5 ms·

All of this is anecdotal: These past couple of days, whenever a coin soars a ridiculous amount, on any given exchange, that exchange seems to mysteriously go d

All of this is anecdotal: These past couple of days, whenever a coin soars a ridiculous amount, on any given exchange, that exchange seems to mysteriously go down. For example: Binance and Bitfinex were down for "maintenance" (or just plain down), while IOTA was experiencing a surge in price (from ~1.10 to 6$). Similarly this happens with Bitcoin today (it seems Quadriga had some issues and Coinbase; not sure about others). Something is up, and it's weird. My conspiracy theory: big money institutions are testing pump and dumps for when short contracts come into play. On the one hand, the cryptocurrency world wants to remain as unregulated as possible; on the other, a lot of individuals are going to get reamed by big whales.

crazypyro 9y ago
Isn't it just the simple explanation that big swings in the market bring insane traffic spikes to market websites? Add to the fact that people are also DDOS websites (doesn't take a "big money institution" to do that) and it seems the explanation is clear...
- odonnellryan 9y ago
  Honestly, I don't think these exchanges can handle a lot of traffic. By a lot, I mean a few hundred trades a second. It is odd to me.
  - mv4 9y ago
    They are very well funded, and they can afford scalability. It's not that hard, given the number of transactions even at peak so far. So yeah, I find these weird circuit breaker patterns suspicious. The worst part is "partial" degradation, when you can't execute trades, but someone else can. It's very easy to hide all sorts of irregularities behind these partial outages.
    - dwaltrip 9y ago
      > It's not that hard I'm sure they would pay you a lot of money to solve their scaling issues, if you were so inclined.
      - mv4 9y ago
        and I would do it.
  - Demiurge 9y ago
    I have entertained using cryptocurrency for game betting at some point, while running some typical web stack. When I started looking into security and scaling, I realized there was a expensive and complicated overhead. When security is of very high concern, traditional performance seems to really suffer.
- superfrank 9y ago
  Yea. I work as a software engineer at a company that sees huge swings in traffic on our product (by nature of the product). It's not uncommon for us to see 20x swings in traffic day-to-day. It's taken us a long time to be able to handle that and even then shit still goes wrong. I'm much more inclined to believe the downtime is caused by scaling issues rather than some big conspiracy, EDIT: Just to give some insight, one of the problems we run into is that usually only one issue is exposed during an outage. For example, lets say we have 10 functions (or services or whatever) in a row that all call each other. All the odd numbered ones have issues where they fail at scale. During the first downtime, function one will fail and start to throw errors, but this means the full traffic load isn't reaching the rest of the functions. By the time the problem is solved, traffic has usually died down, so function 1 is fixed, but 3,5,7,9 still have issues that haven't been exposed. Additionally, at a quickly growing company like Coinbase, the code isn't going to stay the same for very long, so even once those functions are fixed, new issues are introduced. It's easy to say they should be load testing at 10x their expected load to prevent these type of issues, but it's really hard to replicate production traffic. Users do weird and unexpected shit that can cause problems.
  - dmix 9y ago
    There's an article on the frontpage of HN from NYTimes that mentions Coinbase has struggled with the massive spike in traffic recently. It's funny how quickly people jump to overly-complex or borderline conspiratorial explanations when the obvious is staring us in the face... Coinbase might be a large well funded organization but it's still run by developers with giant backlogs of tickets and conflicting priorities to build new stuff vs maintain old stuff.
  - omg_ketchup 9y ago
    > but it's really hard to replicate production traffic This times 1,000.
- SilasX 9y ago
  Not really. While most exchanges went down during the Nov 29th rally, most others didn't during today's, nor did they during the four June rallies where Coinbase also went down.
spelunker 9y ago
I think you can take off your tinfoil hat. Lots of price movement motivates more traffic to the exchanges, resulting in DDoS. As the bitcoin market grows GDAX, Bitfinex, etc are probably going to have to borrow some ideas/talent from NASDAQ & other big electronic exchanges to stabilize things.
- Snackchez 9y ago
  Tinfoil hat off! Shouldn't an exchange be able to handle volume? Seems like a basic requirement. Regardless, I still believe that with the introduction of shorts, were going to see bigger swings.
  - user5994461 9y ago
    Judging by the GDAX runbook, they barely have a couple of orders per second. They can't have performance problem at this scale. I've seen exchanges running 10 or 100 times that amount with no problem, ran by only a couple of graduates out of school. Either way, doesn't matter. Exchanges have no performance problem, it's a big queue, you just queue requests.
  - cortesoft 9y ago
    Clearly it isn't a basic requirement because they exist without being able to handle volume.
  - mortehu 9y ago
    US stock exchanges don't run websites on which you can trade. However, during the flash crash in 2015 I was unable to place trades on either of the two brokerage sites I used at the time (USAA and Vanguard), probably due to other people rushing in to trade like myself.
  - deleted 9y ago
    [deleted]
  - eropple 9y ago
    In my capacity as an infrastructure/scaling consultant I've spoken to multiple exchanges. Without disclosing anything I'm prohibited from, my strong expectation is that almost every exchange can't handle traffic spikes. They're not all shitty me-too Rails apps built by junior engineers who figured "how hard can it be?". But most of the ones I've seen are.
JumpCrisscross 9y ago
> big money institutions are testing pump and dumps for when short contracts come into play Big-money institutions won't do this. Random individuals taking advantage of the fact that lots of value rides on relatively little volume? Much more likely. Combined with the fact that the exchanges, intentionally or unintentionally, lock liquidity when volatility spikes and it's 1907 all over again.
- w-ll 9y ago
  24 Hour Volume is north of 17 Billion. https://coinmarketcap.com/currencies/bitcoin/ https://coinmarketcap.com/currencies/bitcoin/
  - JumpCrisscross 9y ago
    Given the incentives involved (and history of exchanges, everywhere, before regulation) a good fraction of that is wash trading. (A better measure for the risk at hand is the effect of small out-of-market bids and offers on the overall price, i.e. how much it costs to move the price $1.) [1] https://www.investopedia.com/terms/w/washtrading.asp https://www.investopedia.com/terms/w/washtrading.asp Disclaimer: This is not securities advice. Do not buy or sell anything based on this Internet comment.
wolco 9y ago
On the 10th bitcoin will be listed on the chicaco exchange. This is the reason for the price swing lately.
- kwelstr 9y ago
  The 10th is a Sunday
  - kgwgk 9y ago
    The exchange opens Sunday evening.
- misja111 9y ago
  Can you explain? You could also argue that when futures are listed on the 10th, there will finally be an easy way to go short on Bitcoin. For instance when you want to hedge a long position, or simply because you want to speculate on Bitcoin going down. So the listing of Bitcoin futures on the Chicago exchange might not be a good thing for the Bitcoin price at all.
Afforess 9y ago
No, No, No! Conspiracy theories attract attention because they make the world seem more legible, when it's not. In this case, exchanges are not being attacked by shadowy corporations for short contracts. Attention from price surges increases visitor traffic, and exchanges are understaffed or unprepared for the 10-100x increase in traffic volume. There's no need for complicated stories, evil corporations, or any of that nonsense. Stick with straightforward cause and effect.
- jrs95 9y ago
  No, No, No! Don't pay attention to that thing! Look over there! Seriously though, it's worth considering that this kind of thing could be possible even if we don't know whether or not it has anything to do with these specific outages.
  - Afforess 9y ago
    No, it's not. There are an infinite number of conspiracy theories. There is no value in considering them.
- marzell 9y ago
  You are coming off as very emotional/desperate in your attempt to convince people to act cool and logical. It's not very persuasive, and if I could downvote you I would.
kough 9y ago
Coinbase runs on Ruby and their devops aren't good enough to make up for it.
Florin_Andrei 9y ago
No need for conspiracy theories. These services are like banks, but the traffic they handle is more like a news site, due to the extreme volatility of cryptocurrencies. Super-security combined with extremely large traffic fluctuations. Whoever is on PagerDuty at Coinbase these days - I feel for ya.

