Korbit 500,000 xrp Bot

[Guest]

I'm curious if this seems odd? 

For the past few weeks there's been, what I can only assume is, a bot on https://www.korbit.co.kr/market/xrp_krw 

Watch the order book and you'll see. This seems unusually high for 1 order compared to other exchanges' order books. This bot consistently has multiple offers for 500,000 xrp on both sides of the order book. Sometimes it every 5 basis points but sometimes it's more. 

For comparison on another Korean exchange the size of any total price is much much lower and is made up of many participants orders. 

https://upbit.com/exchange?code=CRIX.UPBIT.KRW-XRP

Is this something fishy? 

[knull]

Isn't this the case for most exchanges?

Just look at https://www.kraken.com/charts and select xrp/eur, currently there is a 350k xrp order on both sides of the order book.

[Janno]

Same thing on poloniex, there is this 600k xrp buy and sell wall on xrp/btc. It has been there like couple of months at least, likely longer.

Edited September 28, 2018 by Janno

[Guest]

21 minutes ago, Magickarp said:

Isn't this the case for most exchanges?

Just look at https://www.kraken.com/charts and select xrp/eur, currently there is a 350k xrp order on both sides of the order book.

 

6 minutes ago, Janno said:

Same thing on poloniex, there is this 600k xrp buy and sell wall on xrp/btc. It has been there like couple of months at least, likely longer.

But are the volumes one individual order or multiple orders totaling 350k to 600k? On Korbit it is one order for 500,000 not a total of many orders. This is clearly one person or bot. 

If you watch this individual order over a few days you will see this individual is Influencing the price. 

I'm just not sure if this is the exchange playing games. 

Edited September 28, 2018 by Guest

[Promethee]

That's what I noticed with Kraken. 

It clearly manipulate the order book

[EasterBunny]

I'll make a wild guess and speculate that these are not ordinary bots, but rather, an algorithmic market maker providing services for xRapid... on... you guessed it... XRP ledger.

 

Market Makers(MM's) provide liquidity to XRP by allowing their 'value' to move between XRP and any fiat currency(i.e. KRW) and capturing small gains along the way. If I was a MM, I would place 2 very large orders on either side of the mid-market price, with the goal of earning the bid-ask spread between the two. Buy KRW at 595, sell at 607. You earn 2% every time other people use your liquidity to move funds from XRP to KRW and back to XRP. That's 2% for every transfer you enable through an exchange.

Think about this... If I was a MM, and I enabled 5 million KRW/day in trade volume. I would earn 2% of that, and I could earn enough run a small business. MM's need to automate HFT strategies, and try to predict market moves that could eat away profits. If there is large a large shift in price, MM's liquidity will run out and they might need to buy back XRP at a much higher price or sell XRP to pay employees(who need KRW). Ripple incentives MM's by covering their losses in the case of large market corrections. This lowers the risk for MM's that want to enter the XRP market. If Ripple gives good enough incentives, MM's might decide to join ripplenet and start to create algorithms that trade on exchanges...

Edited September 28, 2018 by EasterBunny

[Guest]

38 minutes ago, EasterBunny said:

I'll make a wild guess and speculate that these are not ordinary bots, but rather, an algorithmic market maker providing services for xRapid... on... you guessed it... XRP ledger.

 

Market Makers(MM's) provide liquidity to XRP by allowing their 'value' to move between XRP and any fiat currency(i.e. KRW) and capturing small gains along the way. If I was a MM, I would place 2 very large orders on either side of the mid-market price, with the goal of earning the bid-ask spread between the two. Buy KRW at 595, sell at 607. You earn 2% every time other people use your liquidity to move funds from XRP to KRW and back to XRP. That's 2% for every transfer you enable through an exchange.

Think about this... If I was a MM, and I enabled 5 million KRW/day in trade volume. I would earn 2% of that, and I could earn enough run a small business. MM's need to automate HFT strategies, and try to predict market moves that could eat away profits. If there is large a large shift in price, MM's liquidity will run out and they might need to buy back XRP at a much higher price or sell XRP to pay employees(who need KRW). Ripple incentives MM's by covering their losses in the case of large market corrections. This lowers the risk for MM's that want to enter the XRP market. If Ripple gives good enough incentives, MM's might decide to join ripplenet and start to create algorithms that trade on exchanges...

If that's the case, maybe they could dial back the order size. Of all the Korean exchanges, Korbit has much lower volume compared to Bithumb and Upbit. 

I'll start looking for a Nexon/Korbit/Ripple connection to see if there's a MM agreement. 

Edited September 28, 2018 by Guest