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If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

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Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#91

Post by account73466 »

kelnos wrote: post #73
account73466 wrote: post #48

Earlier quoted context omitted.

Not my definition but the accepted one is price times number of bitcoins mined so far. Of course by selling 1% of all bitcoins you would clean all order books. However, George Soros used only a few billions to bet against the British pound.

> Not my definition but the accepted one is price times number of bitcoins mined so far. Right, but that's essentially a lazy re-definition of the term. I get that it's a bit wordy to always say, "the current total value of all bitcoins is $X billion", but market cap is specifically about the total value of a security's outstanding shares . If people want bitcoin to be treated seriously as a currency , they should st…

I guess that one of the reasons for this notation is because Bitcoin is not yet a currency in its common sense (e.g., freely used within a country to be exchanges for products and services) but a speculative asset.

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#92

Post by account73466 »

floatingatoll wrote: post #89
account73466 wrote: post #46

Earlier quoted context omitted.

I don't have a crystal ball to claim I know what happens but swings are often due to futures trades and exchanges interested in liquidating longs and shorts. I understand why exchanges are interested in wash trading but I don't know why market makers would provide any illusion since each transaction costs in order of 0.075% of its value.

Wash transactions are cheap compared to the rewards they gamble will occur.

Could you please provide an example?

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#93

Post by shepardrtc »

account73466 wrote: post #46
shepardrtc wrote: post #39

Earlier quoted context omitted.

I have a hard time believe its anything other than market makers providing the illusion of trades. Have you seen the price swings? If there was real volume and real transactions asides from trades, how would such insane swings be possible?

I don't have a crystal ball to claim I know what happens but swings are often due to futures trades and exchanges interested in liquidating longs and shorts. I understand why exchanges are interested in wash trading but I don't know why market makers would provide any illusion since each transaction costs in order of 0.075% of its value.

I believe market makers are paid by exchanges to provide liquidity.

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#94

Post by bduerst »

Acrobatic_Road wrote: post #86
bduerst wrote: post #77

Earlier quoted context omitted.

>... Lightning only scales with the number of transactions, not users. Is the rest of the sentence that you quoted out of context. Did you not see the example?

>Lightning only scales with the number of transactions, not users. You seem to be poking at the need to open a lightning channel to get started using lightning and using the onboarding time to suggest that lightning cannot scale. First of all I think the way you made that argument is entirely disingenuous. Let's look at your first example: >* For 2 users to make 10,000,000 transactions between each other, it would ta…

This is why I precisely used the example of paying monthly rent, because:

1) Paying rent is an example of a repeat payment between two users where you theoretically could have an open Lightning channel, but...

2) Landlords are still going to settle transactions immediately to avoid liability anyways

The "just leave the channel open" is the disingenuous part being projected here. Your landlord isn't going to hold off on cashing your rent check because they want to turn around, endorse it, and use that slip of paper to pay for maintenance. No, the landlord cashes the check the same way that they would immediately settle a lightning transaction.

Now imagine single, non-repeated payments between millions of untrusted parties. You're not going to have millions of "open channels". All those millions of users are going to settle the transactions immediately, which requires Bitcoin's bottleneck.

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#95

Post by Acrobatic_Road »

bduerst wrote: post #84
pouta wrote: post #56

Earlier quoted context omitted.

Where can I read more about how you came up with those numbers? I didn't knew that side of lightning.

It's napkin math based on the Bitcoin network's hard limitations of 4-7 transactions/second, so assuming 5 tx/s, then there's 432K transactions/day limit. Since lightning requires Bitcoin to settle transactions between parties, it means that the more users there are making transactions, the more it needs bitcoin. If it's just a handful of users making a million transactions, then there's no problem since lightning wi…

> If there's a million users making a handful of transactions, well, then lightning needs to settle a few million transactions on Bitcoin (which takes weeks).

Sorry, but you seem to be entirely ignorant of how lightning works. Lightning does not need to settle transactions on Bitcoin. If I pay someone using lightning then that payment is as good as good. The person who received the funds could go on and pay someone further. Notice there was no need to make an on-chain settlement transaction for this to work.

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#96

Post by buboard »

spookthesunset wrote: post #76
account73466 wrote: post #66

Earlier quoted context omitted.

