Creating a Bitcoin crash?

[LucasTerry]

How many Bitcoins / USD would it take to manufacture a 10% price reduction these days? How many individuals own such wealth?

My Guess

The figure is always changing based on the depth of the orderbooks. Selling $xx,000,000 right now could possibly accomplish it, providing no one spotbuys ones full sell order in response.

It would very certainly mean-revert to the original price within hours/days, unless one can continue that continual selling pressure indefinitely. Markets will always tend toward equilibrium over time.

What are your thoughts?

[AGD]

When somebody sells, someone else is buying. Would this event trigger a price dump or a raise?
Price depends on supply and demand and not on the amount of a sell order.

[Fortify]

How many Bitcoins / USD would it take to manufacture a 10% price reduction these days? How many individuals own such wealth?

My Guess

The figure is always changing based on the depth of the orderbooks. Selling $xx,000,000 right now could possibly accomplish it, providing no one spotbuys ones full sell order in response.

It would very certainly mean-revert to the original price within hours/days, unless one can continue that continual selling pressure indefinitely. Markets will always tend toward equilibrium over time.

What are your thoughts?

The price is built on supply and demand. If there is a mass seller but demand is high, then there will not necessarily be a corresponding price drop. It would mostly rely on the capacity and willingness of the buyers out there on whether the price drops. It's impossible to gauge, certain institutions or companies might have placed a buying target and will buy up any Bitcoins that fall under that price if they have long term conviction in their strategy. There is no way to tell what the spare buying capacity is or how many people might rush in to start panic selling if a certain trend materializes, much like the stock market it can be highly erratic and irrational.

[coolcoinz]

It's hard to estimate what would happen on all exchanges at once, but we've seen what can happen on a single exchange like on Jan 24 on Bitstamp where around 500 Bitcoin buy made the price go up by 600 USD. If someone had about 50 mln USD to spend they could easily push the price over 40k right now, which would probably start a short liquidation cascade and take us to 45k, maybe even to the 50k resistance zone. Of course if the demand would not follow we'd see a slow bleed back below 40k in the next days or weeks.

To do the opposite you'd probably need 1k bitcoins. That dumped all at once would easily get us below the current low of 33k, but again that would happen on a single exchange. To really crash the price you'd need a simultaneous attack on big exchanges like coinbase and binance and put 2 orders 1k btc each at each of them. But would that be worth it? Probably not because if the demand is there, all you'd achieve is a flash crash and then the price would start to grind back up to 35k.

[Husires]

The price change is related to the change in market capacity and quantity supplied.
When the quantity supplied increases and no one wants to buy it, the price of Bitcoin decreases until we reach a level where people see that the price is appropriate to buy.

Bitcoin is produced in each block at a rate of 6.12 bitcoin every 10 minutes on average. If those miners sell these coins, there must be a demand for them, in addition to the currencies in the quantities supplied.

Tracking trading volumes, buying and selling, is what gives points of resistance and support, and thus the basis for technical analysis of the price.

[Lucius]

What are your thoughts?

I don't think you are familiar with the rule that when one profile is banned, you have no right to use another profile. Even though you think you're smart and you've deleted all your posts - nothing has been permanently deleted - https://ninjastic.space/search?author=Patrick2t2&board=1

Sooner or later you will be banned again for plagiarism and word spinning.

[jackg]

When somebody sells, someone else is buying. Would this event trigger a price dump or a raise?
Price depends on supply and demand and not on the amount of a sell order.

There are cases where adding one large buy order makes the asset drop in price quite a bit while the order hasn't been filled - in bitcoin it normally causes the same thing on the other side though so the price could just stay the same.


When I last checked, a few weeks ago, I think 1kbtc would fall through the coinbase order book and completely empty it of buys, I don't know whether that was just slippage protection though (I think this was the btc eur pair though too).

[hatshepsut93]

I seriously doubt that you can make any good estimate about how much money would you need to make such shift just by looking at order books. Order books can change in an instant based on the current market state. So technically you can change the price by 10% by fulfilling enough orders on either side, but traders will start immediately making and filling new orders, and it's completely unpredictable if it would cause panic and further crash, or if it would be viewed as a "dip" opportunity and the price would quickly rebound.

[bittraffic]

There are instances that I think someone figured it out how much or when to achive the price movement with their buy or sell order especially when I see there is a flash movement of pice.

I couod be wrong though but if someone is about to lose money for betting the price to go down in futures market yet the price shoots, will it be worth for him manipulating for the price to drop?

[kryptqnick]

It's a great question, but I don't think there's a formula because it really depends a lot of how others react. Even if this a big sum, like hundreds of millions of dollars, people can get excited and buy quickly enough for there to not be such an effect on the price. But I think it's easy to estimate the level of event that can cause such a thing, and I believe events are more important than pure buy or sell orders. So it can be a company with valuation of at least 0.5 trillion dollars announcing pulling out a billion of dollars worth of Bitcoin. It can be a couple of days without electricity in a country that's in top-5 by crypto mining. Another option is a country that has a big population and a lot of crypto users considering a draft bill that bans cryptos or crypto mining.

[teosanru]

How many Bitcoins / USD would it take to manufacture a 10% price reduction these days? How many individuals own such wealth?

