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BTC and pre-IPO tech companies also have the added advantage of being impossible to short Is it impossible? Couldn't you essentially short by borrowing bitcoin

BTC and pre-IPO tech companies also have the added advantage of being impossible to short Is it impossible? Couldn't you essentially short by borrowing bitcoins? (e.g. I will borrow 10 bitcoins today, immediately sell them, paying back say 12 bitcoins in three months. That sort of deal). I seriously contemplated such notions during the recent upswing.

notahacker 13y ago
Fair point, you technically can short it, but given there's no mature infrastructure to support and regulate this sort of trade (and Bitcoin is very volatile and illiquid, and a legal grey area), I'm not sure you'd find anyone to do the deal, especially since I think you'd need to short for a very long period to be on the safe side.
- corresation 13y ago
  Curious I went looking and there are a couple of providers that offer this. For instance Bitfinex - https://www.bitfinex.com/pages/features#short https://www.bitfinex.com/pages/features#short I have zero experience with them so that isn't a recommendation, just someone who does it.
- ramchip 13y ago
  Bitfinex allows shorting, and icbit.se lets you sell futures for a similar effect. It's actually very cheap to borrow bitcoins on bitfinex last I checked due to so many people holding them. I consider both exchanges to be risky, though, compared to mtgox or bitstamp (and naked short sell of bitcoins is extremely risky, think about the margin you'd need if it goes up to $5000 before popping).
  - notahacker 13y ago
    As you've pretty much acknowledged, nobody bearish on the long-term outlook for BTC is going to consider an anonymous overseas Bitcoin startup in beta to be "mature infrastructure" they can rely on to pay out if Bitcoin drops dramatically...
dragonwriter 13y ago
> Couldn't you essentially short by borrowing bitcoins? In theory, sure. In practice, if no one is lending bitcoins based on the promise to repay more bitcoins later, then, no, you can't short them. And the fact that one of the selling points of bitcoin is that it doesn't rely on trust might explain why even with a fair amount of money from enthusiasts chasing present bitcoins, there might not be lots of people with bitcoins lending them against a promise of future bitcoins.
- corresation 13y ago
  In practice people do lend bitcoins. Of course they do, and the entire system does not demand anonymity or non-accountability. If someone actually wanted to short bitcoin in such a way, they can do it right now. Shorting is, as in the normal securities market, a dangerous gambit because the downside is infinitely larger than the upside. But if someone wanted to do it they could.

notahacker 13y ago

Fair point, you technically can short it, but given there's no mature infrastructure to support and regulate this sort of trade (and Bitcoin is very volatile and illiquid, and a legal grey area), I'm not sure you'd find anyone to do the deal, especially since I think you'd need to short for a very long period to be on the safe side.

corresation 13y ago
Curious I went looking and there are a couple of providers that offer this. For instance Bitfinex - https://www.bitfinex.com/pages/features#short https://www.bitfinex.com/pages/features#short I have zero experience with them so that isn't a recommendation, just someone who does it.
ramchip 13y ago
Bitfinex allows shorting, and icbit.se lets you sell futures for a similar effect. It's actually very cheap to borrow bitcoins on bitfinex last I checked due to so many people holding them. I consider both exchanges to be risky, though, compared to mtgox or bitstamp (and naked short sell of bitcoins is extremely risky, think about the margin you'd need if it goes up to $5000 before popping).
- notahacker 13y ago
  As you've pretty much acknowledged, nobody bearish on the long-term outlook for BTC is going to consider an anonymous overseas Bitcoin startup in beta to be "mature infrastructure" they can rely on to pay out if Bitcoin drops dramatically...

dragonwriter 13y ago

> Couldn't you essentially short by borrowing bitcoins? In theory, sure. In practice, if no one is lending bitcoins based on the promise to repay more bitcoins later, then, no, you can't short them. And the fact that one of the selling points of bitcoin is that it doesn't rely on trust might explain why even with a fair amount of money from enthusiasts chasing present bitcoins, there might not be lots of people with bitcoins lending them against a promise of future bitcoins.

corresation 13y ago
In practice people do lend bitcoins. Of course they do, and the entire system does not demand anonymity or non-accountability. If someone actually wanted to short bitcoin in such a way, they can do it right now. Shorting is, as in the normal securities market, a dangerous gambit because the downside is infinitely larger than the upside. But if someone wanted to do it they could.