Bitcoin Forum
November 15, 2018, 11:55:42 PM *
News: Latest Bitcoin Core release: 0.17.0 [Torrent].
 
   Home   Help Search Login Register More  
Pages: « 1 2 3 4 5 6 7 8 9 10 11 [12] 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 »
  Print  
Author Topic: This Bitfinex Credit Bubble cannot end well  (Read 61806 times)
thezerg
Legendary
*
Offline Offline

Activity: 1246
Merit: 1000


View Profile
July 16, 2014, 12:54:21 AM
 #221

We might increase leverage in the future if we see our swap market is cooling off a little.
For the time being we believe it's a good idea, for the sake of traders, liquidity providers and the bitcoin market to slow down a little the growth of our swap total market.

I hope this helps.

Have a good day

Giancarlo
Bitfinex Team

"Earlier today, Mt. Gox halted trading, saying the market needed to "cool down""

I knew i heard that phrase somewhere else before...  Cheesy

Hehe, I don't know about the validity of that analogy, but this is a pretty clear acknowledgement by Bitfinex that swaps/leverage have gotten out of hand vs. liquidity.

"cool down" is a very common phrase... bitfinex is guaranteeing the lender's principal, AND it schedules the margin calls.  In other words, bitfinex can choose to not execute a forced sale if it wants.  So clearly they aren't going to do margin calls so fast that they flash crash to the point where principal is lost because that will be suicide.  Its therefore unlikely we'll get a deep flash crash on bitfinex alone... but a flash crash (or even something smaller than a crash) on other exchanges could trigger a big flash crash on bitfinex.
I don't think they guarantee the lenders' principle. Do you have a link/quote to back this up? AFAIK lenders are putting their money at risk, although they do have ways that should protect your money.

You used to be able to choose "insured" or "uninsured" swaps.  They sent an announcement around a month or so ago increasing their take and saying that they will all be "insured" now.  You are right, what exactly that means is perhaps unclear.

@Coinfan: I and I'd expect that you don't really know how automatic vs manual it is.  However, its not all or nothing... you could do an automatic call until BTC price drops X%, then pause... the human could configure how fast the margin calls are executed... etc.
1542326142
Hero Member
*
Offline Offline

Posts: 1542326142

View Profile Personal Message (Offline)

Ignore
1542326142
Reply with quote  #2

1542326142
Report to moderator
1542326142
Hero Member
*
Offline Offline

Posts: 1542326142

View Profile Personal Message (Offline)

Ignore
1542326142
Reply with quote  #2

1542326142
Report to moderator
1542326142
Hero Member
*
Offline Offline

Posts: 1542326142

View Profile Personal Message (Offline)

Ignore
1542326142
Reply with quote  #2

1542326142
Report to moderator
Advertised sites are not endorsed by the Bitcoin Forum. They may be unsafe, untrustworthy, or illegal in your jurisdiction. Advertise here.
1542326142
Hero Member
*
Offline Offline

Posts: 1542326142

View Profile Personal Message (Offline)

Ignore
1542326142
Reply with quote  #2

1542326142
Report to moderator
1542326142
Hero Member
*
Offline Offline

Posts: 1542326142

View Profile Personal Message (Offline)

Ignore
1542326142
Reply with quote  #2

1542326142
Report to moderator
1542326142
Hero Member
*
Offline Offline

Posts: 1542326142

View Profile Personal Message (Offline)

Ignore
1542326142
Reply with quote  #2

1542326142
Report to moderator
CEG5952
Hero Member
*****
Offline Offline

Activity: 658
Merit: 500

Buy and sell bitcoins,


View Profile
July 16, 2014, 01:06:27 AM
 #222

"Effectively insured." No, they do not guarantee lenders a damn thing. And do the math, 15% insurance off swap fees vs. actual swaps....

Coinfan
Full Member
***
Offline Offline

Activity: 233
Merit: 104


View Profile
July 16, 2014, 01:47:21 AM
 #223

The words were reiterated a few days ago, but are just words:

"No we continue to cover the default of traders. Hence our changes to ensure no default happens" (http://www.reddit.com/r/BitcoinMarkets/comments/2akrbp/psa_bfx_is_making_some_changes_to_margin_trading/ciw69d5).

In the end, the guaranty against default is reversing trades.

But if there were defaults, despite a reversal of trades, and they didn't honored this promise, they would have problems to stay in business. The damaged to their reputation would be heavy.

Therefore, in face of the losses, they will balance what is best: to pay and keep in business; or, end the business and run away.

