Idea for Price Stability - Ban Robot Trading

[spinbox]

The prices right now are changing so drastically in a very short amount of time.  I feel like this is mostly due to automated high-frequency computer trades.  Do you think there would be any difference if this were banned?  Say the government outlaws that and all trades are done manually?

This market is so speculative I can't see any time in the near future that volatility decreases.  Maybe once Bitcoins reaches mass adoption in 5 to 10 years.

Compared to the stock market, I don't know if I've ever seen a $40B market cap stock jump around like this.

[megynacuna]

Well if they can easily be banned or removed from the networks I think they'd have been done a long time. Bots like you are saying are the source of spam and so I will agree they need to be removed but I'm not sure that can be  easily done.

[Fortify]

Where are you meant to ban it? If bot trading gives you any advantage, people will move to the country without those laws and make more money than any competitor. The world is not a simple place like you want it to be, there is not one government - there are many. Bitcoin hard to control than most high frequency trading commodity because it is massively decentralized with real authority.

[panju1]

The prices right now are changing so drastically in a very short amount of time.  I feel like this is mostly due to automated high-frequency computer trades.  Do you think there would be any difference if this were banned?  Say the government outlaws that and all trades are done manually?

This market is so speculative I can't see any time in the near future that volatility decreases.  Maybe once Bitcoins reaches mass adoption in 5 to 10 years.

Compared to the stock market, I don't know if I've ever seen a $40B market cap stock jump around like this.

Why would the government get involved in regulating how bitcoin trades are done? 
We can't stop the march of technology. Algorithmic trading is common in equity markets and it will soon be omnipresent in crypto markets as well (if it isn't already).

[7788bitcoin]

Bot trading is actually promoted by exchanges, as most of them support API. Bot trading allows trading around the clock and each trade is an income to the exchanges.

Rapid increase in price is unlikely due to trading bot, trading bots work on up-and-down of the price. Constant increase or decrease will make these bots useless.

[joshy23]

The prices right now are changing so drastically in a very short amount of time.  I feel like this is mostly due to automated high-frequency computer trades.  Do you think there would be any difference if this were banned?  Say the government outlaws that and all trades are done manually?

This market is so speculative I can't see any time in the near future that volatility decreases.  Maybe once Bitcoins reaches mass adoption in 5 to 10 years.

Compared to the stock market, I don't know if I've ever seen a $40B market cap stock jump around like this.

Why would the government get involved in regulating how bitcoin trades are done? 
We can't stop the march of technology. Algorithmic trading is common in equity markets and it will soon be omnipresent in crypto markets as well (if it isn't already).

I agree. Government will not involved in this kind of thing. And no, bots have its purposes and you can't put the blame of them. Its still the human who is behind making the decisions. And bots just make it automated and its not their fault. And I don't know if investors would agree with you banning bots as well.

[Xester]

The prices right now are changing so drastically in a very short amount of time.  I feel like this is mostly due to automated high-frequency computer trades.  Do you think there would be any difference if this were banned?  Say the government outlaws that and all trades are done manually?

This market is so speculative I can't see any time in the near future that volatility decreases.  Maybe once Bitcoins reaches mass adoption in 5 to 10 years.

Compared to the stock market, I don't know if I've ever seen a $40B market cap stock jump around like this.

I am also quite observant of how the robot trading or the automated high-frequency computer trades will affect the market. It is one of the reasons of the sudden volatility  or the pump and dump scenes in the market. If there were no automated tradings then the volatility would be normal and there will be no sudden and rapid changes on the market value.

[BitcoinHodler]

The prices right now are changing so drastically in a very short amount of time.  I feel like this is mostly due to automated high-frequency computer trades. 

no it is not because of that.
it was because of the series of good news that came out from Japan and a couple of big countries such as Russia about legalizing bitcoin that everyone who was already in decided to invest more. and then the wave of fresh money came in from new investors causing the big rally.
the drop was also because this rise happened all too fast and as a trader you want to cash out to make profit. and as you can see we are at the real price of $2100 ish once again. and that fall is called correction.

Do you think there would be any difference if this were banned?  Say the government outlaws that and all trades are done manually?

i believe your questions and confusion come from the fact that you have never used a bot before in your life and you are making some assumptions. i suggest trying one and see how it is really not that different doing the trades with a bot or without it.

a bot is just giving you more options than the platform itself has.

This market is so speculative I can't see any time in the near future that volatility decreases.  Maybe once Bitcoins reaches mass adoption in 5 to 10 years.

