Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Crypto Wash Trading

arxiv.org

Post reply on HN
Print view View original

171–180 of 306 posts

Re: Crypto Wash Trading

#171

Post by chollida1 »

dragontamer wrote: post #63
brianwawok wrote: post #30

Earlier quoted context omitted.

You do NOT need to change the prices for it to be a wash trade. What you gave me a profitable and likely illegal example of a wash trade, but not a definition of wash trade. A wash trade could be selling thing X for $100 and buying thing Y for $100 where X and Y are the same exact underlying thing. Just moving pointless trades back and forth inflates volumes, which makes people thing the market is moving. See https:/…

> You do NOT need to change the prices for it to be a wash trade. No you don't. But you do need to be buying and selling the underlying repeatedly for "some reason". That "some reason" could be fraud, or it could just be tax-optimization. The important thing is, "wash trading" is the technique of buying-and-selling the same thing at nearly the same time... which has many many applications. Many of those applications…

Wash trading doesn't change the price, it just increase volume, hence the term wash, there is no price change to the owner.

Selling your own NFT to your self for a profit, that's something else, but its not a wash trade as in that case there is a price change.

Re: Crypto Wash Trading

#172

Post by ishjoh »

abakker wrote: post #149
ishjoh wrote: post #122

Earlier quoted context omitted.

I would say there are four important use cases of Crypto so far. 1) NFTs - digital ownership 2) DAO - organizations without having to setup an LLC that allow voting etc 3) Accounting for low trust societies (supply chain management, etc) 4) Value store for very high inflation currencies, or states with severe problems

1. Digital ownership of a token. Digital assets can still be copied and distributed. Notions of ownership and title in digital are still inherently problematic. 2. This is probably not a feature society needs. 3. Possibly good? I'd say instead of "low trust" being the feature, "no natural owner of the database" describes the supply chain situation better. 4. maybe. USD, Gold, Etc have historically been good at this.

> Digital assets can still be copied and distributed. Notions of ownership and title in digital are still inherently problematic

Some NFTs come with additional publishing rights for the underlying asset. For example Eminems sold an NFT that contained to the rights and a different rapper bought it to make a song with it: https://bitcoinist.com/the-rapper-who-bought-eminems-nft-for... I think we're going to see more stuff like this in the future.

> 2. This is probably not a feature society needs

You might be right, but we do allow LLCs so we do allow a more difficult way to do the same thing. There is less regulation around DAOs but that's starting to change in some states, I'm for letting the experiment run

> 3. Possibly good?

I think this is a net benefit

> 4. maybe. USD, Gold, Etc have historically been good at this.

Yeah, for this one in particular I was thinking of stable coins that are backed by USD

Re: Crypto Wash Trading

#173

Post by yokem55 »

greatjack613 wrote: post #121
dannyw wrote: post #108

Earlier quoted context omitted.

If you own most of the lp, most of the fees go to you.

That's not true, the gas fees which are the largest part still go to the miners.

Well, now only about 15% of the tx fees go to miners. The rest of the gas fees are burned, so you can't even get a kickback from a friendly miner on your fees.

Re: Crypto Wash Trading

#174

Post by cblconfederate »

SavantIdiot wrote: post #124
thebean11 wrote: post #83

Earlier quoted context omitted.

What do you mean by "IN"? Are dollars "IN" your bank account? I'm not trying to make a tired argument about dollars being fake or something, I just don't see the distinction as far as wallets specifically are concerned.

The difference is: (a) if I don't trust "computers" it absolutely can because I can use deposit box, and (b) the government guarantees that it is via FDIC insurance plus a long list of legal alternatives if it suddenly isn't there. Crypto has neither (a) nor (b); it is specifically designed to not have (a), and I don't see it having a (b) any time soon since regulation is anathema. I see your point. Both are ledgers.…

you can store your private keys printed inside a deposit box if you don't trust computers (which you shouldn't). Nobody guarantees bitcoin, but insurance companies will always exist.

Re: Crypto Wash Trading

#175

Post by mikegreenberg »

coding123 wrote: post #104
joshfraser wrote: post #78

Earlier quoted context omitted.

Oh yeah? Ever tried to send funds to a family member on the other side of the world over a weekend?

Not on the other side of the world but my parents send me through Zelle and works pretty easily - hits the account same day.

FWIW, cryptocurrency settles in seconds.

Re: Crypto Wash Trading

#176

Post by young_unixer »

If you think this is a problem, then cryptocurrency speculation is just not for you. When you get into cryptocurrency speculation, you know there's not a lot of regulation, and that's the beauty of it. You get what you're paying for.

We are seeing a market evolve naturally, without too much government distortion, which is pretty cool.

Re: Crypto Wash Trading

#177

Post by thebean11 »

JumpCrisscross wrote: post #135
thebean11 wrote: post #112

Earlier quoted context omitted.

That's not the comparison I made. I'm talking about a bank account not holding physical bills.

> I'm talking about a bank account not holding physical bills Trusting the regulated bank isn't that far from trusting the monetary authority that gives paper bills value. Or, for that matter, for the 99% of people who have not verified Bitcoin's math and have not inspected the code running on the servers they buy Bitcoin through, trusting the techies who pitch the product.

That's..a different discussion. My point is that IN bank and IN wallet are both technically incorrect, but for basically all purposes correct.

But yes, you are right that the vast majority of users of [piece of software] have not verified [piece of software] and are relying on other humans to basically tell them if they should or shouldn't run it.

Re: Crypto Wash Trading

#178

Post by arberx »

james305 wrote: post #105
arberx wrote: post #42

We also did extensive analysis on this in 2018/2019 and presented it to the SEC: https://static.bitwiseinvestments.com/Research/Bitwise-Asset... Good news: it's getting better. Bad news: still very high.

This was very interesting analysis. Thank you for sharing. Did you look at Crypto.Com?

If they had any volume, they must have been included in the analysis. But not enough to point out in the report it seems.

Re: Crypto Wash Trading

#179

Post by MrMan »

ur-whale wrote: post #167
Closi wrote: post #132

Earlier quoted context omitted.

Benford's Law is a pretty established method of detecting fraud in forensic accounting.

> Benford's Law is a pretty established method of detecting fraud in forensic accounting Benford law never had to deal with exchanges where any customer can write a python bot and start trading at sub-second latencies via the exchange API's. I'd be very surprised if whatever statistical model they're relying on is in any way a match for what real (as in: legitimate orders from actual customers) trading goes on on cry…

Python ... Subsecond latencies

Ok

Re: Crypto Wash Trading

#180

Post by ur-whale »

nefitty wrote: post #168
_3u10 wrote: post #120

Earlier quoted context omitted.

Completely agree, I’d much rather lose at least 6.2% (if not 20%) in totally legitimate fiat currency inflation than see 200% returns on crypto as a result of that money printing. QE definitely isn’t wash trading.

That's how all Ponzi schemes are marketed. "I got rich, so can you!"

If you are using the P word in a conversation about crypto, chances are you are not adding much value to the conversation.

That particular dead horse has been beaten to a point where all is left are strictly people adhering to dogma on one side or the other of the conversation.

Try tulips next, to make the picture complete.

Post reply on HN