Lessons learned - Crypto and Divorce - In January I was a millionaire thanks to BTC, then my wife divorces me and now I have $30,000 AMA
Crossreferencing u/nanoissuperior He wrote earlier today: https://www.reddit.com/CryptoCurrency/comments/a3n6uw/in_january_i_was_a_millionaire_thanks_to_nano_now/ Title: In January I was a millionaire thanks to Nano, now I have $25,000 AMA I was replying to his post, but my reply ended up being a bit too large as a reply and steered off-topic, albeit an interesting one. So I decided to make it its own post, because there may be a good lessons to be learned and hoping some will come forward with good information to be shared. I hope it can help anyone on this sub avoid the costly mistakes that I made. Here it goes: FLAIR: LEGAL (not in the list) ---- u/nanoissuperior are you who I think you are? I won't give out any further identifying clues, but I happen to know someone in the exact same position that could have written that exact same headline. If you read the first paragraph, you'll know if you know me. The person I know bought Nano really early, based on a tip from a friend. I got in much later. By the time he told me it had already spiked to the $5 range, when I ended up buying. I then sold in the $20's so it was a good buy nonetheless. We were former colleagues at a large, large software company somewhere in the PNW, I left the company to venture out on my own and try to launch some projects I had in mind and relocated overseas for a few years. We lost contact with each other during my time away, but we connected again during the market runup and started exchanging coin information on a daily basis during the big bull run of late 2017. That was a crazy time.... the market trend was a few degrees short of vertical for pretty much all coins! Hey, guess what? Now that I think about it, I could have written that same headline myself! In January 2018 I was a Millionaire too! Not with Nano, but thanks to purchasing a good chunk of Bitcoin in 2011 at $1.20 each. I ended up a single digit millionaire with what I had left in Bitcoin around January of 2018. And, just like you, today, from all that wealth, I have about $30.000 left, with little to show for. Can we call that even? Although my disaster was not caused entirely by market fluctuation; Mine is a more complex story and I am going to mention it, because hopefully, it could serve as a lesson to be learned for any crypto holder out there, so they don't make the make mistake I made: Don't trust anyone. Always be skeptical and watch out for your own interests. Anyhow, here it goes: After 5 years overseas, I had enough and wanted to come back to the States. My wife stated her preference to stay abroad, but eventually, she conceded albeit reluctantly. We chose a small town in CO to settle, and landed in November of 2017. We had plans to settle down and considered purchasing a home with my/our new fortune, based on the market price during that period. At the same time, I was also hesitant about the inherent tax payments due caused by such large liquidation. I was trying to have to pay taxes as far away as possible. So, I decided to wait till New Year's Eve and started liquidating my crypto on January 1st, 2018 right after midnight. This way, I would have 16 months (till April, 2019) to pay any capital gains taxes, and I was confident at the time that the market would give me that for free, especially at the pace that it was going. I have been an early adopter and have since then acquired the high levels of verification and trading limits per week, with many exchanges, but for a large sum like this, I needed several separate transactions, over the course of several weeks, especially wanting to do it with a US-based exchange that was linked to a US bank accounts, to avoid overseas wire transfers, meaning more fees. (Yes, I did look at all OTC options, but for reasons not relevant to the story, I couldn't make it happen, so I had to use the traditional Exchange channels for asset liquidation). My wife and I, initially had some fundamental disagreements on the gross amount to be spent and the type of property we should be purchasing. I wanted a smaller place, with a denser, younger community, where there'd be kids our son's age for him to play. She insisted that we should go big; we had been traveling for so many years, and we had not been able to call any of our past residences our home. It was time to settle and nest; She convinced me that we should own a property of our own that we would be proud of living in for years. One that we could own outright and would not easily outgrow. We ended up splurging and purchased in cash two luxury cars for ourselves and set our sights on a large dream house in the city's Golf & Country Club, free and clear, for us and our two kids. I don't even play golf, nor do I even like it, but, if it makes her happy and it is within the safe margins of making it happen, I figured, why not? My concerns were largely financial and the numbers were adding up. It was a bit tight against my personal safe margins, but, at the same time, I was imagining to never have to make, or even have to think about, a car or home mortgage payment ever again! Bitcoin is on a roll and there is no sign of it stopping. Fine. Let's do it, before I change my mind. Now, I admit I was extremely lucky with choosing the time of when to sell the assets. I had no clue the market would take a dive in February, and so it seemed to many that I had timed the market perfectly, selling most of my coins in the first two weeks of January of 2018. Many called me a genius for selling at the very top, as if I had some sort of wisdom to know when it would drop; the truth is much less flattering; it was nothing but dumb luck, based on me wanting to pay taxes in 2018 and defer to 2019. Awesome, well done! Yeah? well, slow down, son, not so fast. So, I gather the 7-digit lumpsum in January 2018 and we write a check for the full amount at closing in February on the property of her dreams. A property that could easily be showcased on a luxury Real Estate magazine cover. Also, remember we had just moved back to the United States with just a few suitcases each from overseas. We had no furniture, kitchenware, curtains, TV's, bed sheets, winter clothing and so many other essential things that one usually purchases over time, but which we now had to purchase all at once. Not a problem, Bitcoin had dropped slightly but still well above $15k, I believe, at the time. And, earlier, in January, I had diligently taken this expense into account and effortlessly set aside a small fortune for equipping such a large house with everything we would ever need, brand new. It seemed we were protagonists of one of the Home Makeover Shows. Finally, after working day and night, prepping the house non-stop for days and when every piece of furniture had finally arrived, been unpacked and carried to its corresponding room, it seemed most of the essentials were in place and the hard work was done. I longed for pouring myself a Scotch and to finally sit down and enjoy the fruits of my labor. I head downstairs to the dedicated walk-in, cigar-humidor / wine / Scotch cellar in the basement and grab the better bottle of Whisky of the few bottles of Scotch that I had bought earlier in the week. On my way up, I remember feeling a sense of calm, combined with a glow of excitement and this undescribable profound inner peace, all at once. This was such a rare, natural, non-drug induced high