Bitcoin Forum

Wow, great article in Wired!

OK, I am trying to verify - please tell me - true or false?

"The high point in the https://www.coinbase.com/charts (https://www.coinbase.com/charts) bitcoin price graph ($1145) around Dec. 1st 2013, and subsequent decline since, coincides with the rise and fall of Silk Road...?

This was around the time I joined the bitcoin community. The price rose higher to 1.2k in January I believe. I'm not 100% certain but wasn't the crash partially due to the fall of BTCchina and Chinese banks not accepting bitcoin purchases.

It doesn't really have anything to do with Silk Road. Silk Road was operation way before the rise in late 2013. If that bubble and the downslide since then can be attributes to anything or anyone, my bets would be on Gox being responsible for this. I'm quite certain that they indeed caused the price to go up in such an inflationary manner.

I don't think anybody knows what caused the crash. Bitcoin's value seems to have a mind of its own most of the time but I think there were several theories on what caused the crash. The biggest one was the mt gox fiasco.

I believe the bubble and subsequent crash was caused by speculation. Very typical to see this behavior in an unregulated market. Speculators try guessing future prices and often drive the prices up to silly highs. When this is realized the price starts to fall apart and oscillate until settling on a more reasonable estimate. It looks like $230 is that price.

The article was written by people who want you to look at the adds, not by scholars trying to educate you. Including the sexy and interesting idea of secret black markets is too much to resist. It is also why the title is the rise and fall of bitcoin. A fall is far more interesting than a normal, predictable market correction.

Fall indeed, that thing was written Nov 23, 2011. The fall was from $30 then. Did it end anything?

i think the china drama made bitcoin go down so much. a lot people were thinking bitcoin china would really take off. after all the bad news people for some reason lost faith. merchant adoption also had and still has a huge impact on the price.

That price rise actually attracted a lot of common people at that point of time, who by bitcoin understand nothing but its price.

It was really a perfect storm of things.

Willy bot from Mt. Gox was driving the price up (it should have been around $250 all along).  Silk Road. Chinese regulations.  Etc...

Read this and you'll know why the storm was perfect ;)

http://www.businessinsider.com/the-richard-wyckoff-stock-trading-method-2013-2?op=1&IR=T

It was a mix of various factors. Mainly being something new where you can't really draw a ceiling, you aren't sure what is a fair price, so people got caught on a huge rally.
Now time will bring us back to 1K+ territory, but it will be under a more reasonable timeframe.

it's obvious that the crash was caused by willy bot, after he pumped the price to the sky, he wanted to make profit of it, he did it, by sucking who joined the wave of his pump

Though MK made some profit, more benefited were other exchange owners at that time, especially BTC-e. They are now sitting on a pile of coins.

Actually, the article I was referring to is in the latest (May 2015) issue of Wired, and is called "The Rise and Fall of Silk Road - part 1"

It was just a bubble, its at real value now

Not Even close. we're so far away from its ''real'' value now.

Until people pay more for it, this is the real price

No, its the ''Current'' Price :) there's a difference ;)

A single bot couldn't do that, the volume was big enough to not enable a single bot to move the market in such a ridiculous way. It was a mix of bot + people losing it on a super rally.

I think there's a very real chance that Bitcoin won't see $500 again in my lifetime (I'm old).

Sorry for the bearish attitude, but it seems like we've somehow reached a stalling point. Not sure how, but we need some momentum to get things turned around.

Wasn't it "Willy the bot" at MtGox that drove the price that high?

The same FUD was spread about Tor usage going up, when Silkroad was opened. The guys at Tor then exposed this as a lie, with their own statistics showing no dramatic spike in the use of Tor.

People {Press} ...naturally make connections to things that has no real impact to get attention, and increase views on their sites.

Some shills do it for the money.  >:(

yeah it was him 100%, there is a report with all the details explaining everything, and it does make sense, but this new theory about the connection with silk road, sound a bit random, it could be... but i'm skeptical..

when you have at least 3-5 years left, you will see 500 USD for sure  ;)

How can you even know this and how would you know what bitcoin's 'real' value is?

