So for context I was recently reading
this post and read
this response and it gave me this wonderful idea to achieve the flippening almost instantly and make ETH moon 10x in a matter of months (or less). Let me outline my method as follows; Warning though you're going to need a lot of friends to coordinate this
and you're gonna need a lot of balls + some decent risk appetite + the need to stomach a
big loss if I'm wrong:
- Step 1: Buy some ETH
- Step 2: Goto the MakerDAO and learn to use it to generate DAI from ETH.
- Step 3: Serve up that ETH as collateral to issue DAI stablecoins.
- 1DAI = 1USD
- $1500 of ETH can be used to generate up to 500 Dai ($500)
- You are effectively borrowing $500 but locking up $1500 in a contract to do so; if the USD value of ETH no longer greater than 1.5x the USD value of DAI issued then part of the ETH you've locked up will automatically be sold off until the balance = 1.5x the value of DAI borrowed.
- To clarify if you locked 1 ETH at $1000/ETH into a maker DAO contract to generate and borrow 666 DAI ($666) and the price of ETH fell to $900 then you would automatically lose 0.0733 ETH = ((1000 / 1.5) - (900 / 1.5) / 900)
- You could totally wuss out though and lock 1 ETH at $1000/ETH into the maker DAO contract to generate only 250 DAI ($250) and then you would only start losing your ETH if it's price falls to $833/ETH (1200 / 1.5).
- Step 4: Use that newly minted Dai to buy more ETH.
- Step 5 (optional if you have guts - no risk, no reward! :)): Use that ETH bought with Dai to open the biggest most leveraged margin long you can!!! I'm talking 100x ETH long on Bitmex if possible; you're buying as much ETH as your exchange will let you.
- Step 6: Persuade as many people as you can to do the exact same thing you just did in steps 1 to 5!
- Lets say you're now 100x long on ETH via Bitmex, using the full 666 DAI purchased with $1000 worth of ETH: Thats a $66,000 ETH purchase fueled by just $1000. Talk about moving the market!
- Get 1000 people to do the same thing at the same time; $66 million buy order on ETH! Using the 14-02-2018 24h daily trading volume of $2665 milion that could trigger a 2.5% a sudden increase in daily trading volume!
- Best of all because you're using fully transparent credit! That DAI stablecoin is fully publicly auditable and transparent unlike that pesky tether token! No more guilt about illegal market manipulation or lack of audits now baby; we're fully legal and compliant with all the regulations! After all that DAI's still legal right and as soon as the price of ETH goes up (fueled by arbitrage and fomo catalysed by you and your buddies) you can reclaim the principle + fees to recover your collateral, burn the DAI, close your longs and lose all personal risk knowing you just catalyzed a mass FOMO event with eerie resonances akin to the one Bitcoin had 3 months ago...
- Remember you can do it!!! Lets just come together people!
Congratulations!!! You're just like the guys at Bitfinex but you didn't need to run an exchange, be a whale or print your own token to do this; like true millenials all the hard work was done; even this stupid article telling you what to do! Now just get a few (thousand) mates together and get started the modern day LAN party of FOMO fueler lambo whale/minnow catalytic converter trading party to Konami code your way to instant wealth and fuel that never ending bitchin bubble that's crypto!!! LETS GET RICH PEOPLE Disclaimer: This post is strictly parody. The suggested method will probably fail spectacularly and leave you with substantial debts, financial losses and misery. Any references to Bitfinex MakerDAO or any other company referenced in this article including all other content are purely for the purposes of parody; no factual claims have been made, no opinions, assertions or statements made in this article should be taken seriously or as meaningful trading/investing advice. I am not a qualified financial analyst or consultant; you make your own trading and investing decisions at your own risk and take full responsibility. Any strategy outlined in this article should be taken as foolhardy and risky. Do your own research. I am long Ethereum (ETH), Particl (PART), OmiseGo (OMG), Augur (REP), Iconomi (ICN), WeTrust (TRST) and Factom (FCT).
Further reading: Hi, I’d like to start doing leverage trading on kraken but I have a few doubts I haven’t been able to clarify reading the support articles and looking at tutorials on Youtube.
For comparison purposes, when you open a leverage position on Bitmex, the cost of the position is stated very clearly, and so is the liquidation price. If the liquidation price is hit, then your position is closed and you only lose the cost of the position, without putting at risk the rest of your account balance.
On kraken, I find the interface gives less information than Bitmex, so here are my doubts:
- For the sake of this example, let’s say I have an account with 1BTC and $1000.