that I had never experienced. It felt so good! This sense of accomplishment of achieving that one thing I had been chasing and longing for my entire life. I had expected I would be chasing this goal for the next 15-20 years, and yet, here it was. No, where I was, was even better than expected! A place where not even my parents, who still have to make their monthly mortgage payments. I had done it! With a smile from ear to ear, I take a deep breath of relief and while looking around the property, I think to myself: "It's perfect, everything is in place and I can finally call this our home. We are so lucky and we are going to live a great life. A life that few can only dream of. So many concerns will be lifted and become redundant. Everything will be better. I'll start a fire in one of our two fireplaces and I am going to begin enjoying my semi-retired life with the first sip of my drink. That will be the official start of our new life". I head over to the kitchen to get a glass and some ice cubes, while I struggle to find which one is the freezer among the many drawers in the kitchen. It was then when I notice a handwritten note placed front and center on the kitchen counter. It is from my wife and read: "There is no easy way to say this, so I am just going to say it..... I want to legally divorce [ ...]". It continued saying that she had taken our son, and had unequivocally decided to leave me. She had already filed the paperwork for divorce and that I should expect to be served in the morning. My bliss had lasted less than 5 minutes and in less than two seconds, it turned dark, somber and I saw it all crumbling down in front of me. Like a long-awaited rocket launch, years in preparation, which then unexpectedly explodes on the launch pad during the countdown. My stomach, heart and everything in my body just sank and melted into one ball of poison in my core. I felt like throwing up. I was completely blindsided; she had played the game all along, not giving me the slightest hint of what was being concocted in the background. She had already engaged with her lawyers weeks beforehand. Her mother was already in town from another state to help out with I don't know what. I had been gaslighted and was threatened by her that I needed to see a psychiatrist due to a change in my temper that I had supposedly developed - my temper was awesome: with BTC at that price? Everything was perfect! But I obeyed and went anyhow (this would later fit her story that she had to leave with the child because she feared for her safety due to my supposed temper for which I was under treatment, therefore, I must have this temper problem, see?). Also, the purchase of the overpriced home also seemed clearly premeditated: Price was the main driver of the decision making; not location, demographics, taxes, etc. It was the wrong neighborhood for us (people much older than us, retired, golfers and no kids the same age as our son to play with). Our house happened to also be the most expensive in the neighborhood. I can see it all so clearly now. See, your crypto coins on the blockchain, are not within the US court's jurisdiction (or, at least, it's quite debatable - a gray area - ask me for the seed and I can tell you that I may have the seed, or that I may not have the seed, I may have the wrong seed, I may have forgotten it, I may have lost it - you can't prove I did not forget, or lost it, etc). However, once it is in FIAT in a bank, or invested in a property, the courts can rule on the asset(s), freeze, disburse or order a sale of the property, etc. It's done all the time. Also, the coins were technically mine, and by definition private property (not to be divided during the divorce) as they were acquired before the marriage. I could not prove its origins (I bought many of them via direct messaging members on Bitcointalk.org and mining rather than exchanges, so no records, receipts or nothing to prove otherwise: the big exchanges like BitStamp and Coinbase didn't start operations till 2013, if I m not mistaken. Instead, I would talk to one of the forum members offering coins we'd agree on a price, I'd send a check to wherever the individual seller instructed me to (Russia, Bulgaria, Japan, UK. etc) and the coins would be deposited to whatever address I provided. Yes, it was quite crude at the time. However, once I converted my coins to cash and used that cash to buy a property for the benefit of the family, it became common property and thus she then had rights to a portion of it when divided between the two parties should a divorce occur - which ended up being almost 3/4 of all assets. I was robbed in broad daylight. By the one person, I trusted with my life. The one you should trust with your life. Your life partner. And while I was in complete denial, trying to bargain, I waited too long to obtain good legal representation. When I finally ended up getting a lawyer, I was quite distraught and I clearly did not do the proper research and this resulted in a less than stellar performance and detrimental to me at many key steps in the process. I had to switch legal representation right before mediation and I can't blame my new lawyer either, as (s)he did not have the required time to catch up on all the details, (s)he did his/her best, but I was ultimately strongarmed into conceding my soon-to-be-ex-wife to let her return to the house, in exchange to obtain 50% of my son's custody, with serious and strict clauses I had to abide by. So, I had to move out, find a hole in the wall in a student apartment, pay my rent and pay our kids pre-school, while she lives grandiose, without monthly payments in the country club, till the house sells, which will likely be in the spring of next year. Nice! Due to my delay, legal mishandling and somehow every other element in her favor, she inexplicably ended up with around 3/4 of the worth of all assets, free and clear, no taxes due. Mind you, she has never financially contributed, nor made a single $ during our entire marriage. She has never worked and had $0 in her pocket when we married. She didn't even have a checking account, well in her thirties. She is no dummy; she is street smart, knows how to manipulate people, get her way with flirting and charm, while I am more intellectual and book smart. and She beat me hands-down. She is walking away with a sum of, not quite 7 figures, but close. With what I am left with from the sale of the house, I am responsible to pay for all the capital gains taxes from the liquidation to the IRS, which are due in April 2019. I don't expect there to be more left over than the estimated $30k mentioned above. Hate the market all you want, I made peace with the market and am keeping busy at hating my ex for a while for putting me in the same situation. She tripped me 1 yard before the finish line and pushed me in the prickly bushes, to cross it by herself. Go figure. When I am done hating her, I'll get back to rebuilding my life again from scratch. I am not worried, I have done it before. Just pissed, I was so close and that I was so naive to not see it coming. Sorry, I am not meaning to hijack the thread, just wanted you to know that others may have lost more than just "free" money; money we didn't really have to work for. We were the lucky ones. It is what I keep telling myself to stop me from jumping off a bridge. PS - Woah: Sorry for the wall of text; I was just going to write the first paragraph and ended up venting about my current situation. I know, I should take this