Quote from: DATA COMMANDER on July 11, 2012, 02:59:10 PM

Am I imagining things, or did you guys just slightly increase the % difference between your ask price and the Mt. Gox ask?

Our margin is dynamic. We built a pricing model which calculates a discount from the MtGox last price based on a variety of factors. The most important factor being that you can't get funds out of MtGox, at least not in a timely manner. If we were to sell on MtGox we could get a slightly better price and thus offer a better price but then we would exhaust our funds, and need to stop buying. It would be a roughly 14 to 21 days for a "bank wire" to crawl its way to our account before starting the process all over again. We have tried using MtGox in the past but they are simply too unreliable are not concerned about the almost month long delays they cause in cashflow.

So the pricing model looks at the spread between MtGox and other exchanges. As that spread widens so does our margin. It also looks at volatility and the change in volatility. Lastly it considers our available cash relative to unsold bitcoins. All of that is abstracted into a single price that we are willing to buy at. If we are buying at $7.00 and that is 3.5% less than MtGox it simply means right now this second, this trade we are buying at $7.00. We may be trading at more less than a 3.5% discount to MtGox in the future.

The good news is that we are selling more of our coins directly to large buyers and over time that should translate into lower average margin and better cashflow.