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Author Topic: This Bitfinex Credit Bubble cannot end well  (Read 61726 times)
Habeler876
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August 03, 2014, 06:28:17 AM
 #381

Is this the massacre of the leveraged longs?

We aren't low enough for margin calls yet. They will start around 510 ish. The trend is just forced selling and people slowly catching on that the credit bubble was the reason we went from 450 to 680. The Massacre starts when we hit those margin calls.

We've had plenty of margin calls. That spike down to $520ish was margin calls (also why no one followed). At that time $660 longs had a $510 call. There was talk recently of someone being called on TV chat when we dropped below $590 on the way to $561. The truth is, we don't know how long they have been bleeding swap -- a lot will have been called sooner than you think.

There are new swaps being taken out and we don't know much about them, including whether they are being used to open positions or whether they are being used for full leverage. Gleaning much from these stats -- especially when China decides the market, not Bitfinex -- is a hazard to your trading portfolio. Case in point -- that 1k ask the other night? Check the stats. That was a bleeding long. Market didn't give a shit. My two cents.

That 1k was in the middle of a bulltrap, though. China may decide the market mostly, but Bitfinex will have a large effect once we get lower. As for bleeding longs, I'm pretty sure lots of them are taking the position to the end; they wouldn't have been squeezed yet, but are down significantly due to interest. I feel this way because there are an awful lot of bulltards in bitcoin and many many of them have been screaming bubble! bubble! bubble! for the past month. Well, I think they are right - we are in the credit bubble which will at some point collapse.

I see zero evidence for that. You can say otherwise all you want, but when Bitfinex wicks higher or lower, the market doesn't care, and it returns to the mean.

I'd also say that significantly less people are now saying bubble. Many in June were calling for it in July, and instead we down trended for a month straight. I see a lot of bulls turned bear, to be sure.

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August 04, 2014, 02:15:46 AM
 #382

100-200 BTC on p500? I think I earned too much, because they limited my maximum positions to about 1000 USD (actually 25 BTC) a few monts ago Cry

BTW, in my country, taxes on derivatives (CFDs on bitcoin market) are lower than taxes on gains from bitcoins.

During the last bubble they lowered the available leverage(when they were using Gox) gradually from 1:17 to 1:10 to 1:5 and finally 1:2 . But after i haven´t traded there for a while (last time i used in early februar) it got reset. I just checked it again and it´s now possible for me to open up to 185BTC with a 17:1 leverage
Do you have a link to support this? I cannot speak about the leverage that they offered during the last bubble, but AFAIK they only offer 2.5:1 leverage as of now.

We were talking about Plus500 not Bitfinex, maybe you got that mixed up.

http://www.plus500.com/Instruments/btcusd
Isn't this thread about Bitfinex? I have personally never heard of plus500, but a quick look at their website shows that they offer 1:200 margin for some products, which is huge by any measure but much bigger then the 1:17 for BTC CFDs.
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August 04, 2014, 05:38:21 AM
 #383

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me


     
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gizmoh
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August 04, 2014, 07:23:43 AM
 #384

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me

Now is the riskiest time to offer USD swaps imo.

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August 04, 2014, 07:28:59 AM
 #385

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me

Now is the riskiest time to offer USD swaps imo.

Agree, though I tend to think anything more than a flash crash is unlikely, and that BFX will roll back trades if necessary to save lenders, like they have before. But still, definitely risky, and interest rates are falling, so reward becoming less and less worth it.

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August 04, 2014, 09:25:40 AM
 #386

I really think people should stop talking about trades roll back at Bitfinex as a possibility.
It happened once, it was justified and it is just not going to happen again.  For the absolutely extreme situation there will most likely be trading halt, but no roll backs.

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August 04, 2014, 09:39:19 AM
 #387

I really think people should stop talking about trades roll back at Bitfinex as a possibility.
It happened once, it was justified and it is just not going to happen again.  For the absolutely extreme situation there will most likely be trading halt, but no roll backs.
I hope so.
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August 04, 2014, 10:35:03 AM
 #388

I really think people should stop talking about trades roll back at Bitfinex as a possibility.
It happened once, it was justified and it is just not going to happen again.  For the absolutely extreme situation there will most likely be trading halt, but no roll backs.

It depends where the margin cascade will stop at. If it will go to double or single digits it will impact their future revenues as liquidity providers get scared away. It's in their best interest to calm them, unlike BTC-e where margin liquidity is provided in-house..

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August 04, 2014, 01:20:34 PM
 #389

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me

Now is the riskiest time to offer USD swaps imo.

When is the non risky time?  What should I be looking at?


     
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21pilot
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August 04, 2014, 02:36:15 PM
 #390

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me

Now is the riskiest time to offer USD swaps imo.

When is the non risky time?  What should I be looking at?

the best indicator for an assessment of the risk is probably the Total sum of active swaps.
You can find this information on:
https://www.bitfinex.com/pages/stats

(currently ~29.7 million $)
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August 04, 2014, 03:17:35 PM
 #391

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me

Now is the riskiest time to offer USD swaps imo.

When is the non risky time?  What should I be looking at?

the best indicator for an assessment of the risk is probably the Total sum of active swaps.
You can find this information on:
https://www.bitfinex.com/pages/stats

(currently ~29.7 million $)


So wait for swap sum to go down and interest go up?  Whats the ideal interest?