issue to /depressed, /exes or /whereisthenearestbridgeIcanjumpfrom. Hopefully, this can be a lesson to those holding crypto and some can learn what NOT to do. I learned the hard way and was left with nothing. Don't be a nice guy. Don't trust anyone with your crypto. Anyhow, I am sure either our vigilant subreddit bot, or one of the mods will remove my post for not adhering to rule, and if not, I am sure that you fine people will downvote me to hell. Go ahead. Take away from me the little Karma I left too! Thanks! I learned many lessons, but here are some key ones [IANAL - any crypto-educated AL opinion appreciated here, thanks] : - Understand the concept of private property - property you acquire before getting married. INAL - this depends on the state legislation, but it is hard to prove with crypto, especially if you obtained your crypto through foreign exchanges, outside of legal jurisdictions, the petitioner might not understand or willing to invest in obtaining subpoenas and requests to businesses operating overseas, as this may result costly. - Get a lawyer who understands, or is willing to understand crypto, its benefits of being somewhat unreachable and how that can work for you. Don't let them shortchange you with: "well, let's just convert the rest to cash, because that I understand" type of reasoning. - If you do go to mediation, the above applies as well. This arbitrator or mediator needs to be one that understands the intrinsic details of crypto - for example, during the ATH, I bought 6 digits worth in $USD of Stellar. I used the very first version of the software, supporting Stellar on my hardware device, and put it all in a cold storage wallet somewhere around January. I routinely checked on my coins on the blockchain and they are there. A few months later, I try to access my account and the device returns a different public address, which contains 0 funds. I am still trying to debug this issue with the manufacturer, but the fact is that I was accused of hiding these coins or negligence and was demanded that I paid half of what was lost. or not lost, out of my pocket for money that I didn't have access either. I tried to explain it in the simplest terms, there are risks involved with using first come software. There is no 1800 number, mo tech support. no CEO, no, you can't call the BBB and complain, etc and no one seemed to be able to understand, nor willing to either. It became a huge roadblock for which I had to concede, not cash, but a concession, I was not wanting to concede. The petitioner leaned on the fact that I was either wilfully cheating or stupid enough to lose the coins and managed to create enough doubt in my character and integrity and there was nothing rational I could explain that she, or anyone else in the room would understand. Perhaps mutually contracting a seasoned crypto expert that can offer a neutral view and give his/her opinion might be worth considering. Andreas, where were you when I needed you? :) - Other examples were some coins I had bought in 2012 and gifted to some of her family's kids. I was holding these, till they would turn 16 for them to pay themselves their college, or so I told them. These coins were demanded back by the petitioner. Ok, I suggested that I would send them, but with a CHECKLOCKTIMEVERIFY value with a block height of let's say,10 years from now, out of fear that she would spend the coins and the kids would never know (they are toddlers). No one understood what I was talking about, I was made out the crazy one, I gave up, sent her the coins, unlocked and, just as I expected, within 20 minutes of receiving them, she spent $1200 worth of it (for a flight, I think). If you are the only one speaking your language, no one is willing to listen or make an effort to understand you. - It appears my coins were private property, which means, that I acquired them before the marriage and in case of divorce, if I have not moved them or used them for the common good of the marriage, then they remain mine. However, I liquidated them and cash ended up in my checking account to be used to buy groceries, cars and eventually a house, and it is then that they became common property. Only once they landed in my checking account on which she is named on. It appears that had I taken proper legal precautions with documentation, or a company/trust, where that money would have gone, instead of my checking accounts, elsewhere, I would have still been able to be the legal proprietor of the resulting cash. I can't quite remember the details, but it as something that was explained to me afterward, and I honestly think I just tuned it out, because it made me sick to know I could have held on to my wealth. Perhaps a lawyer can chime in? Again, much of the lack of information and every misstep taken was because of dealing with people that are accustomed to traditional assets and will not deviate from it. Crypto is different and is treated differently. It is so important to know the strengths and weaknesses when going into litigation about something that people don't understand. - Some more I can think of, but this post is getting way out of hand in size. Feel free to comment/suggest your own and I'll add more to the comments. Credits to: u/nanoissuperior Thanks for your post, it inspired me to write this one. Anyone, any karma you feels needs to go his way, for providing the source of inspiration, please give to O-OP. TL;DR: Wife, having contributed $0 during entire marriage, waited until I cashed out all my crypto at the top of the bull market in January 2018, for a nice seven-figure amount, and then immediately divorced me for the money. Edit: added TL;DR
Hi Bitcoiners! I’m back with the seventh monthly Bitcoin news recap. Last month's post got very little love, and I don't expect much more success with everyone focussing on August 1st, but here it is nonetheless. In my eyes definitely one of the most eventful months in Bitcoin's history, absolutely unreal how much happened:
SegWit activation imminent
Epic analysis of spam attacks & a 10M-user LN network
2013 price buble & Mt. Gox hack reveals
BTC-e went down
Bitcoin sign guy
Steepest rises and crashes USD-wise
To name a few. For those unfamiliar with the monthly recap, each day I pick out the most popularelevant/interesting stories in bitcoin and save them. At the end of the month I release them in one batch, to give you a quick (but not necessarily the best) overview of what happened in bitcoin over the past month. You can see recaps of the previous months on Bitcoinsnippets.com If you're on mobile and can't see the links below, check the web version. A recap of Bitcoin in July 2017
So it turns out I mined come bitcoin bits in 2013. I'm so confused.
Every time Bitcoin has been mentioned recently (not much, really, right?) I've wondered if I still had anything from when a friend helped me do a little mining in 2013. Finally got around to checking and after some digging I found c.0.2 BTC. How on Earth do I turn that into GBP? I've just spent a couple hours reading about wallets, looking at bitcoin.org -> GreenAddress -> Coinfloor -> Bitstamp -> Revolut -> Coinbase... I'm so confused about the whole thing. Starting to get paranoid that I'm about to give personal details to untrustworthy websites. Generally becoming demoralised about ever getting hold of what for me looks like a significant windfall. The BTC is is on Slushpool. So I'm turning to the collective wisdom of Reddit to un-confuse me. Any advice for a lucky newb?
