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

[NewbieTreider]

Good mornin' Bitcoinland.

Flat at $590 I see. Pretty much where we were before the Finex hack became known.

Was the preceding dip from $650 to $600 perhaps based on insider knowledge?

Time to sit back and watch.

Good point of view. Several days from $650 to $600, until bitfinex hack, and then... uhmmmm

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[Elwar]

I'm sorry but I hate the idea of giving finex the ability to issue "tokens" to their customers.
It means that every time shit happens they can "trick the system" as they please.

That looks like some sort of QE to me. Am I the only one who sees it that way?

It will make other exchanges think twice when they go to spend money on extra security measures. They can just "do what BitFinex did" if anything bad ever happens.

[JayJuanGee]

So, who is going to be stupid enough to lay a finger on their BFX tokens?

i'm a sucker for a sweet deal that no one wants to touch.

That poll... so judging by the 36% haircut, we can assume that 20% - 25% of the total was thieved!... And by that we can assume it is more than 250$ million if it was the total...  But keeping in mind the current rate and the imminent bitcoin potential rise, we can say for the short term(30days) 500$ million would have sufficed, with the adjustment to inflation. But they don't have 100% ... because part of that was erased with the theft. So 250$ million would have been more appropriate and a good deal for the exchange price we have now on hand.

What you are saying makes little sense.

I don't know how a company could be valued based on the amount of customer funds that they supposedly hold, as that same value.  Let's say that they held approximately $500 million in customer funds, that does not make them worth $500 million, but maybe (best case scenario) holding value (and being able to profit from the trading of that value) could make them worth 10% of the value that they hold?

[adamstgBit]

So they wont have a variable value? just 1$ and you can one day maybe swap them for 1$  ?

They say the token will have a blockchain, it will start at $1 value, and they will let people trade it (possibly apart from US customers). That suggests it will be like a normal coin with a wallet. If Bitfinex lets people withdraw the tokens then other exchanges will probably start trading it.

where do they say this token will have a blockchain?

[adamstgBit]

So, who is going to be stupid enough to lay a finger on their BFX tokens?

i'm a sucker for a sweet deal that no one wants to touch.

That poll... so judging by the 36% haircut, we can assume that 20% - 25% of the total was thieved!... And by that we can assume it is more than 250$ million if it was the total...  But keeping in mind the current rate and the imminent bitcoin potential rise, we can say for the short term(30days) 500$ million would have sufficed, with the adjustment to inflation. But they don't have 100% ... because part of that was erased with the theft. So 250$ million would have been more appropriate and a good deal for the exchange price we have now on hand.

What you are saying makes little sense.

I don't know how a company could be valued based on the amount of customer funds that they supposedly hold, as that same value.  Let's say that they held approximately $500 million in customer funds, that does not make them worth $500 million, but maybe (best case scenario) holding value (and being able to profit from the trading of that value) could make them worth 10% of the value that they hold?

the amount of customer funds they hold is a liability, not an asset.

the only thing that makes bitfinex valuable is that they turn a profit

[celebreze32]

So they wont have a variable value? just 1$ and you can one day maybe swap them for 1$  ?

They say the token will have a blockchain, it will start at $1 value, and they will let people trade it (possibly apart from US customers). That suggests it will be like a normal coin with a wallet. If Bitfinex lets people withdraw the tokens then other exchanges will probably start trading it.

where do they say this token will have a blockchain?

In this comment, they say it will be a token on a blockchain so I assume that means it will have its own blockchain unless its like a counterparty asset.

https://www.reddit.com/r/BitcoinMarkets/comments/4wng7l/site_relaunch_bitfinex_blog/d68xbcm

I assume that means it will be a coin premined with the number of tokens they have issued. I don't know if it will be POW, POS, or mineable. All they say is it will have a blockchain, and I can't think of any point of one unless it allows customers to withdraw their tokens to their own wallet.

[Paashaas]

I'm still waiting for the in-depth analysis how they where beeing hacked before even considering investing in scamcoin Finexcoin.

Finex is bankrupt...they try the hard way to save it but if they can make a restart then the users will be scammend again, it might also bring evil plans to other exchanges

[JayJuanGee]

I was able to log into my Bitfinex account. Of the 31 bitcoins I have a balance of 20 bitcoins (which I will withdraw immediately once the option is available). I have 412 USD and about 7000 BFX (tokens).

