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Coinbase down for maintenance

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Re: Coinbase down for maintenance

#221

Post by twohearted »

pcf wrote: post #163

My friend thinks the exchanges also go down when assets "flash-crash", because it means normal users can get in to sell their assets. And when they can't get in, they also can't cancel their stop-loss orders, so it means a TON of assets are available to buy cheaply (by the exchange and/or certain VIP users/collaborators) as the value goes down. Then these are bought up, and the price quickly increases again, before t…

This has always been a worry in the traditional stock market. With a stop loss order you're basically creating a "secret" order to sell at below market value. Anyone who knows about it has a direct incentive to profit from it.

Stop-losses are very important in investing but I'd recommend always executing them manually at market rate. Set a price alert to notify you. Of course if the exchanges are down you're sol, but if BTC is on a bullet train to $10 your exchange stop-loss probably won't fill at your price anyway.

Re: Coinbase down for maintenance

#222

Post by tome »

freen wrote: post #219
tome wrote: post #211

Earlier quoted context omitted.

They presumably have on hand the full amount of cash and Bitcoins that their participants have given them and don't loan any of them out. That means they have a full reserve.

You aren't buying the bitcoin from Coinbase...

No? My understanding was that if you want to sell Bitcons on Coinbase you have to give them custody.

Re: Coinbase down for maintenance

#223

Post by Sohcahtoa82 »

Snackchez wrote: post #39
spelunker wrote: post #14

Earlier quoted context omitted.

I think you can take off your tinfoil hat. Lots of price movement motivates more traffic to the exchanges, resulting in DDoS. As the bitcoin market grows GDAX, Bitfinex, etc are probably going to have to borrow some ideas/talent from NASDAQ & other big electronic exchanges to stabilize things.

Tinfoil hat off! Shouldn't an exchange be able to handle volume? Seems like a basic requirement. Regardless, I still believe that with the introduction of shorts, were going to see bigger swings.

> Shouldn't an exchange be able to handle volume? Seems like a basic requirement.

Exchanges are just websites like any other. They're build to handle a certain amount of traffic based on the average amount plus a little extra to handle spikes.

If they only get (And I'm pulling numbers out of my ass here just to make a point) an average of 10 trades per second with occasional spikes to 100 trades per second, how much infrastructure should they build? What capacity should they build to? 1,000 trades per second? 10,000?

There's a cost analysis involved. I think it's a bit unrealistic for them to have enough infrastructure to handle spikes an order of magnitude higher than their typical peak loads.

Re: Coinbase down for maintenance

#224

Post by j4ship »

pertsix wrote: post #218
Florin_Andrei wrote: post #158

Earlier quoted context omitted.

I've used Coinbase on and off for a while. The service always felt exactly as you describe it: startup busting their collective ass to keep up with demand. Given the recent increase in news about cryptocurrency I've expected "technical difficulties" with Coinbase. Heck, most mining pools are sweating bullets right now. Hypergrowth = hyperpains.

missed opportunity to say: hypergains = hyperpains

no hyperpains no hypergains

Re: Coinbase down for maintenance

#225

Post by rbobby »

Beejeepa wrote: post #192
ceejayoz wrote: post #144

Earlier quoted context omitted.

A run on one bank frequently has knock-on effects on other banks.

Bank runs are bad when there isn't a full reserve. Coinbase says it has 100% reserves. Bank runs are how fraudulent exchanges are caught: Bitcoin is self-auditing, and either you have it or you don't, there aren't IOUs or paper receipts. Fractional reserve banking is a prisoner's dilemma, we all marginally benefit from the status quo of credit/debit/interest, but in a crisis, the first people to pull out win, and eve…

I wonder how quickly CoinBase could release funds from cold wallet(s)? Could be hours... which could pretty bad.

Re: Coinbase down for maintenance

#226

Post by nikkwong »

Klathmon wrote: post #174
chickenfries wrote: post #152

Earlier quoted context omitted.

Is it really that much traffic compared to your typical consumer-facing start up? There can't be that many people buying BTC compared to the number of people that say, Stripe or Whatsapp handled in their early days...