- When I open a leverage position through the interface at trade.kraken.com, I understand that the “Amount” is the total value of the position. Let’s say I use 0.5BTC for the position, and then I select a leverage of 5. This would mean I personally put 0.1BTC (leaving 0.9BTC available for withdrawal or another position) and Kraken lends me the other 0.4BTC. Is that correct?
- I know I always have to use stop loss to protect the capital, but I want to understand how the liquidation process works in kraken. So since Kraken doesn’t show the liquidation price of the opened positions, I’ll have to calculate them myself. In theory, based on my experience with Bitmex, with a leverage of 5, the liquidation price of my position would be hit if the value of the BTC decreases by 20%, right? Since 5x 20% = 100%, then closing the position at a 20% loss would mean Kraken is able to cover the loses with my original 0.1BTC I put in the position (minus fees).But when I look at the support guide, for BTC, Kraken talks about a Margin Call Level of 80% and a Margin Liquidation Level of 40%. I don’t understand what that means and how do I use this in my liquidation price calculations. What are those percentages referring to?
- If this position gets liquidated, do I only lose my 0.1BTC, or does Kraken cover the losses with my collateral currencies beyond the original 0.1BTC I put in the position? They talk about using more collateral if the position goes into a negative p/l, so it confuses me. I guess it depends on where they put the liquidation price, right? So maybe this question is related to the previous one.
- I can open positions using collateral currency. How does Kraken decide, in case of a liquidation, what currency is he going to use to cover the losses? My BTC or my $1000 from my account?
Since Kraken is my native exchange and I trust them, I’d like to do leverage trading there (and not in Bitmex at the moment), but not before fully understanding the mechanics behind it, and particularly the liquidation part.
Thanks for your help!
I want to share my story over how I became a Master crypto trader I first heard about Bitcoin a couple years ago from a twitter account called Trutherbot. This twitter account played a big role in waking me to the truths of the federal reserve and the worldwide central banking scam. Nevertheless everytime he would post something about bitcoin I was to lazy to actually watch a 10 minute video on what it was.
Fast forward to summer 2017 Im working and going to school at the same time hating both at the same time. While I learned some valuable lessons and hd great teachers in college I saw Most universities as outdated institutions more focused on making money and having a succesful football team that actually keeping up to date with the age of information where most careers will have to be relearned by the time you get that paper. To top it all off I would have to go into debt to pay a 4 year university tuition. My job on the other hand was HUGE on "SELL THIS SELL THAT SELL EVERYTHING" It always made me feel like a total cuck seeing poor ladies with their fast food uniform on count out cash to try and pay their bills and it be my job to try to sell them on something I knew they couldn't afford. Point being I felt like a total shill working there and I wanted out. By habit I fall sleep watching a documentary about anything I find on youtube. I watched a youtuber who mentioned Bitcoin which was what eventually made me say " What the hell is this bitcoin thing" and decided to do some research. It was love at first sight. I saw Bitcoin as a sword forged from liberty itself to cut off the tentacles of historical bank oppression and create a financial revolution #DecentralizeEverything. I was so ecstatic; I felt like I had discovered a digital California gold rush besides the technological and financial revolution I was witnessing. I became huge on Bitcoin, almost all my twitter and facebook posts were about cryptocurrency and I kept telling everyone how this was the future. In those summer months I would get out what I could of my paycheck and put it into bitcoin. As the boom continued I continued to HODL and make more money. Then it hit me. "people who dedicate their life to trading stocks or forex it isnt luck its a strategy, and any strategy can be learned and applied.
As I hodled I called my family back in Mexico and told them all about it and my mom sent me 1k to invest it for her. The more I grew in knowledge the more comfortable I felt trading. Over time due to my posts on social media more and more people kept messaging me asking me about bitcoin and how they could invest. This made me decide to start a hedge fund and run it month by month. This was it. My exit from being a tax slave to the dollar fictional system. I quit my job, dropped out of school sold my car and moved back to Mexico with my fam so I could focus full time to trading with maximum efficiency. Fast forward to November 2017. I have 12.5 k invested and my sister turns 15, Her Dad sends her 6k as a birthday present and my mom gives me 4k to invest it for her. Total 16.5 k for the month. One night, I see BCH is pumping like hell. Sticking to trader discipline I tell myself theres no way IM buying on such a high, It goes from 300 to 400 to 500 to 600 to 1lk bam bam bam. This at the same time BTC is going down. I scamble to social media and see everyone talking about "The Cashening". I told myself I wouldent switch unless it went over 2.5k. Within 15 minutes I saw my fund drop 50% in price and i dumped. Now sitting with 50% of what I had I knew I had to make a powerplay to end the month positive. I scoured altcoins for that answer and found XLM. I even posted an analyses on my tradingview. telling everyone to buy at 491 and predicted a 57-120% increase . 4 hours before The pump I set a stop loss on XLM and go to sleep just in case. I wake up to find myself stop lossed with no XLM and it being around 1k sats. again , devastation. I wasent about to end the month negative and dissapoint all my Friends and family. I learned how to margin trade. I made an account on Bitmex and transfered my remaining funds in there.
