I don't like centralized exchanges at all because they always try to fool their customers in every possible way. Yesterday my transaction with $4000 worth of steem -> ethereum were lost by changelly.com probably due to poloniex problems.
I feel that these cryptocurrency exchanges need to follow the exchanges of the stock market. They didn't let it happen on the "normal" exchanges and they certainly shouldn't allow the flash crash to happen on cryptocurrency exchanges. We definitely need to set up circuit breakers if the cryptocurrency market becomes mainstream.
actually I never heard about circuit breakers, however I never consider myself as a trader. IMO there is only one sure way to earn money thanks to cryptocurrencies, and that is not trading. Andreas Antonopolous explain what is that:
I don't think that circuit breakers should be set. People need to be self responsible for their investment. What happened yesterday was free market, if we start putting regulations then we will end up like the tradicional finantial markets controlled by a few making most of the money.
Very informative video! Thank you @ivanli, now I understand what happened and why. Seems like an inside job to me. The plan was to buy 1 million of ETH for a very low price!
People confuse investing with daytrading.
When you buy a cryptocurrency and have it, nothing happens to it during a flash like this. Because you are an investor and intend to sell the coin in a distant future for huge profit.
When you do daytrading, you do not own any coins. You make bets that the coin will rise or fall soon.
And that is the morale of it. When you make bets, the rules of gambling apply to what you are doing. When you buy something, the rules of investing apply.
Nobody who had coins lost anything when the flash happened. Because there is no stop loss order for coins that one HAS. People can panic though and sell their coins when a flash like this occurs. They suddenly become gamblers because of their panic.
There is a nice saying in poker. When someone is steered by his emotions, overriding his rationality, experienced players on the table notice this and know: he is on tilt. They can then easily drain out all the money of him they please.
So as you describe it a stop loss is a dumb algorithm, that sells if the price drops below a threshold. My view is that in free market this type of activity is predictable, and therefore explotiatble. This means the fix should be market driven, i.e. investors have a feeling for the 'true worth' of ether so set up stop loss traps at low values to buy up any panics sells and buy cheap and prop up the price. Competetion between this type of investor should push up the trap level.
Margin is a b$%ch people. This space is not yet ready for margins (i.e. leverage). Very dangerous!!!! Crypto space is not yet mature for margins. Our exchanges are still fragile.
I don't like centralized exchanges at all because they always try to fool their customers in every possible way. Yesterday my transaction with $4000 worth of steem -> ethereum were lost by changelly.com probably due to poloniex problems.
I keep hearing very bad things about Changelly. People getting some ridiculous fees, transactions not going through etc.
I feel that these cryptocurrency exchanges need to follow the exchanges of the stock market. They didn't let it happen on the "normal" exchanges and they certainly shouldn't allow the flash crash to happen on cryptocurrency exchanges. We definitely need to set up circuit breakers if the cryptocurrency market becomes mainstream.
actually I never heard about circuit breakers, however I never consider myself as a trader. IMO there is only one sure way to earn money thanks to cryptocurrencies, and that is not trading. Andreas Antonopolous explain what is that:
https://streamable.com/fr6j8
https://streamable.com/3omv2
interesting, thanks!:)
it's scary stuff this crypto, but are these exchanges any more scary than high street banks?
Coinbase are crooks Ivan !
A few of my friends and I are going around coinbase now. Fees are too high. Its cheaper to use something like BitPay to withdraw now.
this is really so worrying :/
I don't think that circuit breakers should be set. People need to be self responsible for their investment. What happened yesterday was free market, if we start putting regulations then we will end up like the tradicional finantial markets controlled by a few making most of the money.
Very informative video! Thank you @ivanli, now I understand what happened and why. Seems like an inside job to me. The plan was to buy 1 million of ETH for a very low price!
People confuse investing with daytrading.
When you buy a cryptocurrency and have it, nothing happens to it during a flash like this. Because you are an investor and intend to sell the coin in a distant future for huge profit.
When you do daytrading, you do not own any coins. You make bets that the coin will rise or fall soon.
And that is the morale of it. When you make bets, the rules of gambling apply to what you are doing. When you buy something, the rules of investing apply.
Nobody who had coins lost anything when the flash happened. Because there is no stop loss order for coins that one HAS. People can panic though and sell their coins when a flash like this occurs. They suddenly become gamblers because of their panic.
There is a nice saying in poker. When someone is steered by his emotions, overriding his rationality, experienced players on the table notice this and know: he is on tilt. They can then easily drain out all the money of him they please.
So as you describe it a stop loss is a dumb algorithm, that sells if the price drops below a threshold. My view is that in free market this type of activity is predictable, and therefore explotiatble. This means the fix should be market driven, i.e. investors have a feeling for the 'true worth' of ether so set up stop loss traps at low values to buy up any panics sells and buy cheap and prop up the price. Competetion between this type of investor should push up the trap level.
Why Ethereum Was $0.10
https://www.wealthdaily.com/articles/what-was-behind-the-ethereum-drop-flash-crash-gdax-ethereum-volatility-coinbase-protect-yourself-ethereum-investing/8746
39,300 Ether https://etherscan.io/tx/0xdfde8f3a24f92924ca9e046c15d9cc5e40e758df92ca12de56fac1c3469e071f
Margin is a b$%ch people. This space is not yet ready for margins (i.e. leverage). Very dangerous!!!! Crypto space is not yet mature for margins. Our exchanges are still fragile.