Why does an exchange, which is based on basic market principles and claims to incorporate a supply and demand (maker vs. taker) model, have a fixed rate vig on half the transactions? Shouldn't the vig float and have a mechanism which drives it towards zero?
Coinbase – Exchange API
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Re: Coinbase – Exchange API
#12Why does an exchange, which is based on basic market principles and claims to incorporate a supply and demand (maker vs. taker) model, have a fixed rate vig on half the transactions? Shouldn't the vig float and have a mechanism which drives it towards zero?
As I understand it, it's not a fee that the maker receives, it's a fee CoinBase receives, i.e. it's their way of making profit off of this exchange. The mechanism which could drive it to zero is competition from other exchanges.
Re: Coinbase – Exchange API
#13Why does an exchange, which is based on basic market principles and claims to incorporate a supply and demand (maker vs. taker) model, have a fixed rate vig on half the transactions? Shouldn't the vig float and have a mechanism which drives it towards zero?
I don't know much about basic market principles (by the looks of it they aren't very profitable for the host) but constant fee does make it easier to backtest automated trading strategies.
Re: Coinbase – Exchange API
#14Why does an exchange, which is based on basic market principles and claims to incorporate a supply and demand (maker vs. taker) model, have a fixed rate vig on half the transactions? Shouldn't the vig float and have a mechanism which drives it towards zero?
As I understand it, it's not a fee that the maker receives, it's a fee CoinBase receives, i.e. it's their way of making profit off of this exchange. The mechanism which could drive it to zero is competition from other exchanges.
I get that it's CoinBase's fee (vig). I'm having a hard time understanding where the fixed 0.25% fee comes from other than:
fee = desired_profit / (expected_transaction_volume * expected_average_transaction_value)
Re: Coinbase – Exchange API
#15Earlier quoted context omitted.
As I understand it, it's not a fee that the maker receives, it's a fee CoinBase receives, i.e. it's their way of making profit off of this exchange. The mechanism which could drive it to zero is competition from other exchanges.
I get that it's CoinBase's fee (vig). I'm having a hard time understanding where the fixed 0.25% fee comes from other than: fee = desired_profit / (expected_transaction_volume * expected_average_transaction_value)
So you think the fee to remove liquidity should "float" in what way exactly? With per-customer tiered volume discounts like many exchanges offer to customers who trade enough in a given month? Or when you said "float" did you mean it should be variable across the entire exchange over time, but the same for all customers at any given time?
Re: Coinbase – Exchange API
#16Earlier quoted context omitted.
I get that it's CoinBase's fee (vig). I'm having a hard time understanding where the fixed 0.25% fee comes from other than: fee = desired_profit / (expected_transaction_volume * expected_average_transaction_value)
So you think the fee to remove liquidity should "float" in what way exactly? With per-customer tiered volume discounts like many exchanges offer to customers who trade enough in a given month? Or when you said "float" did you mean it should be variable across the entire exchange over time, but the same for all customers at any given time?
Like any well functioning market, it should track the actual cost of goods, in this case, the actual cost of facilitating the transaction.
I have a hard time believing that a fixed 0.25% has anything to do with the real costs. It doesn't appear that CoinBase is even making that argument.
Re: Coinbase – Exchange API
#17After having looked at dozens of Bitcoin exchange APIs, this one was a breath of fresh air. The only other respectable API out there belongs to Kraken [1]. [1] https://www.kraken.com/help/api
Having integrated five other cryptocurrency exchanges, I echo this sentiment. I hope it sets the bar.
Re: Coinbase – Exchange API
#18After having looked at dozens of Bitcoin exchange APIs, this one was a breath of fresh air. The only other respectable API out there belongs to Kraken [1]. [1] https://www.kraken.com/help/api
Really? I've found Kraken's pretty hard to work with. They're inconsistent in some ways, like their currency pair names (sometimes "XXBTXZEUR", sometimes "XBTEUR"). Also, they are the only ones I've come across who don't just use plain old integers for ids - they have some weird scheme that has string ids formatted like O6W5EU-VY7YF-CS3XNP. That said, they're better than say BTC-e and OKCoin :)
Kraken's API is pretty good when compared to the industry average. It's just a little bit whacky.
Re: Coinbase – Exchange API
#19After having looked at dozens of Bitcoin exchange APIs, this one was a breath of fresh air. The only other respectable API out there belongs to Kraken [1]. [1] https://www.kraken.com/help/api
No way. Kraken doesn't even have a real-time feed. The best I've ever seen is HitBtc or Coinsetter. Those two are the closest to Wall Street grade APIs out there (demo environments, real-time API agnostic of protocol, colocation, etc). From a brief glance, this Coinbase exchange API is close.
Re: Coinbase – Exchange API
#20After having looked at dozens of Bitcoin exchange APIs, this one was a breath of fresh air. The only other respectable API out there belongs to Kraken [1]. [1] https://www.kraken.com/help/api
I've just started to work with the Kraken API it is good. Their key signing/hashing auth is a little weird but the example clients are very useful.
Is there a way to get real time order book updates from the Kraken?
Another good API is Paymium's https://github.com/Paymium/api-documentation the most frustrating thing I find about exchanges API are race conditions when doing HFT, like submitting an order getting an ID, then asking about the ID to find it doesn't exist yet as the update hasn't be prorated yet.