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Author Topic: This Bitfinex Credit Bubble cannot end well  (Read 61710 times)
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June 28, 2014, 07:13:17 AM
 #41

They will rollback the trades and everything will be just fine, no need to worry so much about cascade.
This is only true if the price on other markets returns to the point prior to when the cascade went off. If there is a differential, then that portion of liquidated traders will lose.

This has been my worry for a long time. Lenders will be fucked if the price on other exchanges doesn't recover and the book is liquidated. They should have cut back on trader's margin allowed a long time ago. It's out of hand.


Leveraged traders will get wiped out first before lenders. And since bitfinex has insured all swap, they will get sued if they do not keep their promise.


Yes, leveraged traders will get wiped out. First. You assume sufficient liquidity to save lenders. That's a joke. Bitfinex has not insured all swap! They have "effectively" insured it. Do that math -- 15% of swap fees? Versus the reality if they have to liquidate the book? Everyone is just so damn sure that a crash can't keep the price down. But if it does, Bitfinex can't lock traders in their positions, and lenders past their contracts, indefinitely. And that will be the end of this house of cards.

(I'm amazed at how this community learns nothing from the past)

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June 28, 2014, 08:05:04 AM
 #42

They will rollback the trades and everything will be just fine, no need to worry so much about cascade.
This is only true if the price on other markets returns to the point prior to when the cascade went off. If there is a differential, then that portion of liquidated traders will lose.

This has been my worry for a long time. Lenders will be fucked if the price on other exchanges doesn't recover and the book is liquidated. They should have cut back on trader's margin allowed a long time ago. It's out of hand.


Leveraged traders will get wiped out first before lenders. And since bitfinex has insured all swap, they will get sued if they do not keep their promise.


Yes, leveraged traders will get wiped out. First. You assume sufficient liquidity to save lenders. That's a joke. Bitfinex has not insured all swap! They have "effectively" insured it. Do that math -- 15% of swap fees? Versus the reality if they have to liquidate the book? Everyone is just so damn sure that a crash can't keep the price down. But if it does, Bitfinex can't lock traders in their positions, and lenders past their contracts, indefinitely. And that will be the end of this house of cards.

(I'm amazed at how this community learns nothing from the past)

i hear that! and on the matter of sufficient liquidity, +1000. now, i know that bids will come in as price drops, but just take a moment to compare bids to $100 --
Quote
$100.0  6664.47 BTC
with active swaps --
Quote
26,044,613.59 USD

that is some scary, scary stuff. leveraged long? don't look down -- keep thinking happy thoughts. bubble coming, etc. Wink
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June 28, 2014, 09:26:34 AM
 #43

Fist of all, the total borrowed (regardless of what it was in the past) is a reflection of current traded volume on Bitfinex and this number grew simply because more traders joined the platform recently. This is just what it is - Bitfinex recently became the most popular exchange for BTC/USD pair.

Secondly, ALL of the borrowed by traders funds you see are fully backed primarily by THEIR OWN funds. There is simply no other technical way to borrow, but to have sufficient amount in trader's own account and the leverage at Bitfinex is a measly 2.5:1 (this is "nothing" in comparison to a 400:1 or more offered by some Forex brokerages).

What "credit bubble"? What are you talking about? Why do you care and what is your grudge?

Do you have numbers to back up the first bolded? Compare to short swaps over the same period.

Just see any charts site (bitcoinwisdom.com for instance), the bars at the bottom is volume per selected period of time. I know this is stating the obvious, but why asking the question which has the obvious answer? The volume data is right there.
Regarding the volume trends on "short swaps", they HAVE grown as well. I compared as you suggested and I do see a correlation.
Please see the 3rd party's stats site at bfxdata.com. At the top left corner select "swaps stats" for BTC and for USD, open in different browser tabs and toggle between the two. You will see that amounts of borrowed BTC since the beginning of this year peaked from about 3K BTC to about 12K BTC. In fact, the increase in borrowed BTC is bigger than for USD swaps. Usd swaps grew from about 10m to 20m (first peak) and now to 25m. Importantly, when looking at these data and comparing, you have to account for for the sentiment index and the actual BTC price data. For instance, during the last month, traders became increasingly more bullish on average, this is naturally why amount of borrowed USD swaps went up, while BTC swaps went down.

