If you withdraw PPC from BTC-e the price will rise

[BitcoinForLiberty]

The present rally in PPC can be easily sustained as long as people continue to withdraw PPC from BTC-e.

I believe BTC-e has very few PPC on hand, maintaining only a small fractional reserve relative to its deposit liabilities.

Here is the evidence supporting this claim which I would describe as compelling but not conclusive:

1.   I have requested PPC withdrawals several times in the last week where the withdrawal shows as completed in my Transaction History but doesn’t show up on the blockchain. I contact BTC-e support, and they have sometimes credited the PPC back to my account and other times pushed it through the blockchain in delayed fashion. The pattern is not consistent with a hot wallet being drained that is then quickly refilled from cold storage because I have had repeated failures extending beyond 48 hours.
2.   If you were BTC-e and you needed to acquire PPC right away to fulfill withdrawal requests, how would you do it? You would buy at another exchange, such as Vircurex. During the last month there has been a buyer on Vircurex purchasing 20,000 to 50,000 most days in one single market order, causing the price to rise momentarily as much as 33% as they tear through the sell order book. This is not rational behavior for a normal PPC buyer that could easily purchase the same PPC in the much more liquid BTC-e market and pay less. However, if that buyer is BTC-e trying to acquire PPC to meet demand for PPC withdrawals on BTC-e, then it makes perfect sense. In recent days there has been a PPC rally and these mysterious purchases have been stepped up on Vircurex – in the last day there has been 125,000 PPC purchased there in three large buy orders.
3.   There are indications that BTC-e has a large stake in NVC, so they have the motive and the means to suppress the price of PPC through very low fractional reserve.

I encourage BTC-e to post what their PPC reserve ratio in this thread. I think we will get silence from them.

So in conclusion, if you have PPC on deposit at BTC-e it is your best interest to withdraw it. Doing so will cause BTC-e to purchase PPC on another exchange such as Vircurex to provide your withdrawal and that will boost the market price of your PPC.

Longer term we need to develop liquid PPC markets at other exchanges and stop using BTC-e for PPC trading if we want the PPC price to be high.

[lucazane]

You got it wrong. People are depositing coins on exchange's addresses. Once you buy X coins and submit withdrawal request, there is no
need for exchange to do anything except move (X coins - transaction fee) from one or more of their deposit addresses to your address.

Total of all withdrawals can never ever exceed total of all deposits.

The only way for scenario you came up with to become real is if BTC-e themselves are putting sell orders while not having coins at hand.

You don't know what btc-e do with your deposits.
They may act like a bank, using a part of the deposits to invest somewhere.

[BitJohn]

You got it wrong. People are depositing coins on exchange's addresses. Once you buy X coins and submit withdrawal request, there is no
need for exchange to do anything except move (X coins - transaction fee) from one or more of their deposit addresses to your address.

Total of all withdrawals can never ever exceed total of all deposits.

The only way for scenario you came up with to become real is if BTC-e themselves are putting sell orders while not having coins at hand.

I am pretty sure they just do what he said. This is what cryptsy does withdrawing would only have the effect of users not being able to sell coins immediately and in the case of PPC earn stake.

[chryspano]

Some weeks ago I bought 20K PPC at BTC-e, I could not withdraw them after the buy, I had to wait for two days until I was able to withdraw them, this doesnt seem right at all!

[chryspano]

Get your PPC coins out of there ASAP!

[St.Bit]

Some weeks ago I bought 20K PPC at BTC-e, I could not withdraw them after the buy, I had to wait for two days until I was able to withdraw them, this doesnt seem right at all!

Well, given that PPC is PoS coin, it is possible that BTC-e is "reserving" those deposited coins which are close to making them PoS
reward. Afterall, it is their addresses on which people deposit coins so they have all it takes to mine PoS blocks themselves. It could
be withdrawals of X coins, where X is more than "reserved" coins, are delayed until PoS blocks are mined but I just don't see it worth
the trouble. Risk losing customers and risk bad propaganda just to earn less than 0.5% off coins that are untouched for over 30 days?

