Why you can’t cash out part 1: Bitcoin’s “price” is largely fictional

Post by celticninja » Mon, Dec 18, 2017, 2:16 PM UTC

omarforgotpwd wrote: post #128

josephagoss wrote: post #102

You can cash out Bitcoin and the price is actually very accurate. The money I see in my bank account is real I can assure you of that. Also I know friends that cash out six figures at a time and the price they get is within less than 1% difference to the last sell price. The number is accurate enough for most orders under $10,000,000. Has this person actually traded Bitcoin? You might not be able to sell a large orde…

I think the point he’s making is that everybody could not cash out at the listed price at once if something were to happen that made holding bitcoin undesirable (such as say, a possible crack for their elliptic curve crypto implementation). However, the same is true for banks which only keep 10% of deposits. Bank deposits are FDIC insured up to $250,000 though.

Post by tantalor » Mon, Dec 18, 2017, 2:28 PM UTC

patd wrote: post #95

jsmeaton wrote: post #80

Earlier quoted context omitted.

Isn't the difference that a stock is only traded on a single exchange? If stocks were traded on multiple exchanges, and the value was reported as the average across all of them, then that number would be just as made up.

A lot of stocks are trading on multiple exchanges. Unilever and Shell trade on the NY, London and Amsterdam stock exchanges. People typically use the one closer to them geographically or from a currency point of view. And things like gold or oil barrels also have multiple exchanges.

Post by barnabee » Mon, Dec 18, 2017, 2:33 PM UTC

jsmeaton wrote: post #80

alasdair_ wrote: post #65

The article states "The singular “price” of Bitcoin doesn’t exist — it’s a made-up number." This is the same for every stock traded on any stock exchange in the world. The "singular price" is, in most cases, just the mean of the closest bid and offer listed on the exchange and is thus a "made-up number" On top of this, it obviously doesn't take into account everything from transaction costs to the fact that attempts…

Isn't the difference that a stock is only traded on a single exchange? If stocks were traded on multiple exchanges, and the value was reported as the average across all of them, then that number would be just as made up.

Post by sharemywin » Mon, Dec 18, 2017, 2:36 PM UTC

kasey_junk wrote: post #193

josephagoss wrote: post #102

You can cash out Bitcoin and the price is actually very accurate. The money I see in my bank account is real I can assure you of that. Also I know friends that cash out six figures at a time and the price they get is within less than 1% difference to the last sell price. The number is accurate enough for most orders under $10,000,000. Has this person actually traded Bitcoin? You might not be able to sell a large orde…

Is there a way to verify this somehow? One of the biggest issues in the Bitcoin space seems to be counter party risk with the exchanges. How do large Bitcoin traders price that risk? With most modern financial exchanges the accounts are open, audited and they’ve had a long time to generate trust with their members so pricing the counter party risk is straight forward.

Post by sharemywin » Mon, Dec 18, 2017, 2:39 PM UTC

6nf wrote: post #114

cobookman wrote: post #97

Earlier quoted context omitted.

You can however gdax limits you to 10k/day of withdrawls from the exchange (be it usd or btc). And gdax has a 3-6 day wire transfer delay. You end up making more by simply hodling

> gdax limits you to 10k/day of withdrawls from the exchange (be it usd or btc). That's just the default limit. You can ask for increases.