Bitfinex is GONE - Bitcoin will RECOVER - I am buying more BITSHARES!
I wanted to write this article yesterday, but I was too upset to form the right words, so I slept on it for a night in order to give you a better overview of the processes that lead up to the Bitfinex Hack, and the recovery of Bitcoins market-cap.
I have several times spoken directly to Phillip G. Potter, the CSO of Bitfinex about their lack of competence, security issues and repeatedly told my followers to not trade on his exchange.
Phillip G. Potter and Bitfinex has on the other hand seemed desperate to get help, as they are "business-men" without competence when it comes to running an exchange, so there is that... and as I have said to him - The day your exchange is secure enough, I will trade there, not before - and of course - the day never came.
My trading-community did not lose any Bitcoins
On Stakepool Radio & Teamspeak we have one rule you must follow if you want to be a part of the largest virtual radio-studio on the Internet, and that is: Do Not Lose Money! - So when Bitfinex got hacked, and people lost money east and west - we could observe the whole thing from a safe distance, because we don´t risk our capital with shady businesses.
Bitfinex - a repeat offender!
Back in 2014 I became acquainted with Phillip Potter and had the opportunity to ask him a lot of questions about his exchange. In that conversation came out all kinds of answers from the horses mouth. He would regularly inform us about so called "institutional investors" coming in to buy Bitcoins during bull-markets, and then completely disappear during bear-markets except for those 12-18 times Bitfinex lagged so hard during volatility that investors lost money due to not being able to log in for several hours and in the mix get margin-called out of their positions.
I actually have nothing good to say about Bitfinex at all - and I believe the faith of the ones responsible for this lack of security will have to face some years behind bars
about a year ago, Phillip G. Potter admitted to trade on his own exchange which made us raise eyebrows all over the community, but still trading continued over there as if it was not a big deal.
Bitfinex is gone - I am buying more BitShares
Exchanges are not meant to be banks - and they all have potential security-risks - so always keep only what you want to trade there during a day, and not your entire net worth - spread your risk.
Ever heard of the decentralized exchanges called BitShares? - it was created by @dan larimer who also together with @ned scott created #steemit which also has an internal exchange that works in the same kind of way.
As more and more CENTRALIZED exchanges join the long list of GOX, it only make sense to invest in the projects that work for decentralization.
You can buy Bitshares here:
https://bittrex.com/Market/Index?MarketName=BTC-BTS
https://poloniex.com/exchange#btc_bts
And be part of the Bitshares community here:
https://bitshares.org/
Bitcoin will recover
Bitcoin at these prices is a great opportunity to get a lot of bitcoins cheap, and as you can clearly see on the chart - Bitcoin is recovering nicely and there is good money to be made trading in the volatility right now, which I personally do over at 1broker which has been in business since 2012, I love that place.
Hey @fyrstikken, i remember reading about something happening with bts on 5th of November, I'm not sure if you know whats happening. If you do can you please explain it to me here. Thanks
sure, if I hear something I will say something - but I expect good things to come out from Bitshares occasionally anyway, since they are developing on the platform. I think it is a safe bet in an unsafe world.
I was just talking about investing in bitshares on the chat today, I hope something good does come of it. Hey, any idea on Dan's plans for brownie holders?
Any chance Quatloo Trader will support Bitshares Exchange at some point?
👍nice post @fyrstikken, keep up ur work
How can someone, join such a trading community?
@pjheinz You can join us here: Stakepool Radio & Teamspeak - Free & Open Society for Investors & Traders since 2014
Thanks for getting back to me @fyrstikken. I will see you over there.
Decentralization is peddled almost to the point of absurdity.
Most individuals don't know how to secure their crypto funds well, or are unwilling to invest the time to do so.
So they may use insecure brain wallets, or insecurely store private keys.
Why exactly would outsourcing crypto-storage to an entity be somehow more insecure than insecurely storing it yourself?
Plus the stake are higher for third parties.
In fact, to achieve some balance on the matter, it'd be worth considering the amount of priv. key hacks that individuals suffer in a specific period of time vs. entities that manage the secure storage of groups of private keys.
I'm sure you'll find central entities suffer less hacks.
November 5th is the end of the merge payouts. There were going to be defferent chains dedicated to different task such as DNS, Voting and a couple more. At time it was thought to merge those projects into bts chain. In order to to do this, investors in those other chains were given a percentage of bts that vest over 2 years. Similiar to Steam Power, the last of those vezt payouts will occur on the 5th.
As someone who was around in BTS during the merger I am aware that the vesting payouts would all be completed by Nov 5th, but are you sure that DNS and Vote are splitting to a different chain? That part I have not heard.
The merger was to keep them from being seperate chains.