     
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August 04, 2014, 04:50:59 PM
 #392

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me

Now is the riskiest time to offer USD swaps imo.

When is the non risky time?  What should I be looking at?

the best indicator for an assessment of the risk is probably the Total sum of active swaps.
You can find this information on:
https://www.bitfinex.com/pages/stats

(currently ~29.7 million $)


So wait for swap sum to go down and interest go up?  Whats the ideal interest?

the major problem everyone is discussing in this thread is that the swap volume has spiked up to 31 million $ at peak, but BTC
price has stayed in a sideways market. therefore all the long positions probably aren´t profitable and have to be closed at one
point in the future if BTC price doesn´t rise.

this could lead to a flash crash at bitfinex, because the first margin calls could trigger additional margin calls...

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August 04, 2014, 04:57:08 PM
 #393

Is it possible for a single person, or small concerted group, to control both the shorts and longs, profitably? If so, and assuming this is the case, how should an outsider place his or her bets?
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August 04, 2014, 05:03:33 PM
 #394

Anyone here have experience offering swaps on bitfinex?   I'm thinking about doing this and want to hear some real world experiences

Can PM me

Now is the riskiest time to offer USD swaps imo.

When is the non risky time?  What should I be looking at?

the best indicator for an assessment of the risk is probably the Total sum of active swaps.
You can find this information on:
https://www.bitfinex.com/pages/stats

(currently ~29.7 million $)


So wait for swap sum to go down and interest go up?  Whats the ideal interest?

the major problem everyone is discussing in this thread is that the swap volume has spiked up to 31 million $ at peak, but BTC
price has stayed in a sideways market. therefore all the long positions probably aren´t profitable and have to be closed at one
point in the future if BTC price doesn´t rise.

this could lead to a flash crash at bitfinex, because the first margin calls could trigger additional margin calls...



I get that.  You are saying if these traders get margin called and the price crashes I might not be able to get my money back.

My question was more direct.  Just at what swap sum is acceptable risk?  And whats a good interest rate?  I know its speculation.  Just curious what the people who have experience with this thinks


     
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ensurance982
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August 04, 2014, 05:12:08 PM
 #395

That bubble won't pop anytime soon. We'd need a major crash in order to wipe out those longs. Won't happen, I guess. Unless there are some catastophic news. But I'm really not that convinced that the bubble is harming anyone as of now. Do you?

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August 04, 2014, 05:13:58 PM
 #396

Is it possible for a single person, or small concerted group, to control both the shorts and longs, profitably? If so, and assuming this is the case, how should an outsider place his or her bets?

With Bitfinex, you're playing against the house. Cheesy

Whatever you do, the odds are against you. My advice: Use price alarms, and not stops, because they will hunt your stops there every time. Shady as hell....

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August 04, 2014, 05:50:49 PM
 #397

The bubble sure is big! I'm afraid that it is too big for Finex to handle it if it really should pop or cascade through the longs there!!! This seems dangerous. Maybe they won't be able to roll back the trades then anymore!

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August 04, 2014, 07:20:47 PM
 #398

Is it possible for a single person, or small concerted group, to control both the shorts and longs, profitably? If so, and assuming this is the case, how should an outsider place his or her bets?

With Bitfinex, you're playing against the house. Cheesy

Whatever you do, the odds are against you. My advice: Use price alarms, and not stops, because they will hunt your stops there every time. Shady as hell....

Huh? No, Bitfinex is not on either side of the leverage... people offer liquidity, other people take it for leverage, Bitfinex takes some % of the interest.  But Bitfinex is "insuring" the lenders (whatever that means), so only in the case of a flash-crash you might be "playing against the house"
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August 04, 2014, 07:27:40 PM
 #399

Is it possible for a single person, or small concerted group, to control both the shorts and longs, profitably? If so, and assuming this is the case, how should an outsider place his or her bets?

With Bitfinex, you're playing against the house. Cheesy

Whatever you do, the odds are against you. My advice: Use price alarms, and not stops, because they will hunt your stops there every time. Shady as hell....

Huh? No, Bitfinex is not on either side of the leverage... people offer liquidity, other people take it for leverage, Bitfinex takes some % of the interest.  But Bitfinex is "insuring" the lenders (whatever that means), so only in the case of a flash-crash you might be "playing against the house"

I think he's saying that Bitfinex are stop hunting and/or front running their own customers. That's my reading of it, anyway.

I wouldn't put it past them, either....
manfred
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August 04, 2014, 07:47:23 PM
 #400

Is it possible for a single person, or small concerted group, to control both the shorts and longs, profitably? If so, and assuming this is the case, how should an outsider place his or her bets?

With Bitfinex, you're playing against the house. Cheesy

Whatever you do, the odds are against you. My advice: Use price alarms, and not stops, because they will hunt your stops there every time. Shady as hell....

Huh? No, Bitfinex is not on either side of the leverage... people offer liquidity, other people take it for leverage, Bitfinex takes some % of the interest.  But Bitfinex is "insuring" the lenders (whatever that means), so only in the case of a flash-crash you might be "playing against the house"

I think he's saying that Bitfinex are stop hunting and/or front running their own customers. That's my reading of it, anyway.

I wouldn't put it past them, either....
They are known for it https://bitcointalk.org/index.php?topic=660948.msg7444385#msg7444385
https://bitcointalk.org/index.php?topic=660948.msg7444557#msg7444557
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