I have no idea why I have dollars on there, I've never had dollars on there. I'll be buying bitcoins with them and withdrawing those as well.

As for the whole token concept. I had been working with an international company for quite some time and we had been trying to come up with a way to sell shares to raise our initial funding. With the company being based in Belize with Bitcoin as our main currency and the blockchain being used for tracking our shares we would not be like any other company. But with half of the board living in the US and not wanting to lose US customers we had to figure out a way to word things so that we were not offering "shares" or "dollars" or anything else that had some sort of legal connotation. We played around with the idea of tokens because any company can sell tokens. We planned on selling a set amount of them being a percentage share of our company. But when talking to lawyers we found out that linking a token's value to shares of the company would defacto turn it into shares and subject us to all sorts of rules and limitations that just wouldn't work for us. I kinda lost confidence in our business model when we still decided to go with a "token" type of setup but not a limited number and turned it into more of a membership model with not much reward (that I can see) for being a member. But I'm just the IT guy so I am leaving it in the hands of our marketing guy to figure it all out.

I would like to see Bitfinex define what exactly a BFX represents and make sure it is set in stone. Otherwise I will just cash them out. Their initial value is being set to $1 each.

If they are actually representative of a percentage share of their company with dividends then I would consider keeping them. But they likely cannot say that legally, so they become a very shitty centralized alt coin with unlimited printing ability that you can't use for anything.

If I were you,I'd get my cash & BTC out if there ASAP.

Maybe sit on those BFX tokens for few more days,then dump those if things don't look much better by then,or hold if things look stable 

Best of luck,hope ya learned something from this 

Even if your very rich,losing that much "investment" has got to sting abit..............

I lost a lot more from the price drop.

I don't believe they are going to open BFX tokens to be sold for a while. Even then, we are all relying on $65 million worth of investment to come in and buy those tokens. I'll do what I can to be in the front of the line for anyone wanting to buy.

I will attempt to make two points here.

1) Regarding holding Bitfinex tokens.  I am in a similar boat to you, Elwar, I was issued a similar amount of tokens.  We are in a bit of ambiguous position if we are holders of bitfinex tokens.  Sure, if we want to be at the front of the line to cash out, then we cash out as soon as we can, because we believe the value of such tokens will decrease in value over time; however, we do not necessarily want to announce our position, especially if we were to hold a large amount of tokens.  You also seem to acknowledge that there are going to be restrictions on whether some folks can trade or sell their tokens - especially those classified as US customers, which will cause it's own price dynamic, depending on whether there is any ability for US customers to cash out of their tokens.

2) Regarding buying, holding, trading and/or allocation of our bitcoin holdings.  Frequently, hindsight is 20/20, but if we have been involved in bitcoin for a while, we should understand that it is dangerous and risky to allocate 100% of our investment and/or holdings in either direction.  From my understanding, Elwar, you got a lump sum of fiat from your house sale when BTC prices were in the mid $600s, and you decided to go full bitcoin with that lump sum - even though you already were a holder of quite a few bitcoins.  Sure, it could make a difference whether you were doubling or tripling your Bitcoin holdings or adding 10%, and we have had a bit of this conversation before.  I would argue that the more that you hold in bitcoin, then the less eager you should be to allocate higher portions of new money to bitcoin.   Based on your earlier responses to this question, I would not say anything because you had asserted that you wanted to keep all of your free money in bitcoin; however, since you seem to have been complaining that you lost money because the price went down, you had in fact over allocated into bitcoin, which is back to my point of not going 100% with new money, even if you believe that the then current market is bullish.  In your case, if you had gone 80 or 90%, then you would have had the 10% or 20% for investing when BTC prices went down, and you would have been in a more comfortable position (in spite of the loss of value of BTC during that period).  Don't get me wrong.. all of us do need to decide for ourselves regarding risk and about how we allocate the risk without gambling too much and without kicking ourselves too much to keep our losses (when they occur) within personally tolerable limits.

[Hunyadi]

So they wont have a variable value? just 1$ and you can one day maybe swap them for 1$  ?

They say the token will have a blockchain, it will start at $1 value, and they will let people trade it (possibly apart from US customers). That suggests it will be like a normal coin with a wallet. If Bitfinex lets people withdraw the tokens then other exchanges will probably start trading it.

where do they say this token will have a blockchain?

