user22: After the big hack of Mt Gox we all became aware that there is nothing in place to prevent "flash crashes." Most stock, FOREX and other exchanges have features like trading curbs or other market volatility procedures to prevent such crashes - so do any of the Bitcoin exchanges have such curbs in place?
Also, if one exchange were to implement such a procedure would it still be effective if other exchanges did not? In other words, if Mt Gox implemented a trading curb and TradeHill did not, would this non-universal curb be effective? Would the effectiveness hold if the scenario were reversed? (i.e. TH has a curb and Mt Gox does not)

user81: As far as your second question goes, I suppose it comes down to how much volume each of the exchanges have. If a few low-volume exchanges have circuit breakers, but the higher volume one(s) don't, I'm not sure there is any benefit.
As an aside, it is interesting that there are only circuit breakers in one direction on most markets, even though obviously for every seller their must be a buyer (so if one thinks "irrational volatility" is a problem, it doesn't make sense it is a problem only in one direction)

user85: Mt. Gox has stated that they now use "circuit breakers" to disable trading pending manual intervention if trading appears suspicious or unreasonable. They reported a few minor incidents where the breakers did trip in the initial implementation due to unusually high, but normal and innocuous, volatility.
My recollection is that TradeHill only has breakers on the movement of Bitcoins out of the exchange. So far as I know, they have no breakers on trading -- at least not that they've announced.

22: <p>After the big hack of Mt Gox we all became aware that there is nothing in place to prevent "flash crashes." Most stock, FOREX and other exchanges have features like <a href="http://en.wikipedia.org/wiki/Trading_curb">trading curbs</a> or other <a href="http://www.sec.gov/answers/circuit.htm">market volatility procedures</a> to prevent such crashes - so do any of the Bitcoin exchanges have such curbs in place?</p>

<p>Also, if one exchange <em>were</em> to implement such a procedure would it still be effective if other exchanges did not? In other words, if Mt Gox implemented a trading curb and TradeHill did not, would this non-universal curb be effective? Would the effectiveness hold if the scenario were reversed? (i.e. TH has a curb and Mt Gox does not)</p>
 81: <p>As far as your second question goes, I suppose it comes down to how much volume each of the exchanges have. If a few low-volume exchanges have circuit breakers, but the higher volume one(s) don't, I'm not sure there is any benefit.</p>

<p>As an aside, it is interesting that there are only circuit breakers in one direction on most markets, even though obviously for every seller their must be a buyer (so if one thinks "irrational volatility" is a problem, it doesn't make sense it is a problem only in one direction)</p>
 85: <p>Mt. Gox has stated that they now use "circuit breakers" to disable trading pending manual intervention if trading appears suspicious or unreasonable. They reported a few minor incidents where the breakers did trip in the initial implementation due to unusually high, but normal and innocuous, volatility.</p>

<p>My recollection is that TradeHill only has breakers on the movement of Bitcoins out of the exchange. So far as I know, they have no breakers on trading -- at least not that they've announced.</p>
