How will the price move away from exchange price?

[cafucafucafu]

As adoption grows the fiat to BTC volume rate will still be relatively small. Thus the price will be open to manipulation. It seems like the exchanges are a liability to BTC price. How will we solve this?

Unless we get to a stage where BTC become the standard currency, we will always have price manipulation because of low volumes on exchanges.

[1714042977]

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[1714042977]

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[1714042977]

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[jonald_fyookball]

As adoption grows the fiat to BTC volume rate will still be relatively small. Thus the price will be open to manipulation. It seems like the exchanges are a liability to BTC price. How will we solve this?

Unless we get to a stage where BTC become the standard currency, we will always have price manipulation because of low volumes on exchanges.

Arbitrage prevents price manipulation.

If one exchange tries to raise prices, traders will dump on that exchange and profit from the manipulation.
If they try to lower prices, traders will buy cheap from that exchange, dump elsewhere, and profit again.

Attempts to manipulate prices outside of normal order flow will just hurt the exchanges.

[cafucafucafu]

As adoption grows the fiat to BTC volume rate will still be relatively small. Thus the price will be open to manipulation. It seems like the exchanges are a liability to BTC price. How will we solve this?

Unless we get to a stage where BTC become the standard currency, we will always have price manipulation because of low volumes on exchanges.

Arbitrage prevents price manipulation.

If one exchange tries to raise prices, traders will dump on that exchange and profit from the manipulation.
If they try to lower prices, traders will buy cheap from that exchange, dump elsewhere, and profit again.

Attempts to manipulate prices outside of normal order flow will just hurt the exchanges.

This is not the manipulation that I have in mind. I am thinking whales. Pumping and dumping will always be a problem even with greater adoption because exchange volume is low. With BTC being more like gold than fiat with more holding.

[jonald_fyookball]

As adoption grows the fiat to BTC volume rate will still be relatively small. Thus the price will be open to manipulation. It seems like the exchanges are a liability to BTC price. How will we solve this?

Unless we get to a stage where BTC become the standard currency, we will always have price manipulation because of low volumes on exchanges.

Arbitrage prevents price manipulation.

If one exchange tries to raise prices, traders will dump on that exchange and profit from the manipulation.
If they try to lower prices, traders will buy cheap from that exchange, dump elsewhere, and profit again.

Attempts to manipulate prices outside of normal order flow will just hurt the exchanges.

This is not the manipulation that I have in mind. I am thinking whales. Pumping and dumping will always be a problem even with greater adoption because exchange volume is low. With BTC being more like gold than fiat with more holding.

Yes I suppose it could be viewed as a "problem",
but high volatility is par for the course with a thin market.
Not sure anything can (or should) be done about it.
It's the free market.  It provides trading opportunities...
And the volatility should decrease over time as the volume increases.

[cafucafucafu]

I guess there will come a time when retailers will set the value of BTC?

[franky1]

As adoption grows the fiat to BTC volume rate will still be relatively small. Thus the price will be open to manipulation. It seems like the exchanges are a liability to BTC price. How will we solve this?

Unless we get to a stage where BTC become the standard currency, we will always have price manipulation because of low volumes on exchanges.

Arbitrage prevents price manipulation.

If one exchange tries to raise prices, traders will dump on that exchange and profit from the manipulation.
If they try to lower prices, traders will buy cheap from that exchange, dump elsewhere, and profit again.

Attempts to manipulate prices outside of normal order flow will just hurt the exchanges.

arbitrage does not occur in reality. this has been pointed out to you before that bank wire transfers are not instant so if a price falls, no one can instantly deposit funds to then eat up a cheap deal to raise the price to normal.

what does occur is when one price gets manipulated, people on other exchanges panic sell. and that is the point the OP is making about exchanges being a liability.

the last time that arbitration was truly successful was where bitinstant took a risk on being a medium of dollar swaps between exchanges. i would say that in some small way ripple can fill that void, but not all exchanges are connected to ripple to allow successful and instant arbitrage to the same extent that bitinstant did between the exchanges of 2012.