And on the second, take a look at the order book. And consider order book manipulation on top of that. Consider that Stamp liquidity is gone. In a serious decline -- a flash crash that does not recover -- how much of those longs can be sustained by the book?

I'd like to see some numbers since you seem so sure. At a glance, the situation is actually quite bad.

Don't just "glance", try to analyze and see what happens over time. The order book is not carved in stone, it is changing all the time and it is absolutely always a lot "thicker" in bids, which are closer to the current price, on both ends.

Just try to experiment for yourself: Take a "snap shot" of current order book and mark the price. See what is the volume (in order book terms) which it would take for the price to change from the current value to some other value (just mark several scenarios for the price movements in any direction). Wait for the actual price change to any of your marked values and see the real trading volume between the two points. Then, compare the real volume to your original "snap shot". You WILL see that the real volume and the volume you had per order book will be always different AND it could be higher or lower.
 
Another thing is that Bitfinex has "hidden orders" and those are typically quite big (there is probably no point of "hiding" anything under some 5 - 10 BTC). I know there are a lot of hidden orders out there, all the time, this is just personal experience. These make the order book a lot "thicker" than it looks.

Some numbers:
First of all, the current 2.5:1 leverage restriction, plus the 13% of trader's funds reserved in margin requirement, are more than sufficient protection against the worst flash crashes ever known to BTC market. With all of the current expansion of Bitcoin adoption, the growing interest from VCs et.c., I don't think we should expect Bitcoin price to have a complete "free fall", right?. But even then, just like for any publicly traded stock for instance, there is a trading halting, which I believe is also in place at Bitfinex.

I don't have much to say about "order book manipulation", but I've read satisfactory to me comments from Bitfinex team on this elsewhere. I believe there were some recent fixes made in this respect, but generally speaking, this is about finding the optimum between having useful features and their abuse of sorts.

About Bitstamp orders routing, I personally would indeed prefer this feature to be there (at least for bigger orders), but again this is all about big "internal" volume. Trading volume at Bitfinex is sufficiently big for them to become completely independent. After all, to say that Bitfinex is "bad" because it no longer offers Bitstamp routing feature is just wrong. We do not go to BTC-e (or to Bitstamp for that matter) and complain to them that they don't offer any routing, right? BTW, why don't we?

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June 28, 2014, 09:58:50 AM
 #44

Blitz just got totally owned.

"Antagonistic one liner" much? Tongue

Seriously though, Blitz didn't get "owned". His choice of a title was maybe too sensationalist, but read his OP again: Blitz' concern wasn't that the loans somehow aren't backed (which is what urwhatuknow/Giancarlo from finex responded to - pure straw-man rhetorics) and finex would default, his point was (quote):

Quote
here is what happened the last time around on Bitfinex when things went kaboom in a liquidation cascade

[...]

What on earth are these overleveraged maniacs doing? Are they waiting for the bubble messiah and not willing to deleverage, no matter what happens?!


Also, the "Bitfinex market share increased" argument doesn't counter his main point: longs increased by factor 9, shorts increased by factor 2.

tl;dr Blitz didn't call out the exchange finex, so Giancarlo's childish response was completely uncalled for. He called out the "overleveraged maniacs" trading on finex though.

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June 28, 2014, 10:20:07 AM
 #45

Also, the "Bitfinex market share increased" argument doesn't counter his main point: longs increased by factor 9, shorts increased by factor 2.
Where did you get that?
I am looking at USD swaps for the past 6 months, it went from 10m to 25 m, this is point to point a factor of 2.5 (with the 20m peak in between - a factor of 2) . This is close enough to your factor of 2 for shorts, but you are just wrong about this one as well. For fair comparison you have to look at peak values . The fact that there are a lot less shorts than longs today (June 28th) in comparison to a time point about one month ago, is simply a reflection of sentiment (bullish market). We are in the uptrend right now. The stronger the uptrend the higher the ratio of long/short is.