Compared to the stock market, I don't know if I've ever seen a $40B market cap stock jump around like this.

it is the size of the market. it is too small right now. and price is mostly determined in the exchanges and with a quick look you may think the order sizes are big but when you compare it to your stock market you can see that they aren't really that big in comparison.

[FractalUniverse]

imo bots are important for providing liquidity. without them volatility would be even worse.

[matrix zion]

That's a stupid idea in the world of currencies.

I agree with it for the trading of real goods and supplies simply because robot trading makes far more exchanges than humans and the result is in fact that supplies and goods are exchanges thousands of times more than they are produced. Each exchange making the price of the good a bit higher.
But for currencies... Why should we care? Exchanges and numerous exchanges aren't a real problem. There is no reason for us to put any kind of limit to that.

And the sudden pumps and dumps are just whale. Crypto is a small world.

[Mometaskers]

I think we actually benefit from it since it is automated. I don't use one but I suppose you just set at what price to buy and sell. That's definitely better than leaving it to the whims of emotional players. Even without these bots, the price would still be somewhat unstable by virtue of human nature. I suppose people might sell earlier and buy much later if they don't use bots.

Where are you meant to ban it? If bot trading gives you any advantage, people will move to the country without those laws and make more money than any competitor. The world is not a simple place like you want it to be, there is not one government - there are many. Bitcoin hard to control than most high frequency trading commodity because it is massively decentralized with real authority.

This, couldn't have said it any better. People in countries like America and Europe could find themselves being outplayed by people from countries with lax laws and and even more lax implementation.

I don't see bots disappearing in the near future. I would have used one if I know how to and have a large enough money to be worth it.

[krisnt80]

Bots are part of bitcoin since the begining i do believe, since bitcoin has value, people made bots to drain faucets, bots to trade, soo its a profitable business in the general to build and sell them, i do understand thats is bad to see a bot buying his own trades to try to get a new investor, but some people havent time enought to follow the market soo they just let the bot with instructions to act at xx price.

[odolvlobo]

The prices right now are changing so drastically in a very short amount of time.  I feel like this is mostly due to automated high-frequency computer trades.  ...

Your premise is mistaken. Unless all the bots are operating in unison, their competition and frequent trading only serve to add liquidity and reduce volatility.

[LeGaulois]

Governments can't get involved with the bots used for trading Bitcoin or something else... By the way It is a general practice to use bots for trading. Bankers/Traders use bots in mass. In USA they even have a "dark fiber" to get a super fast internet speed to make the trades faster. So those doing it manually are not so efficients compared to bots. The irony is this fiber is paid with the money of the US population, but they get nothing in return

[cryp24x]

I do not thing that there will be a difference if bots are banned.  Remember it is the person that sets up this bot, so definitely whatever this bots are doing, their owner will do even if they have to do it manually.  And I do not thing that the government will involved themselves in this kind of stuff. I think it is the exchange that should rule out bots if it is needed.

[BitcoinPanther]

I think there might be a slight delay on trades if the bot is ban but eventually, the price will move the same path as when a bot is available.  I do agree that bots are being set up by its owner the way they wanted their trades activity to look like so definitely, even if bots are banned there will be no changes just a delay of the execution of trades

[maku]

First of all, there is no way that someone will go as far and ban  bots/automatic trading.
Secondly it is totally impossible to make sure that automatic trades ban can be enforced.
People will exploit the situation and create sophisticated bots. How will you know that trades are 100% organic and human made?

[HeroC]

I think bots are fine. Non-crypto exchanges have bots as well and allow it. I think you are attributing too much of the blame to bots. Plus, if you try to ban them by closing APIs, they will just come back in a more invasive way like web-scraping for exchanges.

[Hydrogen]

I don't think price fluctuations are due to bots.

They're a result of large holders of BTC/crypto being happy with the current price & selling off all the BTC/crypto they own.

Since btc reached $2700 so easily and quickly, the initial response is to buy btc when it drops.

Lots of big dumps with many optimistic buyers -> high volatility and price movements?

[digaran]

Ban them all why not? but when you start blocking bots and banning people from exchanges then they'll try to cheat in other ways, or simply the people running the exchanges will be the only ones taking advantage of using the bots, and people are screwed. people then will go and launch their own exchanging services and will sell the access to the ports opened for bots with exclusive prices and membership.
Besides you can't ban anything in a free market specially in a decentralized market, because there is no authority to enforce such rules.