I don't know about Stripe or Whatsapp, but I know coinbase has had an average of 30,000 new users a day for a while, with spikes of over 100,000 new signups in a single day around thanksgiving. It's absolutely bonkers amounts of growth! Edit: more concrete numbers: In January of 2016 they had around 2.6 million users. On November 29th they announced they had over 13 million users.

That, followed by the fact that many of their users probably sit on the site a good part of the day constantly refreshing the page/taking up websocket bandwidth to watch price changes. Yeah, load is a serious issue.

Re: Coinbase down for maintenance

#227

Post by rsync »

twohearted wrote: post #221
pcf wrote: post #163

My friend thinks the exchanges also go down when assets "flash-crash", because it means normal users can get in to sell their assets. And when they can't get in, they also can't cancel their stop-loss orders, so it means a TON of assets are available to buy cheaply (by the exchange and/or certain VIP users/collaborators) as the value goes down. Then these are bought up, and the price quickly increases again, before t…

This has always been a worry in the traditional stock market. With a stop loss order you're basically creating a "secret" order to sell at below market value. Anyone who knows about it has a direct incentive to profit from it. Stop-losses are very important in investing but I'd recommend always executing them manually at market rate. Set a price alert to notify you. Of course if the exchanges are down you're sol, but…

"Stop-losses are very important in investing but I'd recommend always executing them manually at market rate."

No, no, no, no ...

You do not ever want to insert a market order[1] ... the market can be manipulated and high frequency traders can buy/sell your public market order at an artificially low/high price.

The answer to getting "stopped out" is not to insert a market order - it is to create a fill-or-kill at a specific price or other more specific order type ...

[1] https://www.marketwatch.com/story/this-is-why-you-never-use-...

Re: Coinbase down for maintenance

#228

Post by prawn »

If this phase of Bitcoin is likened to each goldrush around the world, isn't it fairly inevitable that there will be hiccups? Robberies, banged together shopfronts, people using any tools they can find, etc. And the internet has long been a bit of a Wild West already.

Assuming they're adding thousands and thousands of customers quickly, I'm not surprised that their systems and support are lagging. Comes with the (Wild West) territory.

Re: Coinbase down for maintenance

#229

Post by [deleted] »

Klathmon wrote: post #174
chickenfries wrote: post #152

Earlier quoted context omitted.

Is it really that much traffic compared to your typical consumer-facing start up? There can't be that many people buying BTC compared to the number of people that say, Stripe or Whatsapp handled in their early days...

I don't know about Stripe or Whatsapp, but I know coinbase has had an average of 30,000 new users a day for a while, with spikes of over 100,000 new signups in a single day around thanksgiving. It's absolutely bonkers amounts of growth! Edit: more concrete numbers: In January of 2016 they had around 2.6 million users. On November 29th they announced they had over 13 million users.

[deleted]

Re: Coinbase down for maintenance

#230

Post by dangero »

gamblor956 wrote: post #141
wonderwonder wrote: post #124

Just my opinion but I think the conspiracy theories are not realistic. Coinbase is essentially a startup that is dealing with monstrous traffic. They are still scaling their infrastructure and when the price starts moving quickly everyone logs in to either get in on the action or take a look. This cranks the traffic up and the servers cant handle it. I am not excusing their behavior as they need to be able to handle…

Coinbase goes through this charade every time this happens with a major digital currency. It wasn't a legitimate excuse the first time, and it's not an excuse the 7th time. Scaling is a solved problem. You have AWS, Google Cloud, and MS Azure to choose from with financial institution/HIPAA-level offerings.

The thing about scaling is that you can't justify the engineering involved in overscaling until you're reasonably sure you'll need the capacity. Otherwise that's called overengineering. Managers get fired for approving spending on things like that when the demand does not appear. It's also hard to simulate real traffic because they don't always behave how you predicted they would.

Also, your system gets more and more complex as you scale. More monitoring systems needed, more attack vectors to watch for, deployment systems, backup systems... Imagine the security level coinbase needs to have. It's somewhat unprecedented since a hack could make off with a lot of valuable assets in an instant. (even just from their hot-wallet)

You saying scaling is solved makes me question what you think their infrastructure looks like. It's not just an AWS loadbalancer with some shards behind it. It's A LOT more complex than that.

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