Bitstamp's streaming API, and exploitation possibilities it might reveal
TL;DR: Bitstamp's undocumented streaming API seems to reveal out-of-order trade execution that can be exploited to steal margins from large buys/sells. Bitstamp has an undocumented streaming API. You should know what it seems to reveal about Bitstamp's order matching. It's not surprising that I see trades on the stream about 10s before I see them on BitcoinWisdom etc. (I haven't compared that to the latency of direct API polling; my lag to BW and processing lag at BW's end might be included there.) That's already not fair. Bitstamp should document the stream, or delay it. Before I tell you what is surprising, a quick detour: Bitstamp only provides limit orders. "Instant" (aka Market) orders are simulated by placing a limit order with the limit set to whatever was the top of the opposite side of the book at the time, and as anyone who has tried to trade at Bitstamp during a rally/drop will know, the top often moves before your "instant" order hits the books and therefore doesn't execute. People work around this by manually or automatically placing limit orders with limits that go beyond the top of the opposite side of the book, ensuring that they'll match something. Suppose someone places such a limit order. Rather than lock the book until the order is matched and produces a trade, the order is placed on the book and the book is allowed to cross. People have reported here on Reddit seeing this before. That's kind of surprising, but perhaps you're thinking they ensure things still execute in order. Well, the stream I'm watching includes both order and trade events, and I typically see orders on the stream anywhere between ~2.5s and ~8s ("the window") before they match and produce a trade; if you're only trading by watching BitcoinWisdom and others, I see things happen as much as 18s ahead of you. What properly surprises me is that within the window, if another limit order gets placed with a limit even higher than the first before the first has matched, that second order can execute before the first. An example from real stream data follows. The best ask (order_type=1) is 202.10, set by the first order creation I've included. received is added by me on receipt; the rest comes from the live stream. Some non-participating orders away from the book top have been removed for clarity.
Bid 8595048 for 0.19825903 @ 221.13 would cross the book, and should match immediately, but orders continue to be accepted and no trade appears. Bid 8595051 for 0.63 @ 222.65 would also cross the book, but since it arrived ~2.544 seconds later — and assuming FIFO matching — it shouldn't execute until after 8595048. But it executes first. In this case, fortunately there's enough depth to the ask that both fill at the price they should, but this out-of-order execution occurs even when there isn't enough depth; I can give real examples from the stream but they make less clear examples because they tend to involve multiple fills. Imagine that you're watching this stream and you see the FBI dump the SR coins, and that the window is wide enough for you to react. You could place a limit order that beats theirs, being sure to sell your coins before theirs crash the exchange rate. Alternatively you could always maintain a buy order in the book, far enough away that you can maintain a constant distance from the best bid but close enough that a whale might fill it. When you see a whale's sell, you snipe a high sell by beating their limit. The whale's order then goes through and fills some other bids, and your low buy. You effectively just made a high sale and made a low buy with no risk at all. You could do this on both sides of the book at once. Why document this instead of just taking advantage of it? I hate the idea that some traders are playing with loaded dice. If the engine has to behave in this funky way, it should be documented; ideally it should simply behave as everyone expects it to anyway. Why post under a throwaway? While I've made no attempt to exploit this, I wouldn't put it past Bitstamp to confiscate my balances and close my account; that's simpler for them than checking whether I did exploit it. (In case I choose to link this to my real account later or you need me to prove I'm me, I can provide a pre-image for e591ed9a365ad73d29dc22f10b170fff and d4bd7f9db698c81ba31ce544d2025834.) Why not report it to Bitstamp first? Bitstamp has a poortrackrecord for addressing bugs reported in their engine, probably needs to be embarrassed into doing something, and they can easily just disable the stream. I've left stream access details undocumented, for now.EDIT: described on bitcointalk (via Pusher) as well as below (direct WebSocket access). I'd ask Bitstamp to confirm whether they believe this is a problem, say what they plan to do about it (if anything) and I invite them to PM me here in the unlikely event that they need more info. I'd also really like them to make their stream useable, along with a single orderbook snapshot, to maintain an accurate of the orderbook without having to make unreliable inferences — i.e. include prev_amount (or amount_delta) in order_deleted and order_changed, and also include in each trade event the order IDs that matched. Having these things would bring it towards or beyond MtGox's stream, which provides at least the remaining volume at the affected pricepoint. It'd also be lovely if the ungrouped orderbook snapshot included order IDs and could be explicitly pinned between two stream order_foo events for easier syncing (the timestamp doesn't seem to accurately match the stream's datetimes, and requires guesswork). And a pony and a winnebago and the moon on a stick.
I just released zTrader, my trading app! It supports 5 exchanges including Bitstamp, BTC-e, and Bitfinex, and every currency trades on those exchanges.
http://imgur.com/a/LEX3I I have been spending some of my free time over the past few months developing this app. I hope you guys find it useful. API keys are always encrypted and never stored in clear text. Here is the source code for zTrader's cryptography: http://pastebin.com/YhJzwJDp Here's what it can do:
Trade any currency pair supported on Bitstamp, Bitfinex, BTC-e, BTer, and BTC China
View order books and recent trades (like BitcoinWisdom)
Place limit and market orders on all exchanges
View your balances
View and cancel your open orders
View and export your trade history for any currency pair
Why do recent rallies quickly convert into bull traps?
