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Fair, the ForEx role will never go away, but it seems that MtGox has also become a trading platform for the Bitcoins themselves Wait, whats the difference betw

Fair, the ForEx role will never go away, but it seems that MtGox has also become a trading platform for the Bitcoins themselves Wait, whats the difference between those two things? Converting bitcoins into anything else _is_ ForEx.

vy8vWJlco 14y ago
MtGox has become something of a speculative trading platform. While direct exchange (cash in, cash out) will always be necessary (unless you are paid in Bitcoins and live off of Bitcoins), I don't think MtGox is mostly being used that way. Rather, MtGox is becoming synonymous with Bitcoins for traders, and people want to use it like a bank (with all the problems that entails, and Bitcoin was partially hoped to relieve). As such, Bitcoin is only as reliable as MtGox. If People's main interaction with MtGox was buying Bitcoins for use on real goods and services, then I would agree that it is just another exchange, but people aren't using it like that. People buy BTC with USD one day, and buy CAD with BTC the next, with every intention of going back through the exchange and the Bitcoin currency again in order to cash out. MtGox has an API, and in fact, you are right, that is precisely what a ForEx is used for... I'm not knocking it, only pointing out that many of the problems people want Bitcoin to solve are being recreated by re-imposing conventional institutional roles. As long as there is more than one currency, people will need to exchange them. Who am I to say Bitcoin "shouldn't" have a trading platform other than to note that, IMHO, anyone who uses MtGox speculatively is relying on it's centralization, with all that that entails. I think it's ultimately just a matter of scale.
- codeulike 14y ago
  People buy BTC with USD one day, and buy CAD with BTC the next, with every intention of going back through the exchange and the Bitcoin currency again in order to cash out. Are you sure they're doing that?? Bitcoins volatility would render it pointless for Forex trading. (edit: by which I mean trading between two old school currencies via bitcoin)
  - vy8vWJlco 14y ago
    I am taking it for granted that speculative trading is a pretty common, if not the main activity on MtGox: - "Bitcoin day trading": https://bitcointalk.org/index.php?topic=57169.0 https://bitcointalk.org/index.php?topic=57169.0 - "Mt. Gox Temporarily Halts Bitcoin Trading to Allow the Market to Calm the Hell Down": http://betabeat.com/2013/04/mt-gox-halts-trading-temporarily/ http://betabeat.com/2013/04/mt-gox-halts-trading-temporarily... But I could be wrong.
    - codeulike 14y ago
      Oh yeah, people are swapping BitCoin for (old school) currency Y and then back again like crazy. I thought you meant people using Bitcoin to do arbitage between (old school) currencies X and Y I agree that speculation is harming bitcoin. It needs less volatility to be truely useful. But then when a genuinely innovative currency/technology suddenly gets a ton of press, I don't see how a spike could be avoided.
      - vy8vWJlco 14y ago
        "I thought you meant people using Bitcoin to do arbitage between (old school) currencies X and Y" That's precisely what I suspect (and can only guess at this point) that it is being used for: http://bitcoinmagazine.com/btc-trader-bitcoin-arbitrage-made-easy/ http://bitcoinmagazine.com/btc-trader-bitcoin-arbitrage-made... http://lichtman.ca/is-bitcoin-arbitrage-feasible/ http://lichtman.ca/is-bitcoin-arbitrage-feasible/ https://github.com/michaelcdillon/BitCoin-Arbitrage https://github.com/michaelcdillon/BitCoin-Arbitrage At the same time, MtGox also serves as an entrypoint for non-speculating users and has effectively become the "Bitcoin bank." It's voluntary - people are choosing to use MtGox, but in this regard MtGox's success seems to be a Bitcoiner's weakness: a DDoS against MtGox can cut the value of a BTC (and their lunch money) in half.

vy8vWJlco 14y ago

MtGox has become something of a speculative trading platform. While direct exchange (cash in, cash out) will always be necessary (unless you are paid in Bitcoins and live off of Bitcoins), I don't think MtGox is mostly being used that way. Rather, MtGox is becoming synonymous with Bitcoins for traders, and people want to use it like a bank (with all the problems that entails, and Bitcoin was partially hoped to relieve). As such, Bitcoin is only as reliable as MtGox. If People's main interaction with MtGox was buying Bitcoins for use on real goods and services, then I would agree that it is just another exchange, but people aren't using it like that. People buy BTC with USD one day, and buy CAD with BTC the next, with every intention of going back through the exchange and the Bitcoin currency again in order to cash out. MtGox has an API, and in fact, you are right, that is precisely what a ForEx is used for... I'm not knocking it, only pointing out that many of the problems people want Bitcoin to solve are being recreated by re-imposing conventional institutional roles. As long as there is more than one currency, people will need to exchange them. Who am I to say Bitcoin "shouldn't" have a trading platform other than to note that, IMHO, anyone who uses MtGox speculatively is relying on it's centralization, with all that that entails. I think it's ultimately just a matter of scale.

codeulike 14y ago
People buy BTC with USD one day, and buy CAD with BTC the next, with every intention of going back through the exchange and the Bitcoin currency again in order to cash out. Are you sure they're doing that?? Bitcoins volatility would render it pointless for Forex trading. (edit: by which I mean trading between two old school currencies via bitcoin)
- vy8vWJlco 14y ago
  I am taking it for granted that speculative trading is a pretty common, if not the main activity on MtGox: - "Bitcoin day trading": https://bitcointalk.org/index.php?topic=57169.0 https://bitcointalk.org/index.php?topic=57169.0 - "Mt. Gox Temporarily Halts Bitcoin Trading to Allow the Market to Calm the Hell Down": http://betabeat.com/2013/04/mt-gox-halts-trading-temporarily/ http://betabeat.com/2013/04/mt-gox-halts-trading-temporarily... But I could be wrong.
  - codeulike 14y ago
    Oh yeah, people are swapping BitCoin for (old school) currency Y and then back again like crazy. I thought you meant people using Bitcoin to do arbitage between (old school) currencies X and Y I agree that speculation is harming bitcoin. It needs less volatility to be truely useful. But then when a genuinely innovative currency/technology suddenly gets a ton of press, I don't see how a spike could be avoided.
    - vy8vWJlco 14y ago
      "I thought you meant people using Bitcoin to do arbitage between (old school) currencies X and Y" That's precisely what I suspect (and can only guess at this point) that it is being used for: http://bitcoinmagazine.com/btc-trader-bitcoin-arbitrage-made-easy/ http://bitcoinmagazine.com/btc-trader-bitcoin-arbitrage-made... http://lichtman.ca/is-bitcoin-arbitrage-feasible/ http://lichtman.ca/is-bitcoin-arbitrage-feasible/ https://github.com/michaelcdillon/BitCoin-Arbitrage https://github.com/michaelcdillon/BitCoin-Arbitrage At the same time, MtGox also serves as an entrypoint for non-speculating users and has effectively become the "Bitcoin bank." It's voluntary - people are choosing to use MtGox, but in this regard MtGox's success seems to be a Bitcoiner's weakness: a DDoS against MtGox can cut the value of a BTC (and their lunch money) in half.