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June 28, 2014, 10:25:18 AM
 #46

Also, the "Bitfinex market share increased" argument doesn't counter his main point: longs increased by factor 9, shorts increased by factor 2.
Where did you get that?
I am looking at USD swaps for the past 6 months, it went from 10m to 25 m, this is point to point a factor of 2.5 (with the 20m peak in between - a factor of 2) . This is close enough to your factor of 2 for shorts, but you are just wrong about this one as well. For fair comparison you have to look at peak values . The fact that there are a lot less shorts than longs today (June 28th) in comparison to a time point about one month ago, is simply a reflection of sentiment (bullish market). We are in the uptrend right now. The stronger the uptrend the higher the ratio of long/short is.

Good point. I didn't really fact check it, but Blitz mentioned 9 vs 2. Should look at it myself to see why he got that number instead of yours.

The menacing part (that he pointed out) is that over the time period in which the long to short ratio rose, price decline. That is, and I agree with him there, one big fat long squeeze waiting to happen.

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June 28, 2014, 10:32:18 AM
 #47

Blitz just got totally owned.

"Antagonistic one liner" much? Tongue

Seriously though, Blitz didn't get "owned". His choice of a title was maybe too sensationalist, but read his OP again: Blitz' concern wasn't that the loans somehow aren't backed (which is what urwhatuknow/Giancarlo from finex responded to - pure straw-man rhetorics) and finex would default, his point was (quote):

Quote
here is what happened the last time around on Bitfinex when things went kaboom in a liquidation cascade

[...]

What on earth are these overleveraged maniacs doing? Are they waiting for the bubble messiah and not willing to deleverage, no matter what happens?!


Also, the "Bitfinex market share increased" argument doesn't counter his main point: longs increased by factor 9, shorts increased by factor 2.

tl;dr Blitz didn't call out the exchange finex, so Giancarlo's childish response was completely uncalled for. He called out the "overleveraged maniacs" trading on finex though.


Odakrell

my point is: to take a single shot (end of november) and to extrapolate a theory is dangerous as it can paint a completely distorted picture.
How about this: on december 20th 2013 (20 days later) the BTC price was 600 and total swaps were 10 millions.
This means that actually total swaps increased 2.5 times ( guess what.... same as shorts!) since that date.

Long story short: Bitfinex isn't more dangerous than what it was back in december 2013, it is actually less dangerous as it decreased maximum leverage from 5 to 2.5 as outlined by Bitbits in his good analysis ( hattip to him).

As previously stated I'm not the best PR guy in town ( probably the worst, I have no problem in admitting it ) but I will always stand against any attack to Bitfinex that seems to be wrongly undermining confidence in our business.
I do accept educated critics and always try to correct things that can be improved, but this was something else.
To be "politically correct" in my answers is not my goal.
I do care a lot about our customers assets and I will always do anything I can in order to defend them.

That's all I have to say about it.

Thanks a lot and have a great day

Giancarlo
Bitfinex Team


edit: Bitbits answer was quicker than mine....
 

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BitBits
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June 28, 2014, 11:00:14 AM
 #48

See bfxdata.com for historical data on all sorts of volumes.

Regarding all these comments on "credit bubble" and "overleveraging", I don't understand what is the issue some of the posters here have.
The lending thing at Bitfinex is just an extra feature. Absolutely all brokers, big or small, stocks trading or Forex trading, who offer leveraged trading, are ALL taking the liabilities entirely upon themselves. They protect themselves by margin requirements, limiting the leverage rate, forced position liquidations and for the extreme situations - trading halting. All of these parameters are being set depending of the particular trading market or the commodity peculiarities. This is exact same thing what Bitfinex does and THAT, is in fact my own opinion about what the "effectively insured" mostly means - technical solution (not financial).

Moreover, the fact that borrowed by traders assets are "visible" to the public, makes this platform a lot more transparent than anybody else.
Just look at BTC-e, for instance. Leverage there is higher, they have flat, one time fee and traders there are borrowing from thin air, God knows how much. I am not saying however that BTC-e is guaranteed to be insolvent due to margin trading, I am sure they are relying on the same technical solutions as all other brokers have, but don't you see the advantages of Bitfinex in terms of transparency in this respect?
Why inventing the negativity?

EDIT: posted at about the same time as Giancarlo above. Didn't mean to "interfere"...

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June 28, 2014, 11:34:44 AM
 #49

@Giancarlo, BitBits

Maybe there is some very basic misunderstanding going on in this discussion... If I understood Blitz' post correctly, the following summary is the essence of the problem:


Bitfinex traders are kinda retarded for not winding down their longs, despite the price going counter to their position.


