The Christmas crypto correction. What really happened | Hacker News Reader

The Christmas crypto correction. What really happened

jamescrypto.com

42 pointschejazi18 comments

No sources, vague circumstantial accusations. It makes for a good story, but without more information it's just another theory. Not saying it isn't true, but it's presented as fact without very much real assurance. I don't doubt that there's market manipulation, but I have strong personal doubts it's this nice and tidy. This sounds vaguely like a conspiracy theory at times.

I’m sure there’s plenty of market manipulation but this is definitely more conspiracy theory than fact. I highly doubt Coinbase as a company was trying to insider trade on Bitcoin Cash with predatory bots to pump the price. They make enough money off all their fees, and they already have more users than Charles Schwab; they’re not some shady exchange based off-shore.

He never said Coinbase was doing it. It doesn’t matter if Coinbase was involved - it will looks terrible that it was exposed right when they launched.

The bit about not being able to cash out over $1k is flat out false.

The order book history from GDAX (I maintain a personal level 3 copy) also doesn't suggest market pressure at $12k beyond a lot of opportunists (myself included).

Selling bitcoin and cashing out are two different things.

The exchanges will happily let you deposit, buy, and sell, but when you want that wire transfer there are magically a bunch of hurdles to jump. BTC market cap is currently $233,616,547,500. The total USD held by reputable exchanges is probably in the low hundreds of millions.

I appreciate the simplicity of your calculus, but I think you’re being downvoted for lack of citations. The value of the simplicity of your claim is also what makes it an extraordinary claim. Therefore you should back it up with extraordinary evidence.

That said, you’re being upvoted because what you’re saying makes instinctual sense.

I transferred in excess of $50k USD out without incident.

Could I have done the same with $1M USD? I have no idea.

The bar is considerably higher than $1k, though, and I'd wager is considerably higher than most people have to comfortably move around.

Yeah I also withdrew 5 figures of cash during the crazy period. I have an old Coinbase account.. I think there are worse delays/limits put on new accounts.

For sure, if everyone did a bank run then there would be a liquidity shortage. But saying that is wayyy different than what the article said, that most people couldn't even withdraw $1k.

But why would there be a liquidity shortage?

It's obvious that this would be the case in a fractional banking system, but assuming that Gemini or Coinbase aren't complete crooks, through which mechanism would they not have enough cash on hand?

For each transaction on their exchange, they'd receive money from the buyer and pass that on to the seller?

You can trade BTC/LTC and BTC/ETH as well, though, and all of the cryptocurrencies can move into/out of them at will. There are steps they could take to ensure liquidity in USD, but they're relatively expensive.

I, personally, prefer to keep my dollars in dollars and in an FDIC insured account.

My Gemini account says I have a $100k daily USD withdrawal limit via ACH, and doesn't note a limit for wire transfers. I haven't needed to max that out yet, but I don't think I would have a problem selling millions of USD worth of BTC/ETH and withdrawing it to my bank account.

...Meanwhile another cryptocurrency called Ripple basically jumped up 500% during the past week. I think some people might've been cashing out of Bitcoin and moving to the next big thing.

"next big thing" == "next pump 'n' dump"

Sounds plausible, but he didn't give any evidence.

Although the author didn't give any evidence and just a lot of circumstantial hand waving, the whole idea of market manipulation by the exchanges isn't something new. eg. the stock market

In the new year, look for a narrow trading range on a day to day or even week by week basis, with a steady rise in price on relatively low volume. This could possibly be a tell that things are being manipulated upward.

back in the "good ol days" of btc-e.com, i feel like the entire point was pump and dump. it should be expected 100% of the time.

> Obviously, no human would be flooding the books with orders 3X above the current market value only a minute after release.

Whenever such claim is made, I wonder if people in cryptocurrency have heard of the terms - market order, slippage and latency in context of trading.

This is like second rate /r/bitcoinmarkets fanfiction. It’s pure speculation and hand waving.

Although I do find it interesting that dumping $200 million worth of tethers into the market didn’t move the price.

There is going to be hell to pay whenever the run on tethers starts.

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