Bitcoin Futures Start with a Bang as Rally Trips Circuit Breaker

Post by FireBeyond » Mon, Dec 11, 2017, 5:35 PM UTC

Klathmon wrote: post #149

theadamp wrote: post #81

Earlier quoted context omitted.

In 18 months ;)

To be fair, Lightning works, and it works now on the Bitcoin mainnet. The idea is sound, the code is written and somewhat tested, and it has been used in a very controlled fashion on the real bitcoin network already. At this point it's just a matter of further testing and validation that the logic is sound and there isn't anything everyone is missing, and getting vendors on board and adoption started. Still no guaran…

Post by mrb » Mon, Dec 11, 2017, 5:54 PM UTC

empath75 wrote: post #174

d--b wrote: post #108

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Mmmh, why do you need your coins sitting on one exchange? Can't you just take them out once your transaction is done?

good luck: https://www.reddit.com/r/bitfinex/ Nothing but complaints about withdrawals. You can't even withdraw anything from bitfinex less than 250BTC.

Post by bduerst » Mon, Dec 11, 2017, 6:03 PM UTC

nscalf wrote: post #163

etr-strike wrote: post #156

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I hate to break it to you but none of the existing cryptocurrencies know how to scale transactions yet. There are, however, many proposed solutions. Bitcoin is aggressively pursuing those solutions. The worst proposal, increasing blocksize, is not currently being considered because of its impact on centralization.

Have you heard of bitcoin's lightning network? There is a layer they're working on that, as I've heard it, allows 1 million transactions a second for a fraction of the transaction cost. It's not VISA, but it's a huge improvement, and makes Bitcoin much more viable. They've been showcasing successful tests, but are open about it not being 100% ready. Still exciting.

Post by johnrgrace » Mon, Dec 11, 2017, 6:14 PM UTC

ArchD wrote: post #103

gibybo wrote: post #6

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The markets are not as independent as they might seem. If the futures market gets ahead or behind of the other BTC markets, it creates opportunities for arbitragers to profit from the difference which has the effect of reducing the gap. It doesn't matter that they are cash-settled. For example, if lots of money start pouring into Bitcoin futures, the futures price will rise above the price on BTC exchanges. It will t…

But if a lot of traders think this way, they may have high execution cost when the contract expires and they try to sell the spot. Specifically, a lot of selling pressure by this kind of trade will push down the spot price and the traders may not be able to sell the spot at the price of the futures cash settlement. So, there is a connection but only up to a point. Of course there a probably traders doing other kinds…

Post by d--b » Mon, Dec 11, 2017, 6:21 PM UTC

jpmattia wrote: post #188

d--b wrote: post #80

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As others pointed out, when you buy/sell futures, you risk counterparty risk. But it's not that bad because that exchange is really good and people entering the market pay margin calls every day. There is also a financing cost (ie. the cash you use to pay for your margins, transaction costs, and to buy the bitcoins will not pay you any interests over the time of the position). But again, the effect is not very large.…

> As others pointed out, when you buy/sell futures, you risk counterparty risk. Yes, but: There is a chain of companies that have to fail before you incur the loss. The clearinghouse will cover the default first, and bill it back to the clearing broker. So you need someone of the order of Goldman Sachs to fail before counterparty risk affects payments to you.