Crypto Trader Digest – Feb 15

New BitMEX API Goodies


If you have been following BitMEX Testnet, you will have noticed many new features. We are rolling them into the live exchange over the following weeks.

Today we have released new order placement methods and order types.

New Placement Methods:

For market makers, bulk order placement and amend is now available through the API. Previously, to amend an order, one had to cancel and replace the order. Now amending order quantity of price is available both for single orders and for groups.

All bulk operations execute atomically and fail as a group if any order is invalid.

New Order Types:

We’ve added standard Market and Stop Market orders to the available order types. We’ve also added the following advanced orders:

OCO (One Cancels the Other) – OCO orders allow traders to place simultaneous Stop and Take Profit orders. When one order is triggered, the other will be cancelled. Via the API, any number of orders can be linked, allowing very advanced trading strategies, especially in combination with:

OTO (One Triggers the Other) – OTO orders allow orders to be automatically placed one a primary order fully executes. Certain

Trailing Stop – A Trailing Stop follows the current market price at an offset, enabling a trade to remain open, yet closing if the market changes direction by a certain amount.

Post-Only – Post-Only orders ensure that if it would execute against the market, it would be canelled, ensuring your order receives the Maker rebate.

Many of these new order types will be exposed on the frontend shortly. Please view the API Changelog for a complete rundown of the new features.

NIRP Or Bust


While China was celebrating the Year of the Monkey, the global banking system began crumbling. Europe once again became the epicenter of banking woes. Lead by Deutsche Bank, banks across Europe received their humble pie. The bankers began crying out for Super Mario Draghi to outlaw cash, so that NIRP can be pursued even more aggressively.

Net Interest Margin (NIM) is the secret sauce of banks. The nominal level of interest rates doesn’t matter as long as the bank can earn a spread between depositors and the lending book. The only lending banks do these days is to central banks. Therefore, they need to earn a spread between what the pay or charge their depositors and the interest they receive or pay on their reserves with the central bank.

Banks cannot pass on greater charges to their customers than they pay at the central bank while physical cash exists in abundance. If banks push rates too negative on their borrowers, a bank run will ensue. Interest rates will continue to go lower and as they do measures will be put in place to effectively ban cash. Today Super Mario decreed that Toadstool will no longer receive fresh new 500 Euro notes aka Bin Ladens (you’ve heard about them, but never seen one).

Central banks are listening, and this is just the first action in a series of many that will stamp out physical cash. Europe is ground zero for NIRP. The successful measures will be employed rapidly by all major economies. Those who sell first, sell best.

The War On Paper Currency Begins: ECB Votes To “Scrap” 500 Euro Bill

China Devalues Yuan, Bitcoin To Da Moon

In the August 10th Crypto Trader Digest, I predicted the PBOC would devalue the Yuan to regain export competitiveness. Less than 24 hours after hitting the press, the PBOC shocked the market with a 1.9% devaluation. Global macro will be tilted on its head now that the world’s largest export regime is actively engaging in currency debasement.

The RMB is one of the largest globally traded currencies and it’s importance in global capital flows cannot be underestimated. Bitcoin, which is a financial and speculative asset, will be affected as well. Chinese households are now faced with a very painful question, how to protect and grow their saved capital.

Stock market and real estate investments have soured. Households are unable to invest abroad due to capital controls (the elite always could, but I am talking about regular folks). Due to a depreciating Yuan, imported goods will become more and more expensive. They must find a way to convert their paper wealth into real assets that cannot be devalued by the central government. Alternative means of investing will become more and more prevalent. P2P loans, wealth management products, and crypto currency will be three alternative areas where Chinese households will rush to convert Yuan into some form of wealth preserving asset.

The PBOC stated this was a one off devaluation. If anyone believes that, I have a ghost city in China to see you. China is mercantilism on steroids. Kuroda-san’s BOJ printing press will now go into overdrive. Mario Draghi will have no choice but use the cover of Grexit to unlease Euro QE. Each successive devaluation by its exporting peers will be met with force from the PBOC. Chinese speculators recognise this, and they will begin selling and borrowing CNY to buy any risk assets they can get their hands on.

It is time to back up the truck and buy buy buy Bitcoin. The $40 fall from $300 is a blessing. Coins can now be bought at much cheaper levels. To obtain long exposure, buy BitMEX December 2015 futures, XBTZ15.