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PirateHatForTea
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June 26, 2014, 06:05:11 AM |
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Thanks for the wise analysis.
What you write makes a lot of sense.
For the sake of clarity: on February 10th transactions were not cancelled because Bitfinex run out of funds on Bitstamp, but because a smart ass found out a way to artificially push the ticker price to very high levels ( over 10,000 usd per btc) and this caused some people to take leveraged positions that should never have occurred.
As this erratic behavior was due to a technical problem and not to a normal market condition we decided to revert the transactions.
This is common practice also in major markets, such as the NYSE or the NASDAQ.
You can find more details about it if you go back to that date on this thread.
Giancarlo, I went back and checked, and the crash I had in mind did occur on Feb 10th, and there was no mention at the time of it being caused by a bug with the ticker price. Your description of the ticker price bug corresponds much more closely with the episode on Feb 6th, where the ticker price was stuck super high and so everyone has huge 'profits' and tradeable balances. See this screenshot for example:  Feb 10th was when Gox made their bullshit transaction malleability announcement. There was a huge long squeeze at one point which drove the price down to 100. Afterwards, Raphael said: Hey everyone,
I guess it'll be my last message here for today, sorry I can't answer to every individuals requests. Requests made to our email support will be treated in the next few days, including those who lost money because of our trading halt.
So my point will be these: the liquidations that happened and took the price to 100 were less than 25% of the total leveraged long positions. A lot of traders also have collaterals in BTC. Which means that nor Bitfinex nor Bitstamp had enough depth to absorb the cascading liquidations that would have occured and drag the price to near 0 as ALL long would have eventually be liquidated.
So yes, halting the trading engine saved 15+ millions of dollars. Yes, we will be fair to traders that got caught in a short during these time (again, on support email, not in the thread). If you think we should have let liquidity providers lose everything and close the margin trading for good, I understand. Maybe we halted the trading engine a bit too long. But we do not regret this decision and think this was the fairest decision to take.
One last thing: we are not impacted by the problem of Bitcoin withdrawals MtGox have. When a withdrawal seems to have failed, we use the bitcoin address to do a manual double check. So far this is not an issue.
Thank you all for your comprehension and have a good day
Raphael
And earlier that day, you yourself had said that the reason for the flash crash was running out of funds on Bitstamp. Guys
before you start any post please think about the following:
1) Bitfinex is not an exchange. It is a complex trading platform and this is why it made it to place itself among the top 4 BTC/USD platforms in the world for volume in 15 months.
2) Bitfinex also allows trading on Bitstamp via metatrading.
This lowers volatility during market crashes, but it is subject to keeping ALWAYS an amount of BTC and of cash on their platform.
There must be a balance between efficiency and third party related risk ( Gox is teaching us that trading platforms can actually have problems).
Therefore we cannot keep too much money or too many coins on Bitstamp.
When I say too many I mean more than a certain number of million dollars equivalent (either cash or BTC x price).
3) Forced liquidations can trigger cascading prices and also a rapid consumptions of coins on Bitstamp.
It takes time to replenish coins, this is not our fault, it is related to how Bitcoins are transferred.
Today for example more than 10k BTC were sold in a matter of minutes.
4) When we don't have coins on BSTP anymore (that is what happened today, we run out of coins on Bitstamp, we had a lot of them but they were all sold within seconds) we just rely on our orderbook and people tend to panic when the price crashes, therefore thinning even more the bid side of the book.
5) Whenever we see any market abnormalities we halt trading.
We don't make money when we halt trading, we just try to cover the funds given by liquidity providers.
(Today we resumed trading as soon as other coins landed on our Bitstamp account)
6) Any trader with more than 3 neurons should understand why we try to protect liquidity providers.
They are the reason why traders can take leverage.
No liquidity providers, no swap, no margin trading.
Every trader should think about this before he starts considering the liquidity provider as a blood sucker.
The liquidity provider is the one that makes it possible, and therefore he should be protected for the sake of the leverage, not because we think they are more beautiful than the traders.
We are not perfect.
We will keep having problems, this is part of the game called "being in business".
But please try to understand each of our moves is made for the sake of our community.
Letting a bunch of traders walk with their opportunistic strategy ( placing a buying order at 100 can possibly be defined differently?) and by doing this hurt the real funders of our platform will never be an option for us.
I hope that this helps
Have a good day and sorry if I lost it for a couple of posts, I apologize about it.
