SBF@SBF_FTX·Mar 13, 20202) Evidence: (a) BitMEX went down and then crypto recovered. (b) their liquidation engine was lethargic413157
SBF@SBF_FTX·Mar 13, 20203) There's a critical ratio: Liquidations triggered per dollar move / liquidity per dollar. Call this R.24119
SBF@SBF_FTX·Mar 13, 20204) R was huge today. There were endless liquidations, and the BitMEX orderbook was basically nonexistent.74110
SBF@SBF_FTX·Mar 13, 20205) If R gets above 1, we're all fucked. Why is this? Because there's a $10m liq, which moves prices down X, which is enough to trigger... more than $10m liq. So there's a positive feedback loop. And BitMEX liquidates the orderbook...... down to 0.515148
SBF@SBF_FTX·Mar 13, 20206) Well, this looked like it was happening today. There was $1m per 25bps or so on the orderbook, and constant $10m liqs. I think R was, in fact, > 1.3594
Utluna@utluna_com·Mar 13, 2020Replying to @SBF_FTX and @SBF_AlamedaHey Sam, any particular you think R should remain constant across all price levels? I would have assumed a decreasing R with lower BTC prices.11
