Here's the stickiest thing about this entire thing to me: the name.
Roger Ver (one of the people behind bcash) has said repeatedly that he believes that his fork deserves the name "Bitcoin" and that it is the "real" bitcoin. It seems obvious that the intent here is to confuse people.
This, to me, seems like blatant fraud. It is concerning to me that coinbase would continue to allow this market confusion to build by listing this under the name "bitcoin cash". Things like this make me long for better regulation in this space.
Full disclosure: I say this as somebody who holds both bitcoin and bcash in nearly equal amounts. I mean to say that I don't really have a dog in this fight.
I have neither, Why can't he call his fork Bitcoin Cash? He claims that it adheres to the Bitcoin.org idea than BTC.
Him & a vocal community (/r/btc) appears to believe in that. What gives BTC (and /r/bitcoin) the right to the name Bitcoin considering both are forks from the original chain?
I think you're being disingenuous. "bcash" has become a derogatory term and your use of it belies your bias. Do you also rail against Bitcoin Gold, BitcoinDark, Bitcoin Plus, eBitcoin, BitcoinZ, Bitcoin Red, Bitcoin Scrypt...? Or only the one that threatens Bitcoin's HODL culture?
To me it seems like Bitcoin Cash profits greatly just from having the word "Bitcoin" in front of it. Surprised no one just copyrights it and sues other coin makers. I guess that's against he community, but imo it needs to be done.
I don't hold any bitcoin or bitcoin cash...I say this as just a general consumer. The "bitcoin" name has brand value, and having "bitcoin" cash is going to inflate the market value of the it and confuse consumers into thinking some coins are more trustworthy. Especially as this goes more mainstream and your Aunt and Grandma can buy BCH on Coinbase. Or whatever new altcoin comes up that tags on the words "bitcoin."
It seems like one of the disadvantages of Satoshi being anonymous is that Bitcoin wasn't trademarked, which allows for forks like Bitcoin Cash to use the name Bitcoin. I think this is kind of an interesting case of why trademarks are important as having both Bitcoin and Bitcoin Cash must be very confusing to new users on Coinbase.
I've said this before -- but this fork should have broken the illusion that people had that bitcoins are rare. If viable forks are possible, then they will continue to happen, each of them increasing the number of 'bitcoins' in circulation.
I think of cryptocurrency as a wild wild west of high risk investing (aka gambling). Companies like Coinbase is in the business of selling you wagons and oxen so you can participate if you wish. I think the real problem is that this became a gold rush, so too many people who don't know what they're doing are participating.
When Coinbase launched Bitcoin Cash at 17:20 PST (01:20 BST) it was valued at about $3,500 (£2,612) per coin.
At the time it suspended it, the company was quoting a price of about $8,500.
Trade of Bitcoin Cash was frozen just four minutes after it began on the firm's Global Digital Asset Exchange (Gdax) and existing orders were cancelled.
So the prices more than doubled in just 4 minutes. It might not even be a case of insider trading rather very, very thin order book.
> Update - All BCH markets will remain cleared and offline until 9am PST 12/20/17. At that time, BCH markets will enter post-only mode for a minimum of one hour to allow liquidity to be established.
That is to say no matching orders allowed of any kind - limit or market which can suck the liquidity and cause a huge price jump.
One might think that Coinbase/GDAX understand liquidity and market making after so many years. But no. Makes you wonder what kind of stuff is going on in other exchanges.
While it's valid to question insider trading in cryprocurrency, I don't think that's what made the difference here.
Coinbase had said they would add BCH to their exchange before the end of the year months ago. And people had noted BCH appearing in their API a day or two ago, and then the trading pages were up for an hour or two before the official announcement, with some very large orders being placed in advance of trading going live, with the price already set at $1000 dollars higher than any other exchange was offering.
Add to this the fact that anyone who held BTC on Coinbase in August receiving BCH, plenty of people still holding BCH from the last time the price spiked, and the exceptionally deep pockets of certain people/groups who are supporting BCH.
You didn't need to be a Coinbase employee to know this was coming, and that it would, at least short term, have a significant effect on the price. Crypto traders live on big news and swings like this, and it was inevitable that it would be a big event.
>People might not like it but if Coinbase/GDAX cannot understand liquidity issues after so many years, it doesn't bode well for cryptocurrencies in general.