Current news indicates bitcoin is strong and crypto has an amazing future. However the current bitcoin bear market sentiment can be - how can I put it - rather "negative" and even "schizophrenic". When rallies currently start, big or small, inevitability the action gets terminated prematurely by someone dumping huge quantities of coins on the parade. The rapidly dropping price is then usually immediately chased down by sell walls stopping a snapback. This can be perplexing for some because the sell walls following the price down so quickly do not generally get to sell their coins quickly & waiting could easily yield a better price. Of course this is partly just a manifestation of nervousness and doubt rallies will go anywhere due to usual bear market concerns about TL;DR (1) coin oversupply from mining farms needing to liquidate quickly and pay down their electricity costs and loans (2) dismay at problems with Gox and other incompetents in the market (3) fears about altcoins undermining bitcoin (4) liquidity being withdrawn from exchanges because of fears about counter party risk (5) fears we are still in bubble territory & that bitcoin isn't worth the $7b market cap etc. Plenty of reasons for any bear (!) but:- Another important factor IMHO is execution of strategies to maximize utility of shorts. A simplified version of such a strategy might be summed as, wait until a rally starts to slow, then dump not only all your own bitcoin but the same quantity again as a short on margin (typically on Bitfinex). Ideally keep some coins in reserve to chase down the price with sell walls and dump simultaneously on both Bitstamp and Bitfinex. If you successfully crash the rally you benefit not only from selling at the top but benefit greatly on the way down too (I am not recommending such strategies btw just describing). So the question is (1) what is balance regarding causes of current bull trapping, and (2) assuming that shorting strategies mucho involved, how long before sentiment firms up enough that these strategies become non-optimal and we see return of epic bitcoin bull runs. Personally I feel like I'm seeing the odd sign, but market still very bearish. Thoughts? Pics Cryptonica.com, showing sell walls in grouped order book view shortly after recent rally crash http://picpaste.com/XXMCSaic.png BitcoinWisdom.com chart showing same rally and crash http://picpaste.com/4lTFvPWr.png I am this guy https://twitter.com/dominic_w
Our last post had a warm reception among the advanced traders here. We felt like we should produce some help for the new traders too. At BTC.sx we see a lot of traders lose money from simple mistakes that can be avoided. Armed with this insight and over 60 years of collective experience in finance, we have produced 5 tips that should be a big help to new traders. 5 Tips for Successful Bitcoin TradingEssential information you should know before placing your first trade This post is aimed at those with very little knowledge of financial markets. Bitcoin has encouraged many to take an interest in finance and allows easy access to financial exchanges. Consequently a large number of people are attempting to trade Bitcoin, without any prior trading experience. At BTC.sx we sometimes see traders make simple mistakes that could be avoided with a basic understanding about trading and investing. Let’s take a look at the five most common mistakes new traders make and how to avoid them: 1. Do not invest more than you can afford to lose https://d262ilb51hltx0.cloudfront.net/max/800/1*dP87BcY7IMn9aIrwTT1ykg.jpeg Any financial investment can produce losses, rather than returns. With a highly speculative investment, such as Bitcoin, there is a high chance that you can see very large gains or losses. By trading Bitcoin, there is also further scope to lose money from poor decision-making. One should invest such an amount that they feel comfortable with losing completely — be prepared for the worst eventuality. There are two reasons for this. Firstly, successful investors diversify their portfolio. Allocating too many funds to an asset class increases risk exposure. This makes it harder for gains in other assets to cover losses in another asset. You cannot lose more than you put in, so don’t put in more than you can afford to lose and you’ll be all right, even in the most negative case. - Rpietila Secondly, investing more than one can afford to lose reduces an investor’s ability to make good decisions. In particular, there is a risk of ‘panic selling’ when the market declines slightly. Instead of holding throughout a market dip, one who is over-invested may panic and sell-off their holdings for a low price — attempting to cut their losses. This tends to lead to losing more money when the market recovers and the trader buys back at a higher price. 2. Set goals for each trade Setting goals helps traders remain level-headed during periods of extreme volatility. This is highly important for Bitcoin trading. When placing a trade, determine what price to take profits or cut losses in advance. The benefit of this is that it is easier to prevent trading decisions based purely on emotions. For example, a trader with no target price may make a profitable trade, become greedy, and then fail to realize their profits while the market is still on their side. This chart shows the typical emotions an investor may go through and how they make it harder to ‘buy low and sell high’. https://d262ilb51hltx0.cloudfront.net/max/800/1*0tpcgBQ51awHWDhdPy2qUw.jpeg The use of goals / price targets can prevent traders becoming greedy when experiencing euphoria and despondent after a market crash. 3. Learn how to read charts Although technical analysis is a difficult skill to develop, new traders at a minimum should know the basics of chart reading to identify market trends. The most widely used Bitcoin charting tool is Bitcoin Wisdom. Despite looking overwhelming at first, it is actually very intuitive. Here are the basics a new trader should understand: Candlesticks - these are the rectangles and lines that resemble a candlestick shape. They are used to show what the price has done within a chosen time interval, which in this example will be one day. https://d262ilb51hltx0.cloudfront.net/max/800/1*G7g3tvOz4XRcxFX9eZ4icg.png Take a look at the candlestick highlighted by the blue box. There are several pieces of information we can gather from this single candlestick: Opening price — this is the part of the rectangle that is horizontal to the candlestick to the left. On this day, the price opened at approximately $400 (which was the closing price of the day before). Closing price — this is the part