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But is it really? It would seem to depend on what you define as “trading”. If I sell on an exchange, and someone on the same exchange buys, there’s no reason fo

by orev 8y ago

But is it really? It would seem to depend on what you define as “trading”. If I sell on an exchange, and someone on the same exchange buys, there’s no reason for them to actually force transactions through the network. It only needs to go through the network if the exchange doesn’t have enough on hand to complete the transaction. This kind of net trading is fairly common. Just because it didn’t go through the network doesn’t mean it didn’t happen.

tuesdayrain 8y ago
>This kind of net trading is fairly common. Just because it didn’t go through the network doesn’t mean it didn’t happen. I would expect that to be the ONLY kind of trading, with the single exception being decentralized exchanges that need to use the network to facilitate trades.
Traster 8y ago
You're misunderstanding what they're saying. They're literally saying that entire exchanges are clearly faking their trading volume because the data can be observed to be fraudulent - volume doesn't has no time correlation with other exchanges and the distribution of trades by volume is clearly fake.
UweSchmidt 8y ago
The idea of a Bitcoin "exchange" is already weird, as most attributes of crypto don't apply if exchanges are involved. But if those exchanges don't even bother to execute trades on the real blockchain, if the involved steps are just too much of a hassle, if they are content with storing and processing those "transactions" in their SQL Database, then...what is left of that old White Paper, is it anything else than a sacred book of a religion no one believes in anymore?
- reidjs 8y ago
  The saying goes bitcoins on an exchange aren't yours. All exchanges (that I know of) allow you to pull tokens into your private wallet, at which point they belong to you. It would be sort of foolish for the exchange to execute trades on the real blockchain because it would be slow & expensive. Makes way more sense to do that part with database transactions.
  - keymone 8y ago
    Payment channels solve this. It’s basically on-chain trading without custodial account, the exchange simply does order matching.
    - Klathmon 8y ago
      Lightning Network in general is still pretty young, it's no surprise that the big exchanges haven't begun working with it yet. Especially since most implementations still have maximum limits in place to prevent bugs from costing too much money while the software is still being developed, tested, and proven.
  - UweSchmidt 8y ago
    If it is impractical for professional organizations to handle crypto transactions then it is impractical for anyone. If the blockchain works, if it's good for anything, then ... use it!
    - Klathmon 8y ago
      But nobody is saying the blockchain is good for anything. The scaling problems of on-blockchain transactions have been known since it started, and there has been quite a lot of work done on ways to scale cryptocurrencies without giving up many of the properties it has. One of these is called Lightning Network for bitcoin, where (in VERY oversimplified terms) the blockchain becomes an arbiter of sorts, and is only used when there is a disagreement or someone tries to cheat someone else out of money, or for very large transactions (large in terms of value, not transaction size). Saying "If the blockchain works, if it's good for anything, then ... use it!" is like telling someone who wants to fly across the country to just drive it since you were told that cars can drive anywhere in the country... You could technically use the blockchain for all transactions, but it has a number of tradeoffs that most don't want to use for every single transaction. And that's okay! Having the ability to make a choice between the "zero trust" nature of the blockchain and trusting an exchange for faster/cheaper transactions is awesome! Hopefully things like Lightning Network will keep continuing and can add an additional choice which combines just about all of the "zero trust" benefits of a blockchain with the speed and cost of off-chain transactions.
modeless 8y ago
Fake volume is not someone selling and someone else buying. It's just the exchange lying and saying that someone bought and someone else sold when nobody actually did. Or, it's someone who owns two accounts trading back and forth between themselves. (Some of these exchanges have zero fees, so this doesn't cost any money.)

by orev 8y ago

tuesdayrain 8y ago

>This kind of net trading is fairly common. Just because it didn’t go through the network doesn’t mean it didn’t happen. I would expect that to be the ONLY kind of trading, with the single exception being decentralized exchanges that need to use the network to facilitate trades.

Traster 8y ago

You're misunderstanding what they're saying. They're literally saying that entire exchanges are clearly faking their trading volume because the data can be observed to be fraudulent - volume doesn't has no time correlation with other exchanges and the distribution of trades by volume is clearly fake.

UweSchmidt 8y ago

The idea of a Bitcoin "exchange" is already weird, as most attributes of crypto don't apply if exchanges are involved. But if those exchanges don't even bother to execute trades on the real blockchain, if the involved steps are just too much of a hassle, if they are content with storing and processing those "transactions" in their SQL Database, then...what is left of that old White Paper, is it anything else than a sacred book of a religion no one believes in anymore?

reidjs 8y ago
The saying goes bitcoins on an exchange aren't yours. All exchanges (that I know of) allow you to pull tokens into your private wallet, at which point they belong to you. It would be sort of foolish for the exchange to execute trades on the real blockchain because it would be slow & expensive. Makes way more sense to do that part with database transactions.
- keymone 8y ago
  Payment channels solve this. It’s basically on-chain trading without custodial account, the exchange simply does order matching.
  - Klathmon 8y ago
    Lightning Network in general is still pretty young, it's no surprise that the big exchanges haven't begun working with it yet. Especially since most implementations still have maximum limits in place to prevent bugs from costing too much money while the software is still being developed, tested, and proven.
- UweSchmidt 8y ago
  If it is impractical for professional organizations to handle crypto transactions then it is impractical for anyone. If the blockchain works, if it's good for anything, then ... use it!
  - Klathmon 8y ago
    But nobody is saying the blockchain is good for anything. The scaling problems of on-blockchain transactions have been known since it started, and there has been quite a lot of work done on ways to scale cryptocurrencies without giving up many of the properties it has. One of these is called Lightning Network for bitcoin, where (in VERY oversimplified terms) the blockchain becomes an arbiter of sorts, and is only used when there is a disagreement or someone tries to cheat someone else out of money, or for very large transactions (large in terms of value, not transaction size). Saying "If the blockchain works, if it's good for anything, then ... use it!" is like telling someone who wants to fly across the country to just drive it since you were told that cars can drive anywhere in the country... You could technically use the blockchain for all transactions, but it has a number of tradeoffs that most don't want to use for every single transaction. And that's okay! Having the ability to make a choice between the "zero trust" nature of the blockchain and trusting an exchange for faster/cheaper transactions is awesome! Hopefully things like Lightning Network will keep continuing and can add an additional choice which combines just about all of the "zero trust" benefits of a blockchain with the speed and cost of off-chain transactions.

modeless 8y ago

Fake volume is not someone selling and someone else buying. It's just the exchange lying and saying that someone bought and someone else sold when nobody actually did. Or, it's someone who owns two accounts trading back and forth between themselves. (Some of these exchanges have zero fees, so this doesn't cost any money.)