In this comment, they say it will be a token on a blockchain so I assume that means it will have its own blockchain unless its like a counterparty asset.

https://www.reddit.com/r/BitcoinMarkets/comments/4wng7l/site_relaunch_bitfinex_blog/d68xbcm

I assume that means it will be a coin premined with the number of tokens they have issued. I don't know if it will be POW, POS, or mineable. All they say is it will have a blockchain, and I can't think of any point of one unless it allows customers to withdraw their tokens to their own wallet.

The tokens name is BFX Omni...so it is OMNI platforms asset (I believe OMNI is former Mastercoin).

[Tzupy]

how the F thinks bitfinex is worth 1billion?

6 poeple have voted for this option lol

You should have added a negative value option. Without it I had to vote less than 9 million...

[kobilica]

https://www.cryptocoinsnews.com/us-government-auction-1-6-million-bitcoins/

What effect will this have on price?

[macedoniantable]

https://www.cryptocoinsnews.com/us-government-auction-1-6-million-bitcoins/

What effect will this have on price?

None whatsoever!
Just look at the auction that the Feds did a couple of years ago.
The price did not change from it's commonly known adjustments in that same time period.

[kobilica]

Ok, thanks!

[Denker]

https://www.cryptocoinsnews.com/us-government-auction-1-6-million-bitcoins/

What effect will this have on price?

$1,6million in BTC is nothing you should be worried about.
The effect on the market will be zero!!
The trading volume the last 24 hours was around $58million!
So this sell is just a drop.
It's going to be way more interesting when BitFinex opens it doors again.I expect a bankrun.

[savetherainforest]

how the F thinks bitfinex is worth 1billion?

6 poeple have voted for this option lol

Maybe they took in to consideration the future valuation of BTCitcoin?

If probably goes to 3000$ - 4000$ in the short term (next 6-12 months)... it would probably make sense.

[JayJuanGee]

It's going to be way more interesting when BitFinex opens it doors again.I expect a bankrun.

Actually, you are probably correct that there is quite a lot of market anticipation regarding this whole bitfinex reopening matter, and of course a central fear of Bitfinex would be to experience a run on the bank, so I think that the way that bitfinex opens up and possibly even further specifics regarding the extent to which they plan to allow for the trading of Bitfinex tokens could assist in attempting to dissuade a run on the bank... to allow for withdraws, but to also create various incentives and disincentives.  

In their reopening, Bitfinex should be focusing on attempts to communicate and create incentives for folks to stay and using their exchange rather than creating disincentives for account holders to leave.  The creation of incentives will inspire greater confidence in their solvency - at least their short term solvency.  

Folks may be concerned about the long term solvency of Bitfinex, but it does seem that long term solvency matters as much as short and medium term solvency.  If Bitfinex can create the impression that they are solvent in the short term and in the medium term, then folks will continue to use their services, and if folks continue to use their services, the long term solvency becomes a self-fulfilling prophecy, at least the impression of having such long term solvency.

In the short term, Bitfinex may even allow for fee free trading for a period of time after their reopening (maybe one or two months of fee free), which seems to have been the practice of several other exchanges after they experience significant levels of disrupted services.  In that regard, acting anxiously to withdraw funds from Bitfinex may be the less profitable act (even though perhaps the more prudent choice, depending on your personal risk profile and depending on how matters play out).  

Possibly within the next day or two we will find out a few more details from Bitfinex regarding their opening strategy - and maybe we will even be able to experience a bit of bitfinex trading on or before Wednesday (am I being too optimistic?)  

[AlexGR]

https://www.cryptocoinsnews.com/us-government-auction-1-6-million-bitcoins/

What effect will this have on price?

Zero. The quantity is too small and the market is oversold anyway due to bfx hack

[savetherainforest]

So, who is going to be stupid enough to lay a finger on their BFX tokens?

i'm a sucker for a sweet deal that no one wants to touch.

That poll... so judging by the 36% haircut, we can assume that 20% - 25% of the total was thieved!... And by that we can assume it is more than 250$ million if it was the total...  But keeping in mind the current rate and the imminent bitcoin potential rise, we can say for the short term(30days) 500$ million would have sufficed, with the adjustment to inflation. But they don't have 100% ... because part of that was erased with the theft. So 250$ million would have been more appropriate and a good deal for the exchange price we have now on hand.

What you are saying makes little sense.

I don't know how a company could be valued based on the amount of customer funds that they supposedly hold, as that same value.  Let's say that they held approximately $500 million in customer funds, that does not make them worth $500 million, but maybe (best case scenario) holding value (and being able to profit from the trading of that value) could make them worth 10% of the value that they hold?

