Russian: Shorting Bitcoins | TigerDroppings.com

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joshnorris14
Florida Fan
Florida
Member since Jan 2009
21247 posts

Russian: Shorting Bitcoins


LINK

I saw this on Reddit and since you're interested in shorting bitcoins I figured I'd share. I'm not sure if you are familiar with the platforms introduced here.







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GumboPot
LSU Fan
Saints Fan
Member since Mar 2009
24280 posts

re: Russian: Shorting Bitcoins


I'm too risk adverse to short bitcoin. I'd be concerned about liquidity issues too (covering your shorts quickly).





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LSURussian
LSU Fan
Baton Rouge
Member since Feb 2005
81273 posts

re: Russian: Shorting Bitcoins


Thanks but I've never heard of any of those. Since they are total unknowns, there's too much counterparty risk for me.

As soon as a reputable intermediary offers BC shorting, I will jump in.

Eta: With InstalWallet getting hacked today (possible $4.3 million of customer's money lost) and MtGox having problems depositing into its customers accounts today ( LINK) I will be very cautious trusting any transactions with any bitcon specialist.



This post was edited on 4/3 at 9:14 pm


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idlewatcher
LSU Fan
Houston
Member since Jan 2012
8908 posts

re: Russian: Shorting Bitcoins


I wonder how long before they institute an "Uptick rule" for shorting these things. As it stands now, it appears you can short it whenever.





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joshnorris14
Florida Fan
Florida
Member since Jan 2009
21247 posts

re: Russian: Shorting Bitcoins


Mt. Gox on problems:



It’s been an epic few days: What happened?

Dear Mt.Gox users and Bitcoiners,

It’s been an epic few days on Bitcoin, with prices going up as high as $142 per BTC. We all hope that this is just the beginning!

However, there are many who will try to take advantage of the system. The past few days were a reminder of this sad truth.

Mt.Gox has been suffering from its worst trading lag ever, 502 errors, and at one point some users were not able to log in their account. The culprit is a major DDoS attack against Mt.Gox.

Since yesterday, we are continuing to experience a DDoS attack like we have never seen. While we are being protected by companies like Prolexic, the sheer volume of this DDoS left us scrambling to fine-tune the system every few hours to make sure that things don’t go beyond a few 502 error pages and trading lag.

Why has Mt.Gox become the target of a DDoS attack? It is not yet clear who is behind this DDoS and we may never know, but these actions seem to have two major purposes:

Destabilize Bitcoin in general. It is not a secret Mt.Gox is the largest Bitcoin exchange with more than 80% of all USD trades and more than 70% of all currencies. Mt.Gox is an easy target for anyone that wants to hurt Bitcoin in general.

Abuse the system for profit. Attackers wait until the price of Bitcoins reaches a certain value, sell, destabilize the exchange, wait for everybody to panic-sell their Bitcoins, wait for the price to drop to a certain amount, then stop the attack and start buying as much as they can. Repeat this two or three times like we saw over the past few days and they profit.

What can be done? Believe it or not, there is pretty much nothing that can be done. Large companies are frequently victims of these kinds of attacks. Even though we are using one of the best companies to help us fight against these DDoS attacks, we are still being affected.

There are a few things that we can implement to help fight the attacks, such as disconnecting the trade engine backend from the Internet. By separating the data center from the Mt.Gox website, we will continue to be able to trade.

What can you do? Like our favorite author here at Tibanne says… Don’t Panic!

“Panic-selling is a wide-scale selling of an investment which causes a sharp decline in prices. Specifically, an investor wants to get out of an investment with little regard of the price obtained. The selling activity is problematic because the investor is selling in reaction to emotion and fear, rather than evaluating the fundamentals.” (Source: Wikipedia)

I understand that many of you have a lot at stake here, but remember that Bitcoin, despite being designed to have its value increase over time, will always be the victim of people trying to abuse the system, or even the value of Bitcoin decreasing occasionally. These are not new phenomena and have been present since the beginning of time when humans first started trading.

Trade Engine Lags Lag affects everyone, not only us, but also major, world-renowned exchanges like the NASDAQ and NYSE. We can fix lag, but we cannot eradicate lag. Only small exchanges with low volume and liquidity are immune to lag.