now moving to the OP's question.
right now the best thing people can do is use localbitcoins and OTC style systems where actual bank account movements are instantly recognisable against bitcoin movements. and for people to base the value of their buys and sales based on their local and personal supply and demand. ignoring the movements of the crappy PHP exchanges (as we know they are speculative/manipulated). then when circle fully opens up its rates and when things like the winklevoss trust is running which is when true transparent value can also be seen alongside localbitcoins/otc. then we can have a better guage of true value.

until then i feel that the crappy exchanges are undervaluing on purpose, in an attempt to buy up cheap hoards ready for when the proper, scurely and transparent market exchanges are fully operational.

i do feel sorry for anyone selling at losses, and selling at undermarked prices. but that is your own choices and no one else can be blamed for you pressing the sell button

[jonald_fyookball]

Just because delays occur doesnt mean arbitrage isnt happening.  Obviously it is, and exchange prices are based on supply and demand.  Suggesting that the exchanges are setting the prices themselves is pure nonsense.

[caga]

I guess there will come a time when retailers will set the value of BTC?

I think this is true. Once bitcoin becomes more widely accepted, and retailers start accepting it, bitcoin trading volume will increase. This is will hopefully also cause the price to be more stable in the future.

[El Emperador]

I think Bitcoin is still in a phase of mere speculation, so exchanges and more powerful traders simply "play" with the price, at their convenience.

I guess when Bitcoin will be accepted by more and more shops and will be used with everyday payments, the "trading side" will lose its actual power.

[BitMos]

The BTC can only be priced by traders. I think that the "trading side" will never lose it's immutable power: leverage. And from there all wrong sided opposition will perish, as it was, as it is and will be. The trading floors, an undomesticatable forces across the universe, the price isn't based on politics but realities and whom has the mean of it's will. There is a lot of anti market forces in this forum. I don't see what's bad of having a market price true discovery rather than what ever other mean of valuating. So what's wrong with the "trading side", no one is stopping you from hedging against volatility if it's a problem to you. And remember it's easier to say that a whale manipulated the price rather than do it yourself, and like said there is always a bigger fish. Whale death are true blood bath. BTC splashing all around.  .

there is only a price if there is an exchange .

[Kprawn]

Why do you think, the big players are not using the exchanges? It's not just the regulations, is the manipulation too.

It sux but we all know, why and how they doing it, and it cannot be stopped. Let them play monopoly and buy and sell your coins on the open market.

[BitCoinNutJob]

Why do you think, the big players are not using the exchanges? It's not just the regulations, is the manipulation too.

 

I think OKcoin just bragged about a huge billionaire player on their books just signed up.

[Soros Shorts]

I guess there will come a time when retailers will set the value of BTC?

This will happen once vendors start pricing items in BTC and absorbing the exchange rate risk. They only will do that if they perceive that doing so would increase the volume of sales.

[BitCoinNutJob]

I guess there will come a time when retailers will set the value of BTC?

This will happen once vendors start pricing items in BTC and absorbing the exchange rate risk. They only will do that if they perceive that doing so would increase the volume of sales.

Well on openbazaar people will be pricing in BTC right off, lets hope it out grows ebay, i will need to sell my BTC to restock goods atm as suppliers dont accept BTC yet

[Bitcoinbikers]

We need to sell it more in person with localbitcoins if necessary, at our own price to increase the market value..

[BitMos]

if you increase BTCvelocity it results in increased BTCdispersion... the wider, the wilder the BTCdream . BTC liberating People and the Planet of more than 5 thousand years of oppression. One great feature is the ease of equalization if some one sold you something nothing is stopping you from selling him something back and thus far increase real velocity. wooohooo. And if you do it in industries or market segment you feel comfortable to operate (and die) can you create a world (or at least a market segment) that is livable to you and your children. Buy and sell what makes the world goes round... (not even the Sun!).

[bornil267645]

We need to bring more bitcoin in the mainstream then it cal call the shots in the prize.

[Stedsm]

We need mainstreamers then the market cap will rise probably.