Is Bitmex to blame for the price crash or is it the darn futures?

[AppliedOptimal]

Here is my opinion; it is both.
ccn.com reported that

$651 million in BTC was liquidated on BitMEX as the bitcoin price plunged $1,500 in several hours. Most major crypto assets dropped 20 percent.

I cannot remember when but I saw somewhere that Bitmex was sued by US Commodity Futures Trading Commission (CFTC) some time ago. It is possible that something came out of that investigation. According to Bloomberg, CFTC was investigating Bitmex for allowing USA citizens to trade on there?

I am not a fan of high leverages, but if your citizens want to invest to their heart's content, why not allow it? The mighty government knows best for all of us, which is similar to a helicopter parent choking her children to death. This is old news, but I feel there is a connection there, as people withdraw their money.

Other than that, we just had Bakkt starting their futures trading, and they will be settled in physical bitcoin. People could be selling the news, as suggested in another thread, but it is unlikely to cause so much harm. It could have contributed to the bear market, though.  


She is no bear I tell you that much:

[zeto]

It's possible that BitMex aggravated the dump but I never consider at as the trigger.

[Mandoy]

If we read the news today about bitcoin the recent rapid price dropped of bitcoin was due to the sudden occurrences at bitmex. The huge price drop have a negative impact on traders not only on bitmex but throughout the entire bitcoin market. Because of the sudden price drop there is a domino effect since traders have panicked and sold their bitcoins in fear of losing a profit. But though there is a 1000$ price drop in bitcoins value some data in bitmex are not so reliable and it gives us hope that everything is temporary and we will be back soon at 10k$.

[davis196]

651 million USD can't cause a price drop that would lead to billions of the global bitcoin market cap disappearing.I forgot about the investigation against Bitmex,thanks for reminding me.
The traders "sold the news" and now,we have the opportunity to buy some cheap btc.

[Kakmakr]

The Bakkt futures was supposed to push up the price, because it is the first time that institutional capital entered the market. Yes, it is still early days for Bakkt, but it is a bit of a disappointment that it caused a drop in the price. I think a lot of people bought bitcoins in anticipation for a blowout event, where the Bitcoin price would have skyrocketed after the launch of Bakkt and then the opposite happened.

So the speculators might have started to dump some coins due to this disappointment or because they over extended with loans to buy these coins on credit and they are selling now to pay back the money, before the re-payments starts. 

[joelsamuya]

One thing I learned in the world of Bitcoin and cryptocurrency is that anything can be possible. What happened with Bitmex and Bakkt can be contributing factors for the major slide affecting Bitcoin prompting many to conclude that we can be entering a bear market to which I am hoping can just be a temporary and will not be defining the last quarter of the year which what happened last year (2018). As an individual, all I do is just watch the "doom and gloom" of the market which generally turned out to be bloody red. Now, having said that, let's maintain the long-term positive outlook for Bitcoin and cryptocurrency in general. One positive note is that there has been no well-known personalities proclaiming some negative statements against Bitcoin...at least that is a good news in itself.

[BrewMaster]

did Bitmex start working yesterday or was it around for a very long time? if it were the reason for this drop then it should have caused a lot more drops more commonly than this. remember that this is the first major unpredictable drop that we had in 10 months. the last one was the drop below $6k tha happened last year out of nowhere.
things like Bitmex, high leverage, all the other drama with hashrate, etc are always there they sometimes contribute to the falls but they are never the reason.

[Mr.Ease]

Seems to be a solid combination of both.

Probably the futures started bringing price down which triggered the margin calls and now mass panic is setting in.

[Artemis3]

Whatever the cause is, it doesn't matter. People seriously need to stop looking at the short term prices and think long term.

Exactly, or take the chance to buy, as these chances don't come too often. What if, after the halving the price parks at, say, 12k? (after maybe a brief peak at 20k?).

Price will correct itself eventually, if it was too high, it will lower, it if was too low, it will go up. The fluctuations occur naturally as some actors buy or sell, which is perfectly fine. A flat line is a sign of danger, a vigorous fluctuating line means its alive and free.

After the downs come the ups, and after the ups comes the down. But on the long term, you see the price is climbing, as it should be given its deflationary design. In this long term line, isn't actually a line but a logarithmic curve, that it starts very steep up, nearly vertical, but is slowing overtime gradually becoming horizontal, meaning, price increase should be slowing down as time passes in the long run, with the highest rises in the very beginning. But remember it will never go flat, because fiat is devalued intentionally, while Bitcoin is not. Therefore bitcoin keeps its purchasing power, and slightly increases it over time, while the fiat coins are being intentionally devalued by governments over outdated economy dogmas (fear of deflation).

[serjent05]

The Bakkt futures was supposed to push up the price, because it is the first time that institutional capital entered the market. Yes, it is still early days for Bakkt, but it is a bit of a disappointment that it caused a drop in the price. I think a lot of people bought bitcoins in anticipation for a blowout event, where the Bitcoin price would have skyrocketed after the launch of Bakkt and then the opposite happened.

Or some organized whale group wanted to nullify BAKKT effect so they intentionally crash the market making people to panic and catch those flash sales to get more stash of Bitcoin.  As we can see the market immediately recovered to $8.4k plus after dipping below it 8k.  

