2. Mainstream appeal
Asymmetry of information was allegedly exploited for profit by a group of people. The logic behind this point is quite simple: a decentralized, P2P asset that allows people to hedge themselves against government excess — such as censorship and restrictions on personal and economic freedom — should not be held to the same standards and norms that all the regulated assets are held to, unless we would like to get rid of the characteristics that make it so unique.
When the price goes down as a result of trading on privileged information — should we really call it insider trading given the point above? That pain is real, but how can you fault the people who profited from this not so big short at Goldman Sachs?
If they indeed acted on the information that was only disclosed a few days later, it is because:. Nevertheless, futures trading might have been detrimental to Bitcoin itself and not only to its price.
This is the core of the issue; the alleged privileged information saga that hit the markets over the last few days is a by-product of this issue. In fact, long-term Bitcoin holders — who are holding on to their coins for whichever reason — should not be bothered by the move that traders at Goldman pulled. Bitcoin is stronger now than it was a year ago. The Lightning Network is running and there are no more contentious forks looming like a dark cloud in the horizon.
Fiat-dominated systems on the other hand, effectively postponed a painful, protracted downfall through the creation of debt and an artificial monetary expansion that will come back to bite the economies they underpin. If these Goldman traders are as smart as many think they are, they will be using their fiat now to buy actual coins instead of positions on Bitcoin derivatives. Meanwhile, those who are holding Bitcoin long-term, should understand the implications of doing so and make sure they know exactly why they do it.
Price will continue to fluctuate, but the value of the coins that people hold has not moved a single iota since the privileged information trade was placed. Bitcoin provides an alternative to a corrupt system. Therefore, these economic attacks through the use of privileged information do not constitute a problem for those who understand what kind of asset they hold in their wallets.
Analyst and Content Manager at Bitcoin Chaser. Steven has been an avid consumer of any kind of information related to bitcoin, blockchain technology and cryptocurrencies since More Posts. Bitcoin News September 10, By Steven Gleiser. If they indeed acted on the information that was only disclosed a few days later, it is because: They are rational, profit seeking actors in the market who weighed the risks and rewards, and then made a good profit in a very short period of time.
Profits in Fiat In fact, long-term Bitcoin holders — who are holding on to their coins for whichever reason — should not be bothered by the move that traders at Goldman pulled. Connect with. Notify of.
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Coinbase, one of the largest cryptocurrency trading platforms, shocked the crypto-world with its announcement Tuesday evening that it would allow users to buy and sell bitcoin cash. Bitcoin cash's appreciation began slightly before the announcement on some exchanges, raising concerns about the possibility of insider trading by employees with advanced knowledge of the news. The price spike appeared to put pressure on Coinbase. Nearly four hours after the San Francisco-based firm announced it was supporting bitcoin cash trading, it said users wouldn't be able to buy and rrading the cryptocurrency until Wednesday. We anticipate that this will happen tomorrow. The company said in knsider blog post it disabled trading because of "significant volatility. Coinbase has struggled to fully function under such demand in the past.
1. Safe haven
For the latest business news and markets data, please visit CNN Business. The cryptocurrency website Coinbase said it was looking into price movements that occurred shortly after Coinbase launched bitcoin cash on its exchange. Coinbase CEO Brian Armstrong said in a message posted to his blog that it suspended trading of bitcoin cash after seeing a wild price increase on other exchanges before its launch. Bitcoin cash is an alternative form of bitcoin that emerged in August. It features a change in the digital software that was designed to speed up the efficiency of transactions as the value of bitcoin ballooned. Armstrong said that all Coinbase employees and contractors were "explicitly prohibited" more than a month ago from trading in bitcoin cash and from revealing launch plans.
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