Re: How much money and bitcoins do you need to influence the price?
So, the latest buzzword in Bitcoin is manipulation. Has anyone worked out how much money and bitcoins is needed to trigger
a change in the buy and sell behaviour of traders on exchanges? I know the Silkroad Auction did not make a significant impact
on the price and the same goes for the odd coins that were sold from the MtGox hoard. How many coins can individuals dump
on exchanges to push the price down like this? How long can they sustain such an action to sabotage the price? These are
questions that are very relative at the moment.
If the SEC says that the high price increase of last year was manipulation, then they must bring the proof. Let's do our own
informal assessment of the situation and determine what would be needed to cause that kind of a spike in the price.
a change in the buy and sell behaviour of traders on exchanges? I know the Silkroad Auction did not make a significant impact
on the price and the same goes for the odd coins that were sold from the MtGox hoard. How many coins can individuals dump
on exchanges to push the price down like this? How long can they sustain such an action to sabotage the price? These are
questions that are very relative at the moment.
If the SEC says that the high price increase of last year was manipulation, then they must bring the proof. Let's do our own
informal assessment of the situation and determine what would be needed to cause that kind of a spike in the price.
easily couple millions to billions and many strings to pull.
In reality you don't need much to move the market. Bitcoin just isn't that big.
It's not massive whales doing the heavy lifting, it's rogue players with no scruples.
The reality is that the exchanges are not regulated and the rogue players are having the time of their lives.
Not being regulated means that things like Wash Trading (banned in the 1930s!) are not illegal. There are exchanges that don't even know what Wash Trading is, let alone monitor or prohibit it. Wash Trading is when you buy and sell your own orders. Doing so manipulates volume, which in turn impacts and manipulates price.
If one can shift the price of Bitcoin with a 1000 coins in a legit buy or sell (just ask any serious trader), then know that you can heavily manipulate the market with a few hundred coins, leveraged and wash traded.