Fast forward to today. I see BTC forming a pennant after breaking resistance and decide to all in 25x leverage. Gone, everything is gone. I apologize for the rushed ending but im still in shock. Im sorry for the clickbait title but I want this story to serve as an example to anyone who wants to become a "trader" in crypto. My advice is never go all in and just hodl; dont trade. or you could end up like me. A fool who let greed blind him. I dont want anyone else to experience the stress and anguish I felt and still feel. This all happened not more than 2 hours ago. Please be careful.
submitted by Hi, BTCVIX again -- I have spoken with mod
deb0rk who has been very helpful and he wanted me to tone down the illicit activities references and just get at the core essence of the post so I was happy to oblige and make the requested changes
For those that want the
uncensored version I strongly advice NOT to but it can be found
here BACKGROUND To those unaware or new to crypto it might come to a shock that BitMEX up until last summer vehemently denounced the use of high leverage in BTC trading products as well as the socialized loss system they came to finally implement and embrace — they weren’t just skeptical of the system but had VERY strong feelings and arrogance that they had a full understanding of what would be ultimately successful in this market — take a look at some of the outrageous posts for yourself from BitMEX CTO Samuel Reed
(STRML) on Reddit :
https://btcvix.files.wordpress.com/2016/03/bitmexpivot11.png To be fair to BitMEX after months of next to no volume and waving their hands around like some desperate fat chick hoping to get a pity fuck from someone rubbed the wrong way by OKCoin they finally capitulated and embraced the power of the degenerate gambler as their PRIMARY customer… the sacrosanct BitMEX was no more as 100x birthed on October 12 2015
Notice the rise in turnover at 100x inception as they became a more attractive fat chick:
https://btcvix.files.wordpress.com/2016/03/photo444920610451204802.jpg THE ISSUE BitMEX has posted some Settlement and DPE data (Dynamic Profit Equalization) ie their way of rebranding the stigma associated with “socialized losses” since June 1st 2015 and can be found
HERE. What has been missing up until recently is the Insurance Fund data similar to how OKCoin displays it
HERE. The Insurance fund is a result of the salvaged BTC of a position that goes into forced liquidation — so for example:
1 BTC at 100x fixed margin leverage gets liquidated when only 50% or 0.5 BTC remains as collateral, once in forced liquidation the prevalent market conditions will determine how much if any of the remaining 0.5 btc is recovered and placed in the Insurance fund.
On WCHangout a little over a year ago CEO Arthur Hayes put forward the vision of BitMEX in the
following:
“We hope to demonstrate through a track record of honesty and transparency in doing what we are saying we are going to do….” -Arthur Hayes, CEO of BitMEX Unfortunately, the actions and follow through to bring about more transparency after very clearly being made aware of it has not been manifested:
https://btcvix.files.wordpress.com/2016/03/bitmextransparency.png in fact they aren’t even near the level of transparency of industry leading OKCoin, an exchange they criticize and despise so much that their troll box will convert “OKCoin” to “The Woodchipper” when you message them in chat. Let’s take a quick look comparison of OKCoin VS BitMEX as far as transparency goes:
https://btcvix.files.wordpress.com/2016/03/okcoinvsbitmex.png Also I should add that I am betting most are unaware that the BitMEX Insurance fund is pooled from all of BitMEX’s contracts which means ETH, FACT, and the A50 contract both contribute and draw from the same Insurance fund that all the BTC contracts (I just refuse to say XBT) are apart of. The
documentation on the site is almost completely useless in articulating this point — I was however able to get a cagey
answer from Sam on the trollbox. I don’t have a particular issue with this if it is properly disclosed and in the documentation but some users that ONLY trade BTC may find that they are unknowningly subsidizing these other futures products — we don’t have the data but I am fairly confident that these other alt products draw more BTC from the fund then they contribute. This pooled fund gives BitMEX the ability to crank up the leverage on these alt products as optically they can report 0% losses even though there are actually system losses but they don’t disclose them because the Fund is covering them (mostly from BTC traders).
tldr: what if OKCoin used the BTC insurance fund to cover losses on LTC without telling you ?