Giancarlo
Bitfinex Team
So actually it looks like my characterization of the flash crash on Feb 10 was correct. Feb 6th was the ticker bug. |
Unlevereged financial instruments acting as a store of value that fluctuate 50% within 10 minutes is perfectly acceptable. I think it should be offered in IRA form to soon to be retirees.
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Each block is stacked on top of the previous one. Adding another block to the top makes all lower blocks more difficult to remove: there is more "weight" above each block. A transaction in a block 6 blocks deep (6 confirmations) will be very difficult to remove.
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Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction.
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urwhatuknow
Sr. Member
 Offline
Activity: 446
Merit: 250
CAT.EX Exchange
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June 26, 2014, 06:43:15 AM |
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Thanks for the wise analysis.
What you write makes a lot of sense.
For the sake of clarity: on February 10th transactions were not cancelled because Bitfinex run out of funds on Bitstamp, but because a smart ass found out a way to artificially push the ticker price to very high levels ( over 10,000 usd per btc) and this caused some people to take leveraged positions that should never have occurred.
As this erratic behavior was due to a technical problem and not to a normal market condition we decided to revert the transactions.
This is common practice also in major markets, such as the NYSE or the NASDAQ.
You can find more details about it if you go back to that date on this thread.
Giancarlo, I went back and checked, and the crash I had in mind did occur on Feb 10th, and there was no mention at the time of it being caused by a bug with the ticker price. Your description of the ticker price bug corresponds much more closely with the episode on Feb 6th, where the ticker price was stuck super high and so everyone has huge 'profits' and tradeable balances. See this screenshot for example: Feb 10th was when Gox made their bullshit transaction malleability announcement. There was a huge long squeeze at one point which drove the price down to 100. Afterwards, Raphael said: Hey everyone,
I guess it'll be my last message here for today, sorry I can't answer to every individuals requests. Requests made to our email support will be treated in the next few days, including those who lost money because of our trading halt.
So my point will be these: the liquidations that happened and took the price to 100 were less than 25% of the total leveraged long positions. A lot of traders also have collaterals in BTC. Which means that nor Bitfinex nor Bitstamp had enough depth to absorb the cascading liquidations that would have occured and drag the price to near 0 as ALL long would have eventually be liquidated.
So yes, halting the trading engine saved 15+ millions of dollars. Yes, we will be fair to traders that got caught in a short during these time (again, on support email, not in the thread). If you think we should have let liquidity providers lose everything and close the margin trading for good, I understand. Maybe we halted the trading engine a bit too long. But we do not regret this decision and think this was the fairest decision to take.
One last thing: we are not impacted by the problem of Bitcoin withdrawals MtGox have. When a withdrawal seems to have failed, we use the bitcoin address to do a manual double check. So far this is not an issue.
Thank you all for your comprehension and have a good day
Raphael
And earlier that day, you yourself had said that the reason for the flash crash was running out of funds on Bitstamp. Guys
before you start any post please think about the following:
1) Bitfinex is not an exchange. It is a complex trading platform and this is why it made it to place itself among the top 4 BTC/USD platforms in the world for volume in 15 months.
2) Bitfinex also allows trading on Bitstamp via metatrading.
This lowers volatility during market crashes, but it is subject to keeping ALWAYS an amount of BTC and of cash on their platform.
There must be a balance between efficiency and third party related risk ( Gox is teaching us that trading platforms can actually have problems).
Therefore we cannot keep too much money or too many coins on Bitstamp.
When I say too many I mean more than a certain number of million dollars equivalent (either cash or BTC x price).
3) Forced liquidations can trigger cascading prices and also a rapid consumptions of coins on Bitstamp.
It takes time to replenish coins, this is not our fault, it is related to how Bitcoins are transferred.
Today for example more than 10k BTC were sold in a matter of minutes.
4) When we don't have coins on BSTP anymore (that is what happened today, we run out of coins on Bitstamp, we had a lot of them but they were all sold within seconds) we just rely on our orderbook and people tend to panic when the price crashes, therefore thinning even more the bid side of the book.
5) Whenever we see any market abnormalities we halt trading.
We don't make money when we halt trading, we just try to cover the funds given by liquidity providers.
(Today we resumed trading as soon as other coins landed on our Bitstamp account)
6) Any trader with more than 3 neurons should understand why we try to protect liquidity providers.
They are the reason why traders can take leverage.
No liquidity providers, no swap, no margin trading.
Every trader should think about this before he starts considering the liquidity provider as a blood sucker.
The liquidity provider is the one that makes it possible, and therefore he should be protected for the sake of the leverage, not because we think they are more beautiful than the traders.