All of the exchanges are repeating mistakes already learned by the financial industry.
It's why they'll always be amateurs until an actual major financial institution devotes serious time/effort/money to it.
I have a pretty good understanding of economics but what makes market and limit alone responsible for a price jump. When matching orders were allowed yesterday didn't the price also jump? Thanks.
The user mukiwa2 said "Bitcoin Cash coming in the next few days!!" 2 days back in that thread and he even joked saying he knew an employee in Coinbase.
That response has since been deleted. I was just talking to my friend about this. Here is the snapshot: https://imgur.com/a/cLlp7
Wasn't this known well in advance? I had someone tell me that Coinbase was introducing BCH over a month ago and he's not connected in any way to the company. The only way he could have known is if this was public knowledge up until this point.
Some questions I'm curious about (including other exchanges besides Coinbase too).
Do Coinbase employees have to disclose their external crypto-currency trading accounts (as well as for immediate family members) to the internal compliance dept?
Is Coinbase employee crypto trading activity subject to pre-approval prior to trade execution?
What is their policy regarding disclosure of material non-public information of pending changes/additions to their own exchange?
This is the second event involving BCH which is looking very "artificial" for the lack of a better word. About a month ago, BCH started an abrupt up-climb while the prices on BTC started to fall dramatically. BTC recovered soon after by hitting all-time highs while BCH prices fell pretty hard. Now we get these talks of insider trading at Coinbase. I don't have much stake in cryptocurrencies and I actually did not mind the BCH fork, hoping that the 2 cryptos can just co-exist. But from what I'm seeing now this has nothing to do with advancing Bitcoin and is just a money grab by Roger Ver.
"Brian Armstrong responded that he had repeatedly warned his staff not to disclose its launch plans to family or friends or to trade in the digital asset themselves."
So the whole staff new about this move, from which it is to be expected to move the market when published?
I watched this happen live. There was a very obvious trading software malfunction. Here's what I watched happen.
People could place orders before trading started. I was watching BCH/USD and BCH/BTC which had a fixed price, $3100 USD and 3.00 BTC respectively.
BCH/USD had a huge amount of buy pressure (people buying BCH with cash); BCH/BTC had a huge amount of sell pressure (people dumping the airdrop).
Only BCH/USD went live; BCH/BTC remained paused. (That was weird, I thought it looked like a human somewhere hit enter too soon, but apparently it was intended)
Once trading started (BCH/USD only), people couldn't place new sell orders. The unlimited buys cleared, including the guy on reddit whose order was "Buy $100000 USD of BTC at market price", which was filled at 6k and then he was unable to place a sell at 9k. Apparently placing buys without limits is common because unlimited buys are filled before limited ones are.
Since you couldn't place a new sell; the price was not bounded; the book cleared and everything was stuck at 9.5k for a couple minutes. There was a little bit of trades, not sure if it was only people with existing orders that were glitched or if maybe some people weren't glitched, maybe all the activity was orders placed before trading opened.
They realized the issue and paused trading; orders began to accumulate again roughly around here; here's a screenshot of the orders accumulating https://i.imgur.com/0NTyYXx.png There is incredible sell pressure here, the price was obviously out of whack with actual supply/demand.
(MY SPECULATION) Since there was never a functioning market I'd expect Coinbase to rewind all the trades which is what it looks like they are doing.
I might have gotten some of the details wrong, I am just a detached layperson learning about finance who happened to see this go down.
Sorry reddit, no consipiracy here. But none of those posts in r/bitcoin are actual humans anyway, it's all fake bots and a couple poor suckers who don't realize they're arguing with a content farm. Here's some required reading about the bitcoin information manipulation shitshow. https://np.reddit.com/r/BitcoinMarkets/comments/6rxw7k/infor... TLDR: Nothing is real, everything is fake news, you think it can't possibly be that bad? it's actually worse than that.
This is an extremely well written piece of (false) propaganda. Going into why would take a long time, and each person who cares and isn't sure will need to do his or her own research.
I haven't heard any suggestion that they're going to roll back any of the trades that happened, in fact I'm not sure they even can because that money may not even be on the exchange anymore. Their plan seems to be to clear orders, reopen trading again about a day after last attempt (so about now), and hope it goes better this time.
