Mt.Gox/Bitstamp sustained spread reaches all time high at 12.48% on August 12th

[zeroblock]

I just want to make it clear that I am dedicated Bitcoin enthusiast, and I certainly want Bitcoin to succeed.  I've invested my own money in Bitcoin, and Bitcoin related businesses. Despite the consequences of losing an exchange with 50-60% of the total volume, I cannot stand idly by while Gox lies to their customers.  I find it unethical, damaging to Bitcoin related businesses, and hazardous to the Bitcoin movement.  It bothers me when people defend Gox, yet oppose anything centralized.  Gox absorbing this much volume is dangerous to the stability of Bitcoin.  We've placed too much reliance on Gox.  Bitcoin will survive despite Gox, not because of it. 

Please check out the contradictory information we are receiving from Gox.  I don't buy it, and others are starting to lose faith at an increasing rate.   
https://bitcointalk.org/index.php?topic=179586.msg2925369#msg2925369

I've been tracking the variance between Mt.Gox and Bitstamp for 4 months.  I use Bitcoincharts.com for my information.  Let's hope the information is reliable, because Mt.Gox also owns bitcoincharts.

[smoothie]

Bullish action on Gox = Customer Sentiment at all time low.

People arent trusting gox if they are buying bitcoins at a super high price with current events in place concerning legal actions against gox etc.

[zeroblock]

Bullish action on Gox = Customer Sentiment at all time low.

People arent trusting gox if they are buying bitcoins at a super high price with current events in place concerning legal actions against gox etc.

Precisely.  And now people are willing to take 12.5% haircuts to ensure their money is safe.  What size of spread will it take for people to realize that Gox is illiquid?  15%? 20%? 25%?

Coinbase doesn't use Gox prices
Bitpay doesn't use Gox prices
Bips doesn't use Gox prices

[tclo]

Yes I find the spread between the exchanges to be very interesting as well.    Thanks for sharing your research with us.

[bystander]

It will probably only get worse from here, I don't even bother checking Mt Gox anymore since the latest price is an empty, meaningless number.  It could be at USD$600/BTC  and it would no longer matter.  Having any fiat there without any idea when it would arrive or if it will arrive at all is beyond frustrating and too much of a risk to bear.

Between Gox becoming useless and Yifu becoming Josh 2.0, it's been a disappointing few weeks.

[mmortal03]

Who is still buying at this spread at Mt. Gox? Are there a handful of people who CAN withdraw there and they are arbitraging this?

[Abdussamad]

14% now.

[mmortal03]

Who is still buying at this spread at Mt. Gox? Are there a handful of people who CAN withdraw there and they are arbitraging this?

Why people _buy_ BTC at MtGox is obvious: You can, for the time being, withdraw BTC (though there seems to be problems with that too now).

Yeah, but you can buy those BTC elsewhere for cheaper. That's what I mean. I guess if it's only involving people who already have mtgoxUSD stuck there, then that makes sense. Now that I think about it, I associated two motives that aren't necessarily mutually inclusive.

[prophetx]

Who is still buying at this spread at Mt. Gox? Are there a handful of people who CAN withdraw there and they are arbitraging this?

well they can send out 10 swift wires per day according to that chat log so.... they probably aren't sending out $1000 wires....

[zeroblock]

Who is still buying at this spread at Mt. Gox? Are there a handful of people who CAN withdraw there and they are arbitraging this?

Why people _buy_ BTC at MtGox is obvious: You can, for the time being, withdraw BTC (though there seems to be problems with that too now).

Why people _sell_ BTC for worthless mtgoxUSD is another question. There is zero proof that the CEO / employees do withdraws for friends who do arbitrage.... but we can all ask questions and do our own thinking.

*This is totally speculative

I wonder who that may be....

http://www.youtube.com/watch?v=UP1YsMlrfF0

$3721 Exchange fee (lets assume 0.5-5% of total value wired)

Total Value:
0.5% - $744,200
1% - $372,100
2% - $186,050
3% - $124,033

Buy Bitstamp/Coinbase - sell at Gox?

http://corporate.visa.com/pd/consumer_services/consumer_ex_rates.jsp

[Nagle]

Who is still buying at this spread at Mt. Gox? Are there a handful of people who CAN withdraw there and they are arbitraging this?

No, the people buying on Mt. Gox are those who have USD stuck there. It's still possible to get Bitcoins out of Mt. Gox (maybe; there have been reports of trouble).  So people with USD stuck on Mt. Gox are buying Bitcoins at a 15% loss just to get out.

[zeroblock]

Who is still buying at this spread at Mt. Gox? Are there a handful of people who CAN withdraw there and they are arbitraging this?

No, the people buying on Mt. Gox are those who have USD stuck there. It's still possible to get Bitcoins out of Mt. Gox (maybe; there have been reports of trouble).  So people with USD stuck on Mt. Gox are buying Bitcoins at a 15% loss just to get out.

Right.  What I don't get is who would possibly sell their BTC unless they were getting their wires prioritized?  If it were a truly free market, the price would have skyrocketed months ago. 

[flound1129]

Who is still buying at this spread at Mt. Gox? Are there a handful of people who CAN withdraw there and they are arbitraging this?

No, the people buying on Mt. Gox are those who have USD stuck there. It's still possible to get Bitcoins out of Mt. Gox (maybe; there have been reports of trouble).  So people with USD stuck on Mt. Gox are buying Bitcoins at a 15% loss just to get out.

Right.  What I don't get is who would possibly sell their BTC unless they were getting their wires prioritized?  If it were a truly free market, the price would have skyrocketed months ago.  

Other than those somehow getting their wires prioritized, the only people who would sell BTC at Gox are those who are speculating that Gox will eventually start sending out fiat again (or have insider information about when that will happen).