crazypyro 9y ago

Isn't it just the simple explanation that big swings in the market bring insane traffic spikes to market websites? Add to the fact that people are also DDOS websites (doesn't take a "big money institution" to do that) and it seems the explanation is clear...

odonnellryan 9y ago
Honestly, I don't think these exchanges can handle a lot of traffic. By a lot, I mean a few hundred trades a second. It is odd to me.
- mv4 9y ago
  They are very well funded, and they can afford scalability. It's not that hard, given the number of transactions even at peak so far. So yeah, I find these weird circuit breaker patterns suspicious. The worst part is "partial" degradation, when you can't execute trades, but someone else can. It's very easy to hide all sorts of irregularities behind these partial outages.
  - dwaltrip 9y ago
    > It's not that hard I'm sure they would pay you a lot of money to solve their scaling issues, if you were so inclined.
    - mv4 9y ago
      and I would do it.
- Demiurge 9y ago
  I have entertained using cryptocurrency for game betting at some point, while running some typical web stack. When I started looking into security and scaling, I realized there was a expensive and complicated overhead. When security is of very high concern, traditional performance seems to really suffer.
superfrank 9y ago
Yea. I work as a software engineer at a company that sees huge swings in traffic on our product (by nature of the product). It's not uncommon for us to see 20x swings in traffic day-to-day. It's taken us a long time to be able to handle that and even then shit still goes wrong. I'm much more inclined to believe the downtime is caused by scaling issues rather than some big conspiracy, EDIT: Just to give some insight, one of the problems we run into is that usually only one issue is exposed during an outage. For example, lets say we have 10 functions (or services or whatever) in a row that all call each other. All the odd numbered ones have issues where they fail at scale. During the first downtime, function one will fail and start to throw errors, but this means the full traffic load isn't reaching the rest of the functions. By the time the problem is solved, traffic has usually died down, so function 1 is fixed, but 3,5,7,9 still have issues that haven't been exposed. Additionally, at a quickly growing company like Coinbase, the code isn't going to stay the same for very long, so even once those functions are fixed, new issues are introduced. It's easy to say they should be load testing at 10x their expected load to prevent these type of issues, but it's really hard to replicate production traffic. Users do weird and unexpected shit that can cause problems.
- dmix 9y ago
  There's an article on the frontpage of HN from NYTimes that mentions Coinbase has struggled with the massive spike in traffic recently. It's funny how quickly people jump to overly-complex or borderline conspiratorial explanations when the obvious is staring us in the face... Coinbase might be a large well funded organization but it's still run by developers with giant backlogs of tickets and conflicting priorities to build new stuff vs maintain old stuff.
- omg_ketchup 9y ago
  > but it's really hard to replicate production traffic This times 1,000.
SilasX 9y ago
Not really. While most exchanges went down during the Nov 29th rally, most others didn't during today's, nor did they during the four June rallies where Coinbase also went down.

