Quote from: JayBee66 on January 08, 2014, 11:37:35 AM

Quote from: Dende on January 07, 2014, 02:32:43 PM

I am also questioning what cex.io does but many people are just going to learn it the hard way.
I see referral links everywhere, youtube, forums etc and I feel sorry for those who fall into this.
Many people think they can get rich quick and they have only themselves to blame for not doing research.

I visited cex.io from time to time to see how it does and I saw the drop from I believe 0.08btc/ghash to 0.03btc/ghash. It did not fall slowly, it dropped like a rock which could be a manipulation.
There are a lot of bagholders or should I say hashholders in cex.io which will not get their initial investment and I hope they learn from this. We are in very early stage of bitcoin, things are unregulated, and people are being scammed everyday. Nobody is going to save your assess if you lost your bitcoin to scammers. I am not saving cex.io is a scam but that place sure is fishy.

If you want to trade to increase your btc holdings, it does not make sense trading at cex.io. btc/ghash will only devalue over time, you might get lucky from time to time but once the next dump comes ready to say goodbye to your investment if you are not prepared.

Agreed.

I believe that GHASH.IO is as legitimate as any hashing site but that CEX.IO is an ingenious way of getting people to keep their hard-earned Bitcoin on the site with the chance of them gambling it away to CEX.IO

CEX.IO also lures in those without hashing hardware to gamble their Bitcoins too.

At least with Satoshi Dice the game is zero sum. It is not a zero sum game on CEX.IO when CEX.IO is self-regulating its own exchange for its own commodity. A commodity which is constantly trending downwards in price and CEX.IO is the only agent able to short sell that commodity. That is insider trading and in any other field would be ILLEGAL. For a company purports to be based in the UK, I wonder why the Met has not raided it yet.

Wow you guys are really off the deep end!

The CEX.IO is unfortunately also a zero sum game as bitcoins can't be magically produced. We do know that from time to time CEX.IO adds new hardware and they sell the ownership of that hardware on their exchange. Since they do it this way instead of adding the hardware to the current owners CEX.IO is also in the market and taking market risk. It is true that as long as the network hash rate is growing they are normally on the wining side of these trades. However, if the GHS/BTC market soars as it does at times and someone cashes out and withdraws their bitcoin, who pays for that? It would be CEX.IO, the other miners that still invested in GHS have only gained on paper, their investments are still available to them at least in theory.

Internally in CEX.IO there must be many hundreds to thousands of transactions a minute. These are being handled internally and are not apart of the normal bitcoin transactions. There isn't anything wrong with that, it is a typical approach to handling bitcoin. This also means that there is basically a pool of bitcoin that people are adding and removing from. I expect that CEX.IO also has additional mining going on that hasn't been "sold" at any given time and that might also be added to the pool. I also expect that the maintenance fees cover the expenses of running the business and I think that could include paying the employees but I may be incorrect there. So the main business of CEX.IO is selling ownership of hosted hardware. They are doing this in a way that is risky for them but also allows them the chance at great profits. I don't have insight to how they can withdraw from the pool, but that could be the a point of real danger. The other point if of danger is that if everyone cashed out at once it might bankrupt CEX.IO. (A so called run on the bank.)

Over the last six months the huge growth of the network hash rate has likely benefited CEX.IO. The real test will be when the network hash rate growth slows down. At some point mining will probably be profitable but it may not be profitable to sell new GHS into the market. It is hard to be sure what will happen at that point and it is a real risk.

So while one it using CEX.IO, they also need to carefully manage their assets. That is because of the many risks and I suppose there is a risk is that CEX.IO could be criminal, but I believe it is far more likely they just implemented a great idea that many people love.

If you don't like CEX.IO, you should create an alterative instead of just bitching about them. The naysayers are really the lame ones here.