Do you think Bitcoinica should switch to TradeHill? [Edited]

[zhoutong]

I think it's time to have another poll about a potential change. Honestly we're still exploring options, but we definitely want your opinions!

It's important to note that we are not going to have a formal agreement with any exchange. We will just be their client, until they shut us down (which is unlikely to happen.)

Now it's your time to vote. You have two votes. Please consider the following points when you make decisions:

- Market depth
- Trading fees
- Possibility of wide public adoption (if we plan to abandon Mt. Gox)
- Deposits and withdrawals (and withdrawal limits)
- Public reputation and trustworthiness.

Some facts to note:

- Bitcoinica is the largest Bitcoin trading platform if we exclude the hedging volume from Mt. Gox.
- Bitcoinica's hedging volume can be as high as 200,000 BTC in 24 hours.
- Currently Mt. Gox is the most "official" exchange.

EDIT:

A lot of people have chosen "Bitcoinica Independent Exchange" (it will be renamed to something different), I will simply share my ideas for this:

- Insanely low fees, like 0.1%. (Because we have no profit pressure.)
- Websocket API
- BitInstant support
- TCP-based API
- Rackspace Cloud Co-location (1ms to our server)
- Redis-based trading engine (thousands of orders per second)
- Full access to Bitcoinica's limit order liquidity
- Fully independent (You don't have to use Bitcoinica to use the exchange.)

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[SkRRJyTC]

Is it possible to just use the resources of both?  You could even pocket some arbitrage profit.

[teflone]

I hate bitcoinica for using mtgox, but I love bitcoinica because of Zhou, and his professionalism.

Who would you rather support people ?

I love that you listen and act Zhou.. dont stop.

[rebuilder]

If you could do arbitrage between all, or at least many, of the exchanges, mightn't that increase liquidity on every exchange? What are the downsides, apart from it being potentially difficult to get done?

[Mushoz]

I don't understand why people are voting Mtgox (Or Tradehill for that matter)... If it is technically possible and feasible, using more exchanges is going to be a good thing. It will increase liquidity on the other exchanges, will allow smaller spreads due to arbitrage opportunities for Bitcoinica and will stop Mtgox being a single point of failure.

In my opinion it would still be best if they would become an independent exchange though. They are the only ones currently, who have the funds, popularity and features to make this possible. It would also solve the single point of failure problem and would reduce slippage  even further, because they will be able to do high frequency trading and have the least amount of response times. On top of that, they won't have to pay Mtgox a 0.25% fee on every trade, reducing spreads even further! I'm not sure what's not to like?

Edit: And they will set the bar higher, forcing the other exchanges to innovate as well!

[Crypt_Current]

A lot of people have chosen "Bitcoinica Independent Exchange" (it will be renamed to something different), I will simply share my ideas for this:

- Insanely low fees, like 0.1%. (Because we have no profit pressure.)
- Websocket API
- BitInstant support
- TCP-based API
- Rackspace Cloud Co-location (1ms to our server)
- Redis-based trading engine (thousands of orders per second)
- Full access to Bitcoinica's limit order liquidity
- Fully independent (You don't have to use Bitcoinica to use the exchange.)

Excellent.  It will force Gox to go hard or go home.

[teflone]

I don't understand why people are voting Mtgox (Or Tradehill for that matter)... If it is technically possible and feasible, using more exchanges is going to be a good thing. It will increase liquidity on the other exchanges, will allow smaller spreads due to arbitrage opportunities for Bitcoinica and will stop Mtgox being a single point of failure.

In my opinion it would still be best if they would become an independent exchange though. They are the only ones currently, who have the funds, popularity and features to make this possible. It would also solve the single point of failure problem and would reduce slippage  even further, because they will be able to do high frequency trading and have the least amount of response times. On top of that, they won't have to pay Mtgox a 0.25% fee on every trade, reducing spreads even further! I'm not sure what's not to like?

Edit: And they will set the bar higher, forcing the other exchanges to innovate as well!

All of this NEEDS to be repeated..