We are not perfect.
We will keep having problems, this is part of the game called "being in business".
But please try to understand each of our moves is made for the sake of our community.
Letting a bunch of traders walk with their opportunistic strategy ( placing a buying order at 100 can possibly be defined differently?) and by doing this hurt the real funders of our platform will never be an option for us.
I hope that this helps
Have a good day and sorry if I lost it for a couple of posts, I apologize about it.
Giancarlo
Bitfinex Team
So actually it looks like my characterization of the flash crash on Feb 10 was correct. Feb 6th was the ticker bug. you are right and I was wrong, I mistook the 2 episodes. I apologize for my misrepresentation. February hasn't been a good month indeed. Thanks a lot and have a good day Giancarlo Bitfinex Team |
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Ente
Legendary
Offline
Activity: 2126
Merit: 1001
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June 26, 2014, 11:28:27 AM |
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Feature request:
For some months now, whenever some loans are replaced by new loans, the original count of loans stays. Like, replacing 10 loans of 10$ each will have 10 or more new loans in the list, even when all of them are replaced by the same big 100$ loan. Over the time, the loans count goes through the roof.
a) Use the old mechanism, where taken individual loans are merged into the offer they came from
b) In the "Swaps used in a margin position", have a row with "total amount", like in the orderbooks too. Always summing up the amount from the first row on, no matter what the table is sorted as.
As you, Giancarlo, some months ago already explained that there are internal reasons for this behavior, I guess option b would be more realistic. It would be a workaround only, but would help me out a lot. I spend substantial time every day to replace expensive or running-out loans, and have to calculate the sum of loans in a spreadsheet for every iteration.
Ente
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Sukrim
Legendary
Offline
Activity: 2618
Merit: 1006
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June 26, 2014, 12:57:35 PM |
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Another feature request (minor annoyance):
When cancelling a swap offer, the swappable balance (displayed on the right below "Account overview") is not updated.
This means I have to reload the page to be able to click the "Offer all" button (since until then it assumes I have still only the old balance available for offers).
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Sukrim
Legendary
Offline
Activity: 2618
Merit: 1006
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June 26, 2014, 09:58:00 PM |
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~30k Silk Road coins get sold by the USA...
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tooil
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June 27, 2014, 02:06:47 AM |
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urwhatuknow
Sr. Member
Offline
Activity: 446
Merit: 250
CAT.EX Exchange
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June 27, 2014, 02:36:23 PM |
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Guys Since when so called "moderators" are starting FUD threads? Cui prodest? Ask yourself this simple question and if your IQ is not lower than your shoe size you'll come up with the right conclusion. Have a good day and a great weekend Giancarlo Bitfinex Team |
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Sukrim
Legendary
Offline
Activity: 2618
Merit: 1006
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June 27, 2014, 02:52:52 PM |
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What's "fear", "uncertainty" or "doubt" about that thread? He's just pointing out that the amount of USD borrowed is going up into regions that seem unhealthy, especially if you look at the fact that you only have your internal order book to do trades, no longer Bitstamp. Cui prodest?
Ask yourself this simple question and if your IQ is not lower than your shoe size you'll come up with the right conclusion.
I know whom this kind of communication will NOT be beneficial for...  |
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0x3d
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June 27, 2014, 04:59:32 PM |
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... Cui prodest?
Ask yourself this simple question and if your IQ is not lower than your shoe size you'll come up with the right conclusion.
I know whom this kind of communication will NOT be beneficial for... Seriously Giancarlo, please try to learn how to control your temper or more important, learn how to deal with paying and/or potential future customers. Also, maybe BFX as a whole should reconsider the kind of PR-"strategy" Giancarlo is ru(i/n)ning right now. Yes Giancarlo, customers, also and especially the smaller fish, are and will always be the biggest a**holes... that's business, deal with it but stop ruining this fine company and it's reputation by your (granted, almost) daily outbursts! Sure, this is an "anonymous" forum, you're free to answer whatever and however you want. But unlike private channels like emails this is also a *very* public channel, each one of your current and future customers will think that Giancarlo is *the way* this company treats its customers. Tell me, why would I wanna join your platform after looking up some background-infos about it before joining and finding your rants page after page after page around here? Honestly, had I not already joined way back in March 2013 and would I not know that your service is pretty damn fine I would never join again. Yes, just because of the, sorry, disgusting way you represent BFX! And no, this is no personal flaming against you, I know damn well that customers can be a pain in the bottom, especially when they're behind a screen far away but gee, there are better ways to react to that than... well, the current you, the one that's almost as unbearable as the current market. Do you want new customers or not? I certainly want your company (and in turn my portfolio  ) to grow and I guess so does everybody else around here so stop ruining it for all of us and lull those new customers with free beer and confetti and spaghetti instead of ranting them out the door. Pretty please, mkay. xoxo ;-) |
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sleger
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June 27, 2014, 05:06:07 PM |
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Cui prodest?