So the speculators might have started to dump some coins due to this disappointment or because they over extended with loans to buy these coins on credit and they are selling now to pay back the money, before the re-payments starts.  

Indeed that is the normal reactions of people whenever they are disappointed, and other took advantage of this and put more pressure on the buy side making the price to crash.  But I do not think Bitmex is to blame for this crash.

did Bitmex start working yesterday or was it around for a very long time? if it were the reason for this drop then it should have caused a lot more drops more commonly than this. remember that this is the first major unpredictable drop that we had in 10 months. the last one was the drop below $6k tha happened last year out of nowhere.
things like Bitmex, high leverage, all the other drama with hashrate, etc are always there they sometimes contribute to the falls but they are never the reason.

I agree, its that people wanted  someone or something to blame and are keen in creating conspiracy theory  in every event.

[Ayiranorea]

Right now more and more discussions relative to the price crash will happen. Some state it as the cause of bitmex, some state it because of Bakkt and very few believe this is common with the bitcoin. As the crash has taken place, so will be the growth. All that required is the patience, because same as the price crash growth too will happen without any prior signals.

[jackg]

Right now more and more discussions relative to the price crash will happen. Some state it as the cause of bitmex, some state it because of Bakkt and very few believe this is common with the bitcoin.

Most people I've heard from have been predicting a fall for at least a week (and they said that before the crash). The 200 day EMA was going to come into use at some point as it is quite a significant level in the stock market and if people keep wanting to do TA here then it's not surprising we fell that far.

The price on binance fell from $9600 to $8500 in 20 minutes (most of that happening in a 5 minute candle - I can't go back to the minute chart) I bring this up as on CMC their 24 hr volume was at $750m and ranked second (a lot more than what it normally is - probably at least 8x afaik).

[1Referee]

651 million USD can't cause a price drop that would lead to billions of the global bitcoin market cap disappearing.

It certainly can. Bitcoin's market cap being $170 billion doesn't mean you need $34 billion to dump the price down by 20%. The actual orderbooks are so thin, that even a $100 million dump can easily wipe out 10% of Bitcoin's whole market cap. It's even worse when it comes to altcoins where a $100 million dump on Ethereum will probably flash wick the price 75% lower at the very minimum.

The same pretty much applies to stocks. Microsoft's market cap is $1 trillion as we speak. $1 billion in stocks being dumped in one go is enough to wipe out $100 billion of its market cap. Market caps are severely leveraged metrics, especially when it comes to altcoins.

[Kemarit]

Right now more and more discussions relative to the price crash will happen. Some state it as the cause of bitmex, some state it because of Bakkt and very few believe this is common with the bitcoin.

Most people I've heard from have been predicting a fall for at least a week (and they said that before the crash). The 200 day EMA was going to come into use at some point as it is quite a significant level in the stock market and if people keep wanting to do TA here then it's not surprising we fell that far.

The price on binance fell from $9600 to $8500 in 20 minutes (most of that happening in a 5 minute candle - I can't go back to the minute chart) I bring this up as on CMC their 24 hr volume was at $750m and ranked second (a lot more than what it normally is - probably at least 8x afaik).

Yes, there was some prediction about the 200 day EMA and some of them even predicted that the price is going down as low as ~$7000, at least the price remains stable at $8500 and trading volumes are picking up. The market just reacted to the flash crash news, and evidently some whales buy the news, dump huge amount in Bitmex. As for Bakkt, hmm, too early to say, but just remember that when we have CME and CBoE entered the market in 2017 we experienced some massive dump. Not saying that history will repeat itself here, so we really need to wait what Bakkt can bring in the market in the next coming months. It supposed to push the market, but at this point, we're not seeing any, on the contrary it 'might' have contributed to the sudden downward pattern, so let's see.

[AppliedOptimal]

Right now more and more discussions relative to the price crash will happen. Some state it as the cause of bitmex, some state it because of Bakkt and very few believe this is common with the bitcoin.

Most people I've heard from have been predicting a fall for at least a week (and they said that before the crash). The 200 day EMA was going to come into use at some point as it is quite a significant level in the stock market and if people keep wanting to do TA here then it's not surprising we fell that far.

The price on binance fell from $9600 to $8500 in 20 minutes (most of that happening in a 5 minute candle - I can't go back to the minute chart) I bring this up as on CMC their 24 hr volume was at $750m and ranked second (a lot more than what it normally is - probably at least 8x afaik).

Yes, there was some prediction about the 200 day EMA and some of them even predicted that the price is going down as low as ~$7000, at least the price remains stable at $8500 and trading volumes are picking up. The market just reacted to the flash crash news, and evidently some whales buy the news, dump huge amount in Bitmex. As for Bakkt, hmm, too early to say, but just remember that when we have CME and CBoE entered the market in 2017 we experienced some massive dump. Not saying that history will repeat itself here, so we really need to wait what Bakkt can bring in the market in the next coming months. It supposed to push the market, but at this point, we're not seeing any, on the contrary it 'might' have contributed to the sudden downward pattern, so let's see.

