There is something that feels extremely fishy to me about what has happened at coinbase over the last few days.<p>For years I've told people to just store their coins on coinbase. I've been a big fan of their "vaults", and I've been saying that they are the shining beacon of legitimacy in this whole thing.<p>I honestly don't know that I still agree with that. This whole rollout of BCH has made me honestly start questioning if I can trust coinbase anymore. I expect stuff like this from sketchy exchanges like what btc-e was, but not <i>coinbase</i>. That makes me really sad, since they were (still are, for now) such an incredible success story.<p>I think there is going to be a lot of regulation coming and I'm not entirely sure that that is a good thing. It makes me pause for the same reason I wouldn't be sure that regulators telling me what webservers or programming languages I'm allowed to use would be a good thing.<p>I really hope all of the "never keep anything on an exchange!" people aren't proven right again by <i>coinbase</i> of all people.
> "Investigating - All buys and sells have been temporarily disabled. We are working on a fix and apologize for any inconvenience," Coinbase said on its status website at 11:11 a.m., ET.<p>What exactly is broken that needs to be fixed? Is there just a ton of trading volume and their system cant keep up ?<p>Edit:<p>I ask because the headline just says that prices are falling quickly and so Coinbase halted trading. This sounds a lot like a circuit breaker but then you read the article to find out something is actually broken.<p>I'm really curious to know what the symptoms are of whatever is broken. Are trades taking too long to execute? Are people being fulfilled at prices different than they were quoted? What is actually happening?
It seems Coinbase's go to strategy every time markets are volatile.<p>In case people are wondering why is this a recurring problem - this simply perils of Market Making in a volatile market. As a market maker for customer orders Coinbase needs to fulfill both sides. So to make money they buy from customers at low price and sell back at a high price. So they are collecting spread between bid and ask to make money.<p>But what happens if the market moves rapidly in one direction? They end up selling low and buying high.<p>So, they need to reset the market making algorithm. Or shutdown the site for a "fix", long enough that the volatility comes back in their range.
Good opportunity for the old-timers who were daytrading in the 1990s to tell their stories of Datek, E*Trade, Ameritrade, Schwab, etc., failing during peak NASDAQ/NYSE markets.<p>You know who you are -- drinking coffee and staring at multiple monitors while in your boxer shorts at home. 6:29am Pacific, watching Ron Insana and Maria Bartiromo on CNBC...<p>This has all happened before. It will all happen again.
Coinbase is the one exchange that's looked like a legitimate business. Between insider trading and execution problems, it's pretty alarming. (Who am I kidding? Clearly this is actually good for Bitcoin somehow.)<p>Worth noting Coinbase has two kinds of systems risk. There's the technical risk of writing and running code correctly. And there's also the financial risk of them making the market in Bitcoin. Both of those tasks have gotten a whole lot harder recently as Bitcoin transactions have gotten slower and more expensive. Turns out building a global currency with a global 7 transaction / second limit may not be a good idea.
BTC: peaked just shy of $20k, now in freefall to where it was around the beginning of the month, maybe further.<p>BCH: peaked around "$4k" (if we ignore the $8k that Coinbase was briefly showing in the first few hours of having it publicly available to trade there), dropping back down towards the ~$1-1.5k it was at beforehand.<p>Pumped. Dumped. Done.
I ignored all the warnings about Coinbase at my own peril.<p>I tried to move my coins out of the exchange about 48 hours ago (shortly before the crash) but I made the mistake of purchasing a new phone about a week ago and not switching over my 2FA keys in Google Authenticator.<p>They have an account recovery process in place but it takes "48-72 hours" to complete. I had to re-submit my ID, which was confirmed as verified, but now I just have to sit around and pray that they come through and the process is completed over a holiday weekend.<p>Obviously partially my fault for not transferring my 2FA keys, but with all the stories of customer service being unresponsive for weeks, I'm not holding my breath.
Regular markets have circuit breakers [1] that stop trading for a period of time. Coinbase should just define and implement these to let their systems catch up.<p>[1] <a href="https://en.wikipedia.org/wiki/Trading_curb" rel="nofollow">https://en.wikipedia.org/wiki/Trading_curb</a>
Anyone remember this story from a few days ago? I think the insider trading has hit it's dump phase.<p>Pump and Dump? Coinbase Suspends Bitcoin Cash, Investigates Insider Trading<p><a href="https://www.financemagnates.com/cryptocurrency/news/coinbase-suspends-bitcoin-cash-investigate-insider-trading/" rel="nofollow">https://www.financemagnates.com/cryptocurrency/news/coinbase...</a>
Why is it they always seem to go down during times of sudden surges and dips? It almost feels like they’re trying to control the market of their platform rather than let it play out. It may indeed just be infrastructure but given the company’s age and decent amount of funding they have now, can scaling <i>really</i> be at play here?
Coinbase does a number of things that seem strange from a market perspective. There doesn't appear to be an auction to open/close or restart.<p>Instead they seem to lock their markets and allow post only orders.<p>The other things this screams is that<p>1) stop loss orders are useless in volatile markets. I've harped on this alot from the US Cash Equities side but it appears to be equally valid. YOu'll only end up getting filled at te worst possible price and miss the inevitable market rebound.<p>2) Coming from 1) Don't use leverage, you'll get your face ripped off one of these days due to volatility and you'll be asked to submit more margin just when you can least afford to and possibly be liquidated at the bottom.
I’m getting pretty tired of playing whack a mole with these wretched exchanges. I recently left the dumpster fire at Kraken, only to sign up at, yep, Coinbase. Oh well. On to Bitstamp or Gemini I suppose.
So if we shouldn't be leaving our coins on coinbase, where do we leave them? A full wallet is not an option for many of us. I don't want to have to download 100's of gigs of data just to store my coins... I even tried to move from bitcoin to etherum since I thought that wallet might be smaller. And it was, but after leaving it running for 2 days it still had a ways to go and all the IO it was doing was really trashing my SSD.<p>At that point I looked into hot wallets like jaxx. But then on /r/jaxx, there were many people complaining about using jaxx only to have had their private keys stolen. So at that point I just left everything on coinbase :/ Is there any decent hot wallet out there or anything else?
Dear Coinbase,<p>Why in the world do you keep signing up new customers if you don't have the capacity to hold them?<p>All aboard, yet the ship sinks due to the passenger load.<p>That's both absurd and preventable.
Secret of success: buy low, sell high.<p>Unless you are a Coinbase customer (because they will selective disable your ability to act when prices move quickly). I've witnessed it at least a dozen time personally, and stopped trading altogether.<p>Seriously though, the way Coinbase/GDAX has been acting recently can't be attributed to scalability issues. These patterns seem to have a good dose of human decision making in them.
The issue with this type of circuit breaker is that there is really no information to let people absorb and calm themselves. When you resume the trade people will still be clueless on why prices moved that way and resume their selling
If you have USD in Coinbase that you'd like to buy with right now, you can use your Coinbase account at GDAX and transfer USD instantly to GDAX.<p>Trades are working fine at GDAX.<p>Pretty sure GDAX is also owned by Coinbase.<p>I did it just now.