Looks like I need at least 1000 liquid Leo and 200 Steem to trade this market.
I've noticed a liquidity pattern in the network.
When buy orders were holding steady at 0.22 there were very few people willing to place a buy order higher than that. All of the big orders were sellers into the 0.22 buy wall. Now that this wall has fallen, all the big orders are buy orders back at the 0.20-0.22 sell wall level. This seems like a very critical ratio at this point.
No one wants to sell < 0.2; No one wants to buy > 0.22
For now I'm considering this the equilibrium point.
Anything above 0.22 is definitive sell situation unless demand increases.
I still have orders placed at...
I can tell 0.5 will be a big unit bias level in the future. Not sure when of course, but seeing as how rapidly Leo is being developed I have to assume less than a year.
I gotta say it's very odd being a whale.
The ease at which you can move the market with such a low percentage of total stake is truly noteworthy. It's essentially our responsibly to make sure there is enough liquidity available for people to buy/sell if they want to.
If the price of the coin gets to volatile in either direction, it looks bad for the entire network. When you have this much stake and the market cap is so low, it's not longer about maximizing ROI, but instead about bringing value to the network and making sure it operates as intended.
This is a very different situation from holding a tiny bit of Bitcoin (or even Steem) and trying to get maximum value from it, knowing that the market wouldn't even flinch even if we dumped our entire life savings into the project.
Very strange indeed.
In any case, I'm essentially buying at 0.18 and below and selling at 0.22+. For me, transparency is important, and I think more whales should get together (on all projects) and try to work together to gauge value and lower the volatility of their networks.
Reputation via Volatility Reduction
Reputation within the cryptosphere will be the most important thing going forward. Decentralized systems for reputation don't even exist yet, but when they do they'll be the focal point of every network.
For example, what if a group of whales had gotten together on Steem and decided that spiking up to $8 was totally unacceptable. It was. Lots of small fish were looking to buy and no one was selling. All of these plankton got burned and have either left the network or are now super salty about their negative experience.
A system to add liquidity could have been set up to dump coins on the market to decentralize the network and lower volatility. If everyone decided to sell down to $2 (super overly-basic example) all the users who didn't do it would lose reputation within the system.
A more legitimate system would come up with adding a certain amount of liquidity over time rather than all at once.
The same is true for when we dipped under 80 cents and then again under 40 cents. Those same users could have used their profits to prop up the coin and we never would have dipped this far. Again, users who didn't buy at the agreed upon levels would lose reputation within the volatility reduction system that was created.
But How Would The Network Know?
I mean this somewhat assumes that the network knows when prices are bubbled or oversold. If they get it wrong it could be somewhat of a disaster. However, I believe there are a lot of tactics available out there that would help everyone in the network play it more safe when it comes to trading the market. Our combined knowledge of the space is obviously going to be much more accurate than everyone just running around trying to maximize their ROI.
Value of Reputation
If we can convince people to enter into a reputation system that has value, users can begin to shift their focus from maximizing their ROI to maximizing their reputation. Given a good system, this would work out perfectly because reputation ends up having a monetary value going forward. Users with reputation might find it's actually easier to generate ROI in the long run legitimately (providing value to the network) rather than doing anything they can to increase the bottom line (bad actor).
I really went on a tangent with the whole transition into this reputation system that's been bouncing around in my head. I haven't explained it well at all. By no means would it be limited to lowering volatility. Ideally it would include anything that adds/subtracts value to/from the network.
Accounts need to be held accountable for their actions.
Governance structures that measure reputation intelligently are sorely needed.