Where do you hear these people saying it would go down, Twitter? I saw one person on Telegram who said that but it was after the fact. Anyways, if they can predict these kinds of market moves accurately, they would be rich beyond belief. Let us know poor fellows to these accurate predictions so that we may be rich Just kidding. I have seen many who predict one thing correctly, then shits the bed on the next one. If people could predict the market accurately most of the time, they would not need to write on any platform, they would be on a tropical island.

Anyways, there are some views in the comments that say that it is both, and agrees with me. I also agree that the order books are thin and small moves can cause massive panic and result in significant price changes.

When it comes to Bakkt futures, I am hoping settling in bitcoin may be helpful and ICE may soon offer EFT and storage for us lowly investors, and not just the institutional investors.

[NeuroticFish]

I think Bitmex has nothing to do with it, it is unlikely that they are somehow connected with the fall in prices

Imho certain price drop has triggered a massive (stop loss) sell off at BitMex, causing the price drop become very big.

However, the "BitMex has nothing to do with it" is off reality. Everything matters.

[michellee]

We cannot blame anyone while we don't know what is happening in the market. But if we can know what is happening, then, we can blame it because we have a solid proves but once again, we cannot do anything with that exchange. I am sure that soon, everything will be back normal and it will rise to a higher price. Maybe it because many people are afraid of the red candle, so they decide to sell it without thinking that the price will be increased. That makes the price is going to down deeper like what we saw.

[kryptqnick]

Now that you've shared this information, it seems that Bitmex contributed to the price crash. But I agree with you that Bakkt is also the reason.

The Bakkt futures was supposed to push up the price, because it is the first time that institutional capital entered the market. Yes, it is still early days for Bakkt, but it is a bit of a disappointment that it caused a drop in the price. I think a lot of people bought bitcoins in anticipation for a blowout event, where the Bitcoin price would have skyrocketed after the launch of Bakkt and then the opposite happened.

So the speculators might have started to dump some coins due to this disappointment or because they over extended with loans to buy these coins on credit and they are selling now to pay back the money, before the re-payments starts. 

But what if it's actually the opposite? Bakkt could trigger the growth of the price because of drawing the attention of more people to Bitcoin, but actually it seems that the opposite effect even in case Bakkt is successful can happen. Namely, since Bakkt is futures contracts (so, basically, a way of ignoring the market situation and agreeing on prices in advance), it can be that people who were investing into BTC directly are now going with Bakkt. As a result, the price is low. It seems that for now, it's early to evaluate the success of Bakkt, though.

[jackg]

Where do you hear these people saying it would go down, Twitter? I saw one person on Telegram who said that but it was after the fact.

Err, it was someone I know on telegram. I think one person doing TA on youtube predicted it but he uses just TA so a lot of the time it's not an accurate view and he stays a bit too neutral on things a lot of the time (although he's expecting another move down too)...

Most people doing analysis are really awful (especially ones on youtube) as they're too biased for it to go to the upside (because they have a stake in it) so they tell everyone to buy and then it falls...

Anyways, if they can predict these kinds of market moves accurately, they would be rich beyond belief. Let us know poor fellows to these accurate predictions so that we may be rich Just kidding. I have seen many who predict one thing correctly, then shits the bed on the next one. If people could predict the market accurately most of the time, they would not need to write on any platform, they would be on a tropical island.

They probably do like me: I can either trade something or accurately predict it but can't do both at once .


The thing about the futures, didn't DragonMint buy the ASICBOOST patent and then open source it (I thought they bought it for somewhere in the millions of dollard - 45)? If they can do that just to keep the minig open source and avaliable to other producers then this community can do quite a lot more damage to areas it doesn't like...

[AppliedOptimal]

Where do you hear these people saying it would go down, Twitter? I saw one person on Telegram who said that but it was after the fact.

Err, it was someone I know on telegram. I think one person doing TA on youtube predicted it but he uses just TA so a lot of the time it's not an accurate view and he stays a bit too neutral on things a lot of the time (although he's expecting another move down too)...

Most people doing analysis are really awful (especially ones on youtube) as they're too biased for it to go to the upside (because they have a stake in it) so they tell everyone to buy and then it falls...

Anyways, if they can predict these kinds of market moves accurately, they would be rich beyond belief. Let us know poor fellows to these accurate predictions so that we may be rich Just kidding. I have seen many who predict one thing correctly, then shits the bed on the next one. If people could predict the market accurately most of the time, they would not need to write on any platform; they would be on a tropical island.

They probably do like me: I can either trade something or accurately predict it but can't do both at once .

Well, I used to trade based on TA, and I still have an account in Trading View with a good reputation, but it is only useful for daily moves. I do not believe I can predict significant market moves using TA only. That is only me though, perhaps some people can, but I sincerely doubt it. Like many, I am very much opposed to paid groups, as they only benefit the owner, the guy collecting the fees.
Last time I bought some tokens based on fundamental analysis was when a company opened a call center in India. I thought what could be better, right — a big No. The price started free-falling, and it has not stopped since. I knew about the office beforehand, and I thought I would make some money, but in a free market, you never know... It lost money, and the price went down.