spelunker 9y ago

I think you can take off your tinfoil hat. Lots of price movement motivates more traffic to the exchanges, resulting in DDoS. As the bitcoin market grows GDAX, Bitfinex, etc are probably going to have to borrow some ideas/talent from NASDAQ & other big electronic exchanges to stabilize things.

Snackchez 9y ago
Tinfoil hat off! Shouldn't an exchange be able to handle volume? Seems like a basic requirement. Regardless, I still believe that with the introduction of shorts, were going to see bigger swings.
- user5994461 9y ago
  Judging by the GDAX runbook, they barely have a couple of orders per second. They can't have performance problem at this scale. I've seen exchanges running 10 or 100 times that amount with no problem, ran by only a couple of graduates out of school. Either way, doesn't matter. Exchanges have no performance problem, it's a big queue, you just queue requests.
- cortesoft 9y ago
  Clearly it isn't a basic requirement because they exist without being able to handle volume.
- mortehu 9y ago
  US stock exchanges don't run websites on which you can trade. However, during the flash crash in 2015 I was unable to place trades on either of the two brokerage sites I used at the time (USAA and Vanguard), probably due to other people rushing in to trade like myself.
- deleted 9y ago
  [deleted]
- eropple 9y ago
  In my capacity as an infrastructure/scaling consultant I've spoken to multiple exchanges. Without disclosing anything I'm prohibited from, my strong expectation is that almost every exchange can't handle traffic spikes. They're not all shitty me-too Rails apps built by junior engineers who figured "how hard can it be?". But most of the ones I've seen are.

JumpCrisscross 9y ago

> big money institutions are testing pump and dumps for when short contracts come into play Big-money institutions won't do this. Random individuals taking advantage of the fact that lots of value rides on relatively little volume? Much more likely. Combined with the fact that the exchanges, intentionally or unintentionally, lock liquidity when volatility spikes and it's 1907 all over again.

w-ll 9y ago
24 Hour Volume is north of 17 Billion. https://coinmarketcap.com/currencies/bitcoin/ https://coinmarketcap.com/currencies/bitcoin/
- JumpCrisscross 9y ago
  Given the incentives involved (and history of exchanges, everywhere, before regulation) a good fraction of that is wash trading. (A better measure for the risk at hand is the effect of small out-of-market bids and offers on the overall price, i.e. how much it costs to move the price $1.) [1] https://www.investopedia.com/terms/w/washtrading.asp https://www.investopedia.com/terms/w/washtrading.asp Disclaimer: This is not securities advice. Do not buy or sell anything based on this Internet comment.

wolco 9y ago

On the 10th bitcoin will be listed on the chicaco exchange. This is the reason for the price swing lately.

kwelstr 9y ago
The 10th is a Sunday
- kgwgk 9y ago
  The exchange opens Sunday evening.
misja111 9y ago
Can you explain? You could also argue that when futures are listed on the 10th, there will finally be an easy way to go short on Bitcoin. For instance when you want to hedge a long position, or simply because you want to speculate on Bitcoin going down. So the listing of Bitcoin futures on the Chicago exchange might not be a good thing for the Bitcoin price at all.

Afforess 9y ago

No, No, No! Conspiracy theories attract attention because they make the world seem more legible, when it's not. In this case, exchanges are not being attacked by shadowy corporations for short contracts. Attention from price surges increases visitor traffic, and exchanges are understaffed or unprepared for the 10-100x increase in traffic volume. There's no need for complicated stories, evil corporations, or any of that nonsense. Stick with straightforward cause and effect.

jrs95 9y ago
No, No, No! Don't pay attention to that thing! Look over there! Seriously though, it's worth considering that this kind of thing could be possible even if we don't know whether or not it has anything to do with these specific outages.
- Afforess 9y ago
  No, it's not. There are an infinite number of conspiracy theories. There is no value in considering them.
marzell 9y ago
You are coming off as very emotional/desperate in your attempt to convince people to act cool and logical. It's not very persuasive, and if I could downvote you I would.

kough 9y ago

Coinbase runs on Ruby and their devops aren't good enough to make up for it.

Florin_Andrei 9y ago

No need for conspiracy theories. These services are like banks, but the traffic they handle is more like a news site, due to the extreme volatility of cryptocurrencies. Super-security combined with extremely large traffic fluctuations. Whoever is on PagerDuty at Coinbase these days - I feel for ya.