of the rectangle that is horizontal to the candlestick to the right. On this day, the price closed at approximately $378 (which was the opening price of the day after). Price direction — as the closing price is less than the opening price, the price of Bitcoin fell, therefore the candlestick is red. Highest price — the highest point of the stick shows that, during this day, the price reached approximately $407. Lowest price — the lowest point of the stick shows that, during this day, the price fell to approximately $368. Trading range — the difference between the highest price and the lowest price shows the range that the price was trading in. Order book — this is a list of the prices and quantities traders are willing to buy and sell Bitcoin. https://d262ilb51hltx0.cloudfront.net/max/391/1*GmjoL5vhYY834J4w7vu7jg.png The ‘asks’ (sell orders) are listed in the top half, and the ‘bids’ (buy orders) are the listed in bottom half. The difference between the lowest ask ($361.95) and highest bid ($360.95) is known as the ‘spread’. The second section with the scroll bar shows live trades, which can be used to see what is happening in the market right now. Lastly, Bitcoin Wisdom projects how the price may move based on the order book. This can be indicated by the green and red lines at the end of the chart. How can a trader use this information? It allows short-term support and resistance levels to be identified quickly. For example, if there is an order to sell 5,000 Bitcoin at $362, the price will have a lot of resistance at this level. This is because buyers will fullfil the cheapest sell order available to them and, given 5,000 Bitcoin is a huge quantity, this will be sufficient to satisfy buyers for a few days. It is only when this order has been fulfilled, there is potential for the price to move above $362. It is worth watching the live trades and bids / asks being fulfilled to get a feel for how an exchange works. Keep in mind that a buyer will want to buy at the cheapest price for their desired quantity. So they will buy as much Bitcoin as possible at the cheapest price, and then the next cheapest price if the original ask contains an insufficient quantity of Bitcoin. It is this scenario that increases Bitcoin’s price — or decreases Bitcoin’s price in an opposite scenario. Logarithmic scales — using just linear scales makes it difficult to track Bitcoin’s price over a longtime span. This is because linear scales have with Y Axis values of equidistant. This linear Y Axis is easily distorted by extreme values, which Bitcoin’s price is famous for recording. In contrast, logarithmic scales have a Y Axis that changes values according orders of magnitude. This prevents chart distortion and can reveal hidden trends in Bitcoin’s price. Observe the difference below: Linear Bitcoin chart: https://d262ilb51hltx0.cloudfront.net/max/1186/1*uU1WEvsAchNcdK8iGI2XJg.png Logarithmic Bitcoin chart: https://d262ilb51hltx0.cloudfront.net/max/1177/1*t6JwI7xM_BBcZasWvGgmWg.png The logarithmic chart has revealed another rally that was completely hidden on the linear chart. This is useful to assess the long-term trend of Bitcoin. 4. Do not set stop losses too low A stop loss is an automatic trigger to liquidate your position if your losses reach a certain value — essentially stopping you from losing any more. They are a good tool to take advantage of. However, at BTC.sx we recommend that traders do not use a stop loss that is too small. Choosing 10:1 leverage means that your deposit is 1/10th of the position size. This deposit determines the stop price, the price at which a position can drop to until the deposit can no longer cover the position’s loss. At $200, the default stop will be $20 away (or 10% of $200). Anything less than the position’s default stop will increase the risk of a position closing out very quickly because of minor fluctuations in the price of Bitcoin. Here as an example from the rally of Winter 2013 to demonstrate this: https://d262ilb51hltx0.cloudfront.net/max/1192/1*-T0MDCOxwXaUgf_XcvlOZA.png In this hypothetical case, a trader with a default stop at 10:1 would have lost out on a huge rally. They bought-in at the right time, but because their stop loss was set too low, their Bitcoin were automatically sold at a loss during a minor fluctuation. It is important to note that lower leverage options result in a larger stop and as a result is considered a much safer way of exploring the basics of trading. 5. Close unprofitable & leveraged positions within 24 hours Leverage is borrowing or lending an asset in hope that it appreciates or depreciates, respectively. At BTC.sx, we give traders the ability to enter long (buy) or short (sell) positions with 2:1, 5:1 or 10:1 leverage. If a trader shorted 1 Bitcoin at 5:1 leverage, for example, the total investment is 6 Bitcoin. To make a profit the price must fall, allowing the owner to reclaim ownership at a lower price. However, the price of a Bitcoin must fall sufficiently to cover the trading fee and the interest fee charged on borrowing the 5 Bitcoin. Do not fear if this sounds complicated! We have integrated a breakeven calculator into our trading interface to automatically show what price movement is required to return a profit. Our daily interest charge is applicable up-front for every 24 hour period with the first 24 hours being free. Thereafter a trader must ensure that there is sufficient balance in their account to cover the cost and ensure the position remains open for each subsequent 24 hour period. In the foreign exchange trading markets, this is referred to as Rolling Spot FX. As the Bitcoin market is volatile, it can be hard to make a daily profit when the price is prone to change direction quickly. Put simply, we recommend that inexperienced traders close unprofitable positions within 24 hours to avoid paying re-occurring interest. Summary We hope this post has been informative. The key takeaways from this post are: Do not invest more than you can afford to lose Set goals and target prices for each trade Learn how to read charts Do not set stop losses under $20 Do not keep unprofitable positions open for longer than 24 hours If you feel ready to trade your first Bitcoin, click here to use our trading platform
Hi, I follow the price of BTC on a daily basis normally using 30 & 15 minute candles on live charts. Recently there seems to be a few new sources providing live (or nearly) market charts on bitcoin. I have made a list of all the ones that I know about, but wanted to know if there are any more out there? Please post any that I have not mentioned.
New service Cryptonica - special heads up for this sub!