If I recall well, it was in April 2013, because of the crash and connection problems with Gox, since it wasn't possible to liquidate positions, they end up paying the lenders losses, even without any promise in that sense. Of course, it was a relatively small value. Now we are talking about millions of potential losses.

SCAM ALERT: Rock Trading Exchange (www.therocktrading.com): Deceives bitcoiners to create unverified accounts, blocks the withdrawals covertly in order to let the user keep depositing money and uses every pretext to keep it.
https://bitcointalk.org/index.php?topic=4975753.0
https://therocktradingscam.home.blog/
https://therocktradingscam.weebly.com/
Coinfan
Full Member
***
Offline Offline

Activity: 233
Merit: 104


View Profile
July 16, 2014, 04:10:18 AM
 #224

Speaking about running away and since this thread is becoming the unofficial (and unmoderated) thread on Bitfinex...

The Hong-Kong corporation registry allows searching on a corporation (https://www.eregistry.gov.hk/icris-ext/apps/por01a/index#) and getting all the information they have on the partners, but it seems Bitfinex (iFinex Inc.) no longer is incorporated there, now it's at the British Virgin Islands (BVI), as they state in their home page.

The BVI Registrar website (http://www.bvifsc.vg/) only has information about regulated entities, not about the other more than a million corporations they incorporated.

However, some members have checked the Hong-Kong registry before the information was deleted. It doesn't seem proper to publish it, but I wonder if someone is willing to share it in a PM?

SCAM ALERT: Rock Trading Exchange (www.therocktrading.com): Deceives bitcoiners to create unverified accounts, blocks the withdrawals covertly in order to let the user keep depositing money and uses every pretext to keep it.
https://bitcointalk.org/index.php?topic=4975753.0
https://therocktradingscam.home.blog/
https://therocktradingscam.weebly.com/
CEG5952
Hero Member
*****
Offline Offline

Activity: 658
Merit: 500

Buy and sell bitcoins,


View Profile
July 16, 2014, 04:53:05 AM
 #225

However, some members have checked the Hong-Kong registry before the information was deleted. It doesn't seem proper to publish it, but I wonder if someone is willing to share it in a PM?

What's the problem with publishing it exactly? If it was public information, I don't see why it would be an issue. In fact, I'm not sure why they would delete it. I know when I search dissolved/suspended corporations in my work, the records are retained. Out of curiosity, what are you looking for?

Coinfan
Full Member
***
Offline Offline

Activity: 233
Merit: 104


View Profile
July 16, 2014, 11:08:14 PM
 #226

Clearly, right or wrong, Bitfinex doesn't want that information published or they would publish it.

I think customers have a right to know, even if they don't like. Other people, no. It's not hard to get the information, but it's harder than if it's published on a forum post. I wouldn't like to see my name published on a forum in association with bitcoin.

Since I'm a customer, my goal is to know the full name of all owners of Bitfinex and any other relevant information. I hope I won't ever need it, but...

SCAM ALERT: Rock Trading Exchange (www.therocktrading.com): Deceives bitcoiners to create unverified accounts, blocks the withdrawals covertly in order to let the user keep depositing money and uses every pretext to keep it.
https://bitcointalk.org/index.php?topic=4975753.0
https://therocktradingscam.home.blog/
https://therocktradingscam.weebly.com/
thezerg
Legendary
*
Offline Offline

Activity: 1246
Merit: 1000


View Profile
July 17, 2014, 12:24:22 AM
 #227

Clearly, right or wrong, Bitfinex doesn't want that information published or they would publish it.

I think customers have a right to know, even if they don't like. Other people, no. It's not hard to get the information, but it's harder than if it's published on a forum post. I wouldn't like to see my name published on a forum in association with bitcoin.

Since I'm a customer, my goal is to know the full name of all owners of Bitfinex and any other relevant information. I hope I won't ever need it, but...

But you dont have a public bitcoin business so you could have an expectation of privacy.  IMHO officers of bitcoin businesses should be public knowledge... might discourage cut and run.
hollowframe
Sr. Member
****
Offline Offline

Activity: 266
Merit: 250


View Profile
July 17, 2014, 02:22:27 AM
 #228

We might increase leverage in the future if we see our swap market is cooling off a little.
For the time being we believe it's a good idea, for the sake of traders, liquidity providers and the bitcoin market to slow down a little the growth of our swap total market.

I hope this helps.

