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Well you could define 'economic' transactions as those that leave one of the participants with less bitcoin and another participant with more bitcoin. In that

Well you could define 'economic' transactions as those that leave one of the participants with less bitcoin and another participant with more bitcoin. In that sense mining pool distributions are double-counting - the distribution of the mining reward to the pool and then the distribution of that same reward from the pool to an individual member. (I understand that correctly right?) A mixer is just shuffling it's coins around so it's non-economic. Spoofed trades are obviously non-economic. 'Market Manipulation' could mean lots of stuff but I wouldn't be surprised if there are bots that enter lots of offsetting trades on both sides of the orderbook to generate volume around specific events. If they're offsetting that's non-economic. Now maybe 'non-economic' isn't the best term but I do think those sorts of activities should be given a meaningful distinction from the other third of the volume that is 'normal transactions' of individuals buying and selling from/to each other.

hobofan 8y ago
> Spoofed trades are obviously non-economic. In a model where Bitcoin is the only available currency, you could certainly assign an economic value to a mixer - the value of the created privacy (yes, I know that mixers are flawed). There are also cryptocurrencies that have (a higher level of) built-in privacy, like ZCash, and that people are using it should also be an indicator that there is economic value in those transactions since the only real reason to use ZCash is to get that additional bit of privacy.
- frgtpsswrdlame 8y ago
  >In a model where Bitcoin is the only available currency, you could certainly assign an economic value to a mixer - the value of the created privacy (yes, I know that mixers are flawed). Are mixers spoofing? Here, consider a market with three people: A, B, C all with 100 BTC. At 12:01 A sells 50 shares to B. Starting at 12:01 and going until 12:00 B and C sell 1 share back and forth, one transaction per minute. So after 24 hours they have: A - 50 B - 150 C - 100 Is the 'true' trading volume for the day 50 or is it 1490? It's a matter of perspective but Elementus views that 50 as an important number that investors should have. I agree that using the term 'economic' is dumb but investors want to understand the actual dynamics of buyers and sellers in the market, not the dynamics of ultra-noisy zero-netting mixers.
Canada 8y ago
> In that sense mining pool distributions are double-counting Let's say I have a customer who pays me, and I pay a bunch of employees or contractors who helped me deliver services to that customer, keeping some profit for myself. Does that have no economic value? Because that's what mining pools do. > I wouldn't be surprised if there are bots that enter lots of offsetting trades on both sides of the orderbook to generate volume around specific events. There is no order book on Bitcoin, Ethereum, and others. The order books are on web based exchanges, and yeah, there's a lot of fake trading. Most of it is clearly generated by the exchanges themselves and is completely fake. That stuff is so obvious when you look. In those cases the volume dwarfs the depth, so most orders miraculously attract counter parties instantaneously while the rest of the orders just sit there. Exchanges fake it to get a better rank on coinmarketcap, which blindly trusts the trade data from the APIs. And there's wash trades by users of these web based exchanges, but I believe it's significantly less volume than the pure fakes because those guys have to put up real funds so it's only useful to make shitcoins look more popular. In any case, none of that actually makes a transaction on a blockchain. It's just shifting balances in some centralized database.
- frgtpsswrdlame 8y ago
  >Let's say I have a customer who pays me, and I pay a bunch of employees or contractors who helped me deliver services to that customer, keeping some profit for myself. Does that have no economic value? Because that's what mining pools do. Again we're really getting hung up on the term 'economic.' Okay you're the pool, you receive 50 BTC and you pay 45 of that out to miners. Have we transacted 95 BTC or 50 BTC? Is the 'economic value' of our transaction 50 or 95? The best thing is it doesn't even matter what you answer because what's best for everyone is if we know both numbers. Right now all parties interested in BTC can see is the 95. But if I'm investing in BTC I don't care about the 95, I care about the 50 because 50 tells me how much BTC actually changed hands here. And this firm is just trying to find all the double counting and completely fake transactions and remove them from our number. >There is no order book on Bitcoin, Ethereum, and others. The order books are on web based exchanges I mean yeah? I don't understand what difference you're trying to draw here. >yeah, there's a lot of fake trading >It's just shifting balances in some centralized database. Exactly and it's the same way in a mining pool as per the above example. 45 BTC is getting counted twice because we shifted it twice.

hobofan 8y ago

> Spoofed trades are obviously non-economic. In a model where Bitcoin is the only available currency, you could certainly assign an economic value to a mixer - the value of the created privacy (yes, I know that mixers are flawed). There are also cryptocurrencies that have (a higher level of) built-in privacy, like ZCash, and that people are using it should also be an indicator that there is economic value in those transactions since the only real reason to use ZCash is to get that additional bit of privacy.

frgtpsswrdlame 8y ago
>In a model where Bitcoin is the only available currency, you could certainly assign an economic value to a mixer - the value of the created privacy (yes, I know that mixers are flawed). Are mixers spoofing? Here, consider a market with three people: A, B, C all with 100 BTC. At 12:01 A sells 50 shares to B. Starting at 12:01 and going until 12:00 B and C sell 1 share back and forth, one transaction per minute. So after 24 hours they have: A - 50 B - 150 C - 100 Is the 'true' trading volume for the day 50 or is it 1490? It's a matter of perspective but Elementus views that 50 as an important number that investors should have. I agree that using the term 'economic' is dumb but investors want to understand the actual dynamics of buyers and sellers in the market, not the dynamics of ultra-noisy zero-netting mixers.

Canada 8y ago

> In that sense mining pool distributions are double-counting Let's say I have a customer who pays me, and I pay a bunch of employees or contractors who helped me deliver services to that customer, keeping some profit for myself. Does that have no economic value? Because that's what mining pools do. > I wouldn't be surprised if there are bots that enter lots of offsetting trades on both sides of the orderbook to generate volume around specific events. There is no order book on Bitcoin, Ethereum, and others. The order books are on web based exchanges, and yeah, there's a lot of fake trading. Most of it is clearly generated by the exchanges themselves and is completely fake. That stuff is so obvious when you look. In those cases the volume dwarfs the depth, so most orders miraculously attract counter parties instantaneously while the rest of the orders just sit there. Exchanges fake it to get a better rank on coinmarketcap, which blindly trusts the trade data from the APIs. And there's wash trades by users of these web based exchanges, but I believe it's significantly less volume than the pure fakes because those guys have to put up real funds so it's only useful to make shitcoins look more popular. In any case, none of that actually makes a transaction on a blockchain. It's just shifting balances in some centralized database.

frgtpsswrdlame 8y ago
>Let's say I have a customer who pays me, and I pay a bunch of employees or contractors who helped me deliver services to that customer, keeping some profit for myself. Does that have no economic value? Because that's what mining pools do. Again we're really getting hung up on the term 'economic.' Okay you're the pool, you receive 50 BTC and you pay 45 of that out to miners. Have we transacted 95 BTC or 50 BTC? Is the 'economic value' of our transaction 50 or 95? The best thing is it doesn't even matter what you answer because what's best for everyone is if we know both numbers. Right now all parties interested in BTC can see is the 95. But if I'm investing in BTC I don't care about the 95, I care about the 50 because 50 tells me how much BTC actually changed hands here. And this firm is just trying to find all the double counting and completely fake transactions and remove them from our number. >There is no order book on Bitcoin, Ethereum, and others. The order books are on web based exchanges I mean yeah? I don't understand what difference you're trying to draw here. >yeah, there's a lot of fake trading >It's just shifting balances in some centralized database. Exactly and it's the same way in a mining pool as per the above example. 45 BTC is getting counted twice because we shifted it twice.