In comparison with the traiding fees this would be a nice addon and why should they trow them away. They might have other tec. problems or just didn't expect so many withdrawls. Them buying on other exchanges is just ridiculous unless the shorted PPC and got caught (unlikely).

[kneim]

Some weeks ago I bought 20K PPC at BTC-e, I could not withdraw them after the buy, I had to wait for two days until I was able to withdraw them, this doesnt seem right at all!

Well, given that PPC is PoS coin, it is possible that BTC-e is "reserving" those deposited coins which are close to making them PoS
reward. Afterall, it is their addresses on which people deposit coins so they have all it takes to mine PoS blocks themselves. It could
be withdrawals of X coins, where X is more than "reserved" coins, are delayed until PoS blocks are mined but I just don't see it worth
the trouble. Risk losing customers and risk bad propaganda just to earn less than 0.5% off coins that are untouched for over 30 days?

Good hint. I believe they use the cold storage to make an extra profit with proof-of-stake (PoS) minting (so it's more a warm storage). If PoS-blocks are found, the coins that have been used for minting PoS-blocks are locked in stake for 520 blocks, and you have no access in the meantime.

[kneim]

On a trustworthy trading platform, the deposits of the customers stay untouched. So:

all deposits + all possible withdraws = 0

What happens if the owners of a trading platform uses deposits of customers for speculation or gambling, can be seen with bitmarket.eu.

[St.Bit]

PoS mining is solo mining so it as unpredictable as PoW solo mining.

It is randomly choosen which adress is used next, but an exchange like btc-e would have a lot of adresses. They would get close to the expected PoS waitingtime. Some of their would always be in PoS. ASIK do they not put it all in one adress and they use deposited adresses to pay out others. If too many too big adresses got stuck in PoS there would be such delays as experienced.

I don't think here is anything to worry about, but it's always a bad idea to trust others with your money if you can avoid it.

[kneim]

... It goes very complex and time-consuming once you have many inputs (deposits). ...

It does not make sense with the hot wallet, but with the cold wallet.

And if too many want to have access to their coins at the same time, they could be locked in cold storage for some time because of PoS minting.

[kneim]

... It goes very complex and time-consuming once you have many inputs (deposits). ...

It does not make sense with the hot wallet, but with the cold wallet.

And if too many want to have access to their coins at the same time, they could be locked in cold storage for some time because of PoS minting.

You mine PoS offline and then you go online. What is almost certain to happen is that your version of blockchain will be nulled and it is
so because all online PoW and / or PoS miners extended the most accepted blockchain much more than you extended your offline one.

PoS minting is working online only, of course. So I believe, they have an online warm wallet (instead of a cold wallet) that creates PoS blocks.

[BitcoinForLiberty]

I agree with previous posters that POS minting could tie up some coins and cause delays, although they shouldn't be minting with a large portion of the coins to make them reliably available for withdrawal.

However, I still find the trading activity at Vircurex very hard to explain as rational by any actor other than BTC-e and I'd like to hear what other think of that.

Here’s an image of their one month price and volume chart as well as the total number of 24 hour trades made in each coin: http://imgur.com/obNtcyv

Does anyone else find it strange that the PPC/BTC trade pair regularly has more trading volume than all other trade pairs at Vircurex combined? Why would someone who wanted to buy 20,000 to 50,000 PPC most days choose to use the very illiquid Vircurex market instead of the liquid BTC-e market? They end up overpaying by raising the price as their large market order is filled. The only way I can explain it as rational behavior is to suggest that it is BTC-e covering their short position.

I’ll like to remind you all that there is reason to be suspicious:
“balthazar (novacoin dev) sent btc-e a 100k bribe to accept the coin. btc-e provided proof that they destroyed the coins though, yet they still keep nvc on their exchange.”
http://www.reddit.com/r/ppcoin/comments/1chzq8/does_novacoin_pose_a_threat_to_ppcoin/
BTC-e has had and might still have a very large stake in NVC, which is the primary competitor to PPC. This gives them a motive to suppress PPC through short selling.