Have a good day

Giancarlo
Bitfinex Team

"Earlier today, Mt. Gox halted trading, saying the market needed to "cool down""

I knew i heard that phrase somewhere else before...  Cheesy

Hehe, I don't know about the validity of that analogy, but this is a pretty clear acknowledgement by Bitfinex that swaps/leverage have gotten out of hand vs. liquidity.

"cool down" is a very common phrase... bitfinex is guaranteeing the lender's principal, AND it schedules the margin calls.  In other words, bitfinex can choose to not execute a forced sale if it wants.  So clearly they aren't going to do margin calls so fast that they flash crash to the point where principal is lost because that will be suicide.  Its therefore unlikely we'll get a deep flash crash on bitfinex alone... but a flash crash (or even something smaller than a crash) on other exchanges could trigger a big flash crash on bitfinex.
I don't think they guarantee the lenders' principle. Do you have a link/quote to back this up? AFAIK lenders are putting their money at risk, although they do have ways that should protect your money.

You used to be able to choose "insured" or "uninsured" swaps.  They sent an announcement around a month or so ago increasing their take and saying that they will all be "insured" now.  You are right, what exactly that means is perhaps unclear.
Unless the swaps would be "insured" by some 3rd party insurance company that has the ability to pay out an insurance contract in the event that the market were to crash/spike and they were unable to close out the margin positions in time (I would doubt they have this kind of insurance) then you would basically be betting that they have the financial ability to cover any trading losses in excess of 100% and without being able to audit their financial records, this (IMO) means very little.
Marbit
Hero Member
*****
Offline Offline

Activity: 686
Merit: 500


View Profile
July 17, 2014, 03:34:34 AM
 #229

You used to be able to choose "insured" or "uninsured" swaps.  They sent an announcement around a month or so ago increasing their take and saying that they will all be "insured" now.  You are right, what exactly that means is perhaps unclear.
Unless the swaps would be "insured" by some 3rd party insurance company that has the ability to pay out an insurance contract in the event that the market were to crash/spike and they were unable to close out the margin positions in time (I would doubt they have this kind of insurance) then you would basically be betting that they have the financial ability to cover any trading losses in excess of 100% and without being able to audit their financial records, this (IMO) means very little.

BFX takes 15% of swap interest that would otherwise be paid to lenders, to build an insurance fund. As far as I know, they have not made any obligation to pay beyond that fund. I assure you it does not amount to $32 million... Wink
hollowframe
Sr. Member
****
Offline Offline

Activity: 266
Merit: 250


View Profile
July 17, 2014, 04:36:48 AM
 #230

You used to be able to choose "insured" or "uninsured" swaps.  They sent an announcement around a month or so ago increasing their take and saying that they will all be "insured" now.  You are right, what exactly that means is perhaps unclear.
Unless the swaps would be "insured" by some 3rd party insurance company that has the ability to pay out an insurance contract in the event that the market were to crash/spike and they were unable to close out the margin positions in time (I would doubt they have this kind of insurance) then you would basically be betting that they have the financial ability to cover any trading losses in excess of 100% and without being able to audit their financial records, this (IMO) means very little.

BFX takes 15% of swap interest that would otherwise be paid to lenders, to build an insurance fund. As far as I know, they have not made any obligation to pay beyond that fund. I assure you it does not amount to $32 million... Wink
I don't think it says specifically that this is used to pay for their insurance fund. How I read it, this is more their commission and will be their profits and could very well have been paid out to their owners already.

You are correct in that with current interest rates, there is no way that the 15% would be able to cover 100% losses from all margin trades, however would probably be enough to payout if losses were not too severe, that is assuming this is what those funds are being used for.
ask
Legendary
*
Offline Offline

Activity: 1330
Merit: 1004


Open and Transparent Science Powered By Blockchain


View Profile
July 17, 2014, 05:33:03 AM
 #231

I have a solution for Bitfinex issue:

- on 21th Bitfinex or some of their friends sells 5000 BTC at market price, bitcoin price drops to 500 USD
- new rules starts immediatelly afterwards
- price continues to drop, margin calls accelerates price drop
- at 1 USD a big chunk of money is waiting to buy everything (part of money from 5000 previously sold bitcoins)
- remaining money is used to push bitcoin price higher above 700 USD - and new baloooon is triggered

All those 5 steps are done within a minute. Only bitcoins changed their owners...

okthen
Hero Member
*****
Offline Offline

Activity: 490
Merit: 500


View Profile
July 17, 2014, 09:58:59 AM
 #232

I have a solution for Bitfinex issue:

- on 21th Bitfinex or some of their friends sells 5000 BTC at market price, bitcoin price drops to 500 USD
- new rules starts immediatelly afterwards
- price continues to drop, margin calls accelerates price drop
- at 1 USD a big chunk of money is waiting to buy everything (part of money from 5000 previously sold bitcoins)
- remaining money is used to push bitcoin price higher above 700 USD - and new baloooon is triggered

All those 5 steps are done within a minute. Only bitcoins changed their owners...


