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Does anyone else find it highly suspicious that Coinbase goes down whenever there is any major movement in prices? You can explain this as just the natural res

Does anyone else find it highly suspicious that Coinbase goes down whenever there is any major movement in prices? You can explain this as just the natural result of too much traffic, but that's not convincing. This is a business valued at over 1 billion dollars that has been operating for years. If this is still a problem, it's either unbelievable incompetence, or because they see no reason to fix it. And here is a worst-case theory, by way of speculation not accusation. Being down whenever there is a lot of movement lets them beat all of their customers. When there is a crash, they can sell before their customers can. When there is a boom, they can buy before before their customers can. And because such a big portion of the market trades through them, this is more than trivial gains. I have no way of knowing if this is what's happening, but it seems to be worthy of discussion, given how many people are placing trust in them. They don't really have an adequate explanation for the constant downtime, and I think they owe one to their customers.

drchiu 9y ago
The word for this is called front running.
notyourday 9y ago
It is called "separation of fools and their money". This was popular before SEC showed up. It seems crypto-clowns refuse to learn from others and insist on re-learning the lessons
TaylorGood 9y ago
According to Twitter, they're in the ballpark of 500k concurrent users.
michaelmcmillan 9y ago
The track record of billion dollar companies building working software is not exactly impeccable.
kough 9y ago
They aren't frontrunning their customers. Their whole brand is being the one trustworthy option in a world of scammers; they already make a fuckload of money off of transaction fees, no reason to throw out that trust and ruin their cash cow. It's just a scaling problem, turns out it's hard to make Ruby on Rails handle their needs.
- j_s 9y ago
  & MongoDB
- throwaway12351 9y ago
  They could be doing it to make up shortfalls in their own BTC holdings relative holdings promised to customers, either in actual quantity, or in price actually acquired vs. price paid by the customer.
saiya-jin 9y ago
I remember when FB was growing exponentially, their site was broken rather randomly for years (pics upload didn't work, feed was empty, you couldn't post comments, doubling of some feeds etc... basically most parts of their pages were down one time or another). Heck, even these days it doesn't perform 100% reliably how many times did you have to rewrite system / big part of it because the current architecture hit the wall with some performance bottleneck? It takes time a lot of time and experience (and some luck)
andruby 9y ago
They're already earning million's USD per day [0]. I doubt that they would risk that lucrative business by doing something illegal as front-running. That being said, they really should fix the performance of their platform. Yesterday they reduced their API rate limits to be able to handle the load. That's just annoying for traders. [0] https://coinmarketcap.com/exchanges/volume/24-hour/#gdax https://coinmarketcap.com/exchanges/volume/24-hour/#gdax 24h volume = $2,179,471,700 x 0.25% commission = $5,448,679.25 revenue (per day)
- usrusr 9y ago
  Has it ever been tested in court that the laws that make various forms of trading halts a tool to protect fairness in conventional markets can be reliably applied to an exchange of virtual toy tokens? Overloaded front-end servers that stall the bulk of sell orders while willing buyers get through to be matched with "preferred sellers" using lots of careful handholding seems very likely to me in a bitcoin panic, it could happen without any premeditated ill intent at all.
- deleted 9y ago
  [deleted]
alva 9y ago
They have shut down numerous times when there is large (usually downward trending) volatility. It is very suspicious. This has been happening for years now.
- Cthulhu_ 9y ago
  And yet there's nothing you can do about it unless you can prove they did it for personal gain; they operate a service outside the requirements given to e.g. the NYSE, and you the consumer agree to that risk by giving them your money.
  - usrusr 9y ago
    So long as they don't actively mess with customer owned BTC (as in: only stall transaction orders, not outright take them away if that is even possible) I would not even be sure that provable personal gains would be courtroom material. (At least for and user vs exchange company, not for exchange company vs employee)

drchiu 9y ago

The word for this is called front running.

notyourday 9y ago

It is called "separation of fools and their money". This was popular before SEC showed up. It seems crypto-clowns refuse to learn from others and insist on re-learning the lessons

TaylorGood 9y ago

According to Twitter, they're in the ballpark of 500k concurrent users.

michaelmcmillan 9y ago

The track record of billion dollar companies building working software is not exactly impeccable.

kough 9y ago

They aren't frontrunning their customers. Their whole brand is being the one trustworthy option in a world of scammers; they already make a fuckload of money off of transaction fees, no reason to throw out that trust and ruin their cash cow. It's just a scaling problem, turns out it's hard to make Ruby on Rails handle their needs.

j_s 9y ago
& MongoDB
throwaway12351 9y ago
They could be doing it to make up shortfalls in their own BTC holdings relative holdings promised to customers, either in actual quantity, or in price actually acquired vs. price paid by the customer.

saiya-jin 9y ago

I remember when FB was growing exponentially, their site was broken rather randomly for years (pics upload didn't work, feed was empty, you couldn't post comments, doubling of some feeds etc... basically most parts of their pages were down one time or another). Heck, even these days it doesn't perform 100% reliably how many times did you have to rewrite system / big part of it because the current architecture hit the wall with some performance bottleneck? It takes time a lot of time and experience (and some luck)

andruby 9y ago

They're already earning million's USD per day [0]. I doubt that they would risk that lucrative business by doing something illegal as front-running. That being said, they really should fix the performance of their platform. Yesterday they reduced their API rate limits to be able to handle the load. That's just annoying for traders. [0] https://coinmarketcap.com/exchanges/volume/24-hour/#gdax https://coinmarketcap.com/exchanges/volume/24-hour/#gdax 24h volume = $2,179,471,700 x 0.25% commission = $5,448,679.25 revenue (per day)

usrusr 9y ago
Has it ever been tested in court that the laws that make various forms of trading halts a tool to protect fairness in conventional markets can be reliably applied to an exchange of virtual toy tokens? Overloaded front-end servers that stall the bulk of sell orders while willing buyers get through to be matched with "preferred sellers" using lots of careful handholding seems very likely to me in a bitcoin panic, it could happen without any premeditated ill intent at all.
deleted 9y ago
[deleted]

alva 9y ago

They have shut down numerous times when there is large (usually downward trending) volatility. It is very suspicious. This has been happening for years now.

Cthulhu_ 9y ago
And yet there's nothing you can do about it unless you can prove they did it for personal gain; they operate a service outside the requirements given to e.g. the NYSE, and you the consumer agree to that risk by giving them your money.
- usrusr 9y ago
  So long as they don't actively mess with customer owned BTC (as in: only stall transaction orders, not outright take them away if that is even possible) I would not even be sure that provable personal gains would be courtroom material. (At least for and user vs exchange company, not for exchange company vs employee)