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Re: Maximizing Bitcoin Liquidity Through the Make-or-Take Model
No, he agrees that the make-or-take model provides a tight spread. deego's issue was whether the spread was the "true" spread, but I changed that to "right" spread. Sorry if that was confusing.
Whether the spread is the "right" spread as you call it doesn't have anything to do with what is the "fair" or "right" spread.
deego talked about a tight spread.Re: Maximizing Bitcoin Liquidity Through the Make-or-Take Model
Whether the spread is the "right" spread as you call it doesn't have anything to do with what is the "fair" or "right" spread. The "right" spread has to do with the efficient market hypothesis. If you believe that markets are efficient then you believe that the right price is the last current market price. If you do not believe markets are perfectly efficient (which most people do not) then prices will not be the "right" prices, but will correct eventually as people take advantage of the arbitrage opportunity.
Intersango only offers a discount on commission to to market markers but that is still a penalty, market makers should be rewarded, and make money for each trade.
hellobitcoin says they employ the make-or-take model, but in red words below their claim to use the make-or-take model, they state that they actually charge market makers 0.15% which is not the make-or-take model.
bitfloor and hellobitcoin come to mind.
I feel that the differential they choose is somewhat
arbitrary.
I have always felt that the make-take commission differential should
be no greater than the exchange's least count divided by the price of
btcusd. And, all exchanges violate this condition.
Why do I belive in this condition? For if this condition is not
met, then as a trader, it sometimes is cheaper for you to bid at
6.51 than it is to bid at 6.50.
Equivalently, here's, I believe, the problem from the exchange's
perspective if you violate this condition. The make-take difference may help you achieve a tight
spread and thus, a good price-discovery, but both are illusory. For,
imagine that the true bid-ask frontiers should lie at
6.51-6.52. Imagine that your exchange is currently locked in at
6.50-6.51. Your exchange has seemingly discovered a price with a tight
spread. Is this the correct price? Even if traders are convinced that
the correct frontier should be 6.51-6.52, there is a *negative*
incentive for a trader to try to correct that imbalance.
Intersango only offers a discount on commission to to market markers but that is still a penalty, market makers should be rewarded, and make money for each trade.
hellobitcoin says they employ the make-or-take model, but in red words below their claim to use the make-or-take model, they state that they actually charge market makers 0.15% which is not the make-or-take model.
Hi, below is a link to a blog post on maximizing bitcoin liquidity on bitcoin exchanges through the make-or-take model.
http://blog.bitcointitan.com/post/25759461251/maximizing-liquidity-through-the-make-or-take-model
Several exchanges offer a make-take price differential. Intersango,http://blog.bitcointitan.com/post/25759461251/maximizing-liquidity-through-the-make-or-take-model
bitfloor and hellobitcoin come to mind.
I feel that the differential they choose is somewhat
arbitrary.
I have always felt that the make-take commission differential should
be no greater than the exchange's least count divided by the price of
btcusd. And, all exchanges violate this condition.
Why do I belive in this condition? For if this condition is not
met, then as a trader, it sometimes is cheaper for you to bid at
6.51 than it is to bid at 6.50.
Equivalently, here's, I believe, the problem from the exchange's
perspective if you violate this condition. The make-take difference may help you achieve a tight
spread and thus, a good price-discovery, but both are illusory. For,
imagine that the true bid-ask frontiers should lie at
6.51-6.52. Imagine that your exchange is currently locked in at
6.50-6.51. Your exchange has seemingly discovered a price with a tight
spread. Is this the correct price? Even if traders are convinced that
the correct frontier should be 6.51-6.52, there is a *negative*
incentive for a trader to try to correct that imbalance.
Hi, below is a link to a blog post on maximizing bitcoin liquidity on bitcoin exchanges through the make-or-take model.
http://blog.bitcointitan.com/post/25759461251/maximizing-liquidity-through-the-make-or-take-model
http://blog.bitcointitan.com/post/25759461251/maximizing-liquidity-through-the-make-or-take-model
I have been trying to get the mtgox gem authentication to work, using ruby 1.9.2. I attempted the examples in the Readme. Specifically,
After calling MtGox.cancel(...) Mt. Gox returns:
Did the API change such that the MtGox gem is no longer functional for authenticated functions?