Don't give them ideas...
ask
Legendary
*
Offline Offline

Activity: 1330
Merit: 1004


Open and Transparent Science Powered By Blockchain


View Profile
July 17, 2014, 10:13:10 AM
 #233

I have a solution for Bitfinex issue:

- on 21th Bitfinex or some of their friends sells 5000 BTC at market price, bitcoin price drops to 500 USD
- new rules starts immediatelly afterwards
- price continues to drop, margin calls accelerates price drop
- at 1 USD a big chunk of money is waiting to buy everything (part of money from 5000 previously sold bitcoins)
- remaining money is used to push bitcoin price higher above 700 USD - and new baloooon is triggered

All those 5 steps are done within a minute. Only bitcoins changed their owners...


Don't give them ideas...

They can actually sell coins from hot wallet which don't belong to them, actually they belong to their customers. It is a scenario which has  100% probability to be successful.

Market is not regulated...

DavidHume
Full Member
***
Offline Offline

Activity: 235
Merit: 102



View Profile
July 18, 2014, 04:41:30 AM
 #234

I have a solution for Bitfinex issue:

- on 21th Bitfinex or some of their friends sells 5000 BTC at market price, bitcoin price drops to 500 USD
- new rules starts immediatelly afterwards
- price continues to drop, margin calls accelerates price drop
- at 1 USD a big chunk of money is waiting to buy everything (part of money from 5000 previously sold bitcoins)
- remaining money is used to push bitcoin price higher above 700 USD - and new baloooon is triggered

All those 5 steps are done within a minute. Only bitcoins changed their owners...


Don't give them ideas...

They can actually sell coins from hot wallet which don't belong to them, actually they belong to their customers. It is a scenario which has  100% probability to be successful.

Market is not regulated...

Long term businessman don't kill the goose which laid the golden eggs.

lay785
Sr. Member
****
Offline Offline

Activity: 266
Merit: 250


View Profile
July 18, 2014, 06:55:17 AM
 #235

I have a solution for Bitfinex issue:

- on 21th Bitfinex or some of their friends sells 5000 BTC at market price, bitcoin price drops to 500 USD
- new rules starts immediatelly afterwards
- price continues to drop, margin calls accelerates price drop
- at 1 USD a big chunk of money is waiting to buy everything (part of money from 5000 previously sold bitcoins)
- remaining money is used to push bitcoin price higher above 700 USD - and new baloooon is triggered

All those 5 steps are done within a minute. Only bitcoins changed their owners...


Don't give them ideas...

They can actually sell coins from hot wallet which don't belong to them, actually they belong to their customers. It is a scenario which has  100% probability to be successful.

Market is not regulated...

Long term businessman don't kill the goose which laid the golden eggs.

Except for gox
Leina
Full Member
***
Offline Offline

Activity: 152
Merit: 100


View Profile
July 18, 2014, 07:11:08 AM
 #236

I have a solution for Bitfinex issue:

- on 21th Bitfinex or some of their friends sells 5000 BTC at market price, bitcoin price drops to 500 USD
- new rules starts immediatelly afterwards
- price continues to drop, margin calls accelerates price drop
- at 1 USD a big chunk of money is waiting to buy everything (part of money from 5000 previously sold bitcoins)
- remaining money is used to push bitcoin price higher above 700 USD - and new baloooon is triggered

All those 5 steps are done within a minute. Only bitcoins changed their owners...


Don't give them ideas...

They can actually sell coins from hot wallet which don't belong to them, actually they belong to their customers. It is a scenario which has  100% probability to be successful.

Market is not regulated...

Long term businessman don't kill the goose which laid the golden eggs.