Anyhow, as a result of these regular buys the Vircurex market has responded by placing lots of sell orders on the order book, so that in recent days Vircurex has become fairly liquid. I would encourage you to move your trading there or to Crypto-Trade so as to avoid leaving deposits of PPC at BTC-e. I still believe it’s likely they have short sold the PPC market on BTC-e and will be forced to cover their shorts if people withdraw their PPC. It can’t hurt to try it and find out if the price reacts.

[Balthazar]

balthazar (novacoin dev) sent btc-e a 100k bribe to accept the coin.

It's a quote from the fantasy novel. If I would need to push something to the exchange, I could just ask owner for this.

https://bitcointalk.org/index.php?topic=282314.msg3027107#msg3027107
https://bitcointalk.org/index.php?topic=282314.msg3042727#msg3042727

I’ll like to remind you all that there is reason to be suspicious:

I suspect that you are troll. Maybe with plans for own exchange, who knows...

By the way, Proof-of-Stake is an exchange killer. Withdrawal becomes extremely slow, because Proof-of-Stake generation selects/creates too many inputs. Proof-of-Stake is not free for CPU resources of the exchange, that's why any smart exchange operator usually disables it.

[zwanzig20]

balthazar (novacoin dev) sent btc-e a 100k bribe to accept the coin.

It's a quote from the fantasy novel. If I would need to push something to the exchange, I could just ask owner for this.

https://bitcointalk.org/index.php?topic=282314.msg3027107#msg3027107
https://bitcointalk.org/index.php?topic=282314.msg3042727#msg3042727

I’ll like to remind you all that there is reason to be suspicious:

I suspect that you are troll. Maybe with plans for own exchange, who knows...

By the way, Proof-of-Stake is an exchange killer. Withdrawal becomes extremely slow, because Proof-of-Stake generation selects/creates too many inputs. Proof-of-Stake is not free for CPU resources of the exchange, that's why any smart exchange operator usually disables it.

Thanks for your information...

[mr_random]

BTC-e has had and might still have a very large stake in NVC, which is the primary competitor to PPC. This gives them a motive to suppress PPC through short selling.

Why would they list PPC on the exchange in the first place if they thought the way you suggest?

[St.Bit]

By the way, Proof-of-Stake is an exchange killer. Withdrawal becomes extremely slow, because Proof-of-Stake generation selects/creates too many inputs. Proof-of-Stake is not free for CPU resources of the exchange, that's why any smart exchange operator usually disables it.

Well nothing is for free, but PoS rewards for coins you don't even own is damm cheap.

There seem to be some people that keep insane amounts on exchanges and I see no reason why an operater shouldn't get PoS for handling funds. I don't know the balances of btc-e, but I assume they would be worth the effort. They might just got supriced by too many withdrawls.

The only way I can explain it as rational behavior is to suggest that it is BTC-e covering their short position.

It's not rational to assume that everyone else is rational aswell...

Why shouldn't they be able to buy at their onw exchange? If btc-e had higher prices than vircurex PPC would flow into btc-e and they would get new funds to pay out withdrawls ... They already have a licence to print money, so I assume they won't risk that for a stupid gamble.

I belive it is far more likely that someone simply doesn't trust btc-e and so he takes his buisiness elsewere.

[Balthazar]

Well nothing is for free, but PoS rewards for coins you don't even own is damm cheap.

1% is nothing, daily profit from fees much higher than yearly profit from PoS... Especially if it causes constant 100% CPU load on your server.

[BitcoinForLiberty]

BTC-e has had and might still have a very large stake in NVC, which is the primary competitor to PPC. This gives them a motive to suppress PPC through short selling.

Why would they list PPC on the exchange in the first place if they thought the way you suggest?

To give BTC-e a way to short sell it, essentially increasing the number of PPC beyond what's in the blockchain, which in turn reduces the value of all PPC.

[BitcoinForLiberty]

Why shouldn't they be able to buy at their onw exchange?

Buying at their own exchange would only change an accounting entry in their database. In order to get real blockchain PPC (that they can allow customers to withdraw) they must buy it at another exchange.