I don't know exactly what fees they have for as a theoretical... Bitcoin has the history on its side... Meaning that it will go in to a inflation period... And now to the numbers... If they have a 0.1% fee from the amount of each order. And if they have a 100-10$ million volume per day... That means 100k$ - 10k$ per day ... And if someone pays for something like this they don't pay for what is worth, but what it could be worth, they pay for the name, for the publicity, for the recognition... Meaning that in 10 years it could be bigger than the 250$ million they paid. But you are right, they should not be valued more than 150$ million... But on the other hand... They already have money! And they can probably make 100$ million or more in 10 years... And people with money need to be overpaid to budge and roll over!

[DaRude]

So, who is going to be stupid enough to lay a finger on their BFX tokens?

i'm a sucker for a sweet deal that no one wants to touch.

That poll... so judging by the 36% haircut, we can assume that 20% - 25% of the total was thieved!... And by that we can assume it is more than 250$ million if it was the total...  But keeping in mind the current rate and the imminent bitcoin potential rise, we can say for the short term(30days) 500$ million would have sufficed, with the adjustment to inflation. But they don't have 100% ... because part of that was erased with the theft. So 250$ million would have been more appropriate and a good deal for the exchange price we have now on hand.

What you are saying makes little sense.

I don't know how a company could be valued based on the amount of customer funds that they supposedly hold, as that same value.  Let's say that they held approximately $500 million in customer funds, that does not make them worth $500 million, but maybe (best case scenario) holding value (and being able to profit from the trading of that value) could make them worth 10% of the value that they hold?

I don't know exactly what fees they have for as a theoretical... Bitcoin has the history on its side... Meaning that it will go in to a inflation period... And now to the numbers... If they have a 0.1% fee from the amount of each order. And if they have a 100-10$ million volume per day... That means 100k$ - 10k$ per day ... And if someone pays for something like this they don't pay for what is worth, but what it could be worth, they pay for the name, for the publicity, for the recognition... Meaning that in 10 years it could be bigger than the 250$ million they paid. But you are right, they should not be valued more than 150$ million... But on the other hand... They already have money! And they can probably make 100$ million or more in 10 years... And people with money need to be overpaid to budge and roll over!

Yeah that's not how company valuation works. Right now their balance sheet is in red by ~$120MM (meaning they have $120MM more in liabilities more than assets)
Also if you think this "incident" will have no effect on their market share (their daily volume) or their "goodwill" you're delusional

[harrymmmm]

It's going to be way more interesting when BitFinex opens it doors again.I expect a bankrun.

Actually, you are probably correct that there is quite a lot of market anticipation regarding this whole bitfinex reopening matter, and of course a central fear of Bitfinex would be to experience a run on the bank, so I think that the way that bitfinex opens up and possibly even further specifics regarding the extent to which they plan to allow for the trading of Bitfinex tokens could assist in attempting to dissuade a run on the bank... to allow for withdraws, but to also create various incentives and disincentives.  

In their reopening, Bitfinex should be focusing on attempts to communicate and create incentives for folks to stay and using their exchange rather than creating disincentives for account holders to leave.  The creation of incentives will inspire greater confidence in their solvency - at least their short term solvency.  

Folks may be concerned about the long term solvency of Bitfinex, but it does seem that long term solvency matters as much as short and medium term solvency.  If Bitfinex can create the impression that they are solvent in the short term and in the medium term, then folks will continue to use their services, and if folks continue to use their services, the long term solvency becomes a self-fulfilling prophecy, at least the impression of having such long term solvency.

In the short term, Bitfinex may even allow for fee free trading for a period of time after their reopening (maybe one or two months of fee free), which seems to have been the practice of several other exchanges after they experience significant levels of disrupted services.  In that regard, acting anxiously to withdraw funds from Bitfinex may be the less profitable act (even though perhaps the more prudent choice, depending on your personal risk profile and depending on how matters play out).  

Possibly within the next day or two we will find out a few more details from Bitfinex regarding their opening strategy - and maybe we will even be able to experience a bit of bitfinex trading on or before Wednesday (am I being too optimistic?)  

They'd be crazy to reenable withdrawals prior to a complete-sounding report on the hack. Why it occurred, how it has been fixed and why it can't happen again in the next few hours. Lol.
Otherwise, yes. A bank run.