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Bitcoin The Almighty Buck

One Bitcoin 'Whale' May Have Fueled the Currency's Price Spike in 2017 (technologyreview.com) 45

Posted by msmash from the what-they-do-in-shadows dept.
A single Bitcoin holder -- called a "whale" in cryptocurrency parlance -- likely manipulated the market and helped fuel the big rise in Bitcoin's price in 2017, according to researchers. That year, Bitcoin's price jumped from under $1,000 in January to more than $19,000 in December. From a report: Last year, University of Texas professor John Griffin and Amin Shams, an instructor at Ohio State University, published controversial research concluding that in 2017 just a few big players used the stablecoin Tether to prop up the price of Bitcoin following market downturns. Griffin and Shams now tell Bloomberg that just a single whale was likely behind the behavior. They say that one entity on Bitfinex, a popular cryptocurrency headquartered in Hong Kong, appears able to push the price of Bitcoin up when it falls below certain thresholds. Griffin and Shams studied Bitcoin and Tether transactions from March 1, 2017, to March 31, 2018. They found that Bitcoin purchases on Bitfinex increased whenever the price dropped by certain increments. According to Bloomberg, which saw a prepublication version of a paper set to be published in the Journal of Finance, the authors conclude: "This pattern is only present in periods following the printing of Tether, driven by a single large account holder, and not observed by other exchanges."
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One Bitcoin 'Whale' May Have Fueled the Currency's Price Spike in 2017 More

One Bitcoin 'Whale' May Have Fueled the Currency's Price Spike in 2017

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  • The only certainty, 1 Bitcoin is genuinely scarce, and can't be printed for free by anybody. This is what matters!

  • Shocking! (Score:4, Insightful)

    by drew_kime ( 303965 ) on Tuesday November 05, 2019 @05:45PM (#59384702) Journal
    A virtual currency is being manipulated? I'm shocked! Shocked I say!

    • Re:Shocking! (Score:4, Insightful)

      by nonBORG ( 5254161 ) on Tuesday November 05, 2019 @06:03PM (#59384752)
      Manipulated? When the price drops he buys, sounds like a bargain hunter. Hard to read his motivations here but my first guess would not be currency manipulation.

      • They PRINT new tether out of thin air, often, and then buy bitcoin with it. Billions of dollars worth. That's the only thing keeping bitcoin propped up. If Tether was forced to close tomorrow bitcoin would drop below $1000 almost instantly. Every exchange that deals with tether is insolvent today. It's the mother of all scams.

      • Re: (Score:3)

        by rtb61 ( 674572 )

        More like panic and desperation. Bitcoin is backed by nothing but advertising, pretending it has value, it has none, fiat currencies are backed by the wealth of countries, land and resources, productive capacity, agriculture the GDP. Bitcoin is nothing but vapour ware and that whale went deep and is not sinking more money, to try to keep safe the money already invested.

        Bitcoin has become popular amongst the spy vs spy types and law enforcers because it can both be tracked yet used anonymously, real trap ri

    • Thankfully, Dogecoin is invulnerable to manipulation OR to market ups and downs, because for all the craziness of crypto, One Dogecoin is still worth 1 DOGE.

  • Thanks! (Score:4, Informative)

    by EvilSS ( 557649 ) on Tuesday November 05, 2019 @05:49PM (#59384712)
    Well, whoever you are, thanks! I managed to pull in about $2K mining shitcoins on my gaming PCs from December 2017 to March 2018, not to mention saving a few bucks on my heating* during a particularly cold winter.



    *propane auxiliary heating (heat pump won't kick on under 32F), which if you never had the "pleasure", is a fucking rip-off. Screw you Hank Hill.

  • Speculation on speculation (Score:1)

    by Anonymous Coward

    They found that Bitcoin purchases on Bitfinex increased whenever the price dropped by certain increments

    How does this differ from ordinary triggered purchases of stocks or durable goods for speculation? Buy low sell high.

    • The difference is Bitfinex IS Tether (same people) and for 2-3 years they've been printing new tether out of thin air to keep the price of bitcoin propped up. They've been lying all along about tether being backed 1:1 by real USD.

      • Or maybe they really have a 1:1 backing of Tether to USD, but the USD is the one being printed.

        • They've stealth-edited their web site several times in the past year to remove the 1:1 USD backing claim altogether. Now they subtly say it's backed by crypto assets, confirming exactly what I'm saying. They printed billions$ worth of tether and bought bitcoin with it. One giant pyramid scheme.

      • Maybe they hid it in the jungle, like in Cryptonomicon.

  • The new normal is negative interest rates. Bitcoin as sound money; And, Bitcoin as the ultimate hard monetary asset, is not just a new technology. Bitcoin has now an economic role to play!
    • Indeed, a world where low time preference is meaningless! A world where investing is non nonsensical, but speculation is the only concept that remains!

  • We Should Be Happier To Have A Job Than To Have Sa (Score:3)

    by slashways ( 4172247 ) on Tuesday November 05, 2019 @07:03PM (#59384952)
    Christine Lagarde: "We Should Be Happier To Have A Job Than To Have Savings"

    The Euro is doomed to be a simple means of exchange (MoE). Bitcoin as the only digital asset with true scarcity, will be our store of value!
    • "The average lifespan of a fiat currency is 27 years" - Where is the Euro going?

    • The Euro is doomed to be a simple means of exchange (MoE). Bitcoin as the only digital asset with true scarcity, will be our store of value!

      As a 'Murican, I've diversified my investment portfolio to also include a healthy position in FAA: firearms, ammunition, and alcohol.

  • Gold was money, and the Gold standard is over. Money is a winner take all situation. If you want something that can succeed where Gold failed. You want something without any angle of attack, and no single point of failure. So, you want something fully, and genuinely decentralized, without any company or leader to sue. You want something that can run for decades, and that will resist any kind of attack, internal or external. You will chose a harder monetary policy than Gold. This will give a massive incentiv

    • You want something without any angle of attack, and no single point of failure. So, you want something fully, and genuinely decentralized, without any company or leader to sue.

      This assertion needs an awful lot of support, it doesn't sound at all correct to me. Generally with a fiat currency it is preferred if it is backed by a strong power. If being totally powerless is somehow better, a strong case for it would need to be made before being accepted.

      • Before Bretton Woods (1971), money was backed by Gold. This is not the case anymore. FIAT money is a legal tender by government decree. The Gold Standard was defeated; Bitcoin is an attempt by the free market to deliver a better product using technology. In a time where negative rates are the new normal; Bitcoin offers an alternative.
    • Now everything is overpriced, thanks to central banks. Bitcoin is the perfect tool to undermine central banks authority!

  • yeah that bitcoin whale is called (Score:3)

    by etash ( 1907284 ) on Tuesday November 05, 2019 @07:52PM (#59385100)
    ...bitfinex. they need to keep it from crashing so that they can lure new victims. and they do it with tethers.

  • I mined two bitcoins back in 2011 or 2012, sold them by sheer luck three days before the bubble collapsed at $16k.

    No surprise that I'm ... Mr. Dollar Ton.

    Also, thank you, sucker who bought it.

  • I for one am looking forward to witnessing a 95% price drop of the Bitcoin-like coin BTC (that many people falsely call Bitcoin)

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