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Author Topic: MtGox is about to run out of bitcoins.  (Read 3708 times)
lordgerson
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August 18, 2013, 03:45:29 AM
 #1

There are many posts about the arbitrage gap between the mtgox price and the price on other exchanges. This being caused by people trying to get there money outa gox by buying bitcoin and then selling the bitcoin on another exchange  (because gox customers have not been able wire transfers of fiat out of gox for some time).

I have been watching the market depth of the various bitcoin exchanges for some time. A few month back there were 200K+ coins in the sell queue at gox, this has slowly dropped to about 60K coins in the sell queue. On other exchanges (i.e. bitstamp) the sell queue is increasing.

I now think the miners (and anyone else with coins) is no longer sending them to gox to be sold. Thus gox is running out of coins (just like they have run outa fiat).

It looks to me to be coming to a head, I would guess that before the end of September (maybe sooner) gox will run out of coins. When this happens we would get an new all time high on gox of BTC. Basically BTC on MTGOX should go really high ($200+ per BTC). However every other exchange stays at about $100 BTC. All shit breaks loose at that point.

I notice a number of forex brokers are giving options/cfd's on the btc gox price. As long as the broker was sound, it may be time to take that bet.   
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Kluge
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August 18, 2013, 03:53:06 AM
 #2

There's nothing supporting speculation that Gox is bankrupt or otherwise out of fiat. It more likely can't transfer fiat because they're either unwilling or unable to work with the conventional banking structures to push out the volume they need.

Not being able to send out fiat (particularly bad with USD), volume is obviously dropping, because even though the price is higher, what good is GoxUSD if you can't redeem it for real USD?

Gox is dying (really, 0% chance of ever recovering the majority exchange market share - so "dead" might be appropriate), but I don't see anything suggesting there will be some type of destructive implosion (outside a severe lack of urgency @ Gox to resolve this).

Don't mix your coins someone said isn't legal
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August 18, 2013, 03:59:43 AM
 #3

just be careful out there - not everything is as you perceive it.  Cry

BTC.sx - Leveraged Bitcoin Trading. Simply use Bitcoin to take advantage of a rising or falling Bitcoin price.
lordgerson
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August 18, 2013, 05:49:48 AM
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There's nothing supporting speculation that Gox is bankrupt or otherwise out of fiat. It more likely can't transfer fiat because they're either unwilling or unable to work with the conventional banking structures to push out the volume they need.

Not being able to send out fiat (particularly bad with USD), volume is obviously dropping, because even though the price is higher, what good is GoxUSD if you can't redeem it for real USD?

Gox is dying (really, 0% chance of ever recovering the majority exchange market share - so "dead" might be appropriate), but I don't see anything suggesting there will be some type of destructive implosion (outside a severe lack of urgency @ Gox to resolve this).

I think what we do not know is how much USD was taken by the USA Gov when they seized mtgox's dwalla account - thus gox may well be out of fiat. The number of BTC in the sell queue is decreasing, however I have not seen a decrease in the buy queue on mtgox. Thus it is outa whack.

With only 60K coins in the sell queue on gox, those coins could be eaten in only a few days.

I bought a good quantity of coin at $10-$12 in 2012. I watched the volumes/market depth prior to the bubble / peak at $260. Those breakout patterns are again repeating (by my calcs btc on gox is about to go up quickly). However there are very different fundamentals - the others exchanges are not synced with gox this time.  I reccon we are in for an interesting few weeks.
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August 18, 2013, 06:30:27 AM
 #5

did anyone else notice blockchaininfo seems to have dropped gox from its ticket numbers? previously it seemed to be heavily volume weighted by gox numbers,  but recently it seems to have dropped the gox numbers?
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August 18, 2013, 06:39:37 AM
 #6

did anyone else notice blockchaininfo seems to have dropped gox from its ticket numbers? previously it seemed to be heavily volume weighted by gox numbers,  but recently it seems to have dropped the gox numbers?
Bitmit's stopped relying on Gox, too. They no longer hold >50% exchange market share. http://bitcoincharts.com/charts/volumepie/

Since the market on Gox is broken, it makes more sense to use exchanges where price is more in line with USD or whatever instead of GoxUSD (or GoxWhatever).

Don't mix your coins someone said isn't legal
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August 18, 2013, 07:06:48 AM
 #7

Agreed regarding sourcing market data from functional  markets.

I've been wondering where the semi professionals have been hedging their underlying..  no single exchange has enough liquidity.

I put in  an fx cfd platform once and you really need decent liquidity providers..
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August 18, 2013, 07:18:44 AM
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Agreed regarding sourcing market data from functional  markets.

I've been wondering where the semi professionals have been hedging their underlying..  no single exchange has enough liquidity.

I put in  an fx cfd platform once and you really need decent liquidity providers..

I have been looking at using http://www.plus500.com/Instruments/BTCUSD rather then gox for my trading (I am Aus based). They offer a CFD linked to the gox usd price. I would like to know if anyone else is using them and what they think of the company.
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August 18, 2013, 07:22:10 AM
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Not being able to send out fiat (particularly bad with USD), volume is obviously dropping, because even though the price is higher, what good is GoxUSD if you can't redeem it for real USD?