Code:
MtGox.configure do |config|
config.key = [my key]
config.secret = [my secret]
end
# Cancel order #1234567890
MtGox.cancel 1234567890
config.key = [my key]
config.secret = [my secret]
end
# Cancel order #1234567890
MtGox.cancel 1234567890
After calling MtGox.cancel(...) Mt. Gox returns:
Code:
{"error":"Must be logged in"}
Did the API change such that the MtGox gem is no longer functional for authenticated functions?
...to bitcoins as commodities.
Quote
Bitcoins are commodities. ...A thing is tangible if it is [c]apable of being possessed or realized; readily apprehensible by the mind; real; substantial; evident. Ballentines Law Dictionary; See Williams v Board of Comrs. 84 Kan 508, 114 P 858. Bitcoins are clearly useful articles of commerce capable of being possessed.
This is pure conjecture. While some amount of speculation on potential juridical outcomes can be constructive, making such statements in conclusory terms like you have can only lead to confusion on this issue. As I am sure you are aware, there is no case, nor any pending litigation which purports to give an opinion on the issues you raise here. I suggest you rework some of your phrasing to reflect this reality.
Thank you for your comment and concern.
Conclusions are a part of legal writing. Conclusory means offering a conclusion without supporting evidence. As you will see, even from just from the paragraph you quoted, my conclusions are supported by legal arguments, and properly cite legally authoritative sources.
I think people are comfortable with the idea that bitcoins are used in commerce, however, I am surprised that people do not inherently realize that bitcoins are capable of being possessed. I will supplement that paragraph shortly with further citation to U.S. code and cases where digital articles, e.g., electronic chattel paper, U.S. dollars distributed electronically, contracts, illicit pictures on a hard drive.
To me it seems like if bitcoin is not a currency, and if it's not security (investment contract), then is bitcoin then a commodity? Seems like you didn't mention anything about commodities, probably for some unmentioned reason. In The Good Wife the lawyers also argued that bitcoin was a commodity.
Bitcoin is a commodity under U.S. law. I have posted the legal analysis and included a discussion on U.S. regulations of commodities on my blog.
http://blog.bitcointitan.com/post/17789738826/what-u-s-regulations-apply-to-bitcoins-as-commodities
Please cite an opinion which states this holding.
I am not sure what you are looking for. I cited to U.S. codes and cases throughout the entire article.
Right, no cases or statutory material conclude that Bitcoin is a commodity. If I am incorrect on this point please direct me to your source.
You are correct, that is why I wrote about it. Otherwise, I would have made a single paragraph post. The purpose of citing sources is to form an argument. You will find that very few cases exactly match the facts of any other case or situation that you are asked to argue. U.S. courts recognize that as technology and society progress and evolve the law adapts by making analogies to current statues and prior cases.
To me it seems like if bitcoin is not a currency, and if it's not security (investment contract), then is bitcoin then a commodity? Seems like you didn't mention anything about commodities, probably for some unmentioned reason. In The Good Wife the lawyers also argued that bitcoin was a commodity.
Bitcoin is a commodity under U.S. law. I have posted the legal analysis and included a discussion on U.S. regulations of commodities on my blog.
http://blog.bitcointitan.com/post/17789738826/what-u-s-regulations-apply-to-bitcoins-as-commodities
Please cite an opinion which states this holding.
I am not sure what you are looking for. I cited to U.S. codes and cases throughout the entire article.
Hi, below is a link to a blog post on what U.S. regulations apply to bitcoins as commodities.
http://blog.bitcointitan.com/post/17789738826/what-u-s-regulations-apply-to-bitcoins-as-commodities
http://blog.bitcointitan.com/post/17789738826/what-u-s-regulations-apply-to-bitcoins-as-commodities
To me it seems like if bitcoin is not a currency, and if it's not security (investment contract), then is bitcoin then a commodity? Seems like you didn't mention anything about commodities, probably for some unmentioned reason. In The Good Wife the lawyers also argued that bitcoin was a commodity.
Bitcoin is a commodity under U.S. law. I have posted the legal analysis and included a discussion on U.S. regulations of commodities on my blog.
http://blog.bitcointitan.com/post/17789738826/what-u-s-regulations-apply-to-bitcoins-as-commodities
What do you mean by:
You think Trade Hill is just out to scam people?
as for tradehill
tradehill == "long con"
tradehill == "long con"
You think Trade Hill is just out to scam people?
I don't believe Tradehill is exchanging BTC for USD for any customers. The link above is likely someone speaking imprecisely.