Obviously the peak of ~1200 USD was because of the Chineese people started to buy bitcoin as an alternative to Yuan. When the chineese goverment restricted bitcoin, people started to sell and we got pretty much back to where we were before china ~200 USD (Jan 2013). We will be at ~200 USD (+/-100 USD) as long as nothing new happen in bitcoin. I find 100 USD very realistic, but I find 10 USD very UNREALISTIC.

But don't worry about it. Think of bitcoin in a different way: What value does it bring to YOU. If you define value of making money change in exhange rate, then could you might as will buy commodities, iron, coal, corn or gold, all good alternative to bitcoin. But if you define value of something usefull, then does bitcoin have a lot to offer.

Well the price spike and fall was long after the silk road, and I don't see any reason why it should affect the market a the time. But there were other cards on the deck such as,

> BTC and China

> Mt Gox incident

So, it should not coincide with silk road.

As a writer who writes for this market, I can tell you with certainy that the writers of this, and similar articles, don't really care if you look at the ads or not. The publisher cares, but the writer never even considers it.

nobody knows the rise of bitcoin and it's fall bitcoin has it's own market trend so this actually varies

I agree. It was simply an article (like many) written using incomplete information.

price fallen when a major bitcoin exchange MTGox gone and stolen people's bitcoin
then investors lost the faith in bitcoin,now bitcoin have to build the faith again to rise

I read this 'rumor' too, about the 'willy the bot' thing.

But I remember watching the chinese buying bitcoins.

The chinese influx drove bitcoin up, I think

I watched the action at bitcoinity.org in late 2013

Im new here, how big was mt gox? How many bitcoins did they hold? Were they really enough to break the momentum that brought bitcoin to 1.2k?

Never underestimate the power of the chinese. Seriously a billion people suddenly being introduced to something has a big effect.

One thing that indicates a strong connection between MtGox and Silkroad / Ross Ulbricht is the fact, that in Ross' journal he is stating that 2 Mio USD were "stolen" at MtGox:


Now we know, that at the same time this happened:
http://arstechnica.com/tech-policy/2013/05/feds-reveal-the-search-warrant-that-seized-mt-gox-account/


So, why Ross writes about 2 Mio of his money beiing stolen at MtGox at the same day when Marc Karpeles account was seized?

It's quite a convincing theory that people at Mt. Gox used Willy to buy a lot of coins (thus also driving up the price) and then selling those coins to people at an insane markup. That way (if done 'right') they could have made money to pay their bills. If they crashed the price afterwards, they could try and buy back a lot of coins, so people won't come looking for them. This theory would involve a high level of malevolence, though...

I dont feel like people have lost faith in bitcoin. A lot of people now are coming into bitcoin and hardly know of mount gox. I think there just needs to be more uses, I dont think mount gox hadthat much to do with the current users.

I would say that the price of bitcoin hasn't stalled at all.  From the peak in 2013 when it was at and above $1000, we're in a straight downward trend. 

And also, I would add, the price is whatever it is.  You can say bitcoin is under- or over-valued, but that's pure speculation.  Bitcoin can't be analyzed like a stock or a bond since it has no earnings, cash flow, etc.  And I surely would take any analysis by idiots on this board with a huge grain of salt.  No offense.

Agreed. People often think they can analyze bitcoin and make predictions like stocks. But often this is unvalidated, and the truth is bitcoin is far more random and more manipulated than many people would like to think

Nah, I don't think so... I think a ton of people came around November 2013, when the last bubble to over $1000 happened! And those people lost a ton of money, and many have lost their faith. That faith is going to return to some if when Bitcoin continues to go up again. But it may be still quite some way until that happens, unfortunately.

This was not a good example of what I meant. Wired has real tech writers and an established audience. But you have likely seen some of the silly ones with a shocking title.

I really wish people would stop basing their faith in BTC solely on its price. Guess "faith in bitcoin" to me means, can I trust it when I go to use it? Also, people having faith in it need to spread the word. Not just sit back n speculate or get out cuz the price went down a bit...
We keep going the way of the latter, bitcoin's price wont go up much ever.