That reddit link was incredibly informative and worth reading. It finally explains why /r/bitcoin looks like such a meme-driven asylum. All the propaganda, censorship, astroturfing and fake news reminds me of how /r/The_Donald gained support.
I tried to buy it last night and this morning for the ~3K price, and I was blocked by Coinbase. Now it's past the 4K point.
Maybe there's no grand conspiracy, but there's something plasticy about the price movement combined with blocking of new buys at the lower prices (on Coinbase).
And it's not a leap to suggest that these cryptocurrencies are going to be treated like securities by regulatory bodies. If the SEC argues successfully (which they seem to be leaning towards) that they're securities, a slew of regulations will begin to apply.
Simply put, you don't need a law that's SPECIFIC to cryptocurrencies in 2017.
This same pattern seems to repeat immediately preceding any "big announcement" for pretty much every single coin/token out there. It's obvious that insider trading is rampant across the entire cryptocurrency market.
I hope Coinbase and their employees' activities are properly investigated at some point. I think they'll find a lot of "interesting" activity going back very far, assuming Coinbase hasn't "lost" or modified records to hide those activities by now.
Blockstream is a company developing blockchain technologies that employs some of the Bitcoin Core developers and the main developer of the Lightning Network for off-chain transaction channels. (Bitcoin Core is the software usually used to run full Bitcoin nodes; it's basically Satoshi's original client, renamed to clarify that users don't have to choose it as their wallet back when running a full node started to become user-unfriendly.) It's become associated with a conspiracy theory that claims the entire Bitcoin Core development community, including the developers not employed by them, is plotting with the banking industry to sabotage on-chain Bitcoin in order to force everyone to use banks to transfer Bitcoins, basically.
Reminds me of when ZRX was added to Poloniex out of the blue. I very much doubt people with such knowledge wouldn't trade based on it. It's practically impossible to catch anybody short of getting the SEC involved. It's not like Coinbase is keeping track of everyone's wallets or has any ability to get info from other exchanges.
I also think it's funny that people are complaining about this. Isn't this part of the appeal of crypto trading? That the government doesn't 'level' the playing field?
Watching this all go down, I don't see why it would be insider trading. They opened their retail side (Coinbase) at the same time as their exchange (GDAX) and gave minutes notice before going live.
There was about 0% chance there would be enough liquidity on the exchange to support a dual launch, so the price skyrocketed. There wasn't time to deposit enough BCH to give liquidity either. I don't care about traders making bad moves on GDAX, but to screw their retail clients so much is not cool.
Did anyone not expect this? For example, I believe they may add Ripple next so I have made moves into Ripple knowing the price will spike if they add support. What's to prevent Coinbase employees to do the same?
Regulations are the next logical step here. My best guess is that the red tape will at least dampen a lot of the mania around cryptocurricines and bring people back to reality.
I like the volatility :/ I made a couple hundred bucks of lint money yesterday playing the dip. Paid for my dogs' food for the month and a nice night out with my wife and her mother. Even though I have some skin in crypto, at this point I personally don't really care whether it keeps going up or crashes since I've already made back what I put in. But gaming volatility is a nice way to pass the evening...
I don't have a lot of sympathy for anyone who got burned by this. Anyone who is trading crypto knows that there is a lot of risk. Also, everyone who was paying attention knew that BCH was coming to Coinbase before the end of the year, since September. If you're acting like this is a big deal, put your big boy pants on and/or stop trading crypto.
[+] [-] blhack|8 years ago|reply
Roger Ver (one of the people behind bcash) has said repeatedly that he believes that his fork deserves the name "Bitcoin" and that it is the "real" bitcoin. It seems obvious that the intent here is to confuse people.
This, to me, seems like blatant fraud. It is concerning to me that coinbase would continue to allow this market confusion to build by listing this under the name "bitcoin cash". Things like this make me long for better regulation in this space.
Full disclosure: I say this as somebody who holds both bitcoin and bcash in nearly equal amounts. I mean to say that I don't really have a dog in this fight.
[+] [-] ohstopitu|8 years ago|reply
Him & a vocal community (/r/btc) appears to believe in that. What gives BTC (and /r/bitcoin) the right to the name Bitcoin considering both are forks from the original chain?