I don't say I know, I say that I think. It remains a possibility that they are wash-trading.

> It remains a possibility that they are wash-trading. I'd say they all have every single incentive to wash-trade, front-run, and otherwise cheat the hell out of their system to their advantage. After all, they are completely unregulated and almost always operate well outside any jurisdiction who would care to go after them. I'd say you'd be silly to assume they aren't doing ultra-shady crap.

Their BNB coin used to pay fees outperforms bitcoin past year. Is that wash trading as well?

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#97

Post by Acrobatic_Road »

bduerst wrote: post #94
Acrobatic_Road wrote: post #86

Earlier quoted context omitted.

>Lightning only scales with the number of transactions, not users. You seem to be poking at the need to open a lightning channel to get started using lightning and using the onboarding time to suggest that lightning cannot scale. First of all I think the way you made that argument is entirely disingenuous. Let's look at your first example: >* For 2 users to make 10,000,000 transactions between each other, it would ta…

This is why I precisely used the example of paying monthly rent, because: 1) Paying rent is an example of a repeat payment between two users where you theoretically could have an open Lightning channel, but... 2) Landlords are still going to settle transactions immediately to avoid liability anyways The "just leave the channel open" is the disingenuous part being projected here. Your landlord isn't going to hold off…

The landlord does not need to settle the transaction on the Bitcoin network to spend the money I have payed him. He could spend it anywhere within lightning. This is the crux of your misunderstanding.

I really wish people would take more time to understand the things they criticize. There are real problems with lightning, this isn't one of them.

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#98

Post by account73466 »

shepardrtc wrote: post #93
account73466 wrote: post #46

Earlier quoted context omitted.

I don't have a crystal ball to claim I know what happens but swings are often due to futures trades and exchanges interested in liquidating longs and shorts. I understand why exchanges are interested in wash trading but I don't know why market makers would provide any illusion since each transaction costs in order of 0.075% of its value.

I believe market makers are paid by exchanges to provide liquidity.

What you are referring to exists in regular stocks markets but not in cryptomarkets (at least, when we talk about relatively reputable exchanges).

Take Binance as the largest crypto-exchange. Market makers are the ones who put buy or less limit orders. Market takers are the ones who put market order to "eat" limit orders. Market markers are not paid to provide liquidity. However, their fees decrease from, e.g., 0.075% per trade to say 0.030% per trade if they trade millions $ per month.

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#99

Post by bduerst »

Acrobatic_Road wrote: post #97
bduerst wrote: post #94

Earlier quoted context omitted.

This is why I precisely used the example of paying monthly rent, because: 1) Paying rent is an example of a repeat payment between two users where you theoretically could have an open Lightning channel, but... 2) Landlords are still going to settle transactions immediately to avoid liability anyways The "just leave the channel open" is the disingenuous part being projected here. Your landlord isn't going to hold off…

The landlord does not need to settle the transaction on the Bitcoin network to spend the money I have payed him. He could spend it anywhere within lightning. This is the crux of your misunderstanding. I really wish people would take more time to understand the things they criticize. There are real problems with lightning, this isn't one of them.

>The landlord does not need to cash the check to spend the money I have payed him. He could spend it anywhere as a third party check. This is the crux of your misunderstanding.

Ask your landlord why they won't spend third party checks and you have your answer as to why they won't spend unsettled IOUs on a lightning network.

You're free to pull the, "Lightning too complicated for you to understand" but I think you're projecting again. Lightning doesn't scale with millions of users despite your attempts of apologizing for it.

Re: If Bitcoin Looks Like It Isn’t Trading, It’s Because It Isn’t

#100

Post by tuesdayrain »

toomim wrote: post #69
mikeyouse wrote: post #38

Earlier quoted context omitted.

There's no such thing as a "market cap" for Bitcoin - seriously, give me a definition of "market cap" for Bitcoin that makes any sense at all compared to something like the future value of cash flows from UNH equity.

Market Capitalization : The amount of capital allotted an asset in the market . This can be computed as number-of-coins x price-per-coin.

This could result in the common misconception that market cap is equal to the influx of money into an asset. E.g. market cap increasing by 5bil doesn't mean that 5 billion worth of currency was invested into it.
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