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Coinbase says buying and selling temporarily disabled amid price rout

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Re: Coinbase says buying and selling temporarily disabled amid price rout

#61

Post by ceejayoz »

fullshark wrote: post #38
blhack wrote: post #3

There is something that feels extremely fishy to me about what has happened at coinbase over the last few days. For years I've told people to just store their coins on coinbase. I've been a big fan of their "vaults", and I've been saying that they are the shining beacon of legitimacy in this whole thing. I honestly don't know that I still agree with that. This whole rollout of BCH has made me honestly start questioni…

What fishy thing happened re: the bitcoin cash rollout? I know there is speculation of insider trading from individuals at the company but was there anything the company itself did that’s sketchy? They said BCH was coming after the fork and then they delivered it as far as I can tell.

They rolled it out without warning, the price spiked massively, they froze everything, and then revised the pricing charts to hide the $8500 price it peaked at. Their charts now falsely show the high price was only around $4000. All this has caused a lot of speculation about insider trading.

Re: Coinbase says buying and selling temporarily disabled amid price rout

#62

Post by danield9tqh »

peacelp wrote: post #40

How is bitcoin supply finite, if it can hard fork?

Like saying how is gold supply finite if you can break a piece of gold in half. When Bitcoin forks the value is split between the two forks. If the market cap of Bitcoin before the fork is $10 Billion, the combined market cap of both sides of the fork afterwards will still be $10 Billion. There are double the number of coins because of the fork but now each person who had one coin has two and each coin is worth a fraction of what is was before. It's an increase in supply but an increase that is perfectly distributed among the previous holders.

Re: Coinbase says buying and selling temporarily disabled amid price rout

#63

Post by bhouston »

dopamean wrote: post #2

> "Investigating - All buys and sells have been temporarily disabled. We are working on a fix and apologize for any inconvenience," Coinbase said on its status website at 11:11 a.m., ET. What exactly is broken that needs to be fixed? Is there just a ton of trading volume and their system cant keep up ? Edit: I ask because the headline just says that prices are falling quickly and so Coinbase halted trading. This soun…

I did predict a few weeks ago that if things fall quickly, the systems will do down and people will not be able to sell:

https://news.ycombinator.com/item?id=15869668

Re: Coinbase says buying and selling temporarily disabled amid price rout

#64

Post by thisisit »

blhack wrote: post #3

There is something that feels extremely fishy to me about what has happened at coinbase over the last few days. For years I've told people to just store their coins on coinbase. I've been a big fan of their "vaults", and I've been saying that they are the shining beacon of legitimacy in this whole thing. I honestly don't know that I still agree with that. This whole rollout of BCH has made me honestly start questioni…

I posted my comment before I read this. So repeating from here:

https://news.ycombinator.com/item?id=15988939

It seems Coinbase's go to strategy every time markets are volatile. In case people are wondering why is this a recurring problem - this simply perils of Market Making in a volatile market. As a market maker for customer orders Coinbase needs to fulfill both sides. So to make money they buy from customers at low price and sell back at a high price. So they are collecting spread between bid and ask to make money.

But what happens if the market moves rapidly in one direction? They end up selling low and buying high.

So, they need to reset the market making algorithm. Or shutdown the site for a "fix", long enough that the volatility comes back in their range.

And what was wrong with the BCH rollout?

Re: Coinbase says buying and selling temporarily disabled amid price rout

#65

Post by mattbeckman »

smaili wrote: post #20

Why is it they always seem to go down during times of sudden surges and dips? It almost feels like they’re trying to control the market of their platform rather than let it play out. It may indeed just be infrastructure but given the company’s age and decent amount of funding they have now, can scaling really be at play here?

Yes. Consider that the ramp up in Bitcoin has been happening since June. I recall they were adding 50,000 accounts per day. Suddenly, all the new folks that haven't experienced a bloodbath before are all trying to jump on and sell. I'm not surprised at all, really.

Re: Coinbase says buying and selling temporarily disabled amid price rout

#66

Post by dahdum »

chollida1 wrote: post #8

Coinbase does a number of things that seem strange from a market perspective. There doesn't appear to be an auction to open/close or restart. Instead they seem to lock their markets and allow post only orders. The other things this screams is that 1) stop loss orders are useless in volatile markets. I've harped on this alot from the US Cash Equities side but it appears to be equally valid. YOu'll only end up getting…

They lock, other than scaling issues, because of liquidity. Bitcoin cash opened with a thin market and ran up to $9,500 in 4 minutes before they halted the market. Was still trading at ~$3k elsewhere at the time.

An open/close or restart isn't needed because all assets are being heavily traded elsewhere. If they switch to post only the arb bots will fill their book over time.

Leverage will rip your face off.

Re: Coinbase says buying and selling temporarily disabled amid price rout

#68

Post by semi-extrinsic »

chollida1 wrote: post #8

Coinbase does a number of things that seem strange from a market perspective. There doesn't appear to be an auction to open/close or restart. Instead they seem to lock their markets and allow post only orders. The other things this screams is that 1) stop loss orders are useless in volatile markets. I've harped on this alot from the US Cash Equities side but it appears to be equally valid. YOu'll only end up getting…

At least in ordinary stock exchanges with HFT, stop loss orders are perfect devices for the HFTers when the price is approaching some psychological limit (say $100), they can push the price down momentarily and buy from all the average Joes whose stop loss orders just triggered, wait for the inevitable bounce and sell at a nice profit.

Re: Coinbase says buying and selling temporarily disabled amid price rout

#69

Post by smaili »

thisisit wrote: post #64
blhack wrote: post #3

There is something that feels extremely fishy to me about what has happened at coinbase over the last few days. For years I've told people to just store their coins on coinbase. I've been a big fan of their "vaults", and I've been saying that they are the shining beacon of legitimacy in this whole thing. I honestly don't know that I still agree with that. This whole rollout of BCH has made me honestly start questioni…

I posted my comment before I read this. So repeating from here: https://news.ycombinator.com/item?id=15988939 It seems Coinbase's go to strategy every time markets are volatile. In case people are wondering why is this a recurring problem - this simply perils of Market Making in a volatile market. As a market maker for customer orders Coinbase needs to fulfill both sides. So to make money they buy from customers at l…

So this essentially implies Coinbase needs to manipulate the market in order to ensure their profitability?
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