It should because you will not have this new daily supply added for people to sell.
Thanks for the info! i wonder if that will affect the price positivly
I think you nailed it with your assumption, that they got squeezed. And all the others too. Got hacked my arse. For the first time ever I used Openledger today, time to get used to it.
Do you think POLO is shorting their customers, or has special deals with big players? Its shocking to see how they play the Ethereum madness. And to me it always looked as if they were going naked against a lot of coins.
Bitcoin will undoubtedly recover, but don't underestimate the amount of damage these events cause to the public opinion...
And I'm not talking about within the cryptocurrency community, I mean those people in the streets, who have vaguely heard something about bitcoins once, and kind of start to realise that you can pay with it, and that more and more places are starting to accept these bitcoins.
Events like MtGox, and now this are major setbacks on the road to wide market acceptance,...
I was waiting for Bitfinex to happen - I knew it was only a matter of time until something big like this would crash and burn their exchange.
Many people in #steemit may not know how important #bitcoin is for the entire ecosystem of everything crypto, but Bitcoin is the BIG MONEY that runs in and out of all these altcoin-systems and keeping the prices and marketcaps up.
Were your expectations wpecific to bitfinex?
yes, @akhavr - I was 100 % sure that Bitfinex would get mega-hacked after listening to their bullshit-answers to trivial technical questions about their management of peoples funds.
They had no clue what they where talking about, so because of that - I never deposited with them and told my followers to avoid that place like the plague.
I'd agree, for the last few days, everything on Coinmarketcap.com was in the red. I'd say this was down to Bitcoins worries.
If people did research they would see there are solutions. :D #bitshares
Bitshares is a great exchange solution - I just doubled my Bitshares-holding because of this bitfinex-fiasco.
I believe Bitcoin had suffered enough damage over the years. From early news of Mafia using them for drug deals, and financing of terror activities and so on. Negative events will echo and spread very easily, and one of the reason will Bitcoin will recover (definitely) is because the usefulness of cryptocurrency for now, and even more so in the future. But i guess the main reason it will recover is because like what @fyrstikken mentioned, Bitcoin is where all the big money is at the moment, the number of believers now will be able to push this bitcoin prices above 600USD again, just a matter of time, tops 2 weeks I guess.
Sad that this has to happen over and over and people don't learn. I don't keep a dime on exchanges and store my BTC and DASH on a Trezor. You can never be too careful!
good work, but maybe post, and preach the gospel, we need to keep forcing the point.
You're right, the word needs to get out there more. I do what I can.
A Trezor? Some word of wisdom please... would be much appreciated. TIA
Hope so @fyrstikken
In general big exchanges are targets for hacker for big payouts. I have learned my lesson from bter. Its sad to see people lost your their Bitcoins. Definitely Bitcoin will continues.
Once we do get decentralised exchange this should become less of a risk.
As you mention Bitshares exchange already does this although not many people I know use it. The success of STEEM and Steemit may persuade people to take a second look. Personally I'm not a fan of the interface vs somewhere like Poloniex. I had to use it to trade a token I was invested in and just found it difficult to use. That can easily be improved though.
WAVES is also supposed to be creating a decentralised exchange (amongst their other goals) if they can ever get it off the ground I think that could be massive. It was one of the main reasons I got onboard with it early. The potential is huge if they succeed.
Someone in another post suggested that the Bitfinex hack may in part have occurred due to them changing the way they keep customer funds as a result of the US financial regulators fining them (I think last year). I don't know enough about it to be sure.
I would bet anyone a Coke though that this will turn out to be another inside job. Seems par for the course for these hacks.
Also they seem to be happening almost like clockwork whenever markets are on a boom - in this case it seemed to coincide with the ETC surge (may just be coincidental).
I agree that BitShares Exchange's interface could be improved. Feel free to tell the developers what to improve, ideally in https://github.com/cryptonomex/graphene-ui/issues
To be honest if they could just replicate what Poloniex do I would be happy. That is IMO the best interface for ease of use. I don't think these kinds of layouts/interfaces are patented are they?
Given the rise in the value of the bit coin, this incident is Mt. Gox incident and the equivalent of the scale, also the thought of security measures, is the case with more impact.
As a result, the sense of crisis to the people of the bit coin will increase will be a concern.
Events like this are bad but are also a good oportunity to test bitcoin resilience.
If the causes were unknown the value would decrease much more but as the causes are now public there's no reason for the value to remain low. If the trend is positive, the overall conditions are positive and the basics strongly suggest a value increment in time, one should not panic due to a bad episode. I bought more today.
So this was the reason why BTC dropped right in the middle of me selling it for Euros :) I was lucky to finish the transaction it before it dropped bellow 600.
Yes, bitcoin is recovering nicely.