What happened to the Bitmex order book?
I just saw this tweet with the above picture:
https://twitter.com/zhusu/status/1072633621108940801?s=21
It suggest a very large drop off of money and users from bitmex happened very recently.
In fact this drop is so significant it may well be one of the forces pushing prices lower (as volume reduces price will fall)
So I am looking for an explanation of what happened here.
Update: My own conclusion
I am not that impressed with the answers so far.
I saw this when I was on the road, when I came home the first thing I did was look at the real volume vs the order above.
The thing is that the order book increased inversely to the reduction of volatility and return back to a little higher level of high volatility when the price broke out. Thus we have slightly higher order book now than a year ago. Both times we had high volatility.
Volume overall has increased since the drop.
Many people may have exited the market but the traders are still here!
That said we may have seen a slight reduction of volume overall, as many many people are leaving the bitcoin.
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There are three possibilities for such a crash in trading volume:
I think Digitex will be a giant in futures trading because their platform is really good and allows free and seamless transactions without any trading fee.
I am not promoting them but it is a fact that they are better than bitmex. These are my thoughts.
There was no decline in trading volume!
Then I suspect it might just be a bug in the order book. Wait for a couple of days and checking would I think be better because if there was any error they would rectified it. Thanks for reading my comment.
Maybe thr script that creates fake orders crashed.
I'd say traders are expecting large price movements. We have gone down a lot and crypto is far more volatile than stocks or bonds. When prices move, they move a lot. For most traders $3000-$4000 range was the lowest or second lowest bottom they were expecting. After a loss of lots of volume, markets can take a sudden shift with a massive spike.
I've done some margin trading on X5 leverage and the current situation would have made me extremely cautious. Bitmex offer far more leverage and imagine what even a short bull trap could do on high leverage. That's my theory on low volume. The is not in a clear bull or bear phase anymore. Making bets is risky.
Those who made money now have a lot to spare and even the ones who stayed out could very well be expecting large price movements and they could be making bets away from the 10% range of the price. This is just my personal speculation.
My thought is that short sellers have made their money on the drop and now the risk/reward is not as attractive as short sellers are capped at their maximum gains when prices hit zero but could have infinite loses if the price increases. So, they may be out of the market...
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So did this drop start about a month ago? Around election time?
It is because Bitcoin price is getting lowered gradually and the trades on Bitmex is made on the basis of the value of Bitcoin.
When Bitcoin’s price was 20k, if you had 1 bitcoin, you could make order worth 20k on Bitmex using 1x leverage.
But now, you can only make order worth 3k dollar with 1 bitcoin using 1x leverage.
This is what happened to all traders on bitmex and this is natural phenomenon.
I think you can understand my words if you understand how the margin trades is made on bitmex.
It is not the cause of the drop of bitcoin price but the result of the drop of bitcoin price.
Sorry for weird English
I’m not a native speaker
This cannot be. If you look at the charts you see volune goingn up while price drops.
Hence there must be some other reason
Manipulation :D
Why?
BitMEX's picture shows early October,
There are a large number of traders,
Think that the global economy will start to collapse,
So from the middle of October, BitMEX the way down.
And when the economy collapses
False Cryptographic currency will be worthless
So Cryptographic currency will definitely go down first.
BitMEX expression the people's Thoughts.
that is, the climb or decline of the BitMEX chart - expression the confidence of the people in the global economy.
BitMEX has climbed sharply - Most people think the global economy will take off.
BitMEX fell sharply - representing the majority of the public that the global economy will collapse.
Because the trade of BitMEX is buying/selling
You can buy - if Cryptographic currency up - you make money
Can also sell - if Cryptographic currency down - you make money
BitMEX can Borrowing 100 multiple,
As long as the electronic currency rises and falls 1%, you earn 1 share or lose your 1 share.
And the reason why Cryptographic currency fell,
The real reason is the foreign policy of A-country , And C-country's news coverage,
Let most C-country people feel that the global economy will be under the blow of A-country.
A-country will Climbing , other countries will fall,
So the global economy will collapse and Cryptographic currency prices will go to down.
Guess a group of people were high last night
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