Due to withdrawal delays, prices of bitcoins on MtGox have been trading at a premium when compared to exchanges since the middle of 2013. While spreads of prices to other major exchanges such as BTC-e and Bitstamp have been ever changing, they have been pretty consistently fluctuating around the $100 level since bitcoin began its ascent towards $1000 in November 2013. Currently, spreads are once again on the rise, and have crossed the $200 barrier on major volumes at MtGox. As of writing time of this post spreads continue to be near $200 as one bitcoin on MtGox is being priced at $1025 , compared to $828 on BTC-e and Bitstamp (real time prices).
There hasn’t been any news originating from MtGox to attribute the current increase in spreads, while we also haven’t seen any new complaints from users in regards to funding difficulties. However, the heavy volumes that have taken place on each spike higher of prices at MtGox may indicate that a large account holder with cash at the exchange has decided to take a large position in bitcoins. The purchases may be the result of a large speculator that is taking a bullish stance on bitcoins. Alternatively, a large account holder may have decided not to wait any longer to withdraw fiat currencies and is taking their chances that a bitcoin transfer will be more efficient.
Trading Places: Finding The Best Jurisdiction for Your BrokerageGo to article >>
Either way, it’s worth keeping an eye on the spreads. If MtGox prices remain at a large premium, it could indicate that more of their clients are looking to bail the exchange as they convert their holdings to bitcoins. On the other hand, a decline in spreads would show that the current trading is the result of bullish actions from one or more large MtGox account holders. (More on bitcoin arbitrage)