Watching the Bitcoin fire from a safe distance – what just happened | Hacker News Reader

Watching the Bitcoin fire from a safe distance – what just happened

davidgerard.co.uk

37 pointsdavidgerard11 comments

> This crash didn’t just happen — it appears to have been provoked by a pile of fake sell walls, such as a large spoof order at $12,000 that disappeared as soon as the price approached it, and another at $11,000. If this isn’t our friend “Spoofy”, it s a close relative.

> (This sort of glaring manipulation is ridiculously illegal in real securities trading — but welcome to Bitcoin.)

I really don't understand what these "walls" are, and how they can be spoofed. Do the same things also apply to traditional trading on Wall St. or is this unique to crypto currencies?

Anyone?

At any given moment there will be a ton of offers people have made to buy or sell at a given price out in the market (whether it's Coinbase, NYSE or whatever). See [0] for an example of how this "order book" is visualized. In the middle is where the actual transactions are happening.

A fake sell wall is a giant offer to purchase at a price that is pretty far from the current market price. On that chart it would be visible as a large vertical uptick. As the price goes down and approaches the huge buy order, the trader cancels it and the wall disappears.

On a traditional exchange this is technically possible, but it's illegal to intentionally manipulate the market by placing orders. People often complain that high-frequency traders put in these orders and cancel them immediately without having the intention to actually transact.

0: https://www.bitstamp.net/market/order_book/

Wow. Thanks for the explanation.

Ah yes again with the "I told you so" posts. Even though basically everyone that has been in the market before December is still significantly in the green. But no, THIS is probably the time cryptoassets are dead

250 million tethers appeared in 2 days? Is there anything close to an audit of what Tether Limited are actually holding? Why are people fooled by a cryptocurrency supposedly backed by USD that obviously isn't?

because NUMBER GO UP

Really, that's the whole reason. As long as the Bitcoin market keeps treating Tethers like real dollars, the NUMBER KEEPS GOING UP, the media keeps running articles on this exciting new asset class and new bagholders keep putting their cash in for existing holders to cash out with.

Presumably the exchanges are all correlated enough that Bitfinex can pump BTC and whatever else across the market by injecting Tethers?

arbitrage is difficult because the market is stupidly inefficient, but yes, the prices do more or less correlate.

e.g., last night when they arrested the fall with 100m more Tethers, the price shot up $1000 on Bitfinex and about $400 on GDAX a bit later.

"But the emperor isn't wearing anything!?"

But a commodity currency based on entropy has no value!?

Now we know how third world countries feel.

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