Except for gox

Mark Karpeles is a software developer. Not a good businessman as some posters here already pointed out.
myself
Legendary
*
Offline Offline

Activity: 938
Merit: 1000


chaos is fun...…damental :)


View Profile
July 18, 2014, 09:13:34 AM
 #237

Long term businessman don't kill the goose which laid the golden eggs.
believe me they do, look how many "features" did they deploy after they kicked me out 

Los desesperados publican que lo inventó el rey que rabió, porque todo son en el rabias y mas rabias, disgustos y mas disgustos, pezares y mas pezares; si el que compra algunas partidas vé que baxan, rabia de haver comprado; si suben, rabia de que no compró mas; si compra, suben, vende, gana y buelan aun á mas alto precio del que ha vendido; rabia de que vendió por menor precio: si no compra ni vende y ván subiendo, rabia de que haviendo tenido impulsos de comprar, no llegó á lograr los impulsos; si van baxando, rabia de que, haviendo tenido amagos de vender, no se resolvió á gozar los amagos; si le dan algun consejo y acierta, rabia de que no se lo dieron antes; si yerra, rabia de que se lo dieron; con que todo son inquietudes, todo arrepentimientos, tododelirios, luchando siempre lo insufrible con lo feliz, lo indomito con lo tranquilo y lo rabioso con lo deleytable.
gizmoh
Legendary
*
Offline Offline

Activity: 1330
Merit: 1000



View Profile
July 18, 2014, 09:52:47 AM
 #238

believe me they do, look how many "features" did they deploy after they kicked me out 

What's your story with Bfx?

How Ripple Rips you: "The founders of Ripple Labs created 100 billion XRP at Ripple's inception. No more can be created according to the rules of the Ripple protocol. Of the 100 billion created, 20 billion XRP were retained by the creators, seeders, venture capital companies and other founders. The remaining 80 billion were given to Ripple Labs. Ripple Labs intends to distribute and sell 55 of that 80 billion XRP to users and strategic partners. Ripple Labs also had a giveaway of under 200 million XRP (0.002% of all XRP) via World Community Grid that was later discontinued.[29] Ripple Labs will retain the remaining 25 billion"
BitBits
Full Member
***
Offline Offline

Activity: 144
Merit: 100


View Profile WWW
July 18, 2014, 07:00:42 PM
 #239

believe me they do, look how many "features" did they deploy after they kicked me out 
What's your story with Bfx?

A former disgruntled employee, who made it his business to bash Bitfinex with every opportunity (...for about some year now I think)

BITFINEX - Trade with Leverage. Your ref. code: PD3bFJBdKk (Get 10% off fees), LINK: https://www.bitfinex.com/?refcode=PD3bFJBdKk
Tips: || Bitcoin: 1NRmp3ghrmstgQKLv9XUuDpmBEz74Z6gKX || Darkcoin: XcTMucPdBTNg5eP8bYEU1FMZ5CnGkJvFYT || Litecoin: Lc9C6HUhMLKrKAFSSpGHBFdBKd3PZt9oA2 ||
myself
Legendary
*
Offline Offline

Activity: 938
Merit: 1000


chaos is fun...…damental :)


View Profile
July 18, 2014, 08:05:28 PM
 #240

believe me they do, look how many "features" did they deploy after they kicked me out 

What's your story with Bfx?


early i joined bitfinex like a adviser in 2012 and since what i put on the table did push bitfinex up from deep shit  R promised to give me 25% of shares from bitfinex and when he registered the company on early 2013 but he dint and i dint get any document of that, then my theoretical 25% share got diluted to 20% to make room for additional investors, then using the excuse that i dint want to put money for bitfinex loses, i dint recognize the loses because there was no external audit and R already edited the database giving money to special friends so he turn around and said well i was not a share holder just like a adviser like i was in 2012 so he kicked me out

Los desesperados publican que lo inventó el rey que rabió, porque todo son en el rabias y mas rabias, disgustos y mas disgustos, pezares y mas pezares; si el que compra algunas partidas vé que baxan, rabia de haver comprado; si suben, rabia de que no compró mas; si compra, suben, vende, gana y buelan aun á mas alto precio del que ha vendido; rabia de que vendió por menor precio: si no compra ni vende y ván subiendo, rabia de que haviendo tenido impulsos de comprar, no llegó á lograr los impulsos; si van baxando, rabia de que, haviendo tenido amagos de vender, no se resolvió á gozar los amagos; si le dan algun consejo y acierta, rabia de que no se lo dieron antes; si yerra, rabia de que se lo dieron; con que todo son inquietudes, todo arrepentimientos, tododelirios, luchando siempre lo insufrible con lo feliz, lo indomito con lo tranquilo y lo rabioso con lo deleytable.
Pages: « 1 2 3 4 5 6 7 8 9 10 11 [12] 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 »
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!