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Author Topic: Why has bitcoin jumped recently?  (Read 2231 times)
oda.krell
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September 04, 2013, 03:55:52 PM
 #21

Feedback from the mtgox liquidity crisis, nothing else.

Bullshit. We're in this trend since early July. Whatever the reasons (epic bull trap? actual reversal?), the often invoked, bordering on magical "liquidity crisis" can only be a minor part of it, otherwise you'd see not just a largely fixed spread between mtgox and the other exchanges, but a widely diverging price development.

Whatever caused the recent jumps (apart from the obvious: large buys) needs to be seen in perspective of a now almost 2 month long, rather solid upwards trend on all other major exchanges.

tl;dr don't be a lazy bear. at least be creative.


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adamstgBit
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September 04, 2013, 04:01:20 PM
 #22

Quote
Why has bitcoin jumped recently?

bitcoin is booming.

ElectricMucus
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September 04, 2013, 04:01:54 PM
 #23

Spread is increasing overall, that the other exchanges follow mtgox still comes to no great surprise.
It is simply that the amount of USD in mtgox still dwarfs the amount present in the other exchanges. This can go a long way, in theory above the ATH actually.

The problem though is that there isn't really a mechanism to know where it would end unless you know how many funds are in the exchanges besides the order book.

First they ignore you, then they laugh at you, then they keep laughing, then they start choking on their laughter, and then they go and catch their breath. Then they start laughing even more.
oda.krell
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September 04, 2013, 04:27:17 PM
 #24

Spread is increasing overall, that the other exchanges follow mtgox still comes to no great surprise.
It is simply that the amount of USD in mtgox still dwarfs the amount present in the other exchanges. This can go a long way, in theory above the ATH actually.

The problem though is that there isn't really a mechanism to know where it would end unless you know how many funds are in the exchanges besides the order book.

True, spread slowly went up, from around 6% in July, 9% in August, to around 11% now. In the past weeks it  stabilized, actually went down again from a peak about two weaks ago. In any case, that's simply not the development you would see if people would try to get out of mtgox (which they do) and rush out of bitcoin altogether (which they don't, at least not in large numbers).

True, mtgox is still the market leader. Current 30d volume of mtgox vs 30d volume of bitstamp is 566k vs. 334k. That's an interesting definition of "dwarf".

Not sure which Bitcoin wallet to use? I suggest to take a look at Electrum.
Electrum is an open-source lightweight client: user friendly, fast, and one of the safest ways to store, send or receive bitcoins.
For executables (Windows, OSX, Linux, Android), source code and documentation, see the Electrum homepage.
Walsoraj
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September 04, 2013, 04:31:15 PM
 #25

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Why has bitcoin jumped recently?

bitcoin is booming.

Completely inconsistent with the under 7k 24hr volume I'm seeing on Gox right now (even less on Bitstamp) and the extreme difficulty in getting fiat out of Gox, which is the ONLY thing driving the price up atm.

Booming... yea right. More like Gox extorting the suckers with fiat there.
ElectricMucus
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September 04, 2013, 04:31:24 PM
 #26

True, mtgox is still the market leader. Current 30d volume of mtgox vs 30d volume of bitstamp is 566k vs. 334k. That's an interesting definition of "dwarf".

I'm meaning the amount of funds present in the exchange, not the volume. I think that there is a big discrepancy between the volume and the amount of funds in the exchanges. Others have been lot more active in terms of relative volume but that doesn't change the funds on the exchange itself.

First they ignore you, then they laugh at you, then they keep laughing, then they start choking on their laughter, and then they go and catch their breath. Then they start laughing even more.
oda.krell
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September 04, 2013, 04:44:01 PM
 #27

True, mtgox is still the market leader. Current 30d volume of mtgox vs 30d volume of bitstamp is 566k vs. 334k. That's an interesting definition of "dwarf".