Tradehill after consulting with lawyers made the determination that they were not compliant with CA regulations and that further trading could open them to criminal and civil prosecution.
Exchanging BTC for USD would be further violation of the regulations they have now openly admitted they aren't compliant with. If they wanted to flip the bird at the law they could have simply remained open in defiant violation. To accept the regulations and close (and thus admit they are aware of regulations and their non-compliance) and THEN execute trades to assist customers would be beyond asinine.
Tradehill after consulting with lawyers made the determination that they were not compliant with CA regulations and that further trading could open them to criminal and civil prosecution.
Exchanging BTC for USD would be further violation of the regulations they have now openly admitted they aren't compliant with. If they wanted to flip the bird at the law they could have simply remained open in defiant violation. To accept the regulations and close (and thus admit they are aware of regulations and their non-compliance) and THEN execute trades to assist customers would be beyond asinine.
What are the pertinent CA regulations? I have not seen anyone from trade hill release a statement about criminal liability or which laws/regulations were the cause.
Same here. He's been off for a couple hours. I'm sure he has a lot of things to do.
I am currious about who is eating the $100K loss. As the updated announcement states, the trade hill guys are raising money for bitcoin.com. I seems hard to believe that investors taking a $100K bath would be likely to invest again.
Furthermore, it isn't likely that trade hill incurred a $100K loss over night. Shouldn't trade hill have seen this coming? Or been able to adjust before such a staggering loss?
Yes, I think most of the slide is simply erosion of confidence. Also note that the volume, while somewhat high, is nothing like what we'd see if there was a mass liquidation.
Rather than speculating more, let me go ask them directly.
Rather than speculating more, let me go ask them directly.
I sent a message to Jared Kenna, but I haven't heard back yet. I will post his response as soon as I get it.
In that case, Bitcoins have had dozens of crashes...
Yes - Bitcoins have had dozens of crashes. It's pretty exciting as markets go.
You just have a true trader mentality, "I don't care if the market is going up or down, just as long as it is moving."
Oh, sorry, I was making the point that USD is withdrawn as USD and I completely ignored what you wanted to know.
BTC withdrawals are mentioned in the original closure thread: https://bitcointalk.org/index.php?topic=63749.msg746924#msg746924
BTC withdrawals are mentioned in the original closure thread: https://bitcointalk.org/index.php?topic=63749.msg746924#msg746924
After some research with other tradehill account holders, I believe Revalin is correct, that the majority of the bitcoins and currencies held by tradehill are being returned in their respective forms. Thus selloff might not be only based on tradehill's liquidation. It is apparent, however, that there are many exceptions, particularly where deposits were made in currency and not bitcoin. It is certainly still the case that the dissolution of tradehill, one of the most popular bitcoin exchanges, does not inspire confidence in the market place.
I wouldn't be surprised if they're accommodating some customers with unusual needs, but that's not a mass liquidation of their BTC.
Reading that message I'm not sure if he's actually holding BTC or if he just wants to withdraw his "Bitcoin" (TradeHIll) balance which is really USD.
In any case, my evidence is the fact that they're issuing checks to handle everyone's withdraws.
Reading that message I'm not sure if he's actually holding BTC or if he just wants to withdraw his "Bitcoin" (TradeHIll) balance which is really USD.
In any case, my evidence is the fact that they're issuing checks to handle everyone's withdraws.
Sorry I'm still confused, you said they are handling everyone's withdrawals with checks? Not BTC? If that is the case then they are certainly liquidating BTC. Also, I'm still curious what your source is to determine which is the norm?
Thanks.
Your premise is wrong. TradeHill isn't liquidating BitCoins. BTC holders withdraw in BTC; USD holders withdraw in USD.
Thank you for your comment. It appears that at Trade Hill is working to return one BTC holder's deposit (made in USD), which is currently in BTC, back in USD through Dwolla. http://tradehillblog.com/2012/02/13/tradehill-suspending-trading-and-returning-client-funds/#comment-580
What source are you using as the basis of your argument?
There was no crash. Are you confused about market trends?
Thank for you comment. A crash is defined as a loss of more than 20%, as seen in 1929 and 1987. BTCUSD fell from $5.50 to $4.20 within 24 hours. That is a 23.6% drop. That is a crash.
Interesting though you consider a 23.6% drop as simply a market trend. It goes to show that "volatility" is relative and some BTCUSD traders are accustom to the extreme price moves of BTCUSD.