That claim itself is debatable (and you can very much disagree with Blitz on this), but it is not (mainly) an attack on Bitfinex, so there's no need to argue against his point from the angle of "trying to protect the exchange's reputation".

Can we agree on this part?


P.S. I traded on finex myself, and will probably do so again in the future. I have nothing against the exchange, and don't (for example) buy the front running accusations made in another thread.

Not sure which Bitcoin wallet to use? I suggest to take a look at Electrum.
Electrum is an open-source lightweight client: user friendly, fast, and one of the safest ways to store, send or receive bitcoins.
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June 28, 2014, 12:09:01 PM
 #50

Perhaps you are looking for something more sinister here, but from that graph it seems to me that the likeliest explanation of the ballooning swaps on Finex is simply that they have gained a lot of users since December. I don't know for how long they have existed but I didn't actually try trading there until last winter, as part of me moving away from MtGox, and I suspect that may be true for a lot of other users as well. I think you would find that everything from Kraken to Huobi gained a lot of users during that time period.

I disagree that USD swaps balloons more than BTC swaps in general in your graph. If you cut out June the trend is not nearly as pronounced. In fact, both swap pairs follow an upwards trajectory with two major exceptions: people were in general very bearish in February (omg! look at those slopes!), and people are very bullish in June. You can also see the formation of a bullish trend in January which later falls apart spectacularly, and I think we all know why that was.
The BTC swaps are only one piece of evidence for what I believe to be the fact that Bitfinex hasn't grown by a factor of 9 since December. Here's something much better: http://data.bitcoinity.org/markets/volume/6m/USD?c=e&t=a&volume_unit=btc I would say it grew by a factor of 2-3, a moving average would visualize this better.

Hey,

I didnt want to participate in the discussion as I love reading analysis of economic metrics and don't have necessarily anything useful to add, but maybe want to correct some points.

You are right that the increase in USD swap is not necessarily reflecting an increase our active users. Actually, the distribution of long positions size is VERY variable (ie a lot of small positions, a few big positions, classical 80%-20% something).
However I do not think the trading volume is also a very good indicator, for the same reason, and also the fact that volume also depends on volatility.

As for will it end badly I don't think so. Our users are mostly bitcoiners, they are really long and ready to pay a high rate for this, especially because of some "information" circulating about the bubble spiking again for the 24th of July. But if you note, the spike of margin rates is getting lower over time than what it used to be, to a point where it is imho sustainable (less than 100% a year is not unreasonable for bitcoin)

Finally we have taken some steps in order to prevent flash crashes like february. Of course we cannot make bids appear magically, but the worse that could happen is a price significantly depressed on bitfinex compared to other exchanges, until arbitrage made its magic. I want to believe the orderbooks of exchanges do not reflect all the money there is to make the price, the price itself is a signal upon which actors act to buy and sell, send USD or BTC to exchanges,...

Well, an interesting topic, questions we did certainly discuss internally believe me Smiley

Raphael

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June 28, 2014, 12:25:02 PM
 #51

@Giancarlo, BitBits

Maybe there is some very basic misunderstanding going on in this discussion... If I understood Blitz' post correctly, the following summary is the essence of the problem:


Bitfinex traders are kinda retarded for not winding down their longs, despite the price going counter to their position.


That claim itself is debatable (and you can very much disagree with Blitz on this), but it is not (mainly) an attack on Bitfinex, so there's no need to argue against his point from the angle of "trying to protect the exchange's reputation".

Can we agree on this part?


P.S. I traded on finex myself, and will probably do so again in the future. I have nothing against the exchange, and don't (for example) buy the front running accusations made in another thread.

Traders tend to close winning positions too early and losing position too late.
This is human nature and has been documented to be the case on every market ( stocks, bonds, currencies etc), not only in the bitcoin world.
I read various articles about the fact that most traders trim their winners and let their losers run, which is exactly the opposite of what one should do.
The worst enemy of each trader is his/her instinct.
On top of that I believe we all agree with the fact that we are long overdue another big jump and judging from the type of customers BFX welcomes onboard every day ( all sort of deep pocketed financial institutions) it is going to happen soon.
Last year this time we verified young miners that wanted to sell some bitcoins to go on holidays, this year is the grey haired wall street guy that wants to buy bitcoins for millions of dollars.

