I have a suggestion:

From what i understand running out of BTC on bitstamp was what lead to the cascade. How about next time this happens, and the order book moves more than 5% out of sync with bitstamp, that bfx pauses *sell orders*.

So its similar to halting trading, but *limit buy* orders are still allowed.

What will happen is the traders and bots will start to fill in the depleted order book. Eventually sell orders are restored again once the order book depth reaches some predetermined value, like say 1000 Btcs to the bitstamp price. let the sell orders trickle in and if the depth is depleted again and goes 5% out of sync with bitstamp, you once again halt *sells* and resume when the depth rebuilds enough. Meanwhile, you're also sending more BTCs to bitstamp.

This is like a circuit breaker but allows a controlled sell off. The advantage is that because its slow, forced liquidations won't cascade to zero because there will always be buyers willing to fill in with more bids when they see the bitstamp/bfx order books go out of balance. Also i think the number of forced liquidations will be reduced because they are stopped at 5% below bitstamp and only resumed when the bids fill in. eventually there will enough bids to repay lenders and stop the cascade.

The point of halting trading i think is to stop a cascade and destroying the lenders. By still allowing *buy limit orders* placed, we're still giving the lenders their money (since its coming out of the buyers).

If there aren't enough buyers then no worries, the depth never refills and trading is not resumed until the extra BTCs get to bitstamp. This system won't be any worse than the current system of halting all trades until btcs get to bitstamp... at least i don't think it's worse.

This "half-breaker" works both ways, If the opposite happens somehow, you can stop buy orders in the other direction.

Anything wrong with implementing a half-breaker?

The only difficulty i can see is that extra computing power is needed to check if the above conditions are met after every trade. After a sell occurs, check if there is still enough btc in bistamp, if not, check if the last trade pushed the price to 5% below bitstamp price, if true, STOP SELLS.

For very large sells of thousands of BTC you'll also have to break up the transaction into smaller pieces and implement the checks after each piece.

Anyway, could this idea work?

it was around $617 when bfx restarted,
I'm reaally down because i sold at ~600 hoping to get back in at $550. but just when i hit the buy button the trades were stopped....

I feel for ya,

At least you can mitigate your risk with a UPS for your computer/monitor/modem and such. It's something proactive you can do.

But the platform halting just hurts, there is nothing we can do on our end about it.

I hope BFX gives us a few days of zero fee trading or something to lessen the sting of these incidents.

Have everything backed up with a APS UPS,

but they only provide like 5 to 10 minutes at most

of power, what I need to do is install a Gasoline-Generator,

or a monkey on a bicycle, lol  


Having sold at 600 I'm also feeling your pain,

Another Trader's advice to me in situations like

that has been to "Trade the Market, Not Your Position, You can always Find a Good Position Entry"

Don't Worry about having sold low, make up for it via another good trade.

If you have a hybrid electric vehicle a really cool thing a friend of mine did was install a high-powered inverter directly into the car's hybrid battery (not the 12 volt battery, the high voltage one used to run the vehicle). Now the car itself becomes a very powerful portable generator that can run his whole home for a full day on a full tank of gasoline. noise and emissions are also much better than a good store bought generator.

And i realized i just went way off topic. PM me if you want further details.



As for your advice. the real trick is knowing when to abandon a bad position and eat the loss.

Why ?

Because the low is 530. Even NYSE Nasdaq will bust trades that should not have happened.

Read a few pages back in this tread. Basicly Bitfinex's BTC funds at Bitstamp ran out, then the sell orders chewed trough the bitfinex orderbook, and all margin calls hit, causing the price to crash towards zero (in your screenshot the highest bid is only 100), at that time all trading was halted, and rolled back.

I like that idea.
Some automatic breaker, with the rules published in advance, and a clear message on every page of BitFinex in such a condition.

Please, everybody who still complains, take it to BitFinex email, as they themselves asked for. Or open a thread in "scam accusation", whatever. I don't want to hear it again and again for pages and pages.

To everybody making suggestions here: This sounds like we really can come up with a good plan here. And, as was stated by BitFinex/Giancarlo several times, people who make good suggestions will get some goodies. They are listening to us, lets make the platform go out stronger from this!

Ente

Is anyone else having BTC withdrawal issues with Bitfinex? I've placed a withdrawal 7 hours ago; after three hours I sent an email to support and haven't received a response. An earlier post by Giancarlo (sp?) seems to affirm that they're replenishing the hot wallet, but thus far nothing. I received a "Completed transaction" about an hour ago, but receiving wallet still shows no deposit.