241–250 of 252 posts
I wouldn't want to be in a business in which the worlds absolute finest hackers and crackers - the elite of the best of the best - make it their full time job - forever without end - to get into your systems and steal everything of value.
That sounds like any bank. Computer systems as the source of truth for billions of dollars of assets is not new.
I wouldn't want to be in a business in which the worlds absolute finest hackers and crackers - the elite of the best of the best - make it their full time job - forever without end - to get into your systems and steal everything of value.
That sounds like any bank. Computer systems as the source of truth for billions of dollars of assets is not new.
With a cryptocurrency there's nobody to call, you have to convince 50% + 1 of the mining pool to undo any major breach - which is almost certainly never going to happen.
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Coinbase isn’t a bank it’s an exchange. Why would they carry a reserve of anything? It stores your shares for you, but it’s not loaning them out. The only way you get money out of Coinbase is if someone buys your shares.
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.
1 BTC at Coinbase is only worth whatever Fiat currency Coinbase is willing to buy it from you for. If that's $1 for all your Bitcoins, tough luck.
They're under no obligation to guarantee a sale price for BTC.
I do wonder if after the Ether "flash crash" recently ( https://blog.gdax.com/eth-usd-trading-update-5d8142b5bdc1 ), if Coinbase / GDAX instituted some sort of "circuit breakers" on their exchange to prevent this type of thing from happening again. Bitcoin and the other cryptos, trades at a pretty low volume relative to their market cap, so if a lot of people we're trying to dump large orders this morning to take a p…
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How much money needed to come into the bitcoin market for it bump from 15k to 19k? Where is this money coming from??
Had to be a lot. Should have screen recorded it, but instead recorded with my phone. The order book entries and chart were going nuts. Entire sections of the book disappearing at once. The chart would go almost entirely flat several times. Almost always you see minor movement on the order book except maybe sometimes at the actual mid point it may update a bit. The chart is almost always balanced until the past few we…
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This is exactly my question. What happens when these exchanges face the inevitable panic/bank run?
We've been through this in the past. They just cancel your transactions without apology.
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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.
They only need(* depending on TOS guarantee) to keep the full amount of Bitcoins matching your Coinbase wallet. They can take all the cash they've been given, pile it up and set it on fire if they like. 1 BTC at Coinbase is only worth whatever Fiat currency Coinbase is willing to buy it from you for. If that's $1 for all your Bitcoins, tough luck. They're under no obligation to guarantee a sale price for BTC.
Then how do they pay you when you come to withdraw your cash?
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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 s…
Getting "stopped out" is fine, it's part of investing. You need to stop your losses. I'm just saying don't put the order on the books for the exchange to pluck like a ripe berry.