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Author Topic: Was a huge BitPay transaction to BFL responsible for the price drop on Oct 24?  (Read 808 times)
imfed
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October 29, 2013, 07:06:56 PM
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- BitPay, the world’s largest payment processor for virtual currencies, announces that it has processed its largest bitcoin merchant transaction ever, a single order for $1,000,000 for Kansas City-based bitcoin mining hardware manufacturer Butterfly Labs.

- BitPay processed, cleared, and settled the transaction within their normal one business day time frame directly to Butterfly Labs’ bank account.
http://finance.yahoo.com/news/bitpay-processes-1-million-bitcoin-133000619.html

Facts:
- BitPay received about 5,000 BTC from unknown and sent $1,000,000 Butterfly Labs.

- because of low liquidity and market depth, if somebody sells 5,000 BTC within one day that means the market price will drop.

Do you think this transaction was responsible for the price drop on Oct 24? Who would you think could have sent 5,000 BTC to Butterfly Labs apart from themselves?
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MAbtc
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October 29, 2013, 07:10:21 PM
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Where did the dumps start, and how much was dumped? I don't recall...  Smiley

Chalkbot
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October 29, 2013, 07:19:36 PM
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The timing also corresponded with the FBI seizing another 144,000 bitcoins, effectively becoming one of the largest holders in the world. I don't know if this had anything to do with it, but I can see how that would make some people uneasy, or create speculation oppurtunities.

Edit: had the number of coins wrong.
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October 29, 2013, 07:21:40 PM
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I feel like bitpay probably had a lot of the million on hand just for these type of transactions. So I doubt they dumped it all on the exchange at once, but they will spend their own money and try to make money sending it very slowly over time.

Want to earn 2500 SATOSHIS per hour? Come Chat and Chill in https://goseemybits.com/lobby
imfed
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October 29, 2013, 07:42:56 PM
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they will spend their own money and try to make money sending it very slowly over time.

I doubt that, it would be very risky for a payment processor because of high volatility. Your business model would be speculation, not payment processing.

they say: BitPay consolidates market depth from multiple exchanges to provide buyers with a bitcoin best bid (BBB) exchange rate.
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October 29, 2013, 07:46:25 PM
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they will spend their own money and try to make money sending it very slowly over time.

I doubt that, it would be very risky for a payment processor because of high volatility. Your business model would be speculation, not payment processing.

they say: BitPay consolidates market depth from multiple exchanges to provide buyers with a bitcoin best bid (BBB) exchange rate.


They speculate  Cheesy

Pirate likes to buy high and sell low, with other people's money.

if you buy at 8.00 or below, and sell at 9.00 or above, you can make money trading against pirate too.  I've done that x6000 coins this week, earning me about a 25% return on my investment trading against pirate.

EDIT: if anyone wants to buy some goxUSD from me to take advantage of the buying opportunities, email me at tony@bitpay.com
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October 29, 2013, 07:53:59 PM
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they speculate as do most business ie banks, insurance companies, pretty much anyone who has cash on hand to make more cash

ok
Spekulatius
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October 29, 2013, 08:28:18 PM
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If they sell, I dont think they would do it on MtGox this time because it would take them months to get the fiat out.

A dump on Bitstamp would bring the price down to 180$, which would likely trigger that bearish wedge on Gox we are in right now, as well as the tripple top on btchina:



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