Replying to Avatar Bit N Beautiful

Their business plan is to function as a buffer in a volatile market.

So they accumulate a stack and they sell when stock is low and buy when stock is high.

They put a premium on the price a piece, and that's how they make money.

The benefit for their clients is that they don't have to worry about the stock and flow of the day.

They get a steady price, nonetheless. That's what the OTC desks provide. They remove volatility from a volatile market.

We're now in the situation that the buffer is bought dry. They don't have BTC to dampen the sudden daily demand anymore.

So... volatility is coming back to Bitcoin. And it will be to the upside. And it will blow up another bitcoin bubble in the coming 18 months.

The buffer is broken. We're going to pump.
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btc 1y ago

They do not accumulate. They will of course have some float they carry and depending on the shop that number will change but they are not accumulating. If they did that and we tank 50% the firm is down 50%.

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Bit N Beautiful 1y ago

Yes... that's exactly the risk they take, right?

Because if they're never accumulating, how do they get their BTC?

And if they don't take a risk, how do they make money?

There's no such thing as a free lunch. They expose themselves in order to make a profit.

They are like a water reservoir. In rainy season they accumulate water and in dry season they dispense water. But all year round they provide a steady stream of water.

Now, the water reservoir is empty. And people have to bid for the available water. What happens to the price of water, in this situation?