Hacker News Reader

Comment by kasey_junk | Hacker News Reader

> There’s no premium access, no expensive trading floor credentials. It’s totally open. I love that.

I completely understand this sentiment and agree for the most part. That said, for the specific case of co-location it would be better for the exchange to offer paid access.

The reason is that if the exchange doesn't offer it as a standardized option (and the exchange gets successful enough) being close to the exchange will become it's own pet industry. Only those "in the know" or with the ability to pay them will know the right places to host their bots and in the extreme cases only very rich players will have access as they buy up all the premium real estate.

This happened with the other exchanges, so we can only assume at some level of success it will happen with bitcoin exchanges.

View on HN

Coinbase is hosted on AWS in the us-east-1 region; this makes co-location incredibly cheap and accessible. The specific availability zone isn't publicized, but it would be trivial to do latency comparisons between the zones and figure it out - since Coinbase is a fairly new company, there are only 3 zones they could be in.

Availability zones are randomized per accounts; my us-east-1a might be the same as your us-east-1b.

This is presumably done to stop everyone putting things into the same AZ by just choosing the first one in the list.

There is some more detail here: http://alestic.com/2009/07/ec2-availability-zones

That's true, but a latency based test should still let you figure out which zone you need to run in. But everyone would need to do the test for themselves.

The CME & ICE were hosted at 350 Cermak in Chicago. One of the largest data centers in the world. Getting machines in that building was never hard or expensive.

But there was a whole cottage industry built up of consultants which promised to tell you which specific room or cabinet in a room had shorter cable runs to the exchange. There were companies that would idle those cabinets/rooms just so no one else could use them.

AWS hosting is more opaque and thus more likely to be gamed in this way. I wouldn't expect anyone to pay for physical presence information (the latency requirements aren't there yet). But I can totally see large players buying massive amounts of nodes in order to monitor/cycle through the best performing ones or in an attempt to impact the exchange operations. You would also expect to see the pay for Amazon employees with non-public details about node creation/communications to all of a sudden become much more valuable to large banks/trading firms.

Is this something that Coinbase needs to deal with right now? No, it isn't big enough or valuable enough for it. But long term the idea of "open" access falls apart under these conditions, and the more fair approach is actually the paid fee one. As counter-intuitive as that seems.

    ➜ curl -i https://api.exchange.coinbase.com
        HTTP/1.1 404 Not Found
        Server: cloudflare-nginx
        Set-Cookie: AWSELB=7541......;PATH=/

It looks like they are hosted on AWS and only provide access via cloudflare.

Given that, I don't think offering paid access to be closer is really relevant.

The closest you can get physically would be to find the availability zone - however your traffic is still going to be routed through cloudflare, so you might be better being closer to the cloudflare servers handling your requests.

Cloudflare will respond to a ping, but a request will pass through. Clever folks will realize that finding which AWS region(s) host(s) the ELB is trivial with curl --trace-time and ping, since you can deduce the RTT from Cloudflare's proxy through to the ELB. You also know geographical Route 53 and other tricks aren't in use, because you automatically lose that information through Cloudflare.

I'm fairly confident it's in us-east-1 based on a quick glance.

Yeah, it's mentioned in their API docs... AWS US-East

https://docs.exchange.coinbase.com/#colocation

There's nothing preventing them from also opening up direct traffic to those paying for 'close' access that does not flow through CloudFlare or setting up for-pay servers in in their same availability zone(s), maybe through a direct VPN for paying customers, bypassing as much of the public internet as possible.

I've hear OKCoin has 'priorty access' available for their api, paid access that lets you have more frequent queries. Though I don't know for sure.

Reply on news.ycombinator.com