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botany
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December 27, 2014, 09:24:08 AM
 #21

But once the volatility is gone BTC will not be so interesting anymore to play with.
If someone owns 5% of something he can make it volatile by himself.

If someone owns 5% of total bitcoin wouldn't it easier to just sell slowly and not crash the market? Volatile only scare away investor.

If they want it yes the can, but as i stated they can make it volatile by himself.

Essentially he can make it volatile, but he won't.
This is because it is not in his best interest to cause a flash crash.
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December 27, 2014, 04:29:01 PM
 #22

But once the volatility is gone BTC will not be so interesting anymore to play with.
If someone owns 5% of something he can make it volatile by himself.

If someone owns 5% of total bitcoin wouldn't it easier to just sell slowly and not crash the market? Volatile only scare away investor.

If they want it yes the can, but as i stated they can make it volatile by himself.

Essentially he can make it volatile, but he won't.
This is because it is not in his best interest to cause a flash crash.

But he can make it volatile in both directions so that might be in his best interest.

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Barabbas0
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December 27, 2014, 08:30:01 PM
 #23

Honestly, a decent derivatives exchange would really help. Whales could have sold covered calls to provide liquidity without outright selling.
Muuurrrrica!
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December 28, 2014, 12:45:21 AM
 #24

OP is valid. This is in fact the case. The bubble could have and should have been prevented by the big bagholders.
botany
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December 28, 2014, 02:26:23 PM
 #25

Honestly, a decent derivatives exchange would really help. Whales could have sold covered calls to provide liquidity without outright selling.

With Bitcoin's volatility, leveraged derivatives would really not be necessary to make money.
Barabbas0
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December 29, 2014, 09:59:42 AM
 #26

Honestly, a decent derivatives exchange would really help. Whales could have sold covered calls to provide liquidity without outright selling.

With Bitcoin's volatility, leveraged derivatives would really not be necessary to make money.

That's if you're using derivatives for leverage. You could just as easily use them to hedge your position without selling. I'm talking about using BTC as a financial tool, which requires stability, not as a trading instrument.
Window2Wall
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December 31, 2014, 01:09:08 AM
 #27

Honestly, a decent derivatives exchange would really help. Whales could have sold covered calls to provide liquidity without outright selling.

With Bitcoin's volatility, leveraged derivatives would really not be necessary to make money.

That's if you're using derivatives for leverage. You could just as easily use them to hedge your position without selling. I'm talking about using BTC as a financial tool, which requires stability, not as a trading instrument.
If there is any kind of exchange for derivatives people are gong to speculate, that is simply how the markets naturally work.  If you attempt to prevent speculation then the market will not be efficient.
botany
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January 01, 2015, 06:39:01 AM
 #28

Honestly, a decent derivatives exchange would really help. Whales could have sold covered calls to provide liquidity without outright selling.

With Bitcoin's volatility, leveraged derivatives would really not be necessary to make money.

That's if you're using derivatives for leverage. You could just as easily use them to hedge your position without selling. I'm talking about using BTC as a financial tool, which requires stability, not as a trading instrument.

A derivative needs two people to take opposite positions. Usually, you have a speculator on one end. Speculators provide liquidity to derivative markets and play an important role.
Barabbas0
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January 01, 2015, 03:30:38 PM
 #29

Honestly, a decent derivatives exchange would really help. Whales could have sold covered calls to provide liquidity without outright selling.

With Bitcoin's volatility, leveraged derivatives would really not be necessary to make money.

That's if you're using derivatives for leverage. You could just as easily use them to hedge your position without selling. I'm talking about using BTC as a financial tool, which requires stability, not as a trading instrument.

A derivative needs two people to take opposite positions. Usually, you have a speculator on one end. Speculators provide liquidity to derivative markets and play an important role.

Absolutely. Basically what happens is risk gets traded. The speculator offloads risk from the hedger. It's a change in risk:reward balance.
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