[+] [-] asciimo|8 years ago|reply
[+] [-] partiallypro|8 years ago|reply
I don't hold any bitcoin or bitcoin cash...I say this as just a general consumer. The "bitcoin" name has brand value, and having "bitcoin" cash is going to inflate the market value of the it and confuse consumers into thinking some coins are more trustworthy. Especially as this goes more mainstream and your Aunt and Grandma can buy BCH on Coinbase. Or whatever new altcoin comes up that tags on the words "bitcoin."
[+] [-] kbwt|8 years ago|reply
[+] [-] touchofevil|8 years ago|reply
[+] [-] empath75|8 years ago|reply
[+] [-] Alex3917|8 years ago|reply
[+] [-] lurr|8 years ago|reply
Vs a store of value that just racks up transaction fees.
[+] [-] SilasX|8 years ago|reply
It's like saying that the People's Front of Judea is fraudulent because they don't really represent Judeans like the Judean People's Front.
[+] [-] peterjlee|8 years ago|reply
[+] [-] tompetry|8 years ago|reply
[+] [-] thisisit|8 years ago|reply
At the time it suspended it, the company was quoting a price of about $8,500.
Trade of Bitcoin Cash was frozen just four minutes after it began on the firm's Global Digital Asset Exchange (Gdax) and existing orders were cancelled.
So the prices more than doubled in just 4 minutes. It might not even be a case of insider trading rather very, very thin order book.
That is why this happened:
https://status.gdax.com/
> Update - All BCH markets will remain cleared and offline until 9am PST 12/20/17. At that time, BCH markets will enter post-only mode for a minimum of one hour to allow liquidity to be established.
That is to say no matching orders allowed of any kind - limit or market which can suck the liquidity and cause a huge price jump.
One might think that Coinbase/GDAX understand liquidity and market making after so many years. But no. Makes you wonder what kind of stuff is going on in other exchanges.
[+] [-] wjoe|8 years ago|reply
Coinbase had said they would add BCH to their exchange before the end of the year months ago. And people had noted BCH appearing in their API a day or two ago, and then the trading pages were up for an hour or two before the official announcement, with some very large orders being placed in advance of trading going live, with the price already set at $1000 dollars higher than any other exchange was offering.
Add to this the fact that anyone who held BTC on Coinbase in August receiving BCH, plenty of people still holding BCH from the last time the price spiked, and the exceptionally deep pockets of certain people/groups who are supporting BCH.
You didn't need to be a Coinbase employee to know this was coming, and that it would, at least short term, have a significant effect on the price. Crypto traders live on big news and swings like this, and it was inevitable that it would be a big event.
[+] [-] FLUX-YOU|8 years ago|reply
All of the exchanges are repeating mistakes already learned by the financial industry.
It's why they'll always be amateurs until an actual major financial institution devotes serious time/effort/money to it.
[+] [-] notyourday|8 years ago|reply
[+] [-] pducks32|8 years ago|reply
[+] [-] gizmodo59|8 years ago|reply
The user mukiwa2 said "Bitcoin Cash coming in the next few days!!" 2 days back in that thread and he even joked saying he knew an employee in Coinbase.
That response has since been deleted. I was just talking to my friend about this. Here is the snapshot: https://imgur.com/a/cLlp7
[+] [-] shlomok|8 years ago|reply
[+] [-] knowaveragejoe|8 years ago|reply
[+] [-] jeffwass|8 years ago|reply
Do Coinbase employees have to disclose their external crypto-currency trading accounts (as well as for immediate family members) to the internal compliance dept?
Is Coinbase employee crypto trading activity subject to pre-approval prior to trade execution?
What is their policy regarding disclosure of material non-public information of pending changes/additions to their own exchange?
[+] [-] jbigelow76|8 years ago|reply
[+] [-] avenoir|8 years ago|reply
[+] [-] CaptainZapp|8 years ago|reply
So the whole staff new about this move, from which it is to be expected to move the market when published?
Charitably put, that's naive.
[+] [-] dustingetz|8 years ago|reply
People could place orders before trading started. I was watching BCH/USD and BCH/BTC which had a fixed price, $3100 USD and 3.00 BTC respectively.
BCH/USD had a huge amount of buy pressure (people buying BCH with cash); BCH/BTC had a huge amount of sell pressure (people dumping the airdrop).