My Guess

The figure is always changing based on the depth of the orderbooks. Selling $xx,000,000 right now could possibly accomplish it, providing no one spotbuys ones full sell order in response.

It would very certainly mean-revert to the original price within hours/days, unless one can continue that continual selling pressure indefinitely. Markets will always tend toward equilibrium over time.

What are your thoughts?

I think this is a subjective question as the answer depends upon the stage market is in. Apart from stage it depends upon volatility in the market and as you have mentioned the depth of the order book. But on an average i think you need around 15000 Bitcoins and all of them should place a sell order immediately and you can expect a big crash of 10%. If you want crash of more than that then obviously you need a larger sell order. I have seen the past 30% crash would need around 50000 Bitcoins.

[pooya87]

It is an interesting question but very hard to answer because it depends on market conditions.

As you said the "depth of the orderbooks" is an important factor but also there are orders that don't exist in order books, they come into existence when price moves in a certain direction which makes everything so much more complicated. For example you could say it takes $X to dump it 10% but when it dumps 10% there could be a panic and people could remove their orders "thinning" the order books.

But the people's reactions depends on the market conditions. For example we saw this many times in the past, like in 2017, where bear whales tried so hard for weeks to go against the market and dump the price, they lost millions trying to do it and failed even though the order books didn't show that much resistance. It simply was because the trend was bullish and they were going against it.
This happens in the opposite direction in bear markets but way less common.

[Obito]

Bitcoin market follows the same principle as stock market, if there's low supply and a lot of demand then there's an increase in price but if vice versa then the price goes down. An individual can drive down the prices easily but they need to have a lot of money to be able to pull it off and create a significant amount of movement, this kind of tactic can be pulled off in cryptocurrencies that have low market and there you can easily bait people into thinking that it's going to gup more.

[GeorgeJohn]

When somebody sells, someone else is buying. Would this event trigger a price dump or a raise?
Price depends on supply and demand and not on the amount of a sell order.

That's were the demands and supply come's in. The price of cryptocurrencies comes up when the demands is of higher potential than supply, so the demands we are emphasising on trigger the acceleration of cryptocurrency and especially bitcoin, but when the supply is in the stages of higher potential's the market structure goes into shambles, so obviously it began to fluctuating because of surplus, excessive supply, so i believe the of the disadvantages that causes market dump.

[Juse14]

Bitcoin market follows the same principle as stock market, if there's low supply and a lot of demand then there's an increase in price but if vice versa then the price goes down. An individual can drive down the prices easily but they need to have a lot of money to be able to pull it off and create a significant amount of movement, this kind of tactic can be pulled off in cryptocurrencies that have low market and there you can easily bait people into thinking that it's going to gup more.

But I don't think it will be easy to do it even if we have enough money for it, because at the same time we won't know how other people will react, and might do something against ours, to create price pressure. Indeed that affects the price of bitcoin when demand is higher than supply. And in our market it is not easy to guess that.

[barbara44]

When somebody sells, someone else is buying. Would this event trigger a price dump or a raise?
Price depends on supply and demand and not on the amount of a sell order.

Judging from how the question was asked, it doesn’t matter if there is someone who is ready to buy the sell coins or not, the question is whether there will be anyone who can singlehandedly create a Bitcoin crash of at least 10%.

Even if there is someone that would be ready to buy the sold the coins, the market must have gone down that 10% by the time they put that sell order. So that would be a mission accomplished. But the good thing is that there would always be people who are ready to buy it like you have said, and the market would be back on its feet in no long time.

[Gamerholic]

I think the market will be more and more balanced due to the ever increasing number of players and bitcoins in their hands. Thus, we will see a smoother and less volatile picture in the future. Also, do not forget that the last two years there has been a redistribution of bitcoin mining capacities. I think by the middle of the year the picture on the market will stabilize and we will enter a fairly long side trend.

[gantez]

Sell orderbook is what is capable of pulling price down because it may cause fear in every where in exchange but buy order can bring shift up in price for positive sentiment to start out and you can see the price move up. It is the demand that will bring sell, if no demand sell will look hard.

[doomloop]

The figure is always changing based on the depth of the orderbooks. Selling $xx,000,000 right now could possibly accomplish it, providing no one spotbuys ones full sell order in response.

It would very certainly mean-revert to the original price within hours/days, unless one can continue that continual selling pressure indefinitely. Markets will always tend toward equilibrium over time.

What are your thoughts?

Things have really changed in the market when you compare it to what it used to be before , we Joe have so many investors , although there are still the bigger fishes in the sea, those we refer to as the whales, but can one whale today be able to crash the market that much? Maybe it is possible for such thing to happen, and if I am to say someone that can cause such to happen, I would say the world’s  richest man, Elon Musk, he’s the person that can likely do that or maybe not, because the market is huge now. It might require the combined effort of the big fishes to pull it off, and the question is who is even ready to sell?

[pooya87]

Maybe it is possible for such thing to happen, and if I am to say someone that can cause such to happen, I would say the world’s  richest man, Elon Musk, he’s the person that can likely do that or maybe not, because the market is huge now.

Funny that you mentioned Musk here because he did try to crash the market and failed miserably. All he could do was a small panic sell that led to less than 5% drop which is not categorized as even a big drop let alone a crash (drops bigger than 30% are usually considered as crashes).
That was his first attempt, he tried again and people largely ignored him and price didn't even move