Happy to announce a new crypto currency trading platform is coming - Cryptonica. http://cryptonica.com The site above now gives a taste of the unique way we handle crypto market order books (in this case the Bitstamp BTC/USD order book). If you see the "synchronized" status, you are often seeing what is happening in the order book a few seconds before users of other services. We will shortly add features allowing you to execute trades on your exchange accounts, and many other features. UPDATE: there is already a loyal following developing! Big thanks to everyone for the early interest!!! Background Cryptonica is being created from code originally developed by a private crypto fund. We have the following objectives:- 1/ Provide crypto traders with more effective tools and help grow the number of traders. 2/ Create alternatives for RTBTC now it has been acquired by ZeroBlock and help drive technology forwards through competition. Product Roadmap We believe there are already plenty of great charting solutions, including BitcoinWisdom and TradingView. We focus primarily on the order book and optimizing for the increased volatility you see in crypto markets. This is our immediate roadmap:- 1/ Include the rapid trade execution features in our internal version 2/ Add support for other exchanges: Bitfinex, Huobi... 3/ Add support for additional currencies: Litecoin, TBD 4/ Include other advanced features subject to demand. Please see below. Feedback Requested We are seeking feedback on possible inclusion of these advanced features. Automated trading strategies Automated trading strategy features can for example maintain buy or sell orders at specified distances below or above the current price measured by order depth or points (for example to catch the coins from a whale dumping and capitalize on spikes). The trade off is that if too many people use these features market "busyness" will be increased. What such features would you like to see included given they would be shared amongst many traders? Trust-less security. Cryptonica can work without ever storing or handling your exchange API keys on its servers. With trust-less security your exchange key only needs to be stored locally in encrypted form by your Web browser and is never transmitted or shared with us. When the client needs the server to interact with the exchange, for example to create a new order for you, it simply creates the signature for the request and passes that to the server. A trade off is that your keys can be vulnerable to trojans and viruses running on your local machine (but of course it becomes harder for an attacker to obtain keys en masse by compromising the central servers). We'd like to know if you feel this is worth it? Thanks for reading and see the comments for more info or to ask questions. I am this guy https://twitter.com/dominic_w
Does anyone know of a site which plots the discrepancies between exchanges? This would have obvious uses for arbitrage. The past few days I've been opening Bitstamp USD, Mt. Gox USD, and BTCChina CNY plots in BitcoinWisdom, and then jumping between tabs to make visual comparisons. At the 30min resolution, each of these has very different shapes, nevermind the difference in absolute price. I'm curious to see how the new year is shaping up! Does anyone have good explanations for the relative shapes? Bitstamp is climbing, Mt. Gox has a huge sell off around Jan 1st 10am, and BTCChina seems flat.
Ask r/Bitcoin: Is there anything like Bitcoinity or BitcoinWisdom for Coinbase?
I do everything on Coinbase with instant transfers, so Bitcoinity, BitcoinWisdom, and the others don't really help me track the price since they only focus on either Mt Gox, Bitstamp, and others. Howmuchisafuckingbitcoin.com does a pretty good job, but there's no plot. I've been using the BTCReport iPhone app for Coinbase, which is really good, but it's not interactive like the others. Any suggestions?
12-24 10:07 - 'Want to promote bitcoin with friends, easy!!! Here's how!!!' (self.Bitcoin) by /u/Luccio removed from /r/Bitcoin within 234-239min
''' I work for the Airlines at an Airport in N.America. Most of the computers are dedicated hardware running dedicated software to the mainframe. However in the back office, in the employee kitchen, and the recreational room, we have standard PCs at out disposal. I walk in to work and kick off firefox with [link]1 . I set it up to the BitStamp graph with the 30min candles. I do this on all 3 computers. Then when BTC takes a rocket ride, like it did this week, I jump for joy ecstatically!! Then I brag on how much I made in % not in $$$. Then I tell them 'not' to get on the ship ... But to put one foot onboard and keep one foot on the dock. This way if the ship should set sail, then you're half way onboard, and if it should sink, you only get one foot wet. Because BTC will jump overnight... ''' Want to promote bitcoin with friends, easy!!! Here's how!!! Go1dfish undelete link unreddit undelete link Author: Luccio 1: www.BitcoinWisdom.com
I propose a theory here of Huobi’s real business model that can explain their success. Huobi has managed to capture the world’s largest bitcoin trading volume as exemplified by its recent volume surge during the selloff as documented on BitcoinWisdom. It has done this while promising its fee will remain 0 forever as claimed by asian00 in this comment to a recent reddit post: http://www.reddit.com/useasyan00. He also implies that Huobi also allows bitcoin short sales. A bitcoin short sale allows the seller to sell bitcoins that are borrowed from Huobi. The short sale of common stock is an honored Wall Street tradition. In order for bitcoins to become an integral part of the global financial system, there must be a way to easily short sell them. If one could short sell bitcoins on Mt.Gox, its price would quickly reach parity with the other exchanges. Huobi’s success, the short sale option, and no fee forever promise provides clues that their business model is as a bitcoin exchange that also acts like the old New York Stock Exchange specialist who also lends bitcoins for short sales. In 2005 a seat on the NYSE was worth $3.5 million, which only entitled the owner to be a specialist. The role of the specialist was subsequently changed. Before computerization, a specialists actually conducted the trading in each stock and could trade for their own account. However, they were supposed to execute any buy or sell order coming from the public that could be matched with one on their order book of bids and asks before they traded for their own account. Like Huobi now, the specialist was not paid a fee. They made their money trading the stocks that they were the specialist in. It was so lucrative that someone once paid $3.5 million just to become one of many. Huobi does not have that restriction since they own the exchange and can be their only specialist, if they want to be. What do you think they choose to do in this respect? Thus, by letting anyone trade for free they have captured the majority of the bitcoin world’s volume and are free to profit by it in a way that the old NYSE specialist could only dream about. I have not seen any part of this Huobi business model theory proposed before. Although I have research Huobi on the Net, there appears to be very little information available on it in the English language. If you are aware of anything pertinent, please let me know. I watched hours of the recent selloff live on BitcoinWisdom, and have since reviewed it .I was watching the action on Bitstamp, BTC-e, Bitfindex, Coinbase, Mt.Gox, BTCChina, OKCoin, and Huobi. My observations of how most of the minute by minute movements on Huobi were subsequently propagated to the others help me develop this theory. However, Huobi didn’t completely dominate the trading. It appeared to me that the up move from the bottom was initiated by buying on Bitstamp, BCT-e, Bitfindex, and Coinbase that eventually led to an up move on Huobi. BTCChina was the exchange that was best at resisting the wilder swings on Huobi. It was obvious that this was the result of their maker taker system.
CoinerWisdom.com Bitcoin Graph/Statistics/Signals/News Good for Traders!
Hello everyone! first i want to say thank you for all the support! We have released our Beta version for Windows users! Features: [b]* Exchanges Support: BTC-e, Bitstamp, Bitfinex, Houbi, OKCoin, Exmo, BTCChina, Kraken, Cryptsy, Cex.io. * Trading Idea's * Trading Signal's ( Coming from many sources ) * Follow someone trading techniques * Bitcoin, Altcoin Support * News ( Coming from many sources. ) [/b] Website: http://www.CoinerWisdom.com if you found bugs you can report here or contact us via email, pm. Thank you! ::)
With all this hate, why did MtGox hold a commanding lead for so long? They got something right!