I'm meaning the amount of funds present in the exchange, not the volume. I think that there is a big discrepancy between the volume and the amount of funds in the exchanges. Others have been lot more active in terms of relative volume but that doesn't change the funds on the exchange itself.

Look, I'm very doubtful myself about the sustainability of the current uptrend. I wouldn't be all that surprised if we go down again, double digits down, and do so hard. But right now, we're not going up for the reason you mention. What does the order book matter, or total funds stored on the exchange, if people actually buy in large quantities on both exchanges? There's obviously enough cash on bitstamp to overtake mtgox on daily volume on occasion.

What you describe would mean uncertainty drives up the price on mtgox, which then drives up the on the other exchanges, and so on. Problem is, it's not a feedback loop. If you buy coins to get out completely, you will sell on the the other exchanges, which would drive down the price. On the other hand, if you buy coins on mtgox to hold on to them, you might be willing to pay a premium, but then you hold on to them. The way it looks now, reality looks much more in line with the second explanation than with the first.

Not sure which Bitcoin wallet to use? I suggest to take a look at Electrum.
Electrum is an open-source lightweight client: user friendly, fast, and one of the safest ways to store, send or receive bitcoins.
For executables (Windows, OSX, Linux, Android), source code and documentation, see the Electrum homepage.
ElectricMucus
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September 04, 2013, 04:53:08 PM
 #28

The thing is, as this goes on and the asks are depleted on mtgox it sparks more confidence for the bulls, which in term makes them wire more money to other exchanges.

First they ignore you, then they laugh at you, then they keep laughing, then they start choking on their laughter, and then they go and catch their breath. Then they start laughing even more.
oda.krell
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September 04, 2013, 05:01:58 PM
 #29

So what we see is (a) a shift of volume from mtgox to other exchanges, (b) more confidence by buyers, maybe for the wrong reasons, (c) an overall reluctance to sell coins. Looks good enough me.

Maybe we see the same thing, but give it different names. An uptrend lasting several months is never fake in my book, even if it ends in a crash. What matters is how fast price recovers, and if it ends higher or lower than before it took off.

Not sure which Bitcoin wallet to use? I suggest to take a look at Electrum.
Electrum is an open-source lightweight client: user friendly, fast, and one of the safest ways to store, send or receive bitcoins.
For executables (Windows, OSX, Linux, Android), source code and documentation, see the Electrum homepage.
ElectricMucus
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September 04, 2013, 05:29:23 PM
 #30

I never wrote it's fake, every price movement is legitimate. Fundamentals don't mean shit when it comes to Bitcoin prices, it's a Keynesian Beauty Contest.

First they ignore you, then they laugh at you, then they keep laughing, then they start choking on their laughter, and then they go and catch their breath. Then they start laughing even more.
Xiaoma
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September 04, 2013, 05:33:50 PM
 #31

I think current situation is confirming my suspect that price was going up on Gox only because people want out of it, and is pretty much over now.

First we had large USD->BTC buys driving price up in $10 steps, now we have many days of dead flat price on Gox and price falling on bitstamp, as the people moving coins there start selling.

We are approaching today to $20 spread between gox and bitstamp. This is the biggest spread we ever had, and is growing. IMHO, the only reason this can happen is when nobody would touch gox with a barge pole, so we don't see any arbitrage happening. Thinking about it, buy @127 and sell @144 you have the potential to get lots of money. Yet people would rather NOT do it.
rampantparanoia
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September 04, 2013, 05:53:21 PM
 #32

...Thinking about it, buy @127 and sell @144 you have the potential to get lots of money. Yet people would rather NOT do it.

I can print tons of monopoly money on my own printer without risking my coins  Grin

painlord2k
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September 04, 2013, 06:28:00 PM
 #33

People could pay 5% to obtain a international wire out of MtGox.
This is the reason there is an hige 10% differential between Gox and Bistamp.
5%+IW time = 10% spread.
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