[blueadept]

A lot of people have chosen "Bitcoinica Independent Exchange" (it will be renamed to something different), I will simply share my ideas for this:

- Insanely low fees, like 0.1%. (Because we have no profit pressure.)
- Websocket API
- BitInstant support
- TCP-based API
- Rackspace Cloud Co-location (1ms to our server)
- Redis-based trading engine (thousands of orders per second)
- Full access to Bitcoinica's limit order liquidity
- Fully independent (You don't have to use Bitcoinica to use the exchange.)

I'd like to add:

- Predictable deposit/withdrawal procedures, times, etc. and predictable identity verification procedures if necessary
- Liquidity rebate (a fraction of the fees charged) to pay liquidity providers/market makers for providing order book depth

And eventually:

- Options and futures on BTCUSD (settled in USD for merchant hedging)
- Options and futures on BTCUSD and other exchange rates, stocks, indexes, commodities, etc. (settled in BTC for trading/synthetic investing in the outside economy)

You've got the knowledge and background of building excellent trading systems.  I think you should go for it.

[phantomcircuit]

Ok I'll bite.

Have you considered how difficult it would be for you to offer payment services?

[Crypt_Current]

Ok I'll bite.

Have you considered how difficult it would be for you to offer payment services?

You will have to have Dwolla available or I (and probably many others) will not be able to trade.

[waspoza]

A lot of people have chosen "Bitcoinica Independent Exchange" (it will be renamed to something different), I will simply share my ideas for this:

- Insanely low fees, like 0.1%. (Because we have no profit pressure.)
- Websocket API
- BitInstant support
- TCP-based API
- Rackspace Cloud Co-location (1ms to our server)
- Redis-based trading engine (thousands of orders per second)
- Full access to Bitcoinica's limit order liquidity
- Fully independent (You don't have to use Bitcoinica to use the exchange.)

Sounds amazing to me. BTW any chance for PLN support? (Polish currency)

[zhoutong]

Ok I'll bite.

Have you considered how difficult it would be for you to offer payment services?

I have considered that. Things will be easy soon.

[phorensic]

Anything to take dependence off of gox is good.  Even if you go independent I think you should still hedge on gox and tradehill.

[Mushoz]

Anything to take dependence off of gox is good.  Even if you go independent I think you should still hedge on gox and tradehill.

And pay a 0.25% fee to Mtgox, have higher slippage risks due to slower response times and have problems with withdrawals processing because of the daily and monthly limits? The first two points will increase the spreads (so the costs) for the costumers, and the last one is downright inconvenient and borderline unacceptable. I'm all for an independent Bitcoinica exchange!

[jojo69]

build it and they will come

[ineededausername]

kill gox! gox must die. don't give a fuck how you do it.

[P_Shep]

If Bitcoinica were it's own exchange, with a lower spread/fees, quicker updates/processing, I'd probably sign up.

[PatrickHarnett]

I read some of the Bitcoinica threads with interest, not because I use the service, but because of the trouble people get themselves into.  This topic is worth commenting on as there is some incentive to reduce the dominance (and perceived problems with Gox).

Switching to TradeHill (or Intersango as the other apparently well run exchange) could do wonders for their liquidity, as Bitcoinica hedges their position in the market being measured against.

One idea is to offer two products, one pegged against Gox, the other against Tradehill - that will give people extra ability to vote with their feet, rather than having a possibly disruptive change in rules (moving from settling against one index to another).

Also, Bitcoinica appears to be working well and setting up an exchange will not necessarily work as well - stick to the thing that works - distracting into a second unknown could kill both.

[naima53]

+1
I'm all for an independent Bitcoinica exchange!

I'll bite.

Please! Realise "stop loss"! You will have an improbable success!
Zhou, thanks for what you are doing!

[pirateat40]

As much as I think becoming your own exchange is a good thing for everyone I do think we will be heading to a centralized exchange like stocks and currency is traded.  I know we all want a free market and options but I think at this point Mt. Gox is going to be the exchange that ends up becoming the central authority and the rest will simply be brokers.  We are still a ways off from that but I think its coming.