Are Trading Bots Steering Prices of Coins On Bittrex?
So, I started using Bittrex yesterday for trading and I've noticed that there's some serious automated bidding going on on the platform which one can easily point out as behavior of a bot. Specifically, for the following coins (in the Ether market) I've noticed that some of the bids are automated (you can tell by the behavior):
- OmiseGO
- Civic
- AdEx
- FunFair
On either side of the trade (whether you're bidding or asking), if you specify a price, let's say 0.0044 for a coin, you will in a second see about 4 - 5 trade bids that precede you and outbid you by a factor of 0.000001 or so. Other things to notice here (if you have a keen eye) is that:
These "automated" trades that pop up usually have the same amount of coins they're bidding for;
They keep canceling their book order as soon as it's about to be fulfilled, or they keep on outbidding the old bid effectively driving the price up or down on either end of the trade;
All these coins are "trending" on bittrex with a change in coin value ranging between 40 - 200%;
These behavior is especially true with new coins or lesser known coins.
This to me is a sign of caution, especially because your money stays stuck in the system for a good while (as outmatching the bot bids are quite impossible, and it doesn't help that them outbidding us drives the price up and down). I've already contacted Bittrex support asking them about this. I actually really like their platform but if they're somehow involved I would stay away from them.
I also started trading on Bittrex, however, do not feel you have to buy on the ask price, the idea is to buy low and sell high. So put your offer in much lower than the current trades, when your number comes up (and it will believe me) you will go in and you will also sell quicker, because your profit margin is lower than the market initially.
And remember, do not sell when you see the coin going down, it will recover. And ALWAYS BUT ALWAYS check your trading volume. If there is no volume, then you will take longer to sell. Try to buy the well known coins first to build your portfolio, then if you do not mind having a % of your money stuck on new coins for maybe months on end you at least have other money to play with.
One of the reasons I am not a fan of Bittrex. You are right!
There's something shady about almost all companies related to Cryptos. Seems like most of them are out to make a quick buck scamming people and ripping them off. But I will wait for their reply before passing judgement on Bittrex. Let's hope if they're not involved, they can at least put in place a mechanism to get rid of these bots, or ban such behavior entirely.
It's funny you say that. I came across this article today. (Not sure if I can post links in replies). Scroll down to get to the part about Bittrex. The only reason I have a Bittrex account is Antshares (Neo). https://squawker.org/conspiracy/secret-scams-coinbase-bittrex-kraken/
Same here, I just transferred a hefty amount of Ether to trade Neo / Antshares. And I wouldn't be surprised if there's some serious market manipulation going on.
And interesting read. I've been witnessing and complaining about these things myself. I think the solution is to use / build some great decentralized exchange cutting the middleman off, that offers the same level of security an "exchange" offers. After all, that was the whole point of blockchain tech. And I would imagine it's not something hard to conceptualize and pull off for the right people, they could perhaps create a proof of stake blockchain where funds are secured and verified by people who have a lot vested in the system.
There are bots on every exchange. They all have open APIs specifically so that bots can integrate with them. This has nothing to do with Bittrex. Bots are not even bad. Bots help equalize the prices between exchanges via arbitrage trading.
We are looking for Bot Builders
http://shaivitetemple.org/Forum/topic/blockchain-bots-that-benefit-people/