This is not exactly what I would expect to see from a chest thumping “professional” exchange claiming to be the
“Goldman Sachs of Bitcoin”:
https://btcvix.files.wordpress.com/2016/03/bitmex-aims-to-be-the-goldman-sachs-of-bitcoinrerere.png Approximately 4 weeks ago we had Arthur and Wally of BitMEX on WCHangout and
I spoke of the dangers and assumptions that come from not being transparent with the data of this fund.
btcdrak also
requested that ALL data both current and historical be made available and both Arthur and Wally agreed and this was currently on their road map.
Essentially the danger that comes with selective transparency (or lack of transparency) is that it inevitably leads to doubt, doubt breeds skepticism as to why this information is not being provided or withheld, and then when pressed on the issue if the data isn’t then made available bitcoiners will begin to fill in the blanks with their own ideas. From a PR perspective as an exchange in the space the last thing you want is bitcoiners playing fill in the blank as it quickly goes to “omfg GOX!!” — and although that might be extreme when money is at risk the users have the right to bring those accusations even though they might be ridiculous in nature…
WE THE COMMUNITY As a community we really have very little legal recourse against exchanges misbehaving and operating in the wild west culture that is bitcoin trading, that doesn’t mean we are powerless though and although they may taunt us with their
lawless domiciles…
https://btcvix.files.wordpress.com/2016/03/arthurseychelles1.png It is up to us as the community to demand transparency from those we engage in business with and more so to hold them accountable to their OWN standards that THEY first set out establishing like Sam on trust and transparency transcribed from the
WCHangout:
“We believe that we are being… well we ARE being fully transparent to what the rules are, how the market operates and how it is cleared… in a socialized losses environment not only are you accepting some variable amount of loss depending on the volatility, how liquidations were handled and how well they were handled … you are trusting them to be honest with what those numbers are in the first place there in no guarantee of that at all basically — they say they lost x amount and they need to claw back from those accounts — I am not saying anyone is lying I have no idea but blind trust — you have no insights into what actually happened you have no insights what their books looks like so you have to trust them much more than you have to trust us because you are trusting them to be honest with those end of the month numbers” -Samuel Reed, CTO of BitMEX The point I am trying to make is that these aren’t transparency standards that I have concocted but words that have quite literally come out of Sam’s own mouth that I am attempting to hold BitMEX to — and I find that more than fair
Although according to Arthur we are all
children…
https://btcvix.files.wordpress.com/2016/03/bitcoiners-are-a-bunch-of-children-and-they-get-treated-that-way-bitmex-ceo-arthur-hayes-album-on-imgurevveev.png but that doesn’t mean they should ignore our requests or in some paternalistic way know what is “best for us” when we demand transparency, after all we are still their customers and this is the business THEY choose to be in.
I also want to clarify that unlike the conspiracy theorists I DON’T believe BitMEX is insolvent/scamming/etc, quite the contrary as they appear to be making decent money now (or
WERE ), also they aren’t overt crooks but they are surely being slippery & slimy on some profound questions when it comes to transparency and their claims of being “fully transparent”…
BitMax today supports trading in a quite decent number of cryptocurrencies. You can find all of the biggest ones here, and the platform has 190+ trading pairs and 40 different margin trading pairs. Leveraged Trading. BitMax also offers leveraged trading to its users. This means that you can borrow money from the exchange in order to buy crypto. Margin trading allows users to trade with money they don’t inherently own by leveraging their position with borrowed money. Can 2-100X your initial deposit with this temporary loan. So for example, if we had an open position at 2X leverage with $50 of your own money, we would also trade with another $50 from a “lender” off the exchange ... Simply put, BitMEX is an exchange that combines margin trading and derivates of crypto assets for cryptocurrency traders. Hope it makes sense now! If not, I recommend you not to get started with BitMEX because margin trading can be dangerous for your financial health and suicidal if not done correctly. Bitmex is a cryptocurrency-based CFD trading platform. Their trading pairs include various cryptos that users can trade via a contract for difference. Bitmex offers high levels of leverage (up to 100x) and uses a Fair Price Marking system to fairly price both their perpetual and futures contracts. Bitmex has its own order book. You can buy and sell crypto CFDs through their exchange. Overview. In the derivatives space, margin refers to the amount needed to enter into a leveraged position. Initial and Maintenance Margin refer to the minimum initial amount needed to enter a position and the minimum amount needed to keep that position from getting liquidated. As various users have varying trading strategies, BitMEX has employed two different methods of margining:
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