Having said that you also probably agree with me that " The Bitfinex Credit Bubble cannot end well" is some kind of a non neutral title.
And you probably also agree with me that wise people should try to behave wisely as they are taken into high consideration by the community.
The bitcoin world, as every other financial world is based on trust and trust must be defended against discriminatory attacks.
We do monitor our traders constantly and constantly come up with more and more sophisticated solutions to avoid crashes.
They are smart people and they do nothing wrong in believing this wonderful thing called bitcoin will change the world and the life of each of us.


That's my opinion.  

Having said that I think I will go for a swim, need to do some sport.

Have a good weekend

Giancarlo
Bitfinex Team

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June 28, 2014, 03:59:48 PM
 #52

Couple clarifications,

1. I never meant to imply that Bitfinex (the platform) is under threat by this (as oda correctly assumed). I don't have any reason for believing that Bitfinex is unsafe nor untrustworthy (in the contrary, I like their way of BTC audits), and I don't want to convey such a thing.

2. My main point is just that IF this continues for much longer (a divergence between price and active USD swaps), sooner or later people will be forced to deleverage, be it more gently or more dramatically. And of course this is just extrapolation that relies on few factors and educated guesswork, same as most all of speculation.

3. True on the title, it is sensationalistic in two ways, but it's just reflecting my opinion and it attracts readers.

Thanks for all the input everyone.
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June 29, 2014, 01:44:36 AM
 #53

I wouldn't worry so much about the number of loans outstanding because as the site grows more people are going to open accounts and utilize leverage. I would say it would be natural for more loans to be outstanding. What this chart does not display is the overall leverage of accounts.

This is important because if overall leverage is too high then in the event of a flash crash or price spike then the exchange may not be able to force close positions quickly enough if liquidity is not there. It could be very possible that some of the accounts have very low leverage (well under 1.2:1). 

This spot for rent.
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June 29, 2014, 01:53:19 AM
 #54

1...
2. My main point is just that IF this continues for much longer (a divergence between price and active USD swaps), sooner or later people will be forced to deleverage, be it more gently or more dramatically. And of course this is just extrapolation that relies on few factors and educated guesswork, same as most all of speculation.

I still don't get your "main point" of concern. What is it?
Where exactly do you see a problem, if "this" will continue? The fact is, if no other exchanger, as good on features (or better) pops up some time soon, "this" absolutely WILL (!!!) continue.
For some reason, you seem to see the growth of borrowed swaps, as if it did not have any backing. But, it does! Once again, at Bitfinex it is technically impossible to borrow more that 2.5 times (maximum !!!) of the funds which people actually deposited into the system. If borrowed by traders USD swaps are currently at 25mln, it does mean that these same traders have a total of at least 20mln on their accounts. If a month from now this number becomes 50mln, it means there is at least 40mln on the accounts of traders. Also, the current 2.5 factor here is the absolute maximum allowed. In reality, not everyone who uses the leverage is always "all in to the max", which means the "backing" is in fact even higher.

RE: "...sooner or later people will be forced to deleverage, be it more gently or more dramatically..."
This same thing applies to trading without leveraging. This market is highly volatile, so whatever happens "sooner or later" will happen on all exchangers and so far, we see nearly perfect reflection of trading patterns between all exchangers, price wise and trading patterns wise. I don't see why would such correlation change because of leveraging. There is active trading going on, for every sell there is a buy and like wise, for every leveraging there is deleveraging. The two processes are highly dynamic and are taking place at the same time.

3. True on the title, it is sensationalistic in two ways, but it's just reflecting my opinion and it attracts readers.
Well, why then stop there with the title? Something is line with a title like "WARNING: Bitfinex is nearing a complete collapse !!!" would for sure do a much better job "attracting" even more readers.
Considering the fact that you generally seem to agree with at least some of the arguments in this thread, how about changing the title to something more neutral, perhaps with the question mark? This would still show your opinion and will be seen as an invitation to discuss.

Respectfully,

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June 29, 2014, 01:54:09 AM
 #55

@Giancarlo, BitBits

Maybe there is some very basic misunderstanding going on in this discussion... If I understood Blitz' post correctly, the following summary is the essence of the problem:


Bitfinex traders are kinda retarded for not winding down their longs, despite the price going counter to their position.


