4 ms·

So that will depress the price right? Time for some cheap BTC

by ck2 13y ago

jrockway 13y ago
I honestly don't think the Bitcoin market is sophisticated enough to react to events like this. Certainly, if the feds really want to sell and someone puts $0.01 on the order books for that size of a trade, and nobody else is around, it could be filled, but I don't see that happening.
- BlackDeath3 13y ago
  It wouldn't be unprecedented. I believe that mass sells have caused price crashes numerous times in the past. Perhaps I misunderstood you?
  - jrockway 13y ago
    Sort of. To me, it looks indistinguishable from randomness with /r/bitcoin trying to explain the randomness with news stories. But maybe I'm wrong.
- quannabe 13y ago
  Huh? Why would they sell it all at once and crash the price? They won't. That is like Warren Buffet deciding he wants to exit a position and dumping tens of millions of shares on the market. No one does that.
- beedogs 13y ago
  quannabe: It looks as though your account has been hellbanned.
asperous 13y ago
Actually it might be interesting. Technically yes if they sold at any price they'd burn through the orderbook and the price would crash. But if they set a flat sell price then that'd make a buy (edit: sell) wall (price can not go above this amount until all 25 million have been purchased). The sell wall could help stabilize the price.
- gibybo 13y ago
  They are not buying coins, they are selling them, so it would be a sell wall. The price couldn't go _above_ their selling price until all 25 million (dollars worth) have been sold.
  - vdaniuk 13y ago
    That is one really interesing side-effect of the whole silkpath shenanigans.
nostromo 13y ago
It's just $25 million of $11,386 million.
dclusin 13y ago
Probably. To understand price changes it's important to consider how they change. Price movements occur as a result of a buyer or seller aggressing into a market and submitting an order such that the parameters of the aggressor's order match the opposite sides unfilled orders. This process is typically referred to as order matching. If a buyer aggresses into the market and matches against unfilled sell orders the price increases because they have removed the lowest prices from the order book. If a seller does something similar the price will drop because the highest prices have been removed. Another reason price movements occur is because people are also reacting to the market and trying to predict where the market is going. As a consequence they will either enter the market at an off market price attempting to predict it, or cancel their outstanding orders and re-price them. But this is another topic entirely and I will leave it out as it's pretty complex and my understanding of that topic is newb level at best. The second thing to consider is the why. Why do price movements occur? Mainly because people are consuming information and trying to predict where the market is going. For other assets such as FX & commodities there are non-speculative market participants who buy and sell based on their business need. An example from Foreign Exchange is a company such as Google having a stockpile of dollars and needing to pay employees in euros. The end result of these non-speculative market participants is greater price stability because they are always buying or always selling, not because they want to, but because they have to. But since bitcoin is largely a speculative currency (the majority of bitcoin trading volume is the result of speculation, not legitimate commerce) the news has a disproportionate effect on it's prices. My 2 cents say that this will temporarily depress prices but they will quickly recover because someone such as myself recognizes that those bitcoins haven't entered the market, so nothing has really changed.
- minimax 13y ago
  You seem like someone who knows something about markets and you accept that there are very few, if any, natural buyers of bitcoins, and that the price of bitcoin is largely driven by speculators. I'm just trying to understand how you think this thing doesn't end up at $0 some day in the not too distant future.
  - dclusin 13y ago

So that will depress the price right? Time for some cheap BTC

by ck2 13y ago

So that will depress the price right? Time for some cheap BTC

I honestly don't think the Bitcoin market is sophisticated enough to react to events like this. Certainly, if the feds really want to sell and someone puts $0.01 on the order books for that size of a trade, and nobody else is around, it could be filled, but I don't see that happening.

BlackDeath3 13y ago
It wouldn't be unprecedented. I believe that mass sells have caused price crashes numerous times in the past. Perhaps I misunderstood you?
- jrockway 13y ago
  Sort of. To me, it looks indistinguishable from randomness with /r/bitcoin trying to explain the randomness with news stories. But maybe I'm wrong.
quannabe 13y ago
Huh? Why would they sell it all at once and crash the price? They won't. That is like Warren Buffet deciding he wants to exit a position and dumping tens of millions of shares on the market. No one does that.
beedogs 13y ago
quannabe: It looks as though your account has been hellbanned.

asperous 13y ago

Actually it might be interesting. Technically yes if they sold at any price they'd burn through the orderbook and the price would crash. But if they set a flat sell price then that'd make a buy (edit: sell) wall (price can not go above this amount until all 25 million have been purchased). The sell wall could help stabilize the price.

gibybo 13y ago
They are not buying coins, they are selling them, so it would be a sell wall. The price couldn't go _above_ their selling price until all 25 million (dollars worth) have been sold.
- vdaniuk 13y ago
  That is one really interesing side-effect of the whole silkpath shenanigans.

nostromo 13y ago

It's just $25 million of $11,386 million.

dclusin 13y ago

Probably. To understand price changes it's important to consider how they change. Price movements occur as a result of a buyer or seller aggressing into a market and submitting an order such that the parameters of the aggressor's order match the opposite sides unfilled orders. This process is typically referred to as order matching. If a buyer aggresses into the market and matches against unfilled sell orders the price increases because they have removed the lowest prices from the order book. If a seller does something similar the price will drop because the highest prices have been removed. Another reason price movements occur is because people are also reacting to the market and trying to predict where the market is going. As a consequence they will either enter the market at an off market price attempting to predict it, or cancel their outstanding orders and re-price them. But this is another topic entirely and I will leave it out as it's pretty complex and my understanding of that topic is newb level at best. The second thing to consider is the why. Why do price movements occur? Mainly because people are consuming information and trying to predict where the market is going. For other assets such as FX & commodities there are non-speculative market participants who buy and sell based on their business need. An example from Foreign Exchange is a company such as Google having a stockpile of dollars and needing to pay employees in euros. The end result of these non-speculative market participants is greater price stability because they are always buying or always selling, not because they want to, but because they have to. But since bitcoin is largely a speculative currency (the majority of bitcoin trading volume is the result of speculation, not legitimate commerce) the news has a disproportionate effect on it's prices. My 2 cents say that this will temporarily depress prices but they will quickly recover because someone such as myself recognizes that those bitcoins haven't entered the market, so nothing has really changed.

minimax 13y ago
You seem like someone who knows something about markets and you accept that there are very few, if any, natural buyers of bitcoins, and that the price of bitcoin is largely driven by speculators. I'm just trying to understand how you think this thing doesn't end up at $0 some day in the not too distant future.
- dclusin 13y ago