Except that you can still transfer to/from European bank accounts (though it sounds like there's a delay) and it looks like they're getting setup to support US accounts though wiretransfer if nothing else.

Mtgox relied too heavily on dwolla, and that's hurt them. They'll never recover the market share they once had. But I don't think they're dead; they're not currently attractive to US based bitcoiners. Once they get that sorted out, things will normalize.
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August 18, 2013, 07:24:50 AM
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did anyone else notice blockchaininfo seems to have dropped gox from its ticket numbers? previously it seemed to be heavily volume weighted by gox numbers,  but recently it seems to have dropped the gox numbers?
Bitmit's stopped relying on Gox, too. They no longer hold >50% exchange market share. http://bitcoincharts.com/charts/volumepie/

Since the market on Gox is broken, it makes more sense to use exchanges where price is more in line with USD or whatever instead of GoxUSD (or GoxWhatever).

Gox still has 59% of the USD market according to blockchaininfo chart (USD is 72% of total market, mtgox USD is 43% of total market ...gox share of marker is 100*43/72 = 59%). 
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August 18, 2013, 07:29:21 AM
 #11

not for long though..  anyone have a chat of market share over time?

fast settlements and low counterparty risk is the name of the game with exchanges..  gox is down and out, unless a credible fi buys them.
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August 18, 2013, 07:37:33 AM
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It looks to me to be coming to a head, I would guess that before the end of September (maybe sooner) gox will run out of coins. 

Well withdrawing Bitcoins from Gox is delayed as well. They have liquidity problems. They are close to dead imho
lordgerson
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August 18, 2013, 07:41:54 AM
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not for long though..  anyone have a chat of market share over time?

fast settlements and low counterparty risk is the name of the game with exchanges..  gox is down and out, unless a credible fi buys them.

Dunno where you can get a chart of market share over time, but I guess it would start with gox haveing 100% market share back in 2010, and that slowly decreasing to 60% that it is at present. If they do not get there act together I think that gox market share may decrease at a greater/increasing rate.

I would also love to see a chart of market depth on gox (and other exchanges) over time. Dunno how to get this chart either.
lordgerson
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August 18, 2013, 07:51:29 AM
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It looks to me to be coming to a head, I would guess that before the end of September (maybe sooner) gox will run out of coins. 

Well withdrawing Bitcoins from Gox is delayed as well. They have liquidity problems. They are close to dead imho


I pulled 200 coins out of gox yesterday and it was sent in the next block - no delay whatsoever (That was two transactions of 100 coins). I have had no issues getting coins in/out of gox over the past few months. How are you having trouble getting coins out?
nolocimes
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August 18, 2013, 08:00:47 AM
 #15

I think that's the point.  there is no problem moving coins in and out.  but getting usd fiat out seems to be a nightmare.

I have several thousand usd that's been sitting in the queue for two weeks now.

should I sit and wait,  cancel it and send coins out,  or change to another currency?


some Ppl have murmured that non usd is faster but I haven't talked to anyone with concrete experience in recent weeks..  any thoughts?

thanks
lordgerson
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August 18, 2013, 08:09:21 AM
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I think that's the point.  there is no problem moving coins in and out.  but getting usd fiat out seems to be a nightmare.

I have several thousand usd that's been sitting in the queue for two weeks now.

should I sit and wait,  cancel it and send coins out,  or change to another currency?


some Ppl have murmured that non usd is faster but I haven't talked to anyone with concrete experience in recent weeks..  any thoughts?

thanks

I have several thousand in AUD sitting in the wire queue to Australia. It has been there for 6 weeks. So it is not just USD. I can tell you AUD wire from Gox is also stuffed. Gox have been saying it will come soon soon soon, but I no longer believe them. So much so that I have written that money off for tax purposes. I even asked them to cancel the wire, but they have not done so. I am pulling out of gox in BTC, keeping some, and selling some on the couple of places in Aus that allow me to buy/sell BTC (coinjar and bitcoinlocal are favs). Still it is a 5% to 10% loss on the value of the trade price of gox - but what else can you do.
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August 18, 2013, 08:24:41 AM
 #17

hmm many thanks good to know.

no more business with gox.  they must be having problems with their jap bank and/ or liquidity as contrary to some naive comments on here there is absolutely no need for a us bank account to send wires in usd.
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August 18, 2013, 08:37:08 AM
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Price gap is likely a product of a level of mistrust on gox being able to fulfill its financial obligations.

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lordgerson
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August 18, 2013, 08:45:32 AM
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Price gap is likely a product of a level of mistrust on gox being able to fulfill its financial obligations.
Grin

Yes, correct, but I am trying to determine if the market depth (and specifically the rate of shrinkage in the sell queue of bitcoins on mtgox) is a good indicator of the actual failure of mtgox. Methinks that there is only about 60K bitcoins in the sell queue of mtgox, & that is a reasonable predictor of failure of mt gox in the next few weeks - basically they will run out of coins - panic sets in - gox goes over - hence the title.

Basically I am trying to predict **when** mtgox will fail. 
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August 18, 2013, 09:26:55 AM
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If looking at the order depth is a reliable way to predict future price, wouldn't that sound like too easy a method to make money? Real world traders will get very rich easily if that works.
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