Ask yourself this simple question and if your IQ is not lower than your shoe size you'll come up with the right conclusion.
I know whom this kind of communication will NOT be beneficial for... +1, Bfx NEEDS a new PR person, I am scared to see an exchange run by a person who posts so unprofessionally ! |
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komar
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June 27, 2014, 06:12:55 PM |
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Let him speak any way he wants. Just no bullshit, please. I'm tired with MtGox.
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Ente
Legendary
Offline
Activity: 2126
Merit: 1001
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June 27, 2014, 08:28:24 PM |
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Well, Gancarlo might be somewhat controversial, right?
BitFinex' service however, is awesome!
With great joy I found a counter which adds up all funds I have marked in a margin position!
You guys rock! That's you included, Giancarlo! :-)
Ente
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Dalmar
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June 28, 2014, 12:29:09 AM |
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You guys have to put it in context. Giancarlo was responding to people claiming BFX manipulates the market. Of course it is to be expected that he may get a bit agitated.
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0x3d
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June 28, 2014, 01:20:53 AM |
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You guys have to put it in context. Giancarlo was responding to people claiming BFX manipulates the market. Of course it is to be expected that he may get a bit agitated.
Sure, humanly totally understandable. But not if you're trying to grow a "professional business us stoopids don't understand nothing about" like Giancarlo once put it... Sorry, it's just no way to adress your customers if you want to be taken seriously. Oh whatever, the hell with manners and respect and all that shit, probably just getting too old for this... Anyways, if that's how our future generation wants to tread each other then goodnight us all. |
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BitCoinNutJob
Legendary
Offline
Activity: 1316
Merit: 1000
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June 28, 2014, 05:24:02 AM |
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Let him speak any way he wants. Just no bullshit, please. I'm tired with MtGox.
yeah tbh i agree. what do you want another mark karpeles saying all the "right" things? ive always had a good service from bitfinex |
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omio
Newbie
Offline
Activity: 46
Merit: 0
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June 28, 2014, 05:34:29 PM |
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Their PR is pretty bad on this forum. He outed someones balance on another thread here https://bitcointalk.org/index.php?topic=660948.msg7450158#msg7450158. Anything to say about that urwhatuknow? unclescrooge? I know you are responding to people making accusations but that is a little too much shit talking for such a large exchange. Remember what happened to the last exchange run by a french guy?  Just kidding I love bitfinex and I hope it goes on strong. Please don't tell people how poor I am! |
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Xiaoxiao
Legendary
Offline
Activity: 1274
Merit: 1000
The Golden Rule Rules
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June 28, 2014, 06:11:07 PM |
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When you go on a long position leveraged, how do you save the most money from swap rate? Does the system itself save you the most money (by constantly finding the lowest rate) or do you you yourself save more money by continually finding the lowest rate yourself ?
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urwhatuknow
Sr. Member
Offline
Activity: 446
Merit: 250
CAT.EX Exchange
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June 28, 2014, 08:13:11 PM |
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Their PR is pretty bad on this forum. He outed someones balance on another thread here https://bitcointalk.org/index.php?topic=660948.msg7450158#msg7450158. Anything to say about that urwhatuknow? unclescrooge? I know you are responding to people making accusations but that is a little too much shit talking for such a large exchange. Remember what happened to the last exchange run by a french guy? Just kidding I love bitfinex and I hope it goes on strong. Please don't tell people how poor I am! MatTheTwat is playing the big guy and throwing mud at us all the time, his mantra is calling us cheaters and accusing us to play tricks on him in order to steal his money. I didn't reveal his balance, I just mentioned the fact that he had about 2.5 BTC, which by the way was not the exact amount he had (which was afterwards disclosed by himself). This exposed the real enity of his accusation, he's nothing more than a whining kid blaming his poor trading skills on somebody else. I think he deserved such treatment and the result was that he pulled out his belongings and luckily took his business elsewhere. Last but not least our team is formed by 2 french, 2 italians, 1 dutch and 1 american. Do you have any racist comment also on other nationalities? Giancarlo Bitfinex Team |
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