Does this mean that we are giving up fighting lag? Hell, no. We are working on it by creating a new trade engine that will solve many problems, but it’s not a magic bullet. We can always try to scale our servers, but we cannot predict what happens from external sources: DDoS, panic selling, immediate increase of buyers, etc. Lag will always be there, but our mission is to make lag as small as possible.

Account Verification As if a major DDoS attack was not enough, we at Mt.Gox are victim of our own success!

Last year, Mt.Gox saw an average of 9,000 to 10,000 new accounts created every month. This number doubled in January, tripled in February, and sextupled in March. In this month alone, over 57,000 new accounts were created!

Our support and account verification team went from four people in January 2012 to twenty-two people working every day of the week. We are now hiring even more people to solve this problem by finalizing some deals with external companies.

Remember that even if you are waiting for your account to be verified, you can still deposit or withdraw funds via our Japanese account and make your trades! (Only accounts that we pro-actively required to be verified are limited to deposits and trade only.)

Finally We have seen a significant amount of comments on the web (various forums, Reddit, etc.) that portray Mt.Gox as a company held by “idiots” and other rather rude words, complaining about inability to deal with lag and other system issues, without understanding the magnitude of work and attacks we are facing every day.

I understand the frustration many of you feel. We hate this situation as well. Since we took over Mt.Gox, we have been through Hell and back and we are still here. We are still the largest exchange with over 420,000 trades per month and USD $121 million monthly trade volume. We have worked our way through all the requirements needed to run our exchange legally.

Now, there are some things we can improve, but so far we are doing an incredible job that no other exchange has been able to do so far. While I understand a certain amount of frustration, realize what we have accomplished. I appreciate all the work you are doing everyday to push things forward and to help secure the future of Bitcoin

And to all of you who are supporting us on a daily basis, thank you! We could not have done any of this without your help!





This post was edited on 4/4 at 1:15 am


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joshnorris14
Florida Fan
Florida
Member since Jan 2009
21247 posts

re: Russian: Shorting Bitcoins


Even with all the hell that happened today, Mt.Gox tripled the all time trading highs of $6M @ $20M today.


Cashing in on a nice $200,000 in a day when Bitcoin dropped $30 off of its high.






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NC_Tigah
LSU Fan
Member since Sep 2003
51809 posts
 Online 

re: Russian: Shorting Bitcoins


quote:

What can be done? Believe it or not, there is pretty much nothing that can be done. Large companies are frequently victims of these kinds of attacks. Even though we are using one of the best companies to help us fight against these DDoS attacks, we are still being affected
Well that's confidence engendering.






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ItNeverRains
LSU Fan
Franklin, TN
Member since Oct 2007
6320 posts

re: Russian: Shorting Bitcoins


When a currency wants to be the "wild Wild West" rules wise, expect a few Billy the Kids to play along





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C
LSU Fan
The Woodlands, TX
Member since Dec 2007
21600 posts

re: Russian: Shorting Bitcoins


quote:

Cashing in on a nice $200,000 in a day when Bitcoin dropped $30 off of its high


Yeh banks usually do a pretty good job of making money on transaction fees no matter what price products are selling for...






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LSURussian
LSU Fan
Baton Rouge
Member since Feb 2005
81273 posts

re: Russian: Shorting Bitcoins


quote:

Well that's confidence engendering.


I can't believe a service that appeals to drug peddlers, sex traffickers and tax evaders would also attract hackers trying to make a quick buck unethically.....







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LSURussian
LSU Fan
Baton Rouge
Member since Feb 2005
81273 posts

re: Russian: Shorting Bitcoins


quote:

a nice $200,000 in a day

If they increased their staff from 4 to 22 just to verify and process accounts, they damn well better hope the fee volume stays up. Otherwise, they will be filing for bankruptcy.....






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Poodlebrain
LSU Fan
Way Right of Rex
Member since Jan 2004
15317 posts

re: Russian: Shorting Bitcoins


quote:

We have worked our way through all the requirements needed to run our exchange legally.
Doesn't this mean they have established procedures to comply with all government regulations? Don't American anti-money laundering laws require them to collect the identities of their customers and report specific activities to the government? So much for the anonymity of people using Mt.Gox.






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joshnorris14
Florida Fan
Florida
Member since Jan 2009
21247 posts

re: Russian: Shorting Bitcoins


There has never been any claim for anonymity when using Mt. Gox





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