I understand the disgust of MtGox as much as anybody! they have been holding 5 of my bitcoins hostage for nearly a year because they suddenly, out of nowhere, require me to verify my identity/account before I can withdraw ANY funds, even BTC! I've sent them everything I can but I continue to "fail" their verification... I've almost just given up on them... BUT, I'm not afraid to say, when it comes to HFT/day trading/panic trading, they aren't only the best, most (ONLY) reliable exchange, they beat the living hell out of their pathetically weak/lame competitors!!! Have you ever watched BitcoinWisdom during a heated panic sell off? Gox, can eat up millions of transactions from around the world without even the slightest hint of lag! I've seen some crazy action in the past few days... I've been trading the dips non-stop for days (stop! PLLZ PPL!! Need... Sleeeeep ) and my Gox lag meter has never gotten behind more than 3 seconds peak! Compare that to Criptsy or Coinedup, lol, those guys shit their pants and run hide in terror every time a few duzon peeps login... Even Bitstamp doesn't come even close to being reliable when the heat is on... It's that very reason that I started using MtGox in the first place, despite the warnings. I will never forgive them for stealing my 5 BTC, however, I have cussed, thrown fits, smashed windows/screens and lost FAR MORE BTC (and hair) while waiting helplessly on the other exchanges MF websites! Or their lame ass excuse of an API to respond... Seriously guys, invest in some decent hardware that can handle a massive, DDOS style load. Once you have that in place, triple it!!! Slow, half assed trading systems cost us all precious coins and sanity! If I had the patience to start an exchange, speed & reliability under pressure would be our #1 priority. Even above customer service & satisfaction. Just last night I was watching a movie when across the room I saw Cryptsy's green "order confirmed" box pop up. I had put that order in literally 3.5 hours earlier!! And if you expect them all to have Gox's LIFE SAVING always-best-price feature (list for 900 when top ask is 853, Gox sells it for 853 and refunds the difference), nope! In fact, some (Cryptsy) I can prove (order # + screenshot) they dont even honor their million mile order backlog in a first-come-first-serve basis! End result: They sold ALL my Dogecoin at about 20% below the current asking price! I really would like to see MtGox go down... But ONLY IF/WHEN one of the other guys MAJORLY steps up their game! With bitcoin taking over the planet, you need a global enterprise level server farm to host even a small time exchange without pissing off all your serious users. As MtGox has demonstrated for years, an exchange can be world class shit and still dominate the planet! Gox uses torture, theft, non-existant support, outrageously disproportionate market rate, outrageous fee's, insane terms (months for USD withdraw?), nearly unusable website, and the occasional anal rape... Yet they cannot get rid of the traders because they have just that one simple thing going for them: an adequately sized network! When it all boils down, that is all that really matters to the day traders!
Bitcoin Trading Pattern in China Observable on BitcoinWisdom 30 Minute Charts
The daily fluctuations in Chinese trading volume can be seen on the 30 minute BitcoinWisdom charts of BTCChina, Huobi, and OKCoin. They are very similar. These charts are also showing a U shaped price pattern over the last 2 and half days. You can see a two phases of price drops over Monday and Tuesday China time. It looks like Tuesday was a capitulation day for bitcoin in China. Enough of those sitting on the fence dumped their holdings that a snapback rally started Wednesday morning. This rally has almost returned the price to where it was at the start of trading Monday morning in China. These are in stark contrast to the trading volume and price fluctuations on Bitstamp, Bitfindex, BTC-e, and Kraken. The drop on these 4 western exchanges was not as dramatic and probably accounts somewhat for the snapback rally in China/
Compose a clever Tweet. It should be funny, and it can be a little offensive, but don’t get too crazy. I’ll disqualify anything I think a significant number of people would find offensive. No swears, slurs, etc.
Add either #Karhu or #WhaleGod. Karhu lowers prices, WhaleGod brings the tide that raises them.
Add the current Bitstamp ticker price according to BitcoinWisdom. Feel free to round–if it says 626.34 and you write 627 I won’t care. Be as close to accurate as possible.
The earliest entry wins if multiple entries are too similar.
Entries accepted until 11PM EST 3/21/14
3 of the keys will be given to my favorite three “prayer” Tweets to Karhu and WhaleGod, regardless of correctness of call. These 3 winners will also each receive .1 BTC. The other 20 keys will be given to 20 random people who requested the intercession of the correct deity. If you call on #Karhu and the price at midnight EST on 3/21/14 is lower than when you sent your Tweet, you get entered in that drawing. If you call on #WhaleGod and the price at midnight EST on 3/21/14 is higher than when you sent your tweet, you get entered. Guess the price movement correctly and get a chance to win. Thanks for reading, hope you have fun! EDIT: When I announced the contest, it was 8 keys total. It is now 23 keys total, thanks to a contribution from Yo Sub Kwon, Coinsetter co-founder.
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The Bitcoin News Show for the week of July 15th with your host @theonevortex and panelists: @matt_odell, @HillebrandMax and @danheld Quick bits: Bitcoin crosses over $3 billion dollars in daily ... Santiago, Chile- Welcome to the 1 Bitcon Show! The mainstream media goes all in on the Bitcoin climate change narrative. Expect the no-coiners to remember th... This video is unavailable. Watch Queue Queue. Watch Queue Queue Bitstamp & Simplex setup plus bitcoin purchase & withdrawal - Duration: 12:27. John McKillop 4,525 views. 12:27. Alan Watts - how to see through the game - the secret to life :: ... Donate Bitcoin: 1NX6ijFGErktMGNYUHayD5iHDcZSFHdAwe Be a Patreon: https://www.patreon.com/madbitcoins 4248.86 Bitstamp BTC/USD - BitcoinWisdom https://bitcoin...