That claim itself is debatable (and you can very much disagree with Blitz on this), but it is not (mainly) an attack on Bitfinex, so there's no need to argue against his point from the angle of "trying to protect the exchange's reputation".

Can we agree on this part?


P.S. I traded on finex myself, and will probably do so again in the future. I have nothing against the exchange, and don't (for example) buy the front running accusations made in another thread.

Traders tend to close winning positions too early and losing position too late.
This is human nature and has been documented to be the case on every market ( stocks, bonds, currencies etc), not only in the bitcoin world.
I read various articles about the fact that most traders trim their winners and let their losers run, which is exactly the opposite of what one should do.
The worst enemy of each trader is his/her instinct.
On top of that I believe we all agree with the fact that we are long overdue another big jump and judging from the type of customers BFX welcomes onboard every day ( all sort of deep pocketed financial institutions) it is going to happen soon.
Last year this time we verified young miners that wanted to sell some bitcoins to go on holidays, this year is the grey haired wall street guy that wants to buy bitcoins for millions of dollars.

Having said that you also probably agree with me that " The Bitfinex Credit Bubble cannot end well" is some kind of a non neutral title.
And you probably also agree with me that wise people should try to behave wisely as they are taken into high consideration by the community.
The bitcoin world, as every other financial world is based on trust and trust must be defended against discriminatory attacks.
We do monitor our traders constantly and constantly come up with more and more sophisticated solutions to avoid crashes.
They are smart people and they do nothing wrong in believing this wonderful thing called bitcoin will change the world and the life of each of us.


That's my opinion.  

Having said that I think I will go for a swim, need to do some sport.

Have a good weekend

Giancarlo
Bitfinex Team

This is one of my favorite things about Rafael. During the bubble last year, I emailed and asked how much new fiat was entering the exchanges. He actually gave me an honest answer. I knew right away the bubble wasn't even close to stopping.

This is the kind of information that is priceless.  And its nice that Bitfinex provides this type of personalized and honest (even if not politically correct) feedback and customer service.

Thats why they have been my exchange of choice and will continue to be.

If you haven't heard about what is happening with GAME, check it out.  It's revolutionizing gaming. https://bitcointalk.org/index.php?topic=1266597.0
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June 29, 2014, 03:32:55 AM
 #56

@Giancarlo, BitBits

Maybe there is some very basic misunderstanding going on in this discussion... If I understood Blitz' post correctly, the following summary is the essence of the problem:


Bitfinex traders are kinda retarded for not winding down their longs, despite the price going counter to their position.


That claim itself is debatable (and you can very much disagree with Blitz on this), but it is not (mainly) an attack on Bitfinex, so there's no need to argue against his point from the angle of "trying to protect the exchange's reputation".

Can we agree on this part?


P.S. I traded on finex myself, and will probably do so again in the future. I have nothing against the exchange, and don't (for example) buy the front running accusations made in another thread.

Traders tend to close winning positions too early and losing position too late.
This is human nature and has been documented to be the case on every market ( stocks, bonds, currencies etc), not only in the bitcoin world.
I read various articles about the fact that most traders trim their winners and let their losers run, which is exactly the opposite of what one should do.
The worst enemy of each trader is his/her instinct.
On top of that I believe we all agree with the fact that we are long overdue another big jump and judging from the type of customers BFX welcomes onboard every day ( all sort of deep pocketed financial institutions) it is going to happen soon.
Last year this time we verified young miners that wanted to sell some bitcoins to go on holidays, this year is the grey haired wall street guy that wants to buy bitcoins for millions of dollars.

Having said that you also probably agree with me that " The Bitfinex Credit Bubble cannot end well" is some kind of a non neutral title.
And you probably also agree with me that wise people should try to behave wisely as they are taken into high consideration by the community.
The bitcoin world, as every other financial world is based on trust and trust must be defended against discriminatory attacks.
We do monitor our traders constantly and constantly come up with more and more sophisticated solutions to avoid crashes.
They are smart people and they do nothing wrong in believing this wonderful thing called bitcoin will change the world and the life of each of us.


That's my opinion.  

Having said that I think I will go for a swim, need to do some sport.

