same coins are being traded back and forth many times, or how many distinct people are trading, as long as each transaction happens because both sides believe that the price is good.  To me a transaction is "fake" only if the buyer and seller are the same, or are colluding outside the market place.

Methinks that the volume of legitimate transactions is a good measure of the importance of a market.

The higher the volume, the higher the liquidity and the smaller is the spread, therefore the price is pinned down more accurately.  At BTC-e, forexample, the price often is bouncing rapidly up and down by a few dollars, so that the 1-minute plot look like a broad belt.  You hardly see that at Huobi; the plot looks more like a line than a belt.

Usually, the higher the volume, the smaller is the effect on the price of buying or selling a fixed amount of coins.  Therfore, arbitrage trading between a high-volume market and a low-volume market generally has little effect on the price of the former, instead copies the price to the latter.  For example, I would guess that the sharp steps one can see in the 1-minute plots of BTC-China and Bitstamp (but not on Huobi's), at periods when there seems to be little real activity, are arbitrage transactions aligning their prices with the global market.

For all I have seen in the past 2-3 months, I believe that most of Huobi's volume is legitimate in this sense.  At the other exchanges, I am not so sure; but even if it is all legitimate, the volume at non-Chinese exchanges is only 1/3 to 1/4 of the volume at Huobi and OKCoin.   Whatever one may think of the "quality" or "meaningfulness" of their trade, it counts the same for the definition of BTC's price.

Also I do not think that there is any government interference with the bitcoin trading inside the exchanges.  My understanding of the news is that the PBOC, having blocked the use of BTC as a currency in commerce, and prohibited banks from playing with it, now sees bitcoin trading within the exchanges as a kind of gambling, and therefore does not care about it at all.

It may not be a pleasant conclusion for non-Chinese bitcoiners, but it seems undeniable that bitcoin trading is now largely a Chinese thing; specifically, that the price of bitcoin is now largely determined by the Chinese traders at Huobi and OKCoin., and carried to other exchanges by arbitrage.

To me, the thought that BTC is growing to be largely a Chinese "thing" automatically raises concerns over future of innovation in the space and the underlying utility of the tech from a global perspective. Let's face it, China is not the world leader in open innovation policy.

Note that I said "bitcoin trading", not "bitcoin".   Bitcoin development and other activities (such as promoting its commercial use) seem to be mostly "non-Chinese things".   Given the restrictions on use of BTC in China, I do not expect that there will be any significant development or advocacy there, except perhaps in mining technology.

EDIT: BTC-e --> Bitcoin.de

[surfer43]

About 10k coins added to asks on MtGox >1000

Choo Choo!!

This will only make it harder to go to 10000 

[aminorex]

...stuff...

What he said, I endorse.

[JorgeStolfi]

Often I see here complaints about orders suddenly appearing from nowhere in order books, or statements like "there are only XXX coins left to {buy|sell} on exchange YYY".

The books at the larger sites must be huge (millions of entries perhaps), and each chart site in the world requests that data every few seconds.

Correct me if I am wrong, but those exchanges surely must truncate their answers, delivering only the first N (say, 2000) bids and asks in their order books. 

The summaries that tell how many coins there are to each round price, like the two righmost columns below



are computed by the chart sites or scripts from that truncated data, so they are truncated, too.   Depending on the steps and the spacing of the orders, the summary may not fill the whole space allocated on the chart.

In the example above, for example, surely there were many asks above 670 USD and many bids below 270 USD, and many more than 2058 coins for sale.