Only BCH/USD went live; BCH/BTC remained paused. (That was weird, I thought it looked like a human somewhere hit enter too soon, but apparently it was intended)
Once trading started (BCH/USD only), people couldn't place new sell orders. The unlimited buys cleared, including the guy on reddit whose order was "Buy $100000 USD of BTC at market price", which was filled at 6k and then he was unable to place a sell at 9k. Apparently placing buys without limits is common because unlimited buys are filled before limited ones are.
Since you couldn't place a new sell; the price was not bounded; the book cleared and everything was stuck at 9.5k for a couple minutes. There was a little bit of trades, not sure if it was only people with existing orders that were glitched or if maybe some people weren't glitched, maybe all the activity was orders placed before trading opened.
They realized the issue and paused trading; orders began to accumulate again roughly around here; here's a screenshot of the orders accumulating https://i.imgur.com/0NTyYXx.png There is incredible sell pressure here, the price was obviously out of whack with actual supply/demand.
(MY SPECULATION) Since there was never a functioning market I'd expect Coinbase to rewind all the trades which is what it looks like they are doing.
I might have gotten some of the details wrong, I am just a detached layperson learning about finance who happened to see this go down.
Sorry reddit, no consipiracy here. But none of those posts in r/bitcoin are actual humans anyway, it's all fake bots and a couple poor suckers who don't realize they're arguing with a content farm. Here's some required reading about the bitcoin information manipulation shitshow. https://np.reddit.com/r/BitcoinMarkets/comments/6rxw7k/infor... TLDR: Nothing is real, everything is fake news, you think it can't possibly be that bad? it's actually worse than that.
[+] [-] feelix|8 years ago|reply
I will note however that people are paid by Roger Ver himself to make comments like this. eg: https://np.reddit.com/r/BitcoinMarkets/comments/6rxw7k/infor...
[+] [-] makomk|8 years ago|reply
[+] [-] rawnlq|8 years ago|reply
EDIT: And theymos's reply with the other side of the story https://np.reddit.com/r/BitcoinMarkets/comments/6rxw7k/infor...
[+] [-] mancerayder|8 years ago|reply
I tried to buy it last night and this morning for the ~3K price, and I was blocked by Coinbase. Now it's past the 4K point.
Maybe there's no grand conspiracy, but there's something plasticy about the price movement combined with blocking of new buys at the lower prices (on Coinbase).
[+] [-] kooshball|8 years ago|reply
[+] [-] lgats|8 years ago|reply
[+] [-] FLUX-YOU|8 years ago|reply
What possible legal action can he take? Breach of contract, maybe?
There's no laws regarding cryptocurrency insider trading or manipulation as far as I know.
[+] [-] mancerayder|8 years ago|reply
And it's not a leap to suggest that these cryptocurrencies are going to be treated like securities by regulatory bodies. If the SEC argues successfully (which they seem to be leaning towards) that they're securities, a slew of regulations will begin to apply.
Simply put, you don't need a law that's SPECIFIC to cryptocurrencies in 2017.
[+] [-] sp332|8 years ago|reply
[+] [-] 659087|8 years ago|reply
I hope Coinbase and their employees' activities are properly investigated at some point. I think they'll find a lot of "interesting" activity going back very far, assuming Coinbase hasn't "lost" or modified records to hide those activities by now.
[+] [-] mancerayder|8 years ago|reply
That seems to be a theme in the last day or two by the BCH proponents.
[+] [-] makomk|8 years ago|reply
[+] [-] toomim|8 years ago|reply
https://www.reddit.com/r/BitcoinMarkets/comments/6rxw7k/info...
[+] [-] JustAnotherPat|8 years ago|reply
I also think it's funny that people are complaining about this. Isn't this part of the appeal of crypto trading? That the government doesn't 'level' the playing field?
[+] [-] dahdum|8 years ago|reply
[+] [-] pducks32|8 years ago|reply
[+] [-] mancerayder|8 years ago|reply
[+] [-] artursapek|8 years ago|reply
https://cryptowat.ch/gdax/bchusd/1m
[+] [-] sedtrader|8 years ago|reply
[+] [-] heurist|8 years ago|reply
[+] [-] unknown|8 years ago|reply
[deleted]
[+] [-] 0xADADA|8 years ago|reply
[+] [-] rokhayakebe|8 years ago|reply
Surely if there is wrongdoing it is not the work of one employee.
[+] [-] jerkstate|8 years ago|reply
[+] [-] leesalminen|8 years ago|reply