This is the latest update from the willy report, please read it.
Willy was the cause for the November bubble. So yeah, there it is.
Gox is not true. Especially during the last bubble to $1200 Gox was becoming less and less relevant and with pathetic volume, while the chinese at BTC China started throwing hundreds of thousands into BTC.Quote
I want to start off by saying I agree with a lot of the criticism on this article that’s appeared the Web; my conclusions were a bit too opinionated and perhaps exaggerated, and didn’t really fit the tone of the rest of the report, which was intended to be an objective account of my findings. I’ve corrected that with this update. Still, I stand by the most significant conclusion made: Willy was the cause for the November bubble. Sure, it didn’t do it all by itself, but it was the catalyst, and prevented price from coming down by effectively removing all selling pressure with its extremely constant buying (why market sell when you can place an ask order, and know it will be eaten into anyway?). In financial markets, sentiment is driven by price, much more so than the other way around. People see price skyrocketing, get euphoric, forget all the negative and assume the asset must be something absolutely amazing for people to place so much value in it (that, or they see an opportunity to “get rich quick”). It gets media attention, and sparks this whole positive feedback loop thing. A classic bubble in every way, really; but something has to light the fire, and subsequently prevent it from petering out.
Willy was the cause for the November bubble. So yeah, there it is.
I have my doubts about the Willy report as well, but concerning the volume: It doesn't matter if the volume was rather low or the volume only accounted for 8% or whatever of coins traded on Mt. Gox because if Willy really only ever bought coins, it wouldn't drive the volume up that much. Coins get sold and re-sold and re-sold over and over again. If Willy is simply buying, that low volume is enough to push the price up.
If this should really be true... Wouldn't we now sit on a vastly inflated bitcoin price that is about to collapse at any time?
I understand that this is a BTC speculation thread; however, you are speculating too much without specifics. give us some specifics. Possibly Willy caused a certain amount of BTC price inflation; however, that potential price inflation would dissipate over time, no? If we were at 20% price inflation in November 2013, does it follow that we would still be at 20% price inflation - likely NOT...... give some numbers to support your speculation in order to make it meaningful - otherwise you are just spreading and/or encouraging the spreading of near baseless FUD.
The Report points out that those bots (Willy/Markus) have bought a total of about 650000 BTC over that time. Sometimes they didn't even spend money for those trades. These 650000 BTC (plus the recovered 200000 BTC) amount to the total amount of Gox's lost 850000 coins. So maybe those 650000 BTC never existed? Maybe they were stolen and Gox tried to buy them from the customers for fake FIAT. The bots were constantly buying in a way that made it almost impossible for the price to go down! Couldn't this be a very valid reason for a bubble?
Yes, it could be part of an explanation for part of a bubble... but such an explanation seems very incomplete in the way that you are depicting the situation.