Have a good weekend

Giancarlo
Bitfinex Team

This is one of my favorite things about Rafael. During the bubble last year, I emailed and asked how much new fiat was entering the exchanges. He actually gave me an honest answer. I knew right away the bubble wasn't even close to stopping.

This is the kind of information that is priceless.  And its nice that Bitfinex provides this type of personalized and honest (even if not politically correct) feedback and customer service.

Thats why they have been my exchange of choice and will continue to be.

An exchange giving out insider info and pumping?   Gotta make you wonder


     
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June 29, 2014, 04:48:06 AM
 #57


This is one of my favorite things about Rafael. During the bubble last year, I emailed and asked how much new fiat was entering the exchanges. He actually gave me an honest answer. I knew right away the bubble wasn't even close to stopping.

This is the kind of information that is priceless.  And its nice that Bitfinex provides this type of personalized and honest (even if not politically correct) feedback and customer service.

Thats why they have been my exchange of choice and will continue to be.

How would you know if the answer was honest? Frankly, I think this sort of "customer service" is very odd and off-putting in the realm of commodity exchange.

Since Bitstamp routing is gone, definitely not my exchange of choice. Maybe if they recover some liquidity.
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June 29, 2014, 11:36:04 AM
 #58

[kinda angry sounding rant]

Respectfully,

His "main point" is that finex traders are overleveraged to the long side. Since this is the speculation subforum, if one group of market participants does something that another group of market participants thinks is dumb, we will discuss it. That is all.

Title is a bit sensationalist, but not claiming anything per se wrong. He could change it, I guess, but doesn't have to.

Not sure which Bitcoin wallet to use? I suggest to take a look at Electrum.
Electrum is an open-source lightweight client: user friendly, fast, and one of the safest ways to store, send or receive bitcoins.
For executables (Windows, OSX, Linux, Android), source code and documentation, see the Electrum homepage.
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June 29, 2014, 01:56:39 PM
 #59

An exchange giving out insider info and pumping?   Gotta make you wonder

Precisely.

Exchange operators and conflict of interest n all that.

Seems to me that if Bitfinex were to have it's way, that Bitcoin would be getting pumped to the stratosphere, Huobi and OKCoin also. It seems that it is mainly selling pressure on Bitstamp and/or Bitstamp's reluctance to embrace China and Bitfinex pumps that is holding market in place. So we have Bitstamp, the one solid trustworthy exchange where there is no leveraged trading and who have the highest likelihood of having all the USD and BTC that they say they do who are 'weighing down' the market, and then we have the ramping 0% trading fee fake volume Chinese markets (are we supposed to believe that they really make their money just on deposit fees and VIP memberships?) and Bitfinex, where fake volume and liar walls are part of the fixtures and fittings and where their is leveraged trading with USD swaps hitting all time highs despite usurious compound interest rates and the fact that the market remains stagnant.  

Makes you wonder on what grounds or rather, what is driving the pump on Bitfinex. Could it be over-extended leverage held by a whole bunch of 'all or nothing' Kamikaze traders, perhaps with a spot of fractional reserve lending going on? Have the exchange operators a special interest in pulling this off? Are the exchange operators themselves engaging in this ramp attempt in huge leveraged long positions with some set price objective at which they plan to quietly cash in their own positions at? If any of the above were to ring true, would it be beyond the exchange operators to attempt to use artificial numbers to influence the market direction and supports?

People can cry conspiracy theorist all they like. If this ramp were to be based largely on hot air and illusion, and a lot of people were to end up getting burned, it wouldn't exactly be a novel event in Bitcoinland. To completely discount anything like what I have typed above ringing true, one would have to have faith and integrity of those operating these exchanges. So do you all trust Bitfinex? I know I don't!

Kraken Account, Robbed/Emptied. Kraken say "Fuck you, its your loss": https://bitcointalk.org/index.php?topic=1559553.msg15656643#msg15656643

Bitfinex victims. DO NOT TOUCH THE BFX TOKEN! Start moving it around, or trading it, and you will be construed as having accepted it as an alternative means of payment to your USD, BTC, etc.
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June 29, 2014, 05:15:53 PM
 #60

more and more people are realizing 10% interest a month on bitfinex will almost certainly make more than long term btc holding.

At 10%/month